What does a weak Canadian dollar mean for your savings? + MORE Feb 25th

—Chander

Joint accounts after death

I come across this question so often, Chander, that it’s a good one to address in detail. There are different tax and estate implications with joint accounts depending upon who the account holders are. We will start with what happens when someone dies and their spouse is joint on the account.

Joint account taxation when a spouse dies

When someone dies, there is generally a deemed disposition, as if they sold all their assets at their current fair market value. However, when a spouse or common-law partner dies, capital assets can pass to the survivor on a tax-deferred basis. This could include, for example, real estate, private company shares and, with respect to your question, Chander, a joint non-registered margin account…

How unfavourable? Since the beginning of the year, the Canadian dollar’s trading value has fluctuated between roughly USD$0.69 and $0.70—something not seen since the beginning of the COVID pandemic in early 2020. By comparison, as recently as late September 2024, the Canadian dollar was worth about USD$0.74.

Most obviously, this puts Canadian consumers at a disadvantage when they’re cross-border shopping, making online purchases from U.S.-based retailers and independent sellers, or travelling to the United States or countries where the U.S. dollar is widely accepted. While many Canadians are switching gears to avoid travel down south and/or focus more on buying Canadian-made goods, there are some expenses that can’t be avoided entirely.  

For those situations, holding U.S. dollars can offer more predictability for budgeting and lessen the impact of fluctuations or a further decline in the Canadian dollar, particularly for large transactions…