March 4th, 2010
Proposed changes to the Canada Pension Plan (CPP) may affect your decision on when to retire and begin drawing benefits.
The changes, to be phased in starting in 2011, would mean higher payouts for those who wait beyond age 65 and less for those who collect earlier. Read the rest of this entry »
Tags: Retirement Planning
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March 4th, 2010
If you’ve ever wondered if you are in a position to actually grow your money, there’s a simple test. Take the number “72” and divide it by the rate of return you’re getting. For example, if the interest rate is 2%, then the number of years it would take to double your money is 72 ÷ 2, or 36.
The “Rule of 72” is a simple formula that can yield powerful insights. Read the rest of this entry »
Tags: Investments
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March 4th, 2010
When you get a tax refund, it means you have given Ottawa an interest-free loan of funds you could have used last year to reduce debt or boost your investments.
The good news is that if you think you’ll be in line for a refund, you don’t have to wait. Your district tax office can authorize your employer to deduct less tax from your pay, to reflect deductions that typically trigger a tax refund — things like RRSP contributions, charitable donations, deductible support payments, and childcare expenses.
You might also qualify if you will be making a large RRSP contribution or “catch-up” contribution early in the year, or if you expect to have significant carrying charges, rental losses, or legal expenses incurred to collect child support and/or allowable business investment losses.
If you’d like to make this request, you may contact me via phone or e-mail for the necessary T-1213 tax form.
Tags: Tax Planning
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March 4th, 2010
When it comes to our personal finances, it’s easy to set goals, and often hard to meet them. Here are nine financial resolutions you might want to consider.
Tags: Financial Planning, Investments, Money Management
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December 16th, 2009
We’re almost through the year 2009, and you most likely made a RRSP contribution at some point this year. But did you make a contribution to your Tax-Free Savings Account? If you haven’t opened one, you’re missing an excellent opportunity to save and invest without worrying about the future tax burden.
With a Tax-Free Savings Account (TFSA), if you are over 18 years old, you can save up to $5000 each year. You won’t get a deduction, like you would with the RRSP, but you do get a nifty bonus. Any investment return you get – interest, savings, or capital gains – is not taxed, not while it builds up inside the plan, and not when you withdraw it. This is a great companion strategy to help pay for education, plan for retirement, and buying a home. You can even set up a TFSA to help you budget for Christmas presents and annual vacations.
If you felt the crunch of the recession this year, and weren’t able to make a TFSA contribution, don’t worry. Any unused room from this year will carry forward. So if you only made a one-time $50 deposit into your TFSA, you still have $4950 in contribution room that carries forward to 2010. This means you have a total of $9950 of contribution room for next year. If you don’t contribute at all in 2010, you will have contribution room of $14,500 in 2011.
You get the idea.
Another important item: if you are saving your TFSA for future use, the withdrawals won’t affect any income-tested benefits. The Canada Child Tax Benefit, Old Age Security, and the Guaranteed Income Supplement aren’t altered when you make a withdrawal.
If you are thinking about making some big personal and financial changes next year, the TFSA is definitely a good starting point. Keep in mind, though, that you need to put together a financial plan, and find out where the TFSA fits in, in order to get the most out of it.
Tags: Investments, Tax Free Savings Account, Tax Planning, TFSA
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November 23rd, 2009
For the past several years, only Nova Scotia, Newfoundland & Labrador and New Brunswick have operated under the HST. Quebec introduced the Quebec Sales Tax (QST) in 1992, which quite closely resembles the HST. In 2009, both Ontario and British Columbia introduced plans to harmonize their respective provincial sales taxes with the federal GST to create an HST, effective July 1, 2010. In Ontario, the new HST would have a combined tax rate of 13 percent and would include the current general Ontario RST rate of 8 percent and the federal GST rate, currently set at 5 percent.* As a result, a greater proportion of Canadians will be subject to HST. This paper will discuss what harmonization means to consumers and more specifically, how HST will affect your mutual fund investments.
Tags: HST, Investments, Mutual Funds
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November 3rd, 2009
As uncertainty about economic recovery lingers, a new survey reveals that 52% of Canadians are not comfortable with their current financial situation and 53% feel insufficient knowledge about investing is their top wealth-building barrier. The survey, released by real estate and investing training services firm Tigrent Inc., examined over 3,000 British, American and Canadian attitudes, definitions and self-limiting beliefs towards financial freedom and reinvention. It was conducted for Tigrent by Opinion Research Corp. from October 19 to 21.
Read the rest at Investment Executive
Tags: financial literacy, Investments, Wealth management
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November 3rd, 2009
Have you ever thought about going back to school as an adult, but wondered how you would be able to afford it? In this post, we look at using money from an RRSP to finance a Lifelong Learning Plan. Click here for a comprehensive overview.
In 1998 the Federal Budget contained a new education funding plan called the Lifelong Learning Plan (LLP), which allows people tax-free withdrawals from an RRSP to finance post secondary education and skills training, either for themselves or their spouse, under certain conditions. Read the rest of this entry »
Tags: Education Planning, Investments, RRSP
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November 2nd, 2009
Now that you’re in your 50s you’ve probably asked yourself this question a number of times:
How much do I need to retire?
The answer to that question depends very much on the lifestyle you envision in retirement.
Perhaps you want to travel the world or trade your expensive house in the city for a smaller one in the country, and just enjoy yourself. But no matter what your goals are in retirement, financial planning at this stage forces you to admit that your retirement is almost here and you have to make some critical decisions. Read the rest of this entry »
Tags: Investments, Mutual Funds, Retirement Planning, RRSP
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October 30th, 2009
If you’re like many investors, you’ve considered allocating at least a portion of your portfolio into a Guaranteed Investment Certificate (GIC). Why not? After all, GICs are secure investments that are guaranteed to pay back your money. On the other hand, many investors view mutual funds as being too risky, and so avoid them. But is this the whole story? Read the rest of this entry »
Tags: Investments, Mutual Funds
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