Why repaying student debt early is the best investment you can make + MORE Feb 17th

There are plenty of retirement plan options in Canada! Stay on top of the best plans right here.
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An easy guide to income splitting for seniors Apr 14th

Q. My husband and I are both retired. He still has income from his business, and I have cashed in all of my RRSPs but one. My question is: Can Hubby cash one of his RRSPs (and pay taxes, of course), but then turn around and buy a spousal RRSP for me? Would that be worth doing? Then I could cash this.... More »

After inheriting a RRIF account, how to know what you owe the taxman Mar 10th

Q: I’m wondering if there is a simple way to calculate the tax liability to named RRIF beneficiaries upon death of the account holder?  My wife’s mother passed away in October 2018. My wife was one of 3 named beneficiaries of a RRIF worth $265,000, and her share was $117,000 (44%). There are no.... More »

Why the $35,000 RRSP Home Buyers’ Plan won’t be much help Mar 31st

It’s been about a week since federal budget day and I still have questions about some of the things the government announced. For instance, why did they introduce a deferred annuity, which will allow Canadians to put 25% of their RRSP or RRIF into an annuity that must start paying out by 85 at the.... More »

Avoiding future interest is one way to look at your return on investment May 12th

Q. I’m 47 years old and, after suffering a personal injury, have just been awarded a medical pension of $400 per month. The money is indexed annually and payable for life. I can opt for a cash-out and receive $120,000 upfront, but I’m unsure which is the smarter option. My mortgage renews in 202.... More »
The challenge of estate planning with blended families
Q. My husband and I are senior citizens, have both been married before, and each has adult children from a previous marriage. We each have investments we accumulated during our working years, which we have kept strictly separate (about $200,000 each). We purchased and own a home together, which is mortgage free, worth about $250,000. Seems simple, right?
Recently we made a will together, but now I am questioning that will. Here’s what was done: My husband wants to leave his investments to me. They are all in RSP’s and a LLIF. The plan is to pass these on to his children once I pass away. They are already his beneficiaries should I go first. I wish he would just leave these to his children directly but he won’t hear of it.
My own investments of about $80,000 are in a Registered Retirement Income Fund (RRIF), a TFSA and a margin account and the three total $200,000. My RRIF goes to my husband if I die first, with my children as beneficiaries in case my husband dies first. My TFSA goes to my children immediately upon my death, and my margin account will be part of my/our estate, as I cannot designate a beneficiary…

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With the March 1 RRSP deadline just a few weeks away, many savers are no doubt asking themselves whether they should be putting money into this stalwart retirement account or if they should be investing in the decade-old tax-free savings account, or their Registered Education Savings Plan (RESP), instead.
While it’s good to save in any of these vehicles, which one to use first will depend on how much you have to save and what you want to do with your dollars. With the RRSP deadline approaching, we thought we’d take another look at these three accounts.
RRSP: Still a solid retirement savings account
The Registered Retirement Savings Plan was created by the Federal government 62 years ago to help Canadians to save more for their golden years. At the time, people could only put away 10% of their income up to a maximum of $2,500.
While a lot has changed since then, the RRSP has stayed mostly the same. Canadians can still contribute a percentage of their earnings, though it’s now 18% of people’s income up to a maximum of $26,500 for the 2019 year (this year’s deadline is in 2020)…

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What to do when Manulife offers cash to leave its IncomePlus product
Q. My wife and I are retired and in our mid-60s. We are financially very comfortable. I also have a sizeable indexed defined benefit work pension. My wife has a large RRSP from self-employment. It is with Manulife (IncomePlus) and was intended to act as a variable rate annuity since she does not have a pension.
Manulife has offered her a very sizeable “enhancement deposit” to give up the guarantees and get out of the contract. The performance has been marginal because of the high MERs and administration fees. We are thinking about taking the offer and going into a lifetime annuity that guarantees, at a minimum, the return of initial lump sum payment (in case of early death). The annual annuity payments are substantially higher (almost 1/3 higher) than the minimum guaranteed in her current contract. It’s hard though, to give up complete control of some of our retirement funds although we have done it partially already. Any thoughts on what else to consider?  
– Thanks, Abel

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Q. I’m a 23-year-old who just graduated with a Masters degree and I have $30,000 in student debt ($20,000 provincial, $10,000 federal). I also just got a job with an annual salary of roughly $60,000. My question is what is the best way to invest my money (index mutual fund, stocks, online Robo-advisor) so that I can still pay off my loan but also save for the future (i.e. buying a house/condo, getting married, etc.). Thank you!
A. Jake, first, I’d like to offer congratulations. Kudos for wanting to reach for these goals and milestones, especially since you are quite young, have just begun your career and are still several years away from big mortgage payments and retirement.
One key thing to note is whether you are living with your parents or on your own. It makes a difference because paying for rent, food, and other shelter expenditures can consume a lot of financial resources. That being said, in either scenario, debt reduction is the best form of investment within either scenario…

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If you’re like many Canadians, you’re hoping you’ve paid enough tax in 2018 and may even be looking forward to a hefty tax refund. You can help ensure that happens by knowing the details of your Registered Retirement Savings Plan (RRSP), what sets them apart, your contribution limit and a whole slew of other things. Here are the basics:
What’s an RRSP?
An RRSP is a retirement savings plan that you open at a bank or other financial institution near you. It’s registered by the federal government of Canada, and you can contribute to it up to an annual maximum amount.
What’s special about RRSPs?
Contributions to RRSPs are deductible, meaning they can be used to reduce your taxes. Any income you earn in the RRSP is usually exempt from tax as long as the funds remain in the plan; you generally have to pay tax when you withdraw money from the account.

Ten RRSP questions answered »

Who can open an RRSP?
If you have earned income, have a social insurance number and have filed a tax return, you can contribute to an RRSP up until December 31 of the year your spouse turns 71…

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