The Covid-19 pandemic and lockdowns have created plenty of financial stress for individuals and families. Temporary or even permanent income loss has been only partially mitigated by relief programs, such as the Canada Emergency Relief Benefit (CERB) and the Canada Emergency Wage Subsidy (CEWS). In any case, these programs are not permanent and will be wound down eventually. Feeling stressed? This is a good time to take stock of your situation with a financial wellness check in four key areas.
The COVID-19 pandemic has thrown many families’ financial plans into disarray. And while restrictions are gradually being lifted, activity is still far from normal. And, if the experts are right, there’s still the threat of a secondary wave of infections to contend with in the fall. Most everyone is washing their hands frequently and using masks in public spaces to stay healthy. But what about your finances? Here are five smart ways to sanitize your finances to make sure your bank balance doesn’t end up in the ICU.
You may as well face facts: You can’t “save” a million dollars. A recent survey of the market showed that the highest rate paid in a standard, plain-vanilla deposit savings account (the kind that most banks and large financial institutions offer as a place to put your cash) was around 2.8%, while the lowest was, believe it or not, one tenth of 1%. Believe me, with this kind of return, you will not be able to “save” a million dollars. But another fact is that you can still retire rich, possibly with much more than a million dollars in your nest egg, once you unshackle yourself from the savings account trap. Here’s how.
Registered Retirement Savings Plans (RRSPs) are still the best retirement saving and tax-deferral opportunity available for most Canadians. Trouble is, many of us just don’t use RRSPs to their full advantage. Unused RRSP “contribution room” – that is, the amount of eligible RRSP contributions that have not been made – is currently over a trillion dollars. That’s a lot of contribution money that isn’t being tax-sheltered, and that is not giving anyone a tax deduction either. READ MORE
A kind of money madness seizes people at this time of year. The expectation of ever-larger-better-bigger-pricier gifts is aided and abetted by retailers offering deals, promotions, and sales on all manner of shiny baubles and trinkets. Credit card companies have spent the fall season offering to raise your credit limit to make it easy to spend like a billionaire – without actually being one. It all seems like a fairy tale, until the bills come in. Then it’s right back to that Cinderella feeling. Is there a way out of this seasonal spending disorder? Here are a few tips. READ MORE
At this time of the year, when Black Friday madness looms, and financial responsibility seems to evaporate for many people, it’s helpful to revisit what I consider to be the most common financial and planning errors most people make. Over the years, I’ve boiled it down to the seven deadly sins of financial planning. I first produced this list in my blog a few years ago. But it continues to be a popular item, so I thought I’d run it again as a refresher on how to stay financial virtuous and scale back the many temptations and excesses of the holiday shopping whirlwind. Here’s my list, then, and some suggestions for how to avoid those deadly financial sins. READ MORE
As this is Financial Literacy month, and the theme is “Take Charge of Your Finances!”, I want to talk about the very foundation of financial literacy, the building block of successful financial management: the budget. I can sense eyes glazing over right now, but before you click away to another more interesting page or a funny cat video, let me talk about lattés instead. READ MORE
There’s no two ways around it: The cost of a post-secondary education is high. For some, it’s a real challenge to make ends meet while attending college or university. In fact, students can expect to pay a total of about $60,000 for an average four-year post-secondary education program, including tuition, books, board and lodging, and living expenses. It’s more than double that for professional degrees like law, medicine, dentistry, and engineering. READ MORE
It’s tax-filing season for most Canadians, and naturally, the advice and tips you get right now involve maximizing your immediate tax savings by making sure you take all the credits, deductions, and amounts you’re entitled to. But for continuous long-term tax and wealth planning, there is an ultimate tax-slashing tactic. It’s called the Tax-Free Savings Account (TFSA), and it’s the best tax shelter now available to Canadians. Here’s a look at how it works and how to make the most of it. READ MORE
Let’s say you’ve accumulated a nest egg of $1 million at age 65, through pension plans, perhaps a significant RRSP, TFSA contributions, some inheritances, and possibly some money left over from downsizing your home. You’re ready to retire, and you have to decide what to do with it to make it last through retirement. Here’s what you need to know. READ MORE