1 Comment
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Mar 22.10
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Personal Finances
/ by Ro Econ
Young Canadians are notorious for being incapable of thinking long term with their financial strategies. Fun is the name of the game when it comes to living life to its fullest. What they don’t know is that without any (or limited) savings plans early on in earning years they will be setting themselves up for Freedom 85–not 55. Savings are so low that all financially savvy people are begging Canadians both young and old to think harder about tomorrow and less about the wants of big toys today.
Why? Because expectations are mostly incorrect. What does that mean? Canadians think the government will take care of them, or their company pension will cover their expenses. Fact is: if you want to maintain your quality of life around the same pre-retirement earnings then you MUST save around 10 – 20% of income every year. That’s what former Bank of Canada David Dodge seems to think, and we tend to agree. But all is not yet lost for Canadians wanting to have a bit of fun today, there are ways to approach your retirement savings that won’t leave you bored. Continue reading this article »
4 Comments
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Mar 21.10
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Foreign Exchange
/ by Ro Econ
Q. Why do you think Central Banks might prefer a managed exchange rate system over a fixed or a floating exchange rate?
A. Managed exchange rate systems permit the government to place some influence on an exchange rate that would otherwise be freely floating. Managed means the exchange rate system has attributes of both systems. On one hand allowing one’s currency to be dictated in its entirety by a foreign nation would be undesirable since exogenous shocks from the pegged country would affect your currency. Continue reading this article »
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Mar 19.10
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Personal Finances
/ by Ro Econ
Canadians are now capable of using a tax-free savings account thanks to their Conservative government. The investment device permits up to $5,000 deposit annually without paying taxes on the interest earned. Question though, is the TSFA right for you, and should you use it as an retirement investment tool?
Continue reading this article »
2 Comments
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Mar 18.10
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Foreign Exchange
/ by Ro Econ
Why Higher Dollar Means Bank of Canada Can Keep Interest Rates Unchanged
The Canadian dollar is on a tear, and some think that a correction is due, but over the longterm the CDN dollar is strong given the nature of the economy. Bank of Canada Governor Mark Carney has noted the trend but also considers it some good news if the Bank of Canada is going to fulfill their pledge to keep interest rates the same for another quarter.
So why is it a good thing that the dollar is high if you’re going to plan to keep interest rates the same?
Continue reading this article »
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Mar 11.10
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Energy
/ by Ro Econ
Stole the title from a user on the Globe and Mail comments section. Makes sense though when you consider that without an unequivocal doubt, Ed Stelmach is the worst Alberta provincial leader in its history and anybody who continues to his leadership is equally abhorrent. Yet again, the Alberta conservatives run uncontested raping the natural resources of Alberta selling land and decreasing royalties to expand profits for international juggernauts corporations.
Thanks Ed, you’ve systematically done what every spineless politician does–make rash short term decisions to increase the chances of re-election. A real leader would protect what is a declining and finite one-time use natural resource. Ed is not a real leader…A provincial embarrassment that will destroy the capability for future generations to live off the vast resources and pay for the burgeoning health care costs of the future baby boomers.
P.S. A poor leader also does an about face when he makes a decision. *shakes head*
http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/alberta-cuts-royalties-to-lure-investors-back/article1497481/
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Feb 16.10
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Insurance
/ by Ro Econ
Universal life insurance combines an investment component within a life insurance policy. They are often advertised as a tax shelter or as the best way to save on taxes.
Policyholders are able to choose investments in the policy. Premiums are flexible within the minimums and maximums stated in the contract. The Income Tax Act mandates a maximum investment return. Any gains above that are taxable. If only the minimum premium is paid it is difficult for the investment portion to make any gains.
There are many fees that policyholders must pay. Also within the first ten years of the policy access to invested funds is severely restricted. In all cases a person will pay more than they invested to cancel the policy or get back their investment.
Universal life insurance may be suited to taxpayers who have already maxed out their RRSP or who will have challenges paying tax on the sale of a second property or business. However, objective financial experts agree that investments and life insurance should be kept separate.
Continue reading this article »
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Feb 09.10
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Energy
/ by Ro Econ
Great Oil Sands Article in the Globe Interviewing ex-Premier Peter Lougheed
**Re released after six months. Today the AB government, after years in power, have hit a new low stating a deficit of over 4 billion is to be expected this year. It’s hard to swallow because of the immense wealth this province had and how short sighted conservative politicians spent it all. Those moves will come back to haunt this province.***
One thing that Albertans under the age of 30 just don’t comprehend is why those over 45 are ripping the natural resources from the ground to fatten their already grossly overpaid bank accounts. What’s even harder to swallow is the government in charge is doing everything in their power to facilitate the process.
There used to be a bumper sticker in the early 80′s: “Oh lord, give us another boom and i won’t piss it away.” We got another one, and yes, the conservatives have pissed most of it away. Continue reading this article »
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Jan 22.10
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Personal Finances
/ by Ro Econ
A part of all you earn is yours to keep
This is the time of year when we reflect on possible seasonal excesses and think sober thoughts of cutting back, diets, etc. In the past I have mentioned variations of the dreaded ‘B’ word , and have provided a tool for keeping track of your spending.
Before you yawn and say ‘Not again Scrooge,’ let’s look at finances from a fresh angle.
What does this saying mean to you? “A part of all you earn is yours to keep.” (1)
Some of you may have seen the commercial of the young guy on the street where different strangers are helping themselves to money from his wallet. Eventually he is left with nothing except an old woman warning him she will be looking out for him, or more likely, his wallet.
‘A part of all you earn is yours to keep.’ Yet we willingly enable others to become richer and what does that do to our bottom line? It’s red and thin and theirs is thick and black.
Continue reading this article »
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Jan 20.10
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Investments
/ by Ro Econ
Here is a conversation that was posted in the finance forum before it closed.
“So basically after i get my pay cheque and decide to put my money into an rrsp, that money has already been taxed by the gov’t so how does it really reduce my TI vs. having your employer take the money first to put it in a rrsp for you then taking the taxes off the rest of your paycheque?”
Continue reading this article »
