WTFinance is an RRSP? + MORE Sep 9th

How to go about securing the best Retirement Plan in Canada.
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Should you buy back pension service from your employer? Jun 22nd

While defined benefit (DB) pensions are the Cadillac of retirement plans, they also entail a unique set of decisions. Buybacks are one of them. There are a few ways to build up the value of your DB pension: by working to accumulate years of “pensionable service,” of course; by transferring servi.... More »

The best ETFs for retirement income + MORE Aug 24th

While exchange-traded funds (ETFs) are appropriate for investors of all ages and life stages, they make particular sense for retirees and those close to retiring. Things like quick and easy broad diversification of asset classes and geographic exposure at a reasonable price are especially relevant w.... More »
 retirement savings

When It Comes to Retirement, I'm With Cicero Jan 13th

The great Roman orator thought aging and retiring free us from destructive ambition and competition..... More »

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 »
 freedom 55

Piper makes a good buck as a lawyer but still has piles of school debt. Is her dream of owning a downtown Toronto condo realistic? + MORE Jan 25th

Financial adviser Jason Heath says Piper needs to get her debt and expenses under control before even thinking about home ownership and retirement.... More »
How to invest your money in Canada as a U.S. citizen
Q: I am both a Canadian and American. At this juncture, I will not give up my American citizenship since my family is down there and I am only 33. I have maxed my RRSP and I want to invest in ETFs in a non-registered account but I understand there are issues with U.S. tax liabilities.
There are over a million Americans in Canada. My question is simple: what platform can an American in Canada use to acquire indexes or ETFs with minimal tax liability and simplicity for IRS reporting?
–Megan
A: As you likely know, Megan, American citizens need to file U.S. tax returns every year on their worldwide income, regardless of where they live. That means one million U.S. citizens in Canada should be filing with the IRS. Not all of them do.
There is a bilateral agreement between Canada and the U.S. to avoid double taxation and because Canadian tax rates are generally higher than U.S. rates, many Canadian tax filers have no U.S. tax liability on their U.S. returns. That doesn’t mean you don’t need to file or worry about what you invest in here in Canada…

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Can I disinherit my spoiled daughter?
Q: I am a divorced, single woman, and, I have one living daughter who is 31-years old. My ex-husband died of cancer a few years ago after we were divorced, and my daughter inherited his entire estate, which was in the hundreds of thousands of dollars when she was only in her mid-20s. Having money now at such a young age has made her cocky and arrogant and she treats people badly, including me. I do not like the person she has become. I am financially stable, 61 years old, own my own home, have pension income and other income at present. However, I wish to disinherit her from my estate. Can I leave my entire estate to others without worrying that she will challenge it?
– Dianne
A: Dear Dianne, I have struggled with your question about disinheriting your daughter. Your divorced husband left his estate to your daughter. I don’t know if this changed your relationship with your daughter. Parent-child bonds are strong. You did not mention any grandchildren.
Your daughter is an adult and financially independent…

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WTFinance is an RRSP?

– moneysense.ca

The post WTFinance is an RRSP? appeared first on MoneySense.

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The wrong way to pay off debt
I’ve always believed that anyone substantially mired in debt has no business fantasizing about retirement. For me, this extends even to a home mortgage, which is why I often say “the foundation of financial independence is a paid-for home.”
Sadly, however, it’s a fact that many Canadian seniors ARE attempting to retire, despite onerous credit-card debt and sometimes even those notorious wealth killers called payday loans. Compared to paying out annual interest approaching 20% (in the case of ordinary credit cards) and much more than that for payday loans, would it not make sense to liquidate some of your RRSP to discharge those high-interest obligations, or at least cut them down to a manageable size?
This question comes up periodically here at MoneySense.ca. For example, financial planner Janet Gray tackled it in March in a Q&A. A recently retired reader wanted to pay off a $96,000 debt in four years by tapping into her $423,000 in RRSPs. Gray replied that this was ambitious and raised multiple questions…

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