Pay Day
  • As Monday’s RRSP deadline hangs overhead, Nunavut retirees-to-be are Canada’s keenest contributors, according to tax-filing software maker TurboTax.

    Chalk it up to saving funds to escape the cold in retirement or tackling the absurdly high grocery bills – either way, people from Nunavut top the rankings for highest average RRSP contributions across Canada nearly doubling the typical Canadian contribution of $5,461.06 by earmarking an average $9,372.00.

    The closest second is Yukoners, who set aside an average of $6,774.84 this year. Albertans trail a bit further behind, contributing an average of $6,097.96.

    The software maker has also found only one in five Canadians filing taxes through its platform have contributed to their RRSP.

    City-to-city, Torontonians lead the pack contributing an average of $8,074.21. Calgarians follow, putting $7,487.34 into their RRSPs and Vancouverites are stashing an average of $7,079.38 this year.

    Unsurprisingly, Baby Boomers are the most avid savers

    Read More »from Only 20 per cent of Canadians have contributed to RRSPs with Nunavut leading the charge: Turbo Tax
  • RRSP season always brings with it this unsettling fear that if you don’t have millions of dollars tucked away in some hidden box marked “retirement” you’re in trouble.

    “A lot of people end up freaking out and not doing anything about it because they think it’s hopeless,” says David Trahair, financial writer and accountant at David Trahair and Associates.

    It’s what spurred him to write his latest book, which looks to quell the woes of retirement savings procrastinators.

    “I’m 56, raising kids and paying the mortgage – there’s not thousands or tens of thousands of dollars lying around to put in an RRSP, it’s just impossible,” says Trahair. “But the theme is, all is not lost, there’s a lot you can do in ten years or less and that’s what a lot of people are going to be doing for retirement.”

    A lot of the mentalityy stems from the arbitrary guilt that seems to seethe out around RRSP season, he says, but the truth is RRSPs aren’t always the right approach.

    “A lot of people hear this thing

    Read More »from Money Minute: Who should not get RRSPs
  • The spring housing market is starting to bloom, but before you jump in, it’s worth doing a detailed breakdown of what it actually costs to run a home. There’s more to your budget than property taxes and mortgage payments.

    And speaking of property taxes, don’t assume that what you see on realty websites is accurate.

    “Property taxes may be higher than initially quoted on MLS or Realtor.ca,” says Burnaby, B.C. certified financial planner Satpal Rai. “If you’re purchasing from a senior, for instance, your taxes will be higher if you’re not 65-plus yourself.” 

    Home insurance may be higher than what you’re used to as well, especially if you have a bigger space on a bigger lot further away from fire and emergency services. Figures from InsurEye Inc. from 2012 show that Canadians pay an average of $840 annually for their home insurance, with B.C. having the highest rates, at $924 ) annually.

    Other costs to consider include:

    Utilities

    “Your new home may be more costly to heat,” says certified

    Read More »from The true cost of running a home
  • Patricia Arquette’s call for wage equality is expected to rekindle the debate about what women are being paid in the workforce not just in the U.S., but across Canada.

    Workplace experts say companies that aren’t already working on closing the wage gap between men and women need to act soon, or face losing workers to more progressive organizations.

    “It’s an issue companies are going to have to start paying closer attention to,” says Sheryl Boswell, director of marketing at job-search websiteMonster.ca.

    In her acceptance speech after winning best supporting actress for her role in Boyhood on Sunday night, Patricia Arquette said women have spent years fighting for everybody else’s equal rights.

    “It’s our time to have wage equality once for all. And equal rights for women in the United States of America,” she said, prompting fellow nominee Meryl Streep to jump out of her seat and shout “Yes! Yes!” – a reaction that quickly went viral on social media,

    Read More »from Patricia Arquette's Oscar speech puts spotlight back on gender wage gap
  • John Ferrie remembers how anxious he was when he got a notice from the Canada Revenue Agency a few years ago indicating his tax return wasbeing audited. The Vancouver artist didn’t think he had done anything wrong, but the news still made him nervous.

    “It was a registered letter,” says Ferrie, a painter. “It basically said ‘You’re this number. Make sure you have all your papers lined up.’

    “I just thought, ‘What on earth is going on?’ I’m a really creative thinker, and the first thing you do is just panic. I had no idea where this came from or what it was leading to. I’m the kind of guy with a giant box full of receipts; I have an abacus on my wall and count on my fingers and toes. Nothing else is explained to you; you just have to have your accounting ready.”

    Ferrie says he hired an accountant to help walk him through the process. Although sometimes people just have to mail in documents to support their claims for a tax review, an auditor visited Ferrie at his studio. He was there for

    Read More »from What happens when your tax return gets audited
  • For anyone claiming more than a simple income, navigating the labyrinthine tax sphere ranges from perplexing to paralyzing and, occasionally, both emotions in one sitting. 

    Which is why you can kind of forgive some of the folks at the Canadian Revenue Agency for not having all the answers on what to claim, what’s taxable and what credits are out there for taxpayers, right? Well, kind of. 

    Unless of course, a quarter of business callers to the CRA’s tax help call centres are getting shoddy information as an internal survey recently acquired by the CBC suggests. 

    The startling stat, collected by agency employees anonymously calling one of the three business-focused tax advice centres in Saint John, Toronto and Edmonton, found a 75 per cent accuracy rate to seven routine questions. 

    The CRA gets about 3.3 million calls each year at its tax advice geared call centres and an additional 14 million at its six individual focused ones. 

    That’s a lot of calls. And perhaps, more so, a lot of

    Read More »from Money Minute: Most overlooked tax deductions
  • The final push for RRSP contributions may be on, but a lot of Canadians won’t be chipping in because they don’t have happen to have a tidy little sum of cash just sitting around. You can always borrow to make a contribution. But should you?

    The answer is hardly straightforward. That means people need to think things through before asking for a loan.

    “I’m not the hugest fan of RRSP loans for a few reasons,” says certified financial planner Julia Chung of JYC Financial in South Surrey, B.C. “You’re always working backwards — getting a loan, paying off the loan, and then getting a new loan the following year because you haven’t saved any money towards another year’s contribution, because you’ve been paying off a loan. It’s a vicious circle.”

    Plus, the interest isn’t tax-deductible, Chung says, and “you’re married to investing with the institution that gave you the loan, at least for the life of the loan.

    “Basically,” she adds, “it’s an option of last resort.”

    That said, there may be

    Read More »from RRSP season: Does it pay to borrow?
  • Caroline Battista has a positively upbeat view of tax season, and not just because it’s the senior tax analyst’s busiest time of year. She sees filing your taxes not as something to dread but rather a moment of opportunity.

    “You don’t get anything back the rest of the year,” says Battista, who works for H&R Block in Vancouver. “When you fill up on gas while you’re driving your daughter to ballet, you can’t ask the attendant if you can get a little bit of money back from your gas taxes. This is the one time of year you have some control. If you miss out on credits and deductions, you’re just leaving money behind.”

    If you're not sure what you can, or can't, claim, take a look at our list of the most overlooked deductions and credits.

    Medical expenses

    “Quite often things get missed because this is a rather large umbrella and people don’t know what they’re allowed to claim,” Battista says.

    Some of the often-missed items that can be claimed under this umbrella, Battista says, are travel

    Read More »from Tax time: 9 most overlooked credits and deductions
  • Would you consider yourself a saver or an investor? Chancesare, for most Canadians, the answer would be the former. But you may in fact really be an investor, and your mindset can have a big impact on your potential growth prospects, financial experts say.

    “People who consider themselves savers are usually more concerned with capital preservation than with using their assets to increase their wealth,” says Robert Stammers, director of investor education at the CFA Institute (https://www.cfainstitute.org/Pages/index.aspx). The perception of being a saver could explain why some people are reluctant to take on additional risk to realize higher returns to reach long-term financial goals.

    A defined contribution (DC) survey by State Street Global Advisors conducted last year found that only 31 per cent of US participants, 26 per cent of UK participants and 17 percent of Ireland participants said they feel confident that they will have enough saved through their employer sponsored DC plan to

    Read More »from Are you a saver or an investor? The answer might surprise you
  • Lower gas prices are helping Canadians save hundreds of dollars at the pumps, but the majority aren’t doing anything with the extra cash, a new survey shows.

    A recent GfK poll shows 58 per cent of Canadian drivers haven’t changed their spending or savings habits despite the roughly 40-per-cent drop in gas prices in recent months. 

    Only 19 per cent are socking the extra money into savings, while 15 per cent say they’re buying more gas and 9 per cent are driving more often.

    The results don’t bode well for the Canadian economy and predictions the money saved will fuel consumer spending. They also don’t offer much hope that Canadians are working harder on reducing their growing debts.

    “Although falling gas prices are putting a good deal more cash in Canadians’ wallets, most do not seem to be making conscious decisions about what to do with that money,” says Stephen Popiel, VP at GfK Canada.

    The Bank of Montreal recently estimated Canadian drivers could expect to save about $1,500 this year

    Read More »from How are Canadians using their gas savings?
  • So you’re beginning to realize no amount of advanced yoga classes will make you flexible enough to fold yourself into a suitcase and the hypnotize-yourself-into-thinking-the-slush-is-white-sand trick isn’t working either. 

    Stop right there – you’re doing it wrong. 

    Look, trading the winter blues in for sea blues and exotic locales isn’t about contorting yourself (gross) or hypnotism (impractical) it’s about being savvy and spontaneous. 

    It’s about thinking outside of the box says Michael Duchesne, publisher at vacay deal hunter TravelZoo.ca

    “(Forget) the myth of not getting a deal in peak season,” says Duchesne, who devotes his time to diligently combing through deals with his team and curating newsletters espousing their finds. “Right now, you could go to Mount Tremblant, get a studio with a kitchenette for about $139 a night, that’s almost slope-side as well.” 

    Not a bad deal for a couple or a small family, he says adding that it’s just about knowing how to look. 

    Search before you

    Read More »from Money Minute: Exotic but affordable getaways
  • This Saturday is Valentine’s Day —  that greeting-card-inspired celebration that turns up the heat on romance and inspires mad gestures of chocolate and roses.

    It also happens to fall smack in the middle of tax season. And, believe it or not, the Canada Revenue Agency is almost as interested in your relationship status as your mother is.

    It’s not uncommon for taxpayers in Canada to be confused about the tax rules and how they intersect with our love lives.

    A recent survey by Leger, on behalf of H&R Block Canada, found that more than half of us mistakenly think that married and common-law spouses can file a joint return to save money on their taxes. Another 40 per cent believe it’s up to us to decide whether to claim our marital status on our tax returns, while a handful of respondents doubt the CRA has guidelines to determine that status.

    Truth is, there are rules around romantic partnerships, lots of them, and failing to fully comprehend the finer points could cost you money and get

    Read More »from Love and taxes: Canadians confused on how marital status impacts deductions, credits
  • Ah Valentines day, look how far you’ve fallen – from a day devoted to romantic love and rosy-cheeked cherubs to the soapbox of cynics dodging cupid’s chokehold.

    Naturally, the fall was by our own device – love, it seems, has become a very expensive thing.

    According to comparison website RateSupermarket’s annual breakdown, the cost of love from awkward first dates to faces smeared with wedding cake has climbed 11.4 per cent from last year.

    The price tag of adoration you ask? $50,339.21 total, which includes just over $7,740.21 for a year of dates, dinners and a Netflix subscription, $10,913.19 for a year of engagement including the ring and $31,685 for the average Canadian wedding as per Weddingbells magazine.

    To put that in perspective, that’s slightly less than the $50,576 downpayment made by the average first time homebuyer.



    Valentine’s Day = more spending

    With that in mind, we suppose the standoffish attitudes towards Valentine’s Day are somewhat understandable. Especially when they

    Read More »from The cost of cupid's chokehold: $50,000 and counting
  • Sometimes life throws curveballs, and you never know when you might find yourself holding a fundraising event for friends or loved ones in need. Maybe they need help covering costs for things like medical emergencies, funeral services, unexpected travel or the fallout from a disaster for which they didn’t have insurance.

    It’s a steep learning curve, and bake sales will only get you so far. Here are a few steps to get you started on hosting a successful event that will bring in the bucks plus be a lot of fun.

    Look to online platforms to extend your reach (but beware that “free” doesn’t necessarily mean free)

    Assuming the recipients have given the go-ahead to go public with their plea, there are all sorts of websites that allow people to donate to various, independent causes, including YouCaring, GoFund Me, FundRazr, MyEvent, and more. Some claim to cost nothing — but, in fact, still involve fees.

    MyEvent, for instance, has a 2 per cent service fee plus a fee of 75 cents per ticket or

    Read More »from Holding a fundraiser? A few tips on how to throw a great event on a budget
  • Gas prices across Canada are starting to creep back up, but they’re still well below what they were last summer. That means extra money in your pocket. What to do with it?

    Consider your options before going on a shopping spree.

    For starters, you could estimate how much you’re saving withevery fill-up, then after hitting the pump, put that money aside.

    “You don’t need to go as far as placing the monies in a bank account,” says Anthony Larsen, certified financial planner and money coach with Money Coaches Canada in Vancouver. Having a “Gas Savings Money Jar” can be very motivating to look at.”

    Start or build up an emergency fund

    “Put your savings at the pump into savings for a rainy day if you don’t have an emergency fund,” says Leony deGraaf Hastings, certified financial planner at Burlington’s deGraaf Financial Strategies. “When an unexpected expense comes your way, you will be glad you had a cushion.”

    Chip away at debt

    “Pay down debt by making an extra payment on your credit card or

    Read More »from Saving at the pump: 8 ways to use that money wisely
  • Canada’s a teeter-totter. A slab of metal stubbornly placed in the center of a schoolyard with oil-owning provinces like Newfoundland or Alberta set on one side and manufacturing-driven Ontario on the other.

    Sometimes they balance, but it’s a hard act to keep up.

    What’s in the center? Oil – or the loonie, either really, take your pick.

    “There’s this very tight relationship between oil prices and the Canadian dollar, they move in tandem,” says Mike Moffatt, an economist and assistant professor at University of Western Ontario’s Richard Ivey School of Business. “Asking whether or not the Canadian dollar is going to go down or up is basically asking whether or not oil prices are going to go up or down.”

    It’s a paradox of diversity overlooked by the nation’s founder who sought to smoosh the resource-rich west to the peopled east. Sorry, but Canada is kind of a one trick pony.

    Sure, other exports are important when it comes to the loonie says Moffatt.

    “But the price of cars doesn’t change

    Read More »from Money Minute: Why the dollar is sinking
  • It was only about a decade or so ago that it wasn’t uncommon to see line ups stretching outside bank branches across the country this time of year.
    February is the height of registered retirement savings plan (RRSP) season.

    This year, Canadians eager to defer taxes from 2014, and sock some money away for the golden years while they’re at it, have until March 2 to make a contribution.

    But, lately, it seems we aren’t as keen on RRSPs as we used to be. A new survey by TD Bank found that nearly half of all Canadians don’t contribute to one.



    A staggering statistic, really, when you consider that the same survey found that 45 per cent of us plan on using our RRSPs to finance our post-career dreams of travel, starting a small business or volunteering with a favourite charity.

    Still, it’s perhaps a more comforting picture of our collective retirement savings’ effort than recent data served up by Statistics Canada. In a paper published last March, the national statistics agency found slightly

    Read More »from Cash flow, debt keep Canadians out of RRSP season

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