Monthly Archives: December 2017

Posted in Personal Finance

Piggy BAnk

Because the biggest single expense in retirement is usually tax, high-income seniors should strive to use Tax-free Savings Accounts (TFSA) to minimize the tax bite in their later years.

The key is to maximize both contributions and growth no matter how old you are, which means holding proper growth investments (equities) instead of fixed-income instruments that pay a pittance.

The TFSA is a mis-named vehicle,” says T.E. Wealth’s senior vice president Warren Baldwin, who prefers the term “Tax-free Portfolio Account” or TFPA. Still, it’s fortunate that despite the misnomer, the TFSA can act as a TFPA.

Because the TFSA was introduced only in 2009, most seniors have ten times as much money in RRSPs and RRIFs than TFSAs, says Sandy Aitken, CEO of M-Link Mortgage Corp, developer of TFSA Maximizer. Over 15 years, his product aims to reverse that ratio.

The main issue is when RRSPs convert to RRIFs after age 71 (if not annuitized) and the legislated annual minimum withdrawals that require them to pay income tax at high marginal tax rates.

 Why is the TFSA so valuable to seniors? Click here to find out

 

Posted in Personal Finance

Budget

 

As you’re closing one year and resolving to make the next one even better – in whatever way you have in mind – remember that your financial plan has to be ready for the new year, too. You need to go over what you did with your money in 2017 and consider what expenses you’ll face in 2018. In short, you need a budget.

“While [budgeting’s] not necessarily anyone’s favorite part of the financial planning process, it’s a really important part because that’s where you can uncover opportunities or problems,” says Chantel Bonneau, a financial advisor with Northwestern Mutual. “And it really gives us the data to take action from there.”

Here are five steps to build your budget for the new year.

Click here for full article

Posted in Mortgages

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Canadian parents are helping their children buy their first home, but this support is increasing demand and sending prices soaring.

One-third of Canadian Baby Boomers plan to or have already given family members a living inheritance with the specific goal of helping them to buy a home, according to a survey conducted by Sotheby’s International Realty Canada and Mustel Group.

“There’s no question that this is opening up more demand for real estate, more buyers able to buy real estate by virtue of the fact that they’re being supported by their parents,” Brad Henderson, CEO and President of Sotheby’s tells BuzzBuzzNews.

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Bank of Canada

 

The Bank of Canada has decided to keep its benchmark lending rate steady at one per cent,  pausing after two small hikes earlier this year.

Canada’s central bank said Wednesday it has decided to keep its target for the overnight rate right where it is, while rate hikes in July and in September continue to work their way through the economy.

“While higher interest rates will likely be required over time,” the bank said, “the current stance of monetary policy remains appropriate.”

The bank noted that economic data has been coming in within range of what it was forecasting as recently as October, when the bank was expecting moderate growth for the rest of this year after a strong start to 2017.

Exports are a bit lower than expected, but the job market is a bit better than expected, the bank said.

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