Personal Savings getting you down? There are always smart ways to increase your savings.
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The real cost of going back to the office + MORE Jul 10th
If your daily commute currently involves a sweatpants-clad walk from the coffee maker to your home office, you may have seen significant benefits, including a rise in your bank account balance. A 2022 survey from CISCO found that Canadians saved an average of $11,530 per year while working remotely.... More »
Pay Attention to Your RRSP Fees, and How You Pay Them + MORE Mar 14th
No one likes to pay fees, but the rate you pay for your investments and how you pay them can be especially troublesome. Making the right decision for your portfolio can be the difference in how much money you earn over the long haul.
When it comes to your Registered Retirement Savings Plans (RRSPs).... More »
This tech worker makes $60,000 and has no savings. He wants to travel to see his sick grandmother. What can he do? + MORE Mar 13th
Peter had $5,000 saved up for a trip to Colombia and a vacation to Asia later on, but after his car broke down his savings disappeared..... More »
How much cash should you keep in your portfolio? + MORE Jun 24th
Cash is rarely going to remain steady within your accounts, but you may want to have a target for it, just the same as you would for stocks and bonds. How much depends on several factors and can be a percentage or a dollar amount.
Accumulating
If you are in the accumulation phase, new deposits.... More »
The best high-interest savings accounts in Canada for 2023 Jul 24th
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The best high-interest savings accounts in Canada for 2023
Here are the accounts offering the highest interest rates and lowest fees.
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The rates i.... More »
“Should I loan investments or money to my spouse?”
– moneysense.ca
Q. I’m 38 years old and have been married for 10 years. I would like to set up a spousal loan to my wife, who works part-time while raising our two young sons.
How would I go about doing this correctly? And is there any special consideration of a cash versus “transfer-in-kind” of stocks, other than that they would be considered sold and I would have to pay any capital gains tax on their appreciation in value at the time of transfer? Or, for record-keeping purposes, would it be better if I sold the stocks to loan cash?
–Ralph
A. The idea behind a spousal loan is to lend money from a high-income spouse to a low-income spouse. If the subsequent return on the investments exceeds the loan rate prescribed by the Canada Revenue Agency, the general result is that income is effectively moved from one spouse to the other, and the family may pay less tax overall.
Interest paid by the borrower is tax-deductible, as the borrowed money is for investment purposes. Interest income received by the lender is taxable, just like interest income on a savings account, GIC or bond…
How would I go about doing this correctly? And is there any special consideration of a cash versus “transfer-in-kind” of stocks, other than that they would be considered sold and I would have to pay any capital gains tax on their appreciation in value at the time of transfer? Or, for record-keeping purposes, would it be better if I sold the stocks to loan cash?
–Ralph
A. The idea behind a spousal loan is to lend money from a high-income spouse to a low-income spouse. If the subsequent return on the investments exceeds the loan rate prescribed by the Canada Revenue Agency, the general result is that income is effectively moved from one spouse to the other, and the family may pay less tax overall.
Interest paid by the borrower is tax-deductible, as the borrowed money is for investment purposes. Interest income received by the lender is taxable, just like interest income on a savings account, GIC or bond…
Should you use TFSAs and savings to pay off your mortgage?
– moneysense.ca
Q. Our mortgage is our only current debt, and between our TFSAs and other savings, my wife and I could pay off the full $230,000 remaining on our home on renewal later this year. What are the pros and cons of doing this?
–Patrick
A. At first blush this strategy may seem straightforward—and that the best use of money you have in TFSAs and savings would be to pay off your mortgage and eliminate that final debt. After all, you can make withdrawals from your TFSAs tax-free, and paying off debt is a golden rule of good financial planning.
However, there are other factors to consider before you and your wife make a final decision. For instance, how is the TFSA invested? If your TFSA money is held in a savings account, then the answer is a definite “yes”—the TFSA money should be used to pay off the mortgage. Since your savings are likely earning very meagre returns, anyhow (I’m betting the interest on your savings account is much lower than your mortgage rate), then this is a win-win scenario for you…
–Patrick
A. At first blush this strategy may seem straightforward—and that the best use of money you have in TFSAs and savings would be to pay off your mortgage and eliminate that final debt. After all, you can make withdrawals from your TFSAs tax-free, and paying off debt is a golden rule of good financial planning.
However, there are other factors to consider before you and your wife make a final decision. For instance, how is the TFSA invested? If your TFSA money is held in a savings account, then the answer is a definite “yes”—the TFSA money should be used to pay off the mortgage. Since your savings are likely earning very meagre returns, anyhow (I’m betting the interest on your savings account is much lower than your mortgage rate), then this is a win-win scenario for you…
