Allan Hubbard, the shrewd, conservative, Timaru accountant, built his reputation on trust often borrowing from and lending to people on the basis of an old-fashioned handshake.

That trust was shattered in the space of a heartbeat when authorities began probing his company, Aorangi Securities, last June and later Hubbard Management Funds (HMF).

Yesterday the Serious Fraud Office laid 50 charges of fraud against Mr Hubbard, 83, while sparing his wife Margaret (known as Jean) and former or current directors of the two companies.

For more than 30 years Aorangi Securities was one of Mr Hubbards lending vehicles for his wealthier clients.

Yet besides its now hapless investors, few people outside his inner circle knew anything about it.

Nor did many people know about HMF, an investment management business with funds in several NZX-listed companies.

Indeed, it wasnt until statutory managers got hold of Mr Hubbards books did the SFO learn about HMF, which by all accounts turned into a basket case when the global financial crisis hit.

Even Mr Hubbards investors didnt know HMF existed in its current form until March 2010, when their investment statements arrived on freshly printed HMF letterheads.

Aorangi took in $96 million of investor funds while HMF managed about $80 million.

Certainly, thousands of South Canterbury Finance investors had no idea of these sideshows as they flocked to place their money in the finance company based on Mr Hubbards reputation.

It has since become clear that the same peculiar approach to business shown in the statutory management reports also took place at South Canterbury Finance.

The infamous Hyatt Hotel shenanigans, for example, venture capital loans to start up biotechnology companies, and Mr Hubbards personal management of South Canterburys B Stock ledger stacked full of related party loans, did not make good reading for the taxpayer owed more than $1.5 billion under the retail deposit guarantee.

Perhaps most telling of charges laid yesterday was the alleged theft by a person in a special relationship.

SFO chief executive Adam Feeley made it clear that Mr Hubbards frugal lifestyle did not amount to a defence.

We have to consider matters such as whether deceit has occurred; the losses caused by that deceit; and whether the facts meet the prescribed elements of one or more criminal offences, Mr Feeley said.

This is an extremely sad day for Mr Hubbard and his followers, for he truly is an altogether different creature from some of his other finance company director counterparts.

Mr Hubbard was born into an impoverished home in North Dunedin on March 23, 1928, and started work as an office boy at Trustee Executors in 1944, where he stayed eight years.

He founded chartered accountancy firm Hubbard Churcher and Co in the early 1950s, and formed South Canterbury Finance in about 1960 after buying a Timaru finance firm and in the same year bought his first farm.

He famously got about in an old green Volkswagen car he bought in 1968, while he and his wife lived in a modest house in Timaru. They still do.

Last year Mr Hubbard was dropped from the National Business Review Rich List, having had his wealth estimated at $550 million in 2009.

He was the majority shareholder of Southbury Group, which owned South Canterbury Finance, but the 82-year-old was forced out of the chairmanship of South Canterbury in late May 2010.

Southbury Group and a related company Southbury Corporation were both placed in receivership following South Canterburys demise last August.

Together the two companies owed South Canterbury $184 million. Difficulties recovering these loans and other related party lending were a key factor in the Treasury recently increasing the governments provision for losses under the retail deposit guarantee scheme by $310 million to $1.2 billion.

In South Canterburys last week, Prime Minister John Key, conspicuously absent yesterday, as he was last June, would make this point:

The degree of back office book keeping and general observance of standard accounting practices at South Canterbury was in line with Mr Hubbards other private companies, currently in statutory management and subject to a Serious Fraud Office inquiry.

In relation to South Canterbury Finance, the Serious Fraud Office is currently talking to witnesses with some interviews pencilled down for next month.

Top talk

Farm sanctuary owner and animal behaviourist, Lady Lesley Cooper, has recently been sharing her tips for a frugal lifestyle on Channels 4s SuperScrimpers: Waste Not Want Not series.

I have learned to be frugal, she explains. It is not the way I was raised. I had a reasonably luxurious upbringing in a professional family and never went without anything. I went on to work in sales for marketing and advertising earning brilliant money which allowed me to spend time with my own horses.

It was while I was living in Hampshire I was also involved with rescuing dogs and someone contacted me to rescue a horse. He was called Whilber, and that special horse started my animal sanctuary.

Frugal is a term that invokes a lot of feelings for people. Buying organic foods is not a concept most people think can coexist with a frugal lifestyle.

It seems to me that a fundamental shift has occurred in our economy from my generation to my sons’ generation. When I was 18 and graduated from high school, I took a job in a bank, found my first apartment with a roommate and paid a whopping rent of $65 per month. My job, lack of a car, and frugal lifestyle allowed me to save up enough money to buy my first house at age 21. Granted, I lived in Madison, Wisconsin, a lower-priced market and I only paid $22,000 for that 900 square foot beauty, but it was possible for me to live and take care of myself on my salary.

Will my husband and I ever feel “safe” from financial ruin? Probably not. Yet, we’re not the only ones. Until he can find a job, my sister is “supporting” her 30-year-old who just separated from the Navy and my carpool partner has a 24-year-old living with her, a refugee from Michigan’s economy. As parents we are not alone, but I’m wondering who’s going to pick up the financial slack when my generation is gone? Even with all of the financial support we’re providing our quasi-adult kids, I’m e-x-t-r-e-m-e-l-y thankful that all seven of them haven’t decided to cash it in and move back home.

Cherie K. Miller lives on a lake in Georgia with her husband, Steve, and a blended family of seven sons, two dogs, two leopard geckos and one freakishly grumpy 17-year-old cat.  Steve amp; Cherie have a nonprofit organization that provides compelling character development curriculum for use in by parents, in schools, or other community organizations. Reach me at www.character-education.info

I can remember singing along to Madonnas 1985 classic hit, Material Girl. Being just six when it came out, for years I thought it was about loving fabric. Only later did I discover that a material girl is someone who loves owning things.

Two decades later, nobody – not even celebrities – would openly shout from the rooftops about their materialistic nature; although they may admit to a penchant for shoes, or handbags, or private jets, these are accepted as natural weaknesses, and endearingly lsquo;normal. After all, dont we all have our own little insatiable fetishes, whether it be for snazzy cars, jewellery, expensive holidays, or a particular brand of face cream? Arent we allowed to have one indulgence that we give in to? Surely we deserve to treat ourselves to these little luxuries? Perhaps. But your mother probably didnt, its even less likely your grandmother did.

The idea that you deserve to spoil yourself with unnecessary luxuries is more rife today than ever before. When Madonna brazenly sang about her materialism, and other personality traits associated with it, such as narcissism, self-adoration and an appetite for men with heavy wallets, her fans were starting their steep climb to the top of the psychology worlds Most Wanted list. Now, psychologists are saying that narcissism has reached epidemic levels and is not just affecting individuals, but entire communities and cultures.

The birth of a trait

Narcissism has been growing steadily since the 1970s, according to psychologists Jean M Twenge and W Keith Campbell, authors of The Narcissism Epidemic (Free Press), who define the trait as someone being over-confident and placing little value in relationships. Apparently, it was during this decade that drawing attention to yourself started to become widely accepted. The self-exploration trend of the post-war generation was giving way to the lsquo;express yourself vibe of Generation X (which mainly consists of people born in the 1960s and 1970s). This desire to celebrate the real you meant that self-admiration, one of the core pillars of narcissism, was on the rise.

The explosion of the self-help industry in the late 1990s, which tells us all to love, respect and honour ourselves, turbo-boosted the self-admiration trend to its full potential. Layer this up with our preoccupation with celebrity, which promotes vanity and materialism – it is the most narcissistic of celebrities whore usually in the limelight, by nature, so it is their values that we associate with success – and finish off with a healthy serving of Facebook, Twitter, YouTube and blogging, where we can broadcast the mundane minutiae from our lives out to a billion people, and you have a fertile breeding ground for narcissism.

Intense repercussions

The side-effects of narcissism are all pervading. It can stifle a persons career, by causing them to take risks, or to be lazy with their ambitions, safe in the delusion that success will find them no matter how hard they dont try. It can mess with relationships, because narcissistic people may never feel fully content with their partner, believing there may be someone better sitting pretty on the green grass on the other side of the fence. A narcissist may struggle with friendships, too, when people finally get bored of hearing incessant self-promotion, or when they realise they are being used to support the narcissists personal cause. It can get you into debt as narcissists love to treat themselves to little indulgences, whether they can afford them or not, because they feel they deserve it – and they often take risks, due to feeling invincible. Narcissism can create all of these issues, and then leave you feeling completely alone when your inner validation is obsolete, and miserable when life doesnt serve up everything you ever wished for on a shiny platter.

Expat entitlement

Unfortunately, according to Dr Saliha Afridi, Dubai-based clinical psychologist (salihaafridi@gmail.com), the expat community in the UAE is particularly vulnerable to narcissism. She says, One of the downsides of living in an expat community is that the social pressures are less about duty to the greater good, and more about arrogance. People arrive here, not knowing anyone and are only here for the short-term – they need to make friends quickly, and want to fit in with the right house, the right car, the right sunglasseshellip; but unfortunately it is easy to get caught up in this exhibitionist nature.

Helen Williams, counsellor at LifeWorks Counselling and Development (www.lifeworksdubai.com), agrees and suggests that the easy, lsquo;privileged way of life may be to blame. She says, Narcissism can only really happen in societies where all the basic needs are met. Otherwise people are too busy worrying if there is going to be another bomb blast, or where they are going to get a fish from that day. These sort of worries make a real differencehellip; maybe that is why it is so prevalent with expats living in the UAE.

One woman determined not to get seduced by the narcissism in the air is Stephanie French*, who moved to the UAE with her husband four years ago. She says, Back in the UK, I was a primary care nurse at a homeless drop-in centre in central London. To go from that to brunchhellip; it just cant happen. We have friends with similar values herehellip; we dont have lots of bling, so we know people only hang with us if they really like us. I say to my friends, lsquo;The day I start rocking the maxi dress and the Gucci sunnies, bring me back to reality. We dont try to be the big boys. I call it the LOreal effect, based on their advertising campaign that said, lsquo;Because Im worth it.

Sarah Reece* has only been in Dubai for three months. With her fresh eyes, as yet untinged by all the marble and chandeliers, she can notice a clear distinction between the UK and here. She says, Ive met some lovely people, who are down-to-earth, but there are definitely people Ive met who I think have been sucked into the lifestyle. It still surprises me when you go to bars and you see people strutting out of their taxis and valeting their carshellip; you can just tell theyve taken on that persona of being a lsquo;Dubai person. But I can also see that its easy to fall intohellip; You see everyone dressed up like that all the time and you feel like, lsquo;Oh gosh, maybe I should wear nice dresses and get an expensive bag, and get my hair done. It does remind me a bit of The Truman Show sometimes.

Me, not us

One of the most disturbing side-effects of narcissism is the damage it does to relationships. Interestingly, having relationship issues is both a symptom and a side effect of narcissism. At the individual level, a narcissist may only look for partners (and friends) who make him or her look good, or feed their ego in some way. Once married, narcissism can lead to the breakdown of marriage when people start feeling that they deserve better than their partner. For example, a husband who keeps remarrying younger lsquo;trophy wives in order to keep his ego happy and his status elevated.

At the social level, the attitude that there could be someone better out there for you has lead to the widespread acceptance of no-strings-attached relationships, and terms such as lsquo;friends with benefits, say Twenge and Campbell. No doubt this belief has helped boost divorce rates, too.

The boom in use of social media sites, like Facebook and MySpace, has provided a fresh new avenue for narcissism to flourish in. Its not only how many lsquo;friends you have, status updates feed self-importance, uploading photos of yourself is a perfect outlet for vanity, and having your statuses and photos liked by your hundreds of friends boosts self-admiration – all traits which are linked to narcissism. Counsellor Williams says, Facebook allows people to say, lsquo;Look at me, Im so important. What they dont realise is that it also shows that you need to have your self-belief reinforced by other people.

Afridi agrees. The lsquo;tell me how wonderful I am culture of Facebook feeds into this trend. It makes you feel like people care when they comment on your status, but they might just be bored.

Twenge and Campbell take it one step further saying that not only does it allow you to be narcissistic yourself, but that Facebook allows you to become obsessed with other peoples narcissism, too. Dont even get them started on YouTube and blogs.

Fixing it

So once you have accepted the fact that narcissism is an issue, and that you may be succumbing to the disease, how do you go against the cultural grain and stop yourself from becoming a self-loving, self-promoting, paid-up member of Generation Me, as Twenge has aptly named it?

Afridi and Williams say that just by being aware of the narcissism epidemic, you can start to rein it in. Afridi asks parents to be aware of spoon-feeding narcissism to children by calling them lsquo;princess, or by telling them they can be anything they want to be – tell them this, she says, but add on that they have to work to achieve it.

Williams believes that people need to start looking inwardly for validation, instead of externally. Self-esteem means feeling good about myself, intrinsically. Other-esteem means I only feel valued if you value me, or if I feel better than you – for example, if I have a better car than you, or more Facebook friends. A lot of people confuse other-esteem for self-esteem, which it isnt.

Twenge and Campbell provide multiple antidotes for narcissism fever, depending on which symptom you are showing, but for general narcissism rehab, they propose three goals: humility through honest appraisal of yourself; having compassion for yourself and not beating yourself up about things you are not proud of; and mindfulness, meaning living in the moment.

Turning on reality

Becoming aware of the narcissism epidemic is like finding out that Santa doesnt exist. Youve had your suspicions for a while that something didnt quite seem right – that it all seemed too good to be true – but you pushed the thought away to keep the magic alive just a little bit longer. In the same way that Santa-gate didnt mean that Christmas wasnt fun anymore, being aware of narcissism wont take the fun out of enjoying your life. The point is just to know that narcissism is everywhere, in our songs, in our values, and most importantly in our minds – so much so that we dont even notice it as being strange anymore.

Dr Afridi says, Our culture is becoming narcissistic by nature – and that is the really scary part, because once it becomes part of a culture, it becomes accepted as normal. We all have a responsibility to become aware of it – to communicate it to our children. Its not enough for people to be thinking, lsquo;Is that me? It is you. Its going to be you.

Theres no need to feel guilty, or duped. Even Dr Afridi, Williams, Twenge and Campbell admit to falling prey to it at times, whether it be choosing flattering photos of themselves for their websites, or getting a kick out of having a Facebook status lsquo;liked by friends.

All we have to do is adapt alongside our shifting, evolving culture, so that we dont fall behind or miss out on something great. What we need to remember now is that we can have too much of a good thing. And it seems that time has come.

Symptoms and treatment

Here are the six main symptoms of narcissism and how to counteract them in yourself and your children, as outlined by psychologists Jean M Twenge and W Keith Campbell, authors of The Narcissism Epidemic.

Symptom 1: Vanity

Example: Having perfectly white teeth, great hair, a new sports car, or an attractive girlfriend all serve the same psychological function, making others think you are cool, special, popular or important.
Treat it: Remember that it is OK if you dont look like a Hollywood star. Instead, find out what you need to do to improve your health and focus on that goal.

Symptom 2: Materialism

Example: Materialistic people are less happy and more depressed. They also report more physical health problems and are more likely to drink too much alcohol and use illegal drugs.
Treat it: Make an effort to save and focus on becoming more eco-friendly, which should naturally shepherd you towards a more frugal lifestyle.

Symptom 3: Uniqueness

Example: Feeling special helps justify the narcissists belief that its OK to cut in line, get something for nothing, and treat others as inferiorhellip;
Treat it: When bringing up children, focus on your love for them, rather on the fact that they are special.

Symptom 4: Antisocial behaviour

Example: Narcissists are aggressive exactly because they love themselves so much and believe that their needs take precedence.
Treat it: Aggressive behaviour is not cool at any level – remember that.

Symptom 5: Relationship troubles

Example: People often use the term lsquo;feeding the ego to describe narcissists approach to relationships. If the relationship proves to be sufficient food, it works. And if not, it doesnt.
Treat it: Avoid entering relationships with narcissists, or try and educate them on the merits of meaningful relationships.

Symptom 6: Entitlement

Example: You can feel entitled to a flat-screen TV without earning the money to pay for it. You can park in a handicapped space because you are in a rush. You can graduate from college and expect to get a fulfilling job with a six-figure salary straightaway.
Treat it: Start practising gratitude for the things you and your family have in your life. Think about the long list of people who played a part in getting you where you are today.

* Names changed

AMERICAS most senior diplomat in Ireland did not believe former Taoiseach Bertie Ahern received any corrupt payments, a leaked US embassy cable reveals.

Former ambassador Thomas Foley reported to the office of then US Secretary of State Condoleezza Rice on Mr Aherns travails at the Mahon Tribunal.

The ambassador said that while allegations of corruption remained, almost no one believes Ahern took bribes for personal gain.

His frugal lifestyle is apparent to all, the ambassador wrote.

The comments are contained in a cable sent in October 2007 when Mr Ahern comfortably defeated a motion of no confidence tabled by Fine Gael following disclosures at the tribunal.

The dispatch was one of 14 cables dealing with the tribunal sent from the US embassy in Dublin.

Tribunal

The cables reveal how embassy officials followed the tribunal closely and reported in detail to Washington and elsewhere on the unfolding evidence and reaction to it.

Assessments were made of the stability of the Fianna Fail-led coalition governments with the Progressive Democrats and the Greens following each new disclosure about Mr Aherns personal finances.

The tribunal is yet to report following its investigations into several sums of money received by Mr Ahern, many of which the former Taoiseach described dig-outs from friends.

Despite his acceptance that Mr Ahern had not acted corruptly, it is clear from the cables that Ambassador Foley still recognised the allegations were very damaging.

Even after Mr Ahern comfortably defeated the no confidence motion, Mr Foley remarked: He is not out of the woods.

The ambassador briefed Ms Rices office that Mr Aherns political rivals scent blood and continue to highlight alleged inconsistencies in his testimony in the hopes of damaging his political credibility.

In a follow-up cable on the issue in January 2008, the ambassador went on to predict that the tribunal revelations could mortally wound Mr Ahern. However, he said: For the time being, Ahern is showing no signs of giving up or of shedding his reputation as the Teflon Taoiseach who consistently manages to slide out of political difficulties.

The comments were made three months before Mr Ahern finally announced his intention to resign as Taoiseach, claiming the tribunal was distracting the Government from its task of governing.

In another April 2008 cable, marked confidential, Ambassador Foley quoted a Department of Foreign Affairs official, who believed Mr Ahern had been sincerely worried that his loss of credibility would hurt the second campaign to get the Lisbon Treaty ratified.

- Shane Phelan Investigative Correspondent

Irish Independent

EVERY WEEKDAY evening, TheJournal.ie brings you a round-up of the days main news, as well as the bits and pieces you may have missed.

• Taoiseach Enda Kenny told the Dáil today that the government has not decided yet on exactly how much householders will be asked to pay under new property and water charges. Both are required under the terms of the EU-IMF bailout and will be introduced on a flat-rate basis. Heres what we know so far about the new charges.
• Meanwhile, TheJournal.ie has been asking you for your view of the proposed taxes. Four out of ten who responded to the poll said they would refuse to pay, preferring to emigrate or face jail first.
• Bad news on the jobs front today with news that the unemployment rate rose in May, reaching 14.8 per cent. The number of people on the live register has risen by 2,600 since April.
• Sepp Blatter has been re-elected the president of FIFA for a fourth term. Mind you, he was the only person on the ballot The FAs push for the election to be postponed due to the shortage of candidates was defeated earlier today by 172 votes to 17.
• Germany has conceded that Spanish produce is not responsible for a deadly e.Coli outbreak which has killed 16 people. The source of the contamination has yet to be found. Spain, meanwhile, is considering legal action against the German regional authorities who initially blamed Spanish cucumbers for the disease.
• Fianna Fáil senator Denis ODonovan has been elected the 24th Seanad Éireanns Leas Chathaoirleach.
• Convicted murderer Mahendra Nath Das is awaiting execution in India after receiving a rare death sentence. So rare is a death sentence in India, that authorities have put out a nationwide call for a qualified hangman to carry it out.
• Suspected war criminal Ratko Mladic spent his first night in custody at The Hague in solitary confinement. Mladic is due to appear in the war crimes court for the first time on Friday morning, when he is given the opportunity to plead on the 11 charges facing him, the AP reports.
• Some unexpectedly positive news about the Irish economy: A senior director at the Standard amp; Poors ratings agency said Ireland stands a good chance of returning to the markets next year to raise funds and thereby avoid a second bailout.
• A new study has found that big brands Tesco, Ryanair and UPC come bottom of the pile when it comes to engaging with their online customers via social media. At the other end of the scale with a high number of social media features are Amazon, HMV, eBay and Irish site Elverys.
• The minimum wage isnt about equality, its an unfair tax on young men. So says businessman Gerard ONeill in his column for TheJournal.ie today.
• Quiz! Which member of the last government did the then-US ambassador to Ireland describe as bright and capable? Which minister was thought by the ambassador to have virtually no experience? And whose frugal lifestyle was apparent to all? The answers and more of former ambassador Thomas Foleys insights on the Irish cabinet can be found here.
• Facing an energy crisis, the Japanese government has taken the unusual step of launching a campaign to encourage their suit-loving countrymen to ditch their jackets and ties in favour of more light and casual attire which will be cool enough to endure the sweltering summer without resorting to strong air conditioning.
• Minister for Health James Reilly has announced a new health agency which will be responsible for cutting hospital waiting lists.
• Music, flowers, sheep, fun and sun? Check out some of what the June Bank Holiday has in store and start planning your weekend now.
• The childrens cartoon character Pippa Pig is set to generate about $1bn for the brands owners through a merchandising deal. Here are five people who made their fortunes from childrens television.
• The space shuttle Endeavour made a safe return to Earth this morning after its 16-day space mission the last in its career. Here it is, preparing to touch down at Floridas Kennedy Space Centre in the wee hours:

(Image: AP Photo/Orlando Sentinel, Pool)

Call it a retirement debate. Benjamin and Liza have been at loggerheads recently when it comes to their finances. Benjamin, 59, had worked in sales for many years until he was laid off last summer.

He will turn 60 this summer and wants to start collecting CPP early.

Presently on Employment Insurance, he says he will likely look for part-time work next year when it runs out.

But he also wants to begin drawing on his savings, and that is a source of contention for the couple.

Liza, in her mid-50s, is a health-care professional who works part-time for the WRHA and earns about $45,000. She also has a practice where she works the other half of the week. But the clinic is new and business isnt steady yet.

Technically, my clinic did not make a profit last year because I was able to write off a fair bit, she says, adding she plans to work into her late 60s.

She has some RRSPs, but her retirement income will rely heavily on a defined benefit pension plan.

He doesnt have a pension, so the question weve been debating is whether or not we should put a portion of his RRSP into an annuity and start collecting income now, she says.

Benjamin has more than $400,000 in RRSPs and wants to invest $100,000 in a five-year annuity that will last until he can collect OAS.

Id let the other $300,000 keep growing and accumulating, he says.

But Liza says she is concerned he is drawing on his savings too soon.

The couple have a $106,000 mortgage on their $450,000 home, as well as other debt, and they plan to add another $20,000 to the tab from renovations Benjamin will complete while collecting EI this year.

While they have managed thus far on his EI income, Liza says she worries they will no longer be able to travel freely as they have in the past.

When he retires, I dont want to have to be forced to live a very frugal lifestyle, she says.

Certified financial planner Doug Nelson says Benjamin and Liza are focusing on the wrong retirement goal. They should be more concerned about debt retirement than worrying about whether Benjamin can retire.

While they could probably make ends meet with the proposed plan, their No. 1 objective should be to pay down debt, says the adviser with Nelson Financial Consultants. The biggest risk they face is rising interest rates and subsequently rising interest costs for their debt.

Nelson says he believes the couple could manage on Benjamins plan, providing him with about $22,000 in annual annuity income until age 65. They have managed to live off of Benjamins monthly EI payment of $1,560 and Lizas income for the last six months with few problems, so they could probably manage when his income consists of annuity and CPP payments.

But Nelson says that raises an important question: Could he not find part-time work paying $22,000 a year?

The odds are that he could earn that much income on a part-time basis, he says.

Another consideration is Benjamins plan to start collecting CPP this summer. He needs to consider how starting his CPP benefit would affect his EI income, since the pension payment may be considered additional earnings, which reduce the EI benefit.

If CPP does not reduce EI substantially, he should start collecting CPP as soon as possible because its a guaranteed lifetime benefit. Drawing on CPP early reduces the benefit, but the variable to consider is longevity. He could wait until 65 or later to collect, but he could die immediately afterward. At least by taking the benefit early, hes guaranteed to get something from the plan.

The only consideration here is the Survivor Benefit for Liza, which is dependent on her work history. If he dies before she does, she is eligible for some of his CPP benefit. But it will only top her up to the maximum benefit. Based on her present earnings, she likely wont receive much of a top-up, if anything at all.

Yet, even with his early CPP benefit and the annuity, his income would likely still be less than $30,000 a year before taxes.

Nelson says a better alternative is for Benjamin to find work, collect CPP and keep his RRSPs intact.

By working part-time and earning, say $30,000, then he could allow his investments to continue to grow five more years while also paying down debt, he says.

And the bottom line is they need more income to pay down debt — only that increased income shouldnt come in the form of an annuity, Nelson says.

Yes, the annuity would bolster Benjamins income short-term, but reducing his savings by 25 per cent poses short- and long-term risks to their finances.

We can expect to see considerable volatility in investments over the next five to seven years and much of this may be to the downside, Nelson says. What would they do if investment returns were flat or negative over that period?

It is true the annuity would provide guaranteed income to help cover basic expenses, but as Liza fears, it may reduce their ability to pay for their wants such as travel.

Ideally, they want guaranteed sources of income to cover basic needs, and an investment portfolio should cover the lifestyle expenses, he says.

If Benjamin has difficulty finding employment, then they may have to consider alternatives. One option to consider may be Liza working full-time with the WRHA instead of splitting between part-time work there and the other half-week at the clinic.

The purpose of a business is to generate profit so that you can use this income to meet personal goals — otherwise, why do it? Nelson says about her practice.

In the end, it may turn out that Benjamins plan to buy an annuity is the most feasible way to guarantee retirement income for him for the next five years. But they should consider the other options first, Nelson says.

Spending capital today on an annuity is pricing their retirement to perfection and is not something Id recommend, he says. The lesson in this is to always have a Plan B and never assume that the future will be the same as the most recent past.

That said, the couple may have some more debating ahead of them.

giganticsmile@gmail.com

Benjamin and Lizas finances

?ntilde;ordm; INCOME

Liza: $45,164 ($2,708 monthly); plus about $15,000 from private practice (with business deductions, she pays no tax)

Benjamin: $1,560 a month from EI until end of 2011

?ntilde;ordm; EXPENSES

Monthly: $3,119 (Benjamin pays $1,245 share)

?ntilde;ordm; DEBTS

Mortgage: $105,098 (Liza pays $687 a month)

Liza business line of credit: $7,149

Benjamin line of credit: $14,000 (plans to add another $20,000 for renovations)

?ntilde;ordm; ASSETS

Liza RRSP: $89,575 (balanced portfolio)

Liza TFSA: $2,898

Home: $344,902 equity in home valued at $450,000

Liza work pension: Valued at $40,000; plans to collect full defined benefit at age 65

Previous work pension: $300 monthly defined benefit if taken today; plans to collect higher amount at 65

Benjamin: $400,000 in equity mutual funds and blue chip stock (dividend-yielding investments)

Americas most senior diplomat in Ireland did not believe former Taoiseach
Bertie Ahern received any corrupt payments, a leaked US embassy cable
reveals.

Former ambassador Thomas Foley reported to the office of then US Secretary of
State Condoleezza Rice on Mr Aherns travails at the Mahon Tribunal a
public inquiry set up in the Republic to investigate allegations of corrupt
payments to politicians

The ambassador said that while allegations of corruption remained, almost no
one believes Ahern took bribes for personal gain.

His frugal lifestyle is apparent to all, the ambassador wrote.

The comments are contained in a cable sent in October 2007 when Mr Ahern
comfortably defeated a motion of no confidence tabled by Fine Gael in the
Dail following disclosures at the tribunal.

The dispatch was one of 14 cables dealing with the tribunal sent from the US
embassy in Dublin.

The cables reveal how embassy officials followed the tribunal closely and
reported in detail to Washington and elsewhere on the unfolding evidence and
political reaction to it.

Frequent assessments were made of the stability of the Fianna Fail-led
coalition governments in the Republic with the Progressive Democrats and the
Greens following each new disclosure about Mr Aherns personal finances.

The Mahon tribunal is yet to report following its investigations into several
sums of money received by Mr Ahern, many of which the former Taoiseach
described as dig outs from friends.

Despite his acceptance that Mr Ahern had not acted corruptly, it is clear from
the cables that Ambassador Foley still recognised the allegations were very
damaging to the former Irish leader.

Click here to visit our WikiLeaks section and read more