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The $500 Billion Opportunity 10.5 million families in Canada 3.5 million rent 3.5 million own, with mortgage 3.5 million own, free and clear.

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Presentation on theme: "The $500 Billion Opportunity 10.5 million families in Canada 3.5 million rent 3.5 million own, with mortgage 3.5 million own, free and clear."— Presentation transcript:

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2 The $500 Billion Opportunity

3 10.5 million families in Canada 3.5 million rent 3.5 million own, with mortgage 3.5 million own, free and clear

4 The Wealth Pyramid

5 The $500 Billion Opportunity

6 Today you will learn how to: FREE Get FREE tax refunds from the CRA Pay off your mortgage faster Build an investment portfolio

7 SIMULTANEOUSLY

8 The Wealth Pyramid

9 The Problems…

10 THE SMITH MANOEUVRE Is your mortgage tax deductible?

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12 The Solution…

13 THE SMITH MANOEUVRE History of THE SMITH MANOEUVRE

14 THE SMITH MANOEUVRE What is THE SMITH MANOEUVRE

15 THE SMITH MANOEUVRE is a financial strategy designed to convert the non-deductible interest debt of a house mortgage to the deductible- interest debt of an investment loan, which simultaneously ensures the building of a free and clear investment portfolio.

16 A picture is worth a thousand words…

17 THE SMITH MANOEUVRE Is your mortgage tax deductible?

18 GOOD DEBTBAD DEBT

19 THE SMITH MANOEUVRE Is your mortgage tax deductible? GOOD DEBTBAD DEBT

20 Another 1000 words… Another 1000 words…

21 THE SMITH MANOEUVRE Is your mortgage tax deductible?

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29 tidbit How much do you have to earn to pay off a $200,000 loan?

30 Read it and weep… You need to earn this much: $700,402 You pay this much income tax: $280,161 You have this much left: $420,241 You pay this much bank interest: $220,241 Pay back the original loan: $200,000

31 $700,402 !!!

32 Is this legal?

33 During the past 20 years, THE SMITH MANOEUVRE has not been challenged by any tax authority, by any lawyer, by any accountant, by any financial planner or by any financial guru as regards the theory, the strategy, the mechanics, the arithmetic or the projected outcomes.

34 The Four Steps Plain Jane Smith Manoeuvre 1. Re-borrow and invest any paydowns on your first mortgage. 2.Apply tax refunds against your first mortgage then immediately re-borrow and invest the same amount.

35 The Four Steps Enhanced Plain Jane 3.Cash in and apply current paid up assets against the first mortgage in the morning, re-borrow and invest the same amount in the afternoon. 4.Divert any monthly savings or investment programs against the first mortgage, and immediately re-borrow and invest the same amount.

36 case history: Quantify the value of THE SMITH MANOEUVRE for the Blacks.

37 The Blacks $200,000 at 7% for 25 years Both work, $100,000 per year 40% tax bracket $50,000 rainy day fund Adding $500 per month 40 years of age, 2 kids and a dog

38 Future value for the Black’s current investment program?

39 FV of $50,000 for 25 yrs $541,735 FV of $500/mth for 25 yrs 663,417 _______ Total Future Value $1,205,152

40 $1,205,152

41 What if they did THE SMITH MANOEUVRE?

42 Results of the Four Steps Plain Jane Step I $214,207 $214,207 Step II 95, ,882 Enhanced Step III 899,827 1,209,709 Step IV 753,061 1,962,770 ________ Total $1,962,770

43 $1,962,770

44 THE SMITH MANOEUVRE way $1,962,770 The difference $757,618 The Black’s way $1,205,152

45 For the Black’s, this is a decision worth 3/4 of a million dollars!

46 The Smithman Calculator.

47 ACCELERATORS 1.Debt Swapping – Step III 2.Cash Flow Diversion – Step IV 3.Cash Flow Dam I – for business 4.Cash Flow Dam II – for rental homes 5.Investment Category Switch 6.Leverage

48 The Cash Flow Dam

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51 (Rental unit at $1,000 / month) The Blacks Plain Jane results $309,882 The Cash Flow Dam + $303,315 __________ Total Improvement $613,197

52 Investment Category Switch Capital gains to income

53 LEVERAGE

54 THE SMITH MANOEUVRE Is your mortgage tax deductible?

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57 Who’s doing the financing?

58 Lets summarize…

59 Today you learned how to: FREE Get FREE tax refunds from the CRA Pay off your mortgage faster Build an investment portfolio SIMULTANEOUSLY!!!

60 Your next step…

61 “Procrastination is the enemy of your financial success” F. Smith

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