Hello Athletes, Agents, Parents, Trainers & others,

With training camps now in the rearview mirror and a fresh season upon us, the anticipation is palpable. All of us share in your excitement and applaud the hard work already put forth. As you shift your focus from preseason training to regular season play and settle into your new routine, it’s also a prime time to refine your financial strategies – let’s capitalize on this fresh sheet of ice together to ensure your ‘wealth health’ is as robust as your athletic performance. Together, we’ll navigate the opportunities & risks of the season ahead, and start those really smart habits your future self will thank you for.

In this Issue:

“C” is for Caswell
Chuck Knows How to Chuck Em’
Run it Back Yak 😮
DON’T Put Your Money Where Your Mouth Is…
Business Owner Lingo – What is a Holdco?
Paying Credit When it’s Due
Alphabet; a Business We ALL Want to Own

Highlights

“C” is for Caswell

No matter how great of a player you are, or what level you play at; being named team captain is one of the greatest honours you’ll ever receive as a player. Clarke Caswell was recently given the captaincy following his second season in Swift Current.

Well deserved Clarke, wear it with pride!

‘Chuck’ Knows How to Chuck em’!

We came across this tilt during pre-season action featuring Columbus’ Charlie ‘Chuck’ Elick vs. Boston’s Charlie Hilton. Chuck landed some BOMBS – what a great fight ! Oh, did we mention his counterpart Charlie Hilton is 6’5″, 205lbs?!

Congrats on another milestone moment Charlie

Run it Back Yak 😮

Source: Sportsnet, NHL.com

What makes this goal scored by Carter Yakemchuk even more absurd is that it was in Overtime, vs. everyone’s rivals the Toronto Maple Leafs. And Carter is a defenseman. And he’s a rookie. Just wow.

Big time play Carter, Wow

Insights

DON’T Put Your Money Where Your Mouth Is…

We all know the cost of food has soared enormously – along with the cost of eating at restaurants and the cost of convenience (food delivery), but how much are we actually burning during the season eating out? And most importantly, what is the opportunity cost of that money – what if we saved and invested that money instead of spend it?

Here’s the breakdown.

Let’s take this one step further… $10,500 invested at age 18, growing at 7% annually on average grows into $180,000 by age 60 !

For illustration purposes only.

In Summary:

If you get into the habit of saving money vs. spending money by being a little bit smarter, and spending your time more efficiently you can unlock some massive opportunities in your life. The time to start is now.

Holdco vs. Opco

For those of you who have heard the term’s Holdco & Opco and want to learn more, read on. It may or may not be relevant to you at this specific moment in time, but trust us when we say that this base knowledge benefits EVERY business owner (whether you use this strategy or not).

Holdco (Holding Company) and Opco (Operating Company) are two distinct business legal entities in Canada. Holding companies are used to own assets and investments, while operating companies are used to conduct the day-to-day operations of a business.

Holdco’s can provide advantages such as tax efficiency, asset protection, estate planning, and diversification of investments while Opco’s are active businesses created for the purpose of running business operations. These can be in any form, from manufacturing and selling products to offering services in various industries.

Source: wtcca.com

K… but, like, what?!

Imagine a young entrepreneur named Mike who owns a small chain of coffee shops across British Columbia, Canada. To manage his business more effectively and plan for future growth, he decides to establish a holding company, “Mike’s Brew Holdings,” which becomes the parent company for his coffee shop operations.

Here are two examples (among many) of how setting up a holding company benefits Mike:

Asset Protection

Mike’s coffee shops are popular, but like any business, they carry risks such as potential lawsuits or debts. By setting up “Mike’s Brew Holdings” as a separate entity that owns the assets (like the coffee shop properties and equipment), these assets are protected. If one of his shops is sued, the assets in the other shops or held by the holding company are typically shielded from being used to settle such claims.

Tax Efficiency

Mike finds that by using a holding company, he can manage taxes more efficiently. The holding company can receive dividends from the profits of the coffee shops tax-free, thanks to tax regulations in Canada that prevent the same money from being taxed multiple times as it moves within a corporate group. This structure allows Mike to reinvest the saved money back into his business or distribute it among family members as dividends in a tax-efficient manner.

This is just one scenario describing how a Holdco can protect assets & achieve tax efficiencies for business owners in Canada!

Paying Credit Where it’s Due

A strong credit rating is a crucial element to your overall financial well-being; Good credit can provide you with more opportunity to loan money (for mortgages, vehicles, emergency funds, etc.), while Bad credit has the opposite effect – you could literally have enough money to put the down payment on a home, demonstrate you have great income, no debt, etc., but without a good credit score you could be turned away.

Watch this 3 min clip to brush up on your credit basics, then read below about why it matters…

Two ways to establish a credit rating and maintain a strong credit score:

A Credit Card – If you understand how a Credit Card works, and are using it as a tool to build credit (not a tool to buy things with money you don’t have) this can be advantageous (so long as payments are made in full and on time otherwise you’re not ready to use one and it could potentially hurt your credit score instead of improve it).
*Must be age of majority in the province you live in, 18 in MB, 19 in BC, etc. but there are ways to get access to Credit Card credit if you’re a minor, please reach out to us if you’re interested in learning more

Your Cell Phone – your monthly cell phone payments get reported; therefore if you’re late with a payment it will negatively affect your score, and if the contract is in your name (not your parents’) and you make payments on time, it will positively affect your credit score. It’s that simple.

For Canadians living in the US:

Establishing credit in the U.S. isn’t too complex, but it does require some specific steps to get started. Here’s how you can begin:

1. Obtain a U.S. Mailing Address

2. Open Credit Accounts

3. Ensure Timely Payments

4. Apply for a Social Security Number (SSN)

By following these guidelines, you can effectively establish and maintain a U.S. credit rating.

Source: RBC

This month, the Portfolio Manager established a US$32.5 million position in Alphabet Inc. (“GOOGL”) for the VPI Canadian Equity Pool.

We ALL Know Alphabet Well…

Alphabet is a multinational technology holding company and an owner of a wide range of platforms including Google Search, Gmail, and YouTube. It also sells hardware products such as Pixel phones, smartwatches, and Google Nest home products and offers online advertising through Google Network services.

Why Did We Buy It Now?

The company’s strong earnings, attractive valuation, and position in the growing AI space suggest potential upside.
Alphabet’s price dip may represent a rare opportunity to invest in one of the world’s most powerful tech companies at a discount.
Started paying shareholders dividends for the first time ever last quarter, expected to continue (did we ever mention that we like dividends?!)

Note: Annual revenues and profit margin are LTM as of June 30, 2024. Profit margin refers to GAAP Net Income margin. Price to earnings is based on consensus FY2024E estimates. R&D figure as per Fiscal 2023. Revenues and Adjusted EPS as per fiscal year periods with 2024E to 2026E showing consensus estimates. Percentages may not sum due to rounding. Dividends Per Share as per fiscal year periods with 2024E showing consensus estimates. All data is as of September 12, 2024, with dollar figures in $US, unless noted otherwise. Source: S&P Capital IQ, Bloomberg L.P., Company Investor Relations, Value Partners Investments.

We understand you have a lot on your plate, so please feel free to reach out if you are curious or concerned about growing & protecting your wealth efficiently. Financial stress does not allow you to achieve your full potential, we are here to help.

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