I think the most overlooked and underrated strategy for funding retirement is the Systematic Withdrawal Plan (SWP). If done right, a SWP is an excellent tax planning tool and can provide loads of tax efficient cash flow. Not only is a SWP a great way to slash your retirement tax bill, but it can help [...]
If you haven’t looked into flow through shares for tax savings, you should. They can be a good way of saving taxes if they’re used right.
Some people think that flow through shares are complicated and risky. This is only true if you don’t know what you’re doing. They are, however, a great way to save [...]
I don’t applaud the government very often when they change the tax rules, but this change deserves a round of applause. Since 2007, retirees have been allowed to split up to 50% of eligible pension income with a spouse. Will this help every retired couple? No. However, for those couples that are at different marginal [...]
A segregated fund is a mutual fund with a principal guarantee. An insurance company provides the guarantee, and investors pay for it with a higher MER than regular mutual funds have, usually by 1% or 2% (see “Management Expense Ratio” ). The guarantee applies on the 10-year anniversary of the purchase. If you invest $10,000 [...]
Behind every financial product is a clever marketing machine. The marketing machine behind Principal Protected Notes (PPNs) doesn’t need to be all that clever, however. The features are attractive: 100% principal protection at maturity, exposure to a diversified portfolio of great performing stocks (or to almost whatever asset class, sector, or geographic region you want), [...]
If you’re investing in mutual funds you should learn how to do it as economically as possible. By reducing the cost of investing, you automatically increase the return the investments deliver to you. If you reduce the cost by 1%, you’ve increased your return by 1%.
Management Expense Ratio (MER)
This is the fee that every mutual [...]
This is the fee that every mutual fund charges to invest in the fund. It includes all of the ongoing fees of the fund: the manager’s fee, the costs to print the prospectuses and annual reports, custody fees, the costs to mail you statements, and even the federal and provincial regulatory fees.
It also includes the [...]
Most of the time when rates of return get distorted, the distortion exaggerates the upside and makes an investment appear more attractive than it really is. This is not always the case, however. Sometimes a distortion makes the investment look less attractive. This can be the case with individual stocks that pay dividends.
Barry is evaluating [...]
Real Return Bonds are bonds issued by the Government of Canada. They operate differently from regular government bonds in that they don’t pay a fixed rate of interest. Their interest payments are adjusted for inflation. As inflation increases, the interest the bonds pay increases. This protects your purchasing power and acts as an excellent hedge [...]
Way back in 1952, the Canadian government started giving out Old Age Security payments. When it began, the OAS system gave everyone 70 and older $40 per month.
Now everyone who is 65 and older and who meets certain residency requirements, is entitled to OAS. The maximum OAS paid for 2009 is $6,203.52. Old Age Security [...]