Putting a price tag on your dream home

Crunch the numbers before you make an offer

The big question for young couples just starting out is whether to move out of that downtown condo unit and borrow to buy a home. This becomes especially critical if you’re planning a family or if a baby is already on the way. Those new little people with all their gear take up an amazing amount of space, and suddenly the need for more room becomes pressing. READ MORE

Post-divorce financial planning

Four key areas to focus on to make the settlement last

Once a divorce settlement is finalized, the next step is to make that settlement last. But how? What are the next steps in financial planning? Should you keep the same financial advisors and investment professionals as your ex? What are the key areas to focus on? READ MORE

DIY dangers!

When your investments take control of you

There’s nothing quite like the thrill of managing your own investments. That is, until things go south and you wonder whatever possessed you to buy that two-times daily bull crude oil ETF! Then there’s all that paperwork to contend with (what the heck is a “T3 – Statement of Trust Income Allocations and Designations”?) When should you sell to take a tax loss? And can you apply it against gains? Those brokerage fees that get into triple digits can really give you that sinking feeling at year-end (are they deductible or not?). Take heart. You’re not doing anything wrong. But you may have fallen into the trap that so many do-it-yourself investors do. You’ve let your investments start controlling you instead of the other way around. READ MORE

Rules for withdrawing tuition funds from RESPs

Special rules apply to non-residents

When a Registered Education Savings Plan (RESP) matures, the beneficiary of the plan (usually the child for whom the plan was opened) can withdraw the funds for post-secondary tuition. Because they will likely be in a very low tax bracket, little or no tax will be payable on the withdrawals. That’s what makes starting an RESP early so attractive. READ MORE

Fixed-income investing in a rising rate environment

Carefully selected bond funds as part of a diversified asset mix

If you haven’t checked your portfolio for a while, you may have noticed that the performance of your bond mutual funds and ETFs has been lagging a bit. And you may be thinking of selling or switching. But before you do, think about how bonds are priced and the purpose they serve in a portfolio. While bonds are the classic defensive investment, and should generally be a part of a well-diversified portfolio as an asset class that is uncorrelated to equities, their prices react directly to the prevailing level of interest rates. READ MORE

The right financial advice doesn’t cost, it pays

Choosing the best financial advisory team

Once you’re established in your profession or career, and you’re accumulating a sizeable nest-egg, getting financial advice from your second cousin or the bank teller just won’t do. You need to get some professional money advice. But where to begin? There seem to be so many people offering advice, and you often read of people losing their investments through fraud or incompetence. Begin by asking yourself what you think you might need a financial advisor to do. Very likely, you’ll be running across some of these experts. Here’s a look at what they all do. READ MORE

Investing: How to deal with market risk

Can you really “live with the risk”?

In this day and age of “robo-advisors” and passive index investing, many investors seem to have forgotten the single immutable truth that equity markets are inherently risky. That’s simply because the share prices of stocks traded on markets are influenced mostly by expectations of future earnings growth. Many factors can come to bear on these expectations apart from a company’s competitive position, financial strength, and industry outlook. These include shorter-term geopolitical events (not as important) and longer-term economic and monetary policies (more important). Put it all together and it adds up to market-wide trends, oscillations, and fluctuations, which are often characterized by a wide amplitude from top to bottom. This is what’s broadly called “risk.” And it’s what most investors have trouble dealing with. READ MORE

How to cut the cottage-sale tax bill

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The ABCs of the ACB

Thinking of selling your cottage, cabin, or recreational property? Unless it’s truly your principal residence, the Canada Revenue Agency (CRA) will want its share of any capital gain you make on the sale. It calculates the capital gain as the proceeds of the sale minus the cost of selling and the adjusted cost base (ACB). Here’s where you can find ways to cut the tax take. But a note of caution: The CRA are fully aware of ACB games people play with cottage sales, so ensure that all the components of the ACB are documented and are all bona fide. READ MORE

Money Makeover: No plan and a high-risk portfolio threaten their retirement security

Robyn Thompson is regularly featured in The Toronto Star’s “Money Makeover” series by Deanne Gage. This month, Money Makeover takes a look at Victor and Shelly, who hope to retire next year, but have a risky investment portfolio and no plan. Read Robyn Thompson’s advice on how this couple can use their substantial pension income along with a sizable inheritance to ensure a financially secure future.

Businesses increasingly use DPSPs and Group RRSP combo benefits

Employer contributions and tax savings can really add up

Employers often use group benefits as a way to attract and retain their best employees. The most popular group benefits typically offer the most flexibility for employees and the lowest costs for employers. That’s why employers are increasingly turning to the flexibility and low costs characterized by Deferred Profit Sharing Plans (DPSPs) and Group Registered Retirement Savings Plans (RRSPs). READ MORE

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