It’s been over 12 years since Ottawa did a pivot and taxed income trusts. It was a shock. Actually, a betrayal. In the election campaign a year earlier the Harperites promised the sweet tax treatment of income flowing from these vehicles would never be changed. Then, boom, the hammer fell.
Hardest hit were those investors who had the most money stuffed into high-paying trusts – wrinklies, many of whom needed the retirement income. It was a disaster, but the government didn’t care. Stephen Harper just wanted to plug a tax loophole.
So, some people worry. If the feds could shut down a popular tax-saving vehicle overnight without opposition, couldn’t RRSPs or TFSAs be raided in the future?
Here’s a comment in that vein from yesterday’s riveting blog:
I have a large amount of money saved in RRSP and TFSA and I am hoping to use both of these in retirement which may be 5 – 10 years away. However, I have this fear. Fear of government. I fear that there will be governments in the future that are much like the current government, but even more desperate for revenue to feed their debt. People like us and ones on this blog will be the minority. As such the promises made by past governments will be broken,…and no votes lost. They will systematically remove our savings, ”for the good of the majority”. They will find a way to twist it as a good ethical decision, as it is what they have to do…
that is my greatest fear….
Is this valid? By having ‘registered’ investments like RRSPs, TFSAs, RDSPs and RESPs – which are 100% visible to governments at all times – are citizens setting themselves up for some kind of future confiscation through taxation? After all, as reported here, the middle class is sleepwalking towards a cliff. The savings rate has plunged to less than 1%, household debt is off the charts and governments have repeatedly proven they’ll curry votes by taking from the ‘rich’ and redistributing wealth. Look at the T2 administration’s first major act – gutting TFSA contribution levels, saying they benefited only the wealthy, while slapping on a new tax bracket for high income-earners. Is it not obvious where we’re headed, comrades?
Yes, it is. But there are good reasons to believe that never in this lifetime will Ottawa ever reverse course and tax RRSPs or TFSAs. The first is simple: with low savings and huge debt the last thing Canada needs is more people depending on the government for income. Already old age payments are crippling federal finances – about $40 billion now, expected to balloon past $100 billion by 2030. The country needs future retirees to be financially independent, so taxing the RRSPs of those who have prepared is just bad public policy.
Second, it would be political suicide.
There are about 14 million households in Canada, and two-thirds of them have a TFSA, an RRSP or both to which a contribution is being made, according to StatsCan. The tax-free account, in particular, has been widely embraced by people – even though most use it as a glorified savings account for discretionary spending (fail). This jives with a growing meme among people – especially younger workers – that there’s no point investing through an RRSP since the money coming out of the plan is taxed. A CIBC poll last year confirmed that, in contrast, almost 70% of people prefer the TFSA because withdrawals are completely tax-free.
So, TFSAs are off the table for political reasons, and also because contributions are made with dollars that have already been taxed. In theory they won’t be taxed again.
RRSPs, as you know, are different beasts. Contributions come from pre-tax dollars. When you put cash in, you get your taxes back. The money grows free of tax over the years, then you return tax to the government upon withdrawal. So if Ottawa decided to tax outstanding RRSP balances, it would just be collecting its cut early. That might not be too much of a stretch for a future government, especially one formed by a political party that starts with ‘N’ and ends with ‘P.’
But wait. RRSPs are actually trusts. And they’re protected under the federal Bankruptcy and Insolvency Act, which is a pretty good precedent for arguing that these accounts are untouchable by anyone. In fact when someone hits the bottom of the financial barrel, the courts or CRA might garnishee their income, Hoover off their bank account and investment assets, seize their TFSA and even their kid’s RESP, but the RRSP is inviolate. This is why lots of entrepreneurs (high-risk takers) choose to keep their personal wealth inside one, and why trustees in bankruptcy tell clients to do the same. So long as cash has not been moved into an RRSP within a year of bankruptcy, it’s safe.
And while going broke is an unequal risk to being taxed more by a hungry government, you can see why attacking RRSPs would be unlikely in the extreme. A far more reasonable threat would be a gutting of RRSP contribution limits, particularly for high-income earners who can now salt away a hefty $26,000 a year, slashing their tax at the same time. After all, if T2 could do it to TFSAs without much of a public whimper, well…
Conclusion: the more you stuff into an RRSP at this time, the better. They are tax-shifting vehicles, whether you use them to fund retirement or not. They’re creditor-proof. The provide tax-free growth. They let you chop current income tax. And the sweet, sweet advantage they provide to 1%ers may not last. You have nine days.
150 comments ↓
Garth,
I’ve made the same comments before on your comments section and been shot down by you. You have more faith than I.
Check this one out about Illinois…
Illinois may tax private retirement funds to pay public worker pensions
Fox Business Videos•February 18, 2019
The government will never go “bankrupt” as long as there is private wealth that they can get their hands on. This is easiest with anything that is “registered”
You still think Bitcoin has no future. Check back in 10 – 20 years….
Resps are a load of crap… the entire system of funding post secondary education should be rethought.
Full disclosure I have resp contributions maxed out for my son. I’m ethical, I play by the rules.
My issue is this;
Why do children from low income families get big breaks (under the former liberal government it was free) to go to school? While kids from more affluent families need to pay?
At first glance the answer is obvious, the parents can afford to pay. How about a situation where the parents are estranged? Since when does the income of one adult (parent) have an impact on another adult (18 year old attending school)?
If grands and free education is given based on income it should be based on the individuals income.
Would you guys put money into RRSP if you had a defined pensionable plan?
# a guy in vancouver
So from $295k in 2001 to $1.58 mil eighteen years later in 2019. Could someone calculate the average yearly return on that investment?
You need to find the value x, for which x to the power of 18 equals 1580/295.
x ** 18 = 5.45
x = 5.45 ** (1/18)
x = 1.099
Hence, a 9.9% gain per year.
Granted, it outpaces inflation by a long shot, but not nearly astronomical as you would have thought at first glance. It also outpaced TSX.
But this is an outlier. Most homes in Canada are far, far below these gains.
PS: Thank you flop, for digging up the sale price. I appreciate it.
The vast majority of Canadians are dumb and financially and math illiterate. This includes well educated people like lawyers and doctors. I’m a doctor, and I saved prudently. I’m able to retire in my mid thirties but am still working for fun. I have no need to make as much money as possible and no fear of our regulatory body as I don’t need the money. I work for fun. I enjoy my work and excel at it. I have no time pressures. I have no external pressures because my lifestyle is not dependent on an income. As a result I provide excellent care as I’m able to spend the time with my patients without watching the clock to bill as much as possible.
Vast majority of folks prefer a pension. This is funded from investment returns, usually invested in Canadian corps. My leftist colleagues want to tax the heck out of corps, decry them as evil, and gut profits. This means investment returns will be gutted more and pensions may become insolvent. They then wonder what happened to their pensions. Using government to tax corps and then to redistribute wealth as vastly inefficient as there is an extra step of paying taxes to the government first which then redistributes wealth. Much easier to just let corps make the profits, give out dividends to pension funds and then redistribute that way. Most Canadians don’t have the know how to personally invest anyway. Much more efficient for these folks to let CPP or their pension plan take care of them. Unfortunately leftists like th NDP only see corps as evil.
I’d forgotten about the gutting of income trusts. Another disastrous Harperite policy to add to his cutting the GST.
Question : Can elimination ( or modification ) of mandatory drawdowns from RRIF in next budget a possibility ? It is after all an election year . Would be a blessing for retirees .
Speaking of Trudeau.
Will he be at the head of the Welcome Wagon when the “Pipeline Caravan” arrives in Ottawa this week?
https://www.bnnbloomberg.ca/pipeline-protest-convoy-approaches-ottawa-after-rolling-across-country-1.1216000
Protesters driving across Canada during one of it’s coldest winters in years…….. methinks Mr Trudeau may be fighting an uphill battle this election.
Speaking of uphill battles…
Good old SNC Lavalin may have helped NDP leader Jag Singh win the unwinnable out here in South Burnaby.
Now who would have thought that……..
For people worried about the tfsa shelter:
It actually shelters in two ways:
* Taking it out, you face no capital gains tax.
* But it also shelters your dividends.
If the government ever decides to tax cap gains after all (and I agree, far too unlikely to ever happen, but for the sake of argument, let’s pretend) then you will still have your dividends sheltered.
So load up the tfsa with stocks/ETFs that pay out as opposed to grow and gain in value. After all, you are the (part) owner of the company, so you get to reap its profits.
There are exactly 0 ways in which a hellbound and broke government can retroactively tax dividends in your tfsa. The practicality is just not there.
Hoover off their bank account and investment assets, seize their TFSA and even their kid’s RESP, but the RRSP is inviolate.
===================================
Not True in actual practice.
I know someone who declared bankruptcy. He had some 18k in RRSP’s. He defaulted on loans and CC’s with Scotia Bank. Scotia took his RRSP’s plain and simple.
I was appalled that this could happen. His bankruptcy trustee apparently told him that they broke the law but the trustee advised him to not bother as he would have had to sue to get it back.
He was broke, there was no money for lawyers!
Another Myth busted.
No myth. This has been the law for over a decade. – Garth
Never say never.
I am under no illusions that in future the TFSA might end up being taxes or restricted in some way. I treat it just as my non-reg. Which I know the non-reg laws will never get changed as that’s how the wealthy invest.
RRSP, unless you know what you’re doing is a terrible idea for most. Stuck with dead GICs or crappy mutuals making at most 2% peddled by [email protected]. To only be then told how much you can withdraw and be fully taxed on top of that!
I’ll be sticking with my non-reg thanks, still have about 1/5 my portfolio in RSP that I manage.
Isn’t it a bit disingenuous to claim that Trudeau “gutted” the TFSA limit? After all, Harper raised it that one single year as a vote-buying tactic before the election, right? Trudeau simply returned it to the status quo. And the Libs have since nudged it higher, which bodes well for a more reasonable rising ceiling as time ticks on.
Well, Gerald Butts is out.
Since he was the “real” Prime Minister, I can only imagine the chaos in the PMO right now.
Today, on Family Day, the PM’s principal secretary (and chief advisor) has chosen to ‘spend more time with his family’
https://www.theglobeandmail.com/politics/article-trudeau-aid-gerald-butts-resigns-in-wake-of-snc-lavalin-scandal/
Or, more accurately, to fall on his sword.
I’m not sad to see him go. Maybe the Liberal platform for 2019 will be more fiscally responsible as a result.
You forgot a couple of things the government could do without a ton of fallout.
-tax large accounts, similar to the day trading rules for tfsas. “It’s a savings vehicle not a speculative vehicle” is similar to “it’s a savings vehicle, not designed to make you rich”.
-put the 30% foreign content rule back in place. “You should invest at home to support our economy”
!!! Extra, Extra !!! Breaking News !!!
Gerald Butts, the butt-head who helped orchestrate Ontariowe’s disastrous Green Energy policies under former Premier Doltown McShifty has just resigned from Trud’oh!’s government.
Butts is the guy who whispers nonsense into the ears of gullible politicians who lap up his eco-fantasy mumbo-jumbo.
I guess Butts had to be the fall-guy for the whole SNC-Lavalin-gate scandal thing that still won’t go away…
Justin: He’s just not ready…
Australia changed rules for Old Age, so it is asset tested, from 2017. Value of principal residence not calculated in assets.
https://www.choice.com.au/health-and-body/healthy-ageing/ageing-and-retirement/articles/pension-income-test-changes
Tax and spend
We have to remember that the socialists want everyone dependent on government then they have control of the population. They then hand out crumbs to the population to get your vote. If you want to know where this will end up just look at Venezuela. Liberal plan tiny baby steps till it is to late to change and they control everything. Been watching this all my life.
#5 Bob – What is your secret of saving? The average M.D. would open an office at age 25, and to specialize would take from 3 to 5 additional years. The average M.D. in Canada earns about $200,000 annually before taxation. Your about 35 years old so how could you possibly retire with a life expectancy of 80?
@ #1 AM in MN , currently Illinois does not levy an income tax on retirement income at all. All pension earnings are tax exempt, whether from public pension, private pension, or social security. And yes, they are considering changing that, since the court ruled that they could not reduce benefits to retirees. They are not looking at taxing the money inside private plans, even if that’s how Fox News is trying to spin it. They are looking at ending the tax exemption for all pension income. And really, why should retirees be tax exempt? They don’t use services or drive on roads like the rest of us? I’ll be a retiree some day (in Canada) – I expect I will be paying income tax on all my income. Illinois retirees will need to get used to the fact that they aren’t special.
It’s been over 12 years since Ottawa did a pivot and taxed income trusts. It was a shock. Actually, a betrayal. In the election campaign a year earlier the Harperites promised the sweet tax treatment of income flowing from these vehicles would never be changed. Then, boom, the hammer fell.
Hardest hit were those investors who had the most money stuffed into high-paying trusts – wrinklies, many of whom needed the retirement income. It was a disaster, but the government didn’t care. Stephen Harper just wanted to plug a tax loophole. Second, it would be political suicide.
…………………
Really ? Harper was re-elected after killing the income trusts.
As stated, two-thirds of Canadians have a TFSA or RRSP. Income trust holders were a small cohort. Political suicide. – Garth
#12 TBB on 02.18.19 at 2:17 pm
Isn’t it a bit disingenuous to claim that Trudeau “gutted” the TFSA limit? After all, Harper raised it that one single year as a vote-buying tactic before the election, right? Trudeau simply returned it to the status quo. And the Libs have since nudged it higher, which bodes well for a more reasonable rising ceiling as time ticks on.
———————————————————-
That nudge is a programmed auto pilot increase, in response to inflation, no kudos to Libs for that. Unless you count not screwing it up more and taking that element away as a plus. Gutting is fair terminology for a 50% cut IMHO…
Given well documented job / salary economic conditions etc, the RRSP as a defer higher taxes tool is less relevant with flatter salaries over a longer time, so, the TFSA is even more vital and relevant at $10000 limits as a real personal retirement tool…
RRSP are creditor proof, while TFSA are not – learnt something new. Why is that?
Michael Bublé sold his West Vancouver mansion.
Paid $4.55 million in 2007.
Sold $5.18 million in 2018.
A whopping 14% profit after 11 years, before deducting fees etc.
http://www.theglobeandmail.com/real-estate/the-market/article-michael-buble-sells-west-vancouver-mansion-for-18-million-below/
#10,
What you put in an RRSP the year before going bankrupt isn’t creditor proof. Maybe this is why your friend got screwed.
#14 Smartalox on 02.18.19 at 2:26 pm
Today, on Family Day, the PM’s principal secretary (and chief advisor) has chosen to ‘spend more time with his family’
Trudeau next.
We should just have an auction for the Prime Ministers seat to the highest bidder. Who needs elections or taxes?
The I.B.M corporation could run this country better than any government could
#12 TBB on 02.18.19 at 2:17 pm
Isn’t it a bit disingenuous to claim that Trudeau “gutted” the TFSA limit? After all, Harper raised it that one single year as a vote-buying tactic before the election, right? Trudeau simply returned it to the status quo. And the Libs have since nudged it higher, which bodes well for a more reasonable rising ceiling as time ticks on.
—————————————————
Every party engages in vote buying. I would say doubling the TFSA is the most responsible type of vote buying imaginable. An easy way for middle class to shelter more of their income from tax while promoting saving. Far more responsible than the Liberals extending the CHILD benefit to 17 year-olds, FFS!
One butthead down, one more to go.
Why does someone who did nothing wrong need to resign?
Smoking Man, can’t wait to hear your comments about your Butts buddy.
I share this concern. I imagine for the commenter who is 5 years from retirement, this is unlikely, but it is hard to know how things might change in 20-30 years for a millennial like me.
I think it is less likely for something like an RRSP or TFSA, which affects more people (aka voters) and much more likely for vehicles like a professional corporation or individualized pension plans which affects less people. I’m a medical resident and I have heard horror stories of physicians near the end of their careers who saved all their money in their corporations in lieu of RRSPs because it was slightly more efficient (no CPP payments). With the new corporation rules, the retirement plans of these people have been affected just before they retire and after decades of saving.
I think the best strategy is one of diversification. Max out as many different tax shelters as possible and hope that if the government goes after one account, you’ve still got money in another.
Medical professionals have received awful advice for decades from accountants, and peers, with regard to retirement planning. – Garth
So, TFSAs are off the table. In theory they won’t be taxed again.
______________________________________________
Communism is a really great idea in theory.
Says who? – Garth
#17 Hajrin on 02.18.19 at 2:34 pm
Australia changed rules for Old Age, so it is asset tested, from 2017.
_______________________________________________
I am concerned that the clawback threshold for OAS will be lowered at some point.
I retired early and am now withdrawing my RRSP before I turn 65 to avoid clawback of OAS and the Age Amount.
#5 Bob – What is your secret of saving? The average M.D. would open an office at age 25, and to specialize would take from 3 to 5 additional years. The average M.D. in Canada earns about $200,000 annually before taxation. Your about 35 years old so how could you possibly retire with a life expectancy of 80?
—-
Yes, I would like to know too. I am 33 and still in sub-specialty training (almost the end now!). I have been frugally saving my trainee salary ($15,000 of my $60,000 post-income, or about 25%) for the last 7-8 years and have not completely paid off my medical school debt. I can’t imagine how I could possibly be financially independent by 40 let alone 35.
This gentleman stated that neither he or anyone else in the PMO’s Office influenced the Attorney General. He just resigned because needed to get away from it all; perhaps he needed a vacation or a career change. Nothing to hide here, or is there some smoke with a fire burning?
Never been comfortable with RRSPs, so the room just built up slowly for around a dozen years without ever contributing, then I had one of those homerun stocks and the RRSP ended up being invaluable.
Not sure if in my early 40s it’s starting to get too big or unfavourable ($270k between RRSP/LIRA) considering I have no family/kids and a low-key lifestyle.
#35 Butterhead on 02.18.19 at 4:40 pm
This gentleman stated that neither he or anyone else in the PMO’s Office influenced the Attorney General. He just resigned because needed to get away from it all; perhaps he needed a vacation or a career change. Nothing to hide here, or is there some smoke with a fire burning?
—
In chess it is called queen sacrifice.
In this case it will be remembered as
#drama queen sacrifice
Rotting from the Butt first…
I wonder if he’ll charge his $200,000 in moving expenses to move away from Ottawa this time…..
#32,
Why do anything but the absolute minimum required to survive in a communist country? Sure, we’ll all sacrifice for the betterment of society. Maybe some will. Most won’t.
Well, well well,
When Trudeau said, “I didnt speak to Jody Wilson Raybould about SNC Lavalin” …..
and the rumours were
” The PMO’s office was pressuring her….
It didnt take 1 +1 to figure out someone in the PMO’s office very high up may have been issuing “orders”.
And now Butts jumps on a sword for the good of the party…..
Too little too late.
Amateur hour meets the real world of politics.
“Hero to Zero” in a day.
I love it.
So does this mean SNC gets a “pass” ?
Governments are already going after registered assets
1) TFSA- if you work in investments a small numbef of active traders have been taxed – class action lawsuit making its way now. Even though 95% of active traders lose money over time the CRA has decided to selectively go after the few who made money
You can bet as rates go negative and QE really gets going with stocks exploding higher to respond to the currency devaluation they will start going after non investment account holders
2)rrsp- easy to get this account in 2 ways: CRA has for the last few years and confirmed recently that any “speculative” gain in a registered plan is potentially subject to tax as income , and more easily the govts will simply declare government bonds as the only eligible investment in a registered plan and apply a surtax on any withdrawals above 15 k. Easy , RRSP effectively confiscated even though you still see it in your name
3) non reg accounts – easy too. Govt simply increases capital gains tax to 75% and as the currency declines steadily people will see their wealth, after taxes, fees, inflation, has been taken. And ironically the bigger the gain the bigger the after tax/after inflation wipeout
After you pay your real tax on the IMAGINARY gain you will have to use that money to pay 7-800/week for groceries and other high costs
And worse comes to worse for the very few who make a serious gain a targeted audit program with an assessment taxing the windfall gain as income or an actual windfall gain is easily Doable
All governments have and will go after investors as easy food once the sovereign debt crisis hits Canada as it inevitably will within 5 years or so
This is historic fact – if anything the SNC lavalin Case is but a minor slip that goes to show you how corrupt the Canadian governments are
And you’ve seen nothing yet
Tangible and movable assets folks
And small homes
And a good CPA who does your taxes conservatively
Check in with me by mid 2020s
Let’s see how all you with “big” RSPs and TFSAs
“but the RRSP is inviolate.” Garth.
Is that so during a divorce assets splitting?
Stay married. – Garth
2 down. 1 to go.
Well, now that the BRAINS behind Justin is gone, we’re not left with much other than a Pretty Face, some fancy Indian dance moves, virtue signalling and costumes/socks.
More fun for me until October.
If Justin asked Butts to resign, that is strategically dumber than a sack of hammers, box of rocks…aaaannnd, then some. Fire somebody lower down the food chain in case they aim high and accusers have their way.
I they aim high now, it’s you Justin they’ll be after.
SO NOT his father’s son in the brains department, not even close.
Well Liberal Elite, I hope you’re happy with what you gave us for a PM.
All that glitters is not gold.
Even if a tax-strapped government did raid TFSA or RRSP holdings, how much could they get? Would it be enough to meet future debt or other obligations? This is not a rhetorical question. I really wonder if it would be enough to even matter.
Second, it would be political suicide.
…………………
Really ? Harper was re-elected after killing the income trusts.
As stated, two-thirds of Canadians have a TFSA or RRSP. Income trust holders were a small cohort. Political suicide. – Garth
……………………
Harper was re-elected for a second term with a gretaer number of seats than he won the first time. Not exactly political suicide or even a mild punishment.
As stated. – Garth
@ Im stupid
I believe the reason governments will give free education to low income families while not giving that benefit to non-low income is because they believe non-low income families perpetuate their advantage by providing their kids with better education. So the government wants low-income families to follow that same process, if they can get the current generation on that conveyor belt there will be better outcomes for that family and society in the future. But that assumes, that life is static, we all know many children of privilege that ended up destitute and many poor kids that ended up rich. The other assumption is that the economy and number of jobs will keep increasing, which I fear is a wrong assumption. Personally I think providing tuition free education to low income families will divert them onto a unhappy path. Better to provide skills training in jobs that won’t be off-shored or automated away.
Most cities, state govts, in the USA are essentially broke. As politicians get more desparate you would be foolhardy to assume that registered programs are safe.
As stated here Illinois is planning to tax 401K’s.
Never underestimate the enemy. They have regulation and we have nothing but the ability to move.
That’s it….. Govts in Canada are far outreached their ability to ever pay their bedt or meet their public sector entitlements.
I know of plans to do something like this from friends who know these things.
The time to move though is getting less as CRA drafts plans for an exit tax of 30-50%.
In essence most people are trapped in the fishbowl
#13 Howard on 02.18.19 at 2:26 pm
Well, Gerald Butts is out.
Since he was the “real” Prime Minister, I can only imagine the chaos in the PMO right now
================================
New Netflix series. The Fools on the Hill.
…besides Butts being fired, I mean resigned, that was a very good RISK discussion today on tax deferred or tax savings plans.
Something most of us would not have considered, including me.
As usual, nicely done G.
Govts will attempt “tax the rich” schemes in the G7.
What few politians get becuae tey are essentially financially unaware is that smart capital moves before they ever get to regualtion.
Most people in my sphere left already and many people I know who created jobs and wealth are in the process.
If a person works 70-100 hour weeks, risks capital to succeed why the hell would you ever let the govt take 70% por more of your wealth to feed layabouts and public sector pensions and fatcat public salaries?
Only the foolish…
Thus, the tax the rich schemes end up targeting those who are left…. No pun intended
#48 gfd
Nah.
With the Brains gone, it will now be more like we’ll get to see the Real Slim Shady, Please Stand Up.
Goodbye Gerry! Smoking Man is gonna love this! Infighting in the PMO? Right before the election? Andrew Scheer stay near because it is clear you will be here with no fear and grab a beer and sing a cheer! Bye Bye Butts!
You are all barking up the wrong tree.
Government wants you to save YOUR OWN MONEY for retirement.
The government’s full intention is to change the income threshold to roll back OAS.
If you have income of more than $40,000 per year you don’t need an OAS subsidy.
The rollback will occur in stages.
This is inevitable so prepare accordingly.
Don’t be naive.
Government is desperate for money. They have no intention to cut costs. Deal with it, after all you are Canadian. You are conditioned to put up with it.
Hell hath no fury like the recipient of a tax break when it is taken away. The tax break immediately becomes a lifetime entitlement in their minds apparently.
#3 Akhtar on 02.18.19 at 1:37 pm
Would you guys put money into RRSP if you had a defined pensionable plan?
I would (and do in fact). It’s inevitably an inconsiderable amount, but not reason not to shelter a bit more.
“but the RRSP is inviolate.” Garth.
Is that so during a divorce assets splitting? Yanniel
Stay married. – Garth
Or stay single! :-) Yanniel
A TFSA question for anybody who may be able and kind enough to answer:
What would you buy with funds in your TFSA (maxed out) if it were in USD (the only available option right now) if you were reluctant to convert to CAD. Buy growthy stuff — whether ETFs or individual stocks — on NYSE etc. and be fine with the US withheld 15% tax that you can never claim?
TIA for any helpful suggestions!
Buy bitcoin. Wealth insurance.
Aside: https://blogs.imf.org/2019/02/05/cashing-in-how-to-make-negative-interest-rates-work/
I seem to remember around 2009 that our government was funding our CPP in part through Income Trusts. So they got while the gettin’ was good and then turned off the tap for the little investor.
@#31 sail away
In my experience after 30-plus years previously living in the US, I find the Canadian healthcare system frustrating for a healthy person with infrequent injuries and illnesses as it’s very difficult to book appointments with a family doctor, and the walk-in clinics and ER always seem to always be filled with junkies, which results in excessively long wait times. This doesn’t happen in the US because… no insurance, no luck.
Of my hundreds of US relatives and acquaintances, I know of nobody driven to destitution by healthcare costs. That argument, often presented stridently, is much overused unwitting hyperbole by people who have experience with only a socialized-type system.
Yes, salaries are higher in the US, taxes are lower and prices are lower. Does Canada have advantages over the US from an economic or healthcare perspective? Again, in my experience… no. And significant downsides.
In my experience after 10-plus years previously living in the US, three different states, I find the Canadian healthcare system a dream for a healthy person with infrequent injuries and illnesses as it’s dead simple to book appointments with a family doctor online compared to calling the toll-free-and-wait-on-hold forever HMO number, and the walk-in clinics with their slick ipads based reseveration systems are amazing – lists all the docs and their wait times. pick the doc you like, or get the next one up, beautiful. This doesn’t happen in the US because if you are traveling outside the coverage area of your HMO… no insurance, no luck, call the toll free travel number and pray….
Of my hundreds of US relatives and acquaintances, I know of many driven to destitution by healthcare costs. My facebook page currenty has two familes being destroyed by cancer. A good realtor friend of mine is donating $500/house sold to one of the Go Fund Me’s, another friend is beg-posting for her uncle as well. Healthcare costs are the #1 purpose of Go Fund Me campaigns…
Yes, salaries are higher in the US, taxes in California were about the same as Ontario and prices for electronics are higher (due to tariffs on taiwanese imports) and food prices about the same. Does Canada have advantages over the US from an economic or healthcare perspective? Again, in my experience… yes. And significant upside in terms of family life, safety, and public education.
Thx Garth. I had a question, you answered it.
I still feel a little queasy..,.but…. The Marlies won.!?
Holy Smokes!
Butts and Telford abandon the SS T2 Ship.
Looks like the libs are imploding.
Butts next Job. UN is my bet.
So taxing tfsa returns would be political suicide? but halfing contribution room was met without a whimper from the public.and the latter actually has far greater implications. It cut the possibilities for future tax sheltered wealth by 50% which is far less than taxing withdrawals as income would have done. As usual Garth you greatly over estimate the rationality of decisions the Canadian public will make and the fortitude they have for tolerating injustice.
#50 expat on 02.18.19 at 6:01 pm
If you leave the G8 countries, which other low tax country will give you citizenship (besides Singapore whose now reducing that as well).
Besides a few island countries I can’t think of any country that would be worth moving to that has both low taxes and still gives citizenship to foreigners.
#5 Bob on 02.18.19 at 1:45 pm
Bobby if you are doc iam sure you are familiar with Illusory superiority, if not here is wiki link.
—
For illusory superiority to be demonstrated by social comparison, two logical hurdles have to be overcome. One is the ambiguity of the word “average”. It is logically possible for nearly all of the set to be above the mean if the distribution of abilities is highly skewed. For example, the mean number of legs per human being is slightly lower than two because some people have fewer than two and almost none have more. Hence experiments usually compare subjects to the median of the peer group, since by definition it is impossible for a majority to exceed the median.
https://en.wikipedia.org/wiki/Illusory_superiority
@27 No Cash …….”The I.B.M corporation could run this country better than any government could”
Yes, they’ve demonstrated that clearly … with the CDN$1billion dollar Phoenix pay system.
If Butts wasnt fired by Trudeau…..then he’s see’s the writing on the wall and bailed before the shite hit the fan.
Either way.
Justin just lost his brain.
If Gregor Robertson firing Penny Ballem in Vancouver is any indication of what is next……we should see gaff after gaff.
Fun times!
Lovin it!
Gone With The Wynne and The Fools on the Hill in a theatre near you come this fall.
Real life drama. . . make sure you bring your own Kleenex, it’s supposed to be a tear jerker.
#3 Akhtar on 02.18.19 at 1:37 pm
Would you guys put money into RRSP if you had a defined pensionable plan?
————————————————————
Akhtar, especially as long as those left over contribution $$ after DP pension accounted for are taxable in a higher tax bracket now then when you expect to retire then sure, invest the tax “refund” as well to maximize impact. Have you maxed TFSA as well though?
If you are expecting a major bump in income in next couple of years then you may want to bank the RRSP a bit to increase later return from CRA but don’t lose too many years of compounding tax free growth either…
In the end it depends on your circumstances though…
What’s next on Butts’ resume? The Tide Foundation? The Senate of Canada” Jeez Garth … thanks a lot for reminding me why I hated your Elfin Deity friend. SOB cost me 25K.
So why would Trudeau and butts risk everything on this ill fated adventure with SNC including the press buy off? Politicians always have self interest in mind and montreal is never going to vote anything but liberal no matter what happens there. Seems strange to risk it all for that.
Could the Trudeau foundation be a major shareholder and stood to take a loss if the company got sanctioned or went out of business. Something deeper there.
Best family day of my life; Butts is out, Libs are in disarray, and great comments today on this board!
Life is good! :)
#4 Re: a guy in vancouver
Thanks for the calculation, so vancouver RE did prove the best mainstream investment.
Not so much for this fellow, remember when I asked why we weren’t hearing the stories of those burned by bitcoin:
“Software engineer Tong Zou lost his life savings — more than $500,000 — in the QuadrigaCX cryptocurrency meltdown.
The mild-mannered 30-year-old Vancouver resident wasn’t making any clandestine, high-stakes trades when the online platform was shut down on Jan. 28 amid a storm of controversy and conspiracy rumours.
Instead, Zou was simply looking for an easy way to transfer U.S. funds into Canada for a down payment on a local property…”
https://vancouversun.com/news/local-news/a-vancouver-insiders-view-of-the-quadriga-meltdown-its-kinda-devastating
Recent sale report.
Recently a knockdown was sold for 750k in East Van which was the cheapest block of land I had witnessed go in some years in Vancouver proper.
Another one went for 775k.
Let’s see what you roughly get for the same money in Port Coquitlam right about now.
The details…
1490 Apel Dr, Port Coquitlam.
Sold January 31st 2019 740k
Originally asking 899k
Assessment 868k
Previous owner paid 576k January 2015.
So the previous owner bought in in January 2015, most remember the euphoria of Spring 2016, but 2015 was rocking for real estate as well and never really went into hibernation for the winter that year, and Spring Fling 2016 exploded early.
Whoever took the photos of this place probably could have done a better job, but when I saw the sales price my mind instantly went to the knockdowns on the bottom of the Eastside market and thought I would show what is currently going for the same money out yonder…
M44BC
https://www.zolo.ca/port-coquitlam-real-estate/1490-apel-drive
This Just-In!
Trudeau is “surprised,” “disappointed” and “puzzled” that Gerald Butts has resigned from the PMO.
Recent sale report.
What else can I dig up on Booniewatch 2019?
How about this recent sale in Delta that appear to have scored a relative bargain?
The details…
5601 47a Ave, Delta.
Sold 815k January 2019
Originally asking 995k
Assessment 1.15
So this respectable 40 year old house was sold 30% less than assessment within walking distance of shops and restaurants.
I won’t do my usual Milestones posts that I used to do after every 5000 visitors to show where the traffic is coming from around the world.
Instead I will do them after every 10,000 visitors.
After I completed a couple of reports the other day a guy told me to get a life.
I am happy to report back that I purchased one on Craigslist today for $10
Bargain…
M44BC
https://www.zolo.ca/delta-real-estate/5601-47a-avenue
https://www.rew.ca/insights/361977/5601-47a-avenue-delta-bc
As long as they can’t ever raid my daughters RDSP savings. That would hooefulky be illegal
Darn… *hopefully
Somewhere is Ontario Doug Ford is doing his happy dance! Pipeline stocks up huge tomorrow on Butts Exit? Here comes the convoy to Ottawa and Butts runs out the exits.
Re Gerald Butts;
perpetual deflection. Even in his resignation letter he asks us to watch him bow down at the climate change altar. Hey look, a diversion!! I hope that was the jumping of the shark, but I fear not.
Of course, the final straw for “F” (campaign promise or not) was BCE floating the idea of converting to an income trust – and those of us who practicing a bit of independent thinking at the time, came out relatively unscathed.
It sounds good until you get Negative interest rates then all bets are off…..Harper did in F…shame
..he was really for the people down with
Harper
“So, TFSAs are off the table for political reasons, and also because contributions are made with dollars that have already been taxed. In theory they won’t be taxed again.” – Garth
Talk about dollars that have already been taxed: what about all the consumption taxes, provincial tax on the GST tax, land transfer taxes, property taxes, school taxes etc. that have to be paid with income dollars that have already been taxed?
And “In theory they won’t be taxed again.” Yeah, in theory… There’s no limit to creativity in gov’t when it comes time to find yet more income to feed that bottomless pit.
Garth, you must read this email I received today telling people waiting to 70 to take CPP is best. I have to admit I cringed reading it.
https://boomerandecho.com/take-cpp-at-age-70/
#47 Mick Marris
Very valid points you make. I grew up poor, when it came time for post secondary education when I came of age there weren’t very many perks that I got. I worked and paid my way threw.
I wanted to get a post graduate degree I was burnt out. So in a sense I never reached my full potential and my career path is completely different. I live with that regret.
I think it’s time that we as a society ensure that every child reaches his or her potential. The young shouldn’t be saddled with huge student debt or silenced because they can’t afford to learn. Investing in our children’s minds will help society as a whole. We all benefit from having a smarter population. So I think that education should be free for everyone and to pay for it something like a system that requires a minimum gpa average plus 5 years of work in this country would suffice.
Gpa will ensure enrolling and attending. While the 5 years work will reduce brain drain. Only fair I think.
Recent sale report.
Alright to finish up Booniewatch 2019 I will show another 40 year old house to try and keep it even, this time in Maple Ridge.
The details…
Sold 875k
Originally asking 1.09
Assessment 931k
So this house is nearly 3500 sq ft and so that comes in at $250 a sq ft.
I heard recently that they were going to attempt to get $2000 a sq ft at the Oakridge redevelopment at Cambie and 41st.
We’ll see how that works out.
Alright, so that should help out a bit the people who have been writing me about price discovery in various parts of the city.
My meatloaf is ready.
I don’t mind helping people out but you should never get between a man and his meatloaf…
M44BC
https://www.zolo.ca/maple-ridge-real-estate/21293-douglas-avenue
https://www.rew.ca/insights/568808/21293-douglas-avenue-maple-ridge-bc
#2 Im stupid on 02.18.19 at 1:37 pm
Why do children from low income families get big breaks (under the former liberal government it was free) to go to school? While kids from more affluent families need to pay?
———————————————————
One of those crazy Liberal ideas that giving post-secondary education to disadvantaged kids that weren’t going to be able to afford to go to university or college otherwise but were capable, would uplift their opportunities and improve their lot in life / be role models in their communities, thereby contributing to society (and taxes) more then they would otherwise. Silly Liberals, education on average improves your future opportunities? Or like, paying for education is like cheaper then paying for welfare and prisons etc? Jeez.
Oh, BTW. The more affluent pay b/c hey, they have money and the government doesn’t have unlimited funding (our taxes) for everyone’s education. Sure, lets discuss what the right cut-off level is, important conversation…
#13 Howard on 02.18.19 at 2:26 pm
Well, Gerald Butts is out.
Since he was the “real” Prime Minister, I can only imagine the chaos in the PMO right now
——-
Looks like sunny ways are enroute for Emperor Justinian.
I think we can now officially state that there is a lot more going on with SNC and our elected officials than a little bit of “pressuring”.
#5
By the time you complete your residency, you are 29 (best case scenario) or older. How can you retire in your mid thirties? Hit lotto jackpot?
#74 AGuyInVancouver on 02.18.19 at 7:33 pm
Instead, Zou was simply looking for an easy way to transfer U.S. funds into Canada for a down payment on a local property…”
———————————————————–
No pleasure taken in his loss, but “easy” isn’t the word I’d use. Maybe “tax authority scrutinizing / legit transfer fee” free… Or am I being too pre-digital native thinking a Swift Transfer would have been more appropriate?
#78 Rargary on 02.18.19 at 8:03 pm
As long as they can’t ever raid my daughters RDSP savings. That would hooefulky be illegal
#79 Rargary on 02.18.19 at 8:03 pm
Darn… *hopefully
$$$$
“Hooefulky” is a wonderful word. I’m throwing it in the next legal brief I write. As follows “The decision of the Supreme Court of Canada in Doe v. Government of Canada is of no precedential value because the reasoning was hooefulky.” It will be italicized because it is clearly a Latin phrase.
#48 expat on 02.18.19 at 5:55 pm
The time to move though is getting less as CRA drafts plans for an exit tax of 30-50%.
In essence most people are trapped in the fishbowl
———-
Agreed, on most points – but that last one will never happen. Canada is totally 110% reliant on immigration to increase its population. If they put that plan into action, that’ll be the end of it in short order. That’ll mark the beginning of the end of our social welfare net (among other things) as we slowly age out of the money.
Great news with Butts out of the way! It’s starting to feel like the thick dark clouds are starting to break apart over this country. Canada still has a long way to go to clean up the Liberals messes. Looking real good for Andrew Scheer to become our next PM !!!!
#48 expat on 02.18.19 at 5:55 pm
The time to move though is getting less as CRA drafts plans for an exit tax of 30-50%.
In essence most people are trapped in the fishbowl
————————————————————————————————
Build the wall Build that wall, oh wait wrong country!
“…the last thing Canada needs is more people depending on the government for income.”
That’s exactly where it’s heading though. Universal basic income was just tested. More and more people are relying on government for everything – especially the millennials. It’s what people have come to expect these days.
Butts is gone. The wall is being built. All the “hoax” hate crime is being exposed. AOC and the Democrats are being exposed for the psychopath KOOKS they are. The Globalists are being routed in droves. What a glorious time to be alive !!
Vive la résistance!
Yanniel on 02.18.19 at 5:39 pm
“but the RRSP is inviolate.” Garth.
Is that so during a divorce assets splitting?
Stay married. – Garth
BEST REPLY EVER !!
#58 JD on 02.18.19 at 6:13 pm
A TFSA question for anybody who may be able and kind enough to answer:
What would you buy with funds in your TFSA (maxed out) if it were in USD (the only available option right now) if you were reluctant to convert to CAD. Buy growthy stuff — whether ETFs or individual stocks — on NYSE etc. and be fine with the US withheld 15% tax that you can never claim?
TIA for any helpful suggestions!
The withholding tax (15%) is levied on dividends (not capital gains) of US equities (not bonds) and includes US listed equity ETF’s.
Use the TFSA for growth. There is really no point in holding US dividend stocks listed on US markets in a TFSA. RRSP’s & RRIF’s are exempt, so if you are investing in US listed dividend stocks do it there. Alternatively, bonds are also exempt from WHT, but also kind of defeats the purpose of the TFSA.
That’s my take on it. I am still learning this stuff, too, so take it with a grain of salt. Here is a good cheat sheet:
https://www.blackrock.com/ca/individual/en/literature/brochure/withholding-tax-reference-guide-en-ca.pdf
#32 Deplorable Dude on 02.17.19 at 6:17 pm
Sure 91% of US Citizens have health ‘coverage’….how many can afford to actually use it when the average deductible is $1000? Need a trip to your Doctor about that niggling pain that won’t go away…gonna cost you a grand.
+++++++++++++++++
Um, no.
It’s true that details of how much a doctor’s visit will cost vary depending on policy. But as Garth noted, most Americans get health coverage through their employer, which is usually a good enough policy that a doctor’s visit costs a relatively modest amount, say $10-$30.
“A trip to your Doctor about that niggling pain that won’t go away…gonna cost you a grand” falls under the “much overused unwitting hyperbole by people who have experience with only a socialized-type system”, as Sail Away observes (#31, on 17/02/19).
@# 67 earthboundmisfit
Yes, they’ve demonstrated that clearly … with the CDN$1billion dollar Phoenix pay system.
The only thing that’s been demonstrated is the governments incompetency to train employees to run the program.
@ Remembrancer
I do max out my TFSA every January, I was told by my advisor not to bother with RSP as it will be taxed at a higher rate by the time i retire. I don’t plan on having any kids and i plan on working every year until i retire so i won’t really be pulling it out before i retire.
Hi garth, I made 102k in 2018, I put 70k into my rrsp to catch up to my un used rrsp room. When I do my taxes should I use 35k as deduction? I will make the same amount of money for next 3 years. I have no other deductions to use either
Thanks
Marissa
Garth
When you say MDs have had poor financial advice from their accountants do you mean with regard to being told to avoid the RRSP and keep all funds on the corporation?
What is the difference at this point ?
#68 crowdedelevatorfartz
I’m afraid I can agree with you on Penny Ballam. In addition to being a poor budget manager, Dr. Ballam had trouble putting out fires. Many of these were of her own making as a micromanaging senior manager. I think it more likely that Gregor laments not firing her sooner.
98 Yellow Vest on 02.18.19 at 10:33 pm
Butts is gone. The wall is being built. All the “hoax” hate crime is being exposed. AOC and the Democrats are being exposed for the psychopath KOOKS they are. The Globalists are being routed in droves. What a glorious time to be alive !!
Vive la résistance!
…..
Not to mention Climate Barbie who posts every 5 seconds on Twitter is dead silent…
Was it the snow in Vegas. Nope. It snowed in bullhead Arizona yesterday. Never happened before. I took the pics.
A mini ice age is coming. So much for selling and taxing global warming.
All in all, it was a good day for patriots. Don’t be high fiving too fast. Trapped phyco animals don’t go down without a vicious fight.
Stay vigilant. Fight is just starting.
Burr its getting cold at FBI head office.
Gartho’s missive today started a number of sentences with “But”. Is he Kreskin?
Liberals self immolating on both sides of the border…
Winning!
Wrong, confiscation is a major ideal in every socialist platform. You simply must have alternatives to protect yourself, physical gold and silver, foreign accounts in cash, fungible assets like bitcoin, art etc. Never trust Trudeau .
https://nationalpost.com/opinion/kelly-mcparland-if-no-one-did-anything-wrong-why-two-resignations-and-a-pmo-in-crisis-mode
Look at the history of lies perpetrated by Liberal insiders. Trudeau has now become a crusader for the globalist takeover of western civilization. Butts has a history of radical hate for Canada’s citizenship values. The UN is already confiscating homes in Europe to house migrants. They are literally turning German , Spanish and U.K. Residents out of their homes as migrant numbers grow. Look at what the NDP is doing to confiscate property in BC. Next is forced housing of Trudeaus bloc voters into the spare bedrooms you’ve been forced to disclose. Get ready, it’s coming.
# 41 Crowded
” So does this mean SNC gets a “pass” ? ”
It got (another) one last Friday according to CBC news article on February 15th online
” Former SNC- Lavalin executive accused in Libyan bribery case has obstruction of justice charges stayed.
Sami Bebawi, a former SNC-Lavalin executive and his tax attorney have had obstruction of justice charges against them stayed because it took too long for their case to get to trial
Bebawi who was vice-president at the Montreal based engineering giant and his lawyer Constantine Kyres were charged in 2014.
The pair were charged of trying to obstruct justice in another criminal case involving Bebawi work securing contracts in Libya.
Quebec Superior Court Justice Guy Cournoyer handed down the ruling Friday citing unreasonable delays.
He said the case was dormant for 11 months and called it a ship without a captain . “
SNC charges will likely be stayed. Their high priced lawyers will argue that there is no way they get a fair trial after this mess.
Even if SNC does go to tria
Good read but you’ll have to pay.
https://www.armstrongeconomics.com/product/2019-canadian-outlook-report/
#98 Yellow Vest on 02.18.19 at 10:33 pm
Butts is gone. The wall is being built. All the “hoax” hate crime is being exposed. AOC and the Democrats are being exposed for the psychopath KOOKS they are. The Globalists are being routed in droves. What a glorious time to be alive !!
Vive la résistance!
—————————————-
Classical liberalism and patriotism/nationalism are the new counter-culture.
“Stephen Harper just wanted to plug a tax loophole.”
On the other hand he like Brian Mulroney didn’t want to plug the bottomless pit of endless borrowing and spending thus saddling the country with a monsterous debt did they? This is not responsible government!
Perhaps those politicians who voted for deficits should be personally responsible for paying the national debt out of their own earnings and fortunes. Same thing at the provincial level. After all they had a choice of voting yes or no when it comes to the budget, party discipline not withstanding.
Politicians just do enough to handle the ongoing situation. They do not care about what will happen to their political career down the line -that time is long gone.
At the moment, only thing holding the fort in the Western economies is by robbing prudent Peter to pay the entitled Paul. So far, in the last couple of decades it was all clandestine. It will be more pronounced in the future. Because desperate times call for desperate actions. All will be justified in the name of social justice. Memes such as “we are in this together” will be abound.
When you can not run the country anymore because there is no money for the government to pay the largess, do you really think they will spare your tax-free savings?
#98 Yellow Vest on 02.18.19 at 10:33 pm
Wait a second, I’m confused.
I thought the Yellow Vests were on the streets demonstrating against the ultra wealthy “globalists” for government intervention to reduce gas prices aka socialism??
MF
#85 Stats Freak
Garth, you must read this email I received today telling people waiting to 70 to take CPP is best. I have to admit I cringed reading it.”
Thanks for the link, it made for interesting reading. Their logic was sound in mitigating longevity risk by deferring CPP/OAS and erstwhile burning up their RRSPs. CPP and OAS are both indexed defined benefit plans, whereas RRSPs carry the risk of losses that might not be regained in the person’s lifetime.
The biggest question still remains: “how long will I live?”
@#76 DD
“Trudeau is “surprised,” “disappointed” and “puzzled” that Gerald Butts has resigned from the PMO….”
*****
The drama teacher hath spoken….
#105 Samuel Most on 02.19.19 at 1:06 am
Garth
When you say MDs have had poor financial advice from their accountants do you mean with regard to being told to avoid the RRSP and keep all funds on the corporation?
——
First of all doctors are poor money managers because they are socialists. But they end up with massive cash inside a shell company that they then don’t know what to do with. Passive equity investing inside a corp is not viable, so they are reluctant to claim personal income to open RRSP room so its a chicken and egg thing. So instead they will buy stuff they know nothing about like farmland or rental suites which then have high tax as passive income too inside a corp. The best tax on passive income is personal. Corps are for business activities.
Why someone who gets a cheque from the govt gets to act like an independent business with risk is beyond me.
#103 Akhtar on 02.18.19 at 11:56 pm
@ Remembrancer
I do max out my TFSA every January, I was told by my advisor not to bother with RSP as it will be taxed at a higher rate by the time i retire. I don’t plan on having any kids and i plan on working every year until i retire so i won’t really be pulling it out before i retire.
//////////////////
What about this crazy idea?
Retiring earlier?
@Number100 CEW9 on 02.18.19 at 11:05 pm
Thanks so much. Yes, makes perfect sense. Perhaps int’l equities (stocks and ETFs both) then.
I have also wonder the same as your blog responder.
” They will systematically remove our savings ”
He didn’t say, they will tax our savings, he said remove.
I would love to hear your thoughts about this.
#116 MF on 02.19.19 at 7:00 am
#98 Yellow Vest on 02.18.19 at 10:33 pm
Wait a second, I’m confused.
I thought the Yellow Vests were on the streets demonstrating against the ultra wealthy “globalists” for government intervention to reduce gas prices aka socialism??
MF
—————————————
Just the opposite. They are protesting AGAINST government intervention in the form of more crippling gas taxes. They are also protesting against Macron signing the UN open borders pact.
what happened yesterday, may not be the Liberal Party’s greatest fear but it’s close
Ottawa Citizen: Andrew Scheer: Butts’ departure is the clearest indication yet that there is much more to the affair
Ottawa Citizen: Andrew MacDougall: That’s why Gerry Butts or Katie Telford will not be sacrificed, no matter how Duffy-esque the Norman or SNC-Lavalin episodes get. This PMO will battle through, just as the previous PMO did before them.
They have to. Justin Trudeau just wouldn’t function without them.
CBC: The bombshell departure — Butts, along with chief of staff Katie Telford, are the two most senior staffers in Trudeau’s inner circle
First Jody Wilson-Raybould, former minister of justice, then Butts and Telford number one and number two, in the Prime Minister’s Office.
there’s more to this than SNC-Lavalin.
#117 pay your taxes on 02.19.19 at 7:18 am
#85 Stats Freak
Garth, you must read this email I received today telling people waiting to 70 to take CPP is best. I have to admit I cringed reading it.”
Thanks for the link, it made for interesting reading. Their logic was sound in mitigating longevity risk by deferring CPP/OAS and erstwhile burning up their RRSPs. CPP and OAS are both indexed defined benefit plans, whereas RRSPs carry the risk of losses that might not be regained in the person’s lifetime.
The biggest question still remains: “how long will I live?”
____
This article does not get into how much was forfeited from 60-70. This might be a workable strategy for Women, but it’s crap for Men. Ms. IH has a better than even chance of passing 90. I’d be lucky to make 80 (based on family history).
Maybe having a strategy for the wife as described, but instead have the Hubby start drawing at 60? If we’re talking a married couple, I think the idea may have some merit.
For the young kids going forward – it would be better to just arrange things to bulk up the TFSA’s instead of the RRSP’s.
#103 Akhtar on 02.18.19 at 11:56 pm
That must be one sweet DB pension plan and great advisor you have.
Anyway, life happens as they say so circumstances may change. For now, if nothing else, your RRSP contribution allowance keeps accumulating and could be a real savior if you say age out of your deal and get shown the door with a large salary-based payout.
Otherwise, if you are saving a sufficient amount for future you then party on… True, the RRSP is a (rarely discussed) balancing act between current contribution and future predicted withdrawals taxation along with tax-free growth which is why a $10000 yearly TFSA limit made so much more sense, especially in this flat income world…
#115 From Across The Pond on 02.19.19 at 6:47 am
At the moment, only thing holding the fort in the Western economies is by robbing prudent Peter to pay the entitled Paul. So far, in the last couple of decades it was all clandestine. It will be more pronounced in the future. Because desperate times call for desperate actions. All will be justified in the name of social justice. Memes such as “we are in this together” will be abound.
When you can not run the country anymore because there is no money for the government to pay the largess, do you really think they will spare your tax-free savings?
______
Government will find it exceedingly difficult to make any rash moves towards regular folks’ life savings or on the wealth of rich folks.
France already tried that, and had to do a 180 because so many millionaires were leaving that their revenues started dropping instead of increasing. Taxpayers with big incomes are the hands that feed government – and both parties know it. France went too far, now they’ve reached the end of the line for this option.
Classic Laffer Curve, taxes go up, revenues go down. Game over mon amie.
France also found out that the majority of those millionaires who left – did not come back after the tax was rescinded. So the big tax revenues that left with the rich folks are gone for good. That’s a galactic backfire right in the face. You just can’t pick another replacement millionaire off the tree tomorrow to cover the loss.
Then – they they tried to make cuts and raise all kinds of other taxes – including a whopper on gas. This time they got a series of huge yellow vest riots. France had to rescind that gas tax too.
If our government has any brains at all, they will let sleeping dogs lie when it comes to stupid abusive and relentless taxation on basically anyone. They’re either going to lose a sizable chunk of their most valuable taxpaying demographic, a series of huge riots; or both.
bs sh
Calgary condo owners, facing millions in repair bills, find out their builder isn’t who they thought it was
Condo corp. files $6.5-million lawsuit after owners bought into Cardel Homes marketed project
Bryan Labby · CBC News · Posted: Feb 19, 2019 5:00 AM MT | Last Updated: 42 minutes ago
“Leaky roofs, windows and walls and defective balconies — all symptoms of the shoddy construction of four condominium buildings in northwest Calgary, according to a civil lawsuit filed in Alberta Court of Queen’s Bench.
You may be thinking that you’ve heard this leaky condo story before, but this one may be different. It includes a cautionary tale about who is marketing your condo, who is going to build it and who’s accountable if things go sideways.
The people who bought the 288 units at the Panorama West project are facing massive bills. And they’ve been told to keep quiet by the people whose job it is to protect them: their condo board and their lawyer. They were told in writing that speaking out could jeopardize any potential settlement.”
#119 wrote
First of all doctors are poor money managers because they are socialists.
That is the funniest miscalcualtions I have heard in a long time. Doctors for the most part are not socialist. They have to bill govts in Canada due to universal healthcare.
I have many doctor friends are are shrewd investors unlike what you state.
They accumulate wealth, they spread risk across multiple investment classes like stocks, land, rentals, bonds etc.
Foolish statement.
Butts was a McGill student communist/socialist.
Enough said.
However, you all should be very afraid of who his repalcement is.
There are radical hardlines Soros lefties crawling everyhwere in the walls of the Parliament.
Now that Butts is gone one can only imagine what radical lefty will take his place.
“…without much of a public whimper…”
But when ANY party is going to (eventually) gouge us when in power, they simply ignore the outcry.
B.C. is recent proof of that.
Both Peter and Paul take turns screaming.
#124 45north on 02.19.19 at 10:55 am
what happened yesterday, may not be the Liberal Party’s greatest fear but it’s close
Ottawa Citizen: Andrew Scheer: Butts’ departure is the clearest indication yet that there is much more to the affair
Ottawa Citizen: Andrew MacDougall: That’s why Gerry Butts or Katie Telford will not be sacrificed, no matter how Duffy-esque the Norman or SNC-Lavalin episodes get. This PMO will battle through, just as the previous PMO did before them.
They have to. Justin Trudeau just wouldn’t function without them.
CBC: The bombshell departure — Butts, along with chief of staff Katie Telford, are the two most senior staffers in Trudeau’s inner circle
First Jody Wilson-Raybould, former minister of justice, then Butts and Telford number one and number two, in the Prime Minister’s Office.
there’s more to this than SNC-Lavalin.
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Telford has not resigned.
That line on CBC was just worded strangely.
#122 Mike Eh on 02.19.19 at 10:25 am
I have also wonder the same as your blog responder.
” They will systematically remove our savings ”
He didn’t say, they will tax our savings, he said remove.
I would love to hear your thoughts about this.
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Much like the post-apocalyptic gold bugs or crypto-currency fanbois, the government asset seizure fetishists visualize a end state they think they have prepared for and will be the stars of, like some self-published end-of-the-world YA novel.
If Canada’s government of the day is seizing RRSP accounts to remain afloat, a different asset allocation isn’t really going to matter there’s bigger forces at work that best case will ignore you for a time – better to plan for what you can manage, like unrelenting but average rates of inflation and interest rates, roughly 10 year business cycles, stagnant salaries, understanding your real expenses and not just a monthly payments average, whether you are currently living on an existing or potential future flood plain b/c no matter how you vote, the water level is rising etc etc. Basically turning into the wind, shorten the sails and try to keep it straight with a balanced portfolio…
#132 Howard on 02.19.19 at 12:43 pm
She hasn’t? CBC’s weekend edit department needs to be revamped big time then, this is David Mamet-class phrase twisting…
https://www.cbc.ca/news/politics/gerald-butts-resigns-pmo-1.5023675
The bombshell departure — Butts, along with chief of staff Katie Telford, are the two most senior staffers in Trudeau’s inner circle — comes amid allegations that senior members of the PMO pressured former justice minister Jody Wilson-Raybould to help Quebec-based multinational engineering firm SNC-Lavalin avoid criminal prosecution on bribery and fraud charges in relation to contracts in Libya.
#134 Remembrancer on 02.19.19 at 1:03 pm
#132 Howard on 02.19.19 at 12:43 pm
She hasn’t? CBC’s weekend edit department needs to be revamped big time then, this is David Mamet-class phrase twisting…
https://www.cbc.ca/news/politics/gerald-butts-resigns-pmo-1.5023675
The bombshell departure — Butts, along with chief of staff Katie Telford, are the two most senior staffers in Trudeau’s inner circle — comes amid allegations that senior members of the PMO pressured former justice minister Jody Wilson-Raybould to help Quebec-based multinational engineering firm SNC-Lavalin avoid criminal prosecution on bribery and fraud charges in relation to contracts in Libya.
—
Departure. Maybe sabbatical or working from home. Didn’t her departure tweet mention?
The President of the USA has short listed four names to become appointed for UN Ambassador. One of those names is Kelly Craft.
#130 expat on 02.19.19 at 12:20 pm
“However, you all should be very afraid of who his repalcement is.”
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Thankfully, it won’t be Maurice Strong, who had the Liberals’ ear, albeit from China, his chosen country after he left Canada.
He was known to recommend the downfall of western democracy(ies). Odd for a man who made his fortune in a democracy.
https://en.wikipedia.org/wiki/Maurice_Strong
Business
UPDATED
Payless seeks creditor protection, plans to close stores in U.S. and Canada
Chain has 2,500 locations across North America, including 248 in Canada employing 2,400
Pete Evans · CBC News · Posted: Feb 19, 2019 1:19 PM ET https://www.cbc.ca/news/business/payless-shoe-stores-1.5024739
#135 Ubul on 02.19.19 at 1:49 pm
Seems from Twitter and other, less convoluted reports etc she’s still on the job…
#74 AGuyInVancouver on 02.18.19 at 7:33 pm
#4 Re: a guy in vancouver
Thanks for the calculation, so vancouver RE did prove the best mainstream investment.
Not so much for this fellow, remember when I asked why we weren’t hearing the stories of those burned by bitcoin:
“Software engineer Tong Zou lost his life savings — more than $500,000 — in the QuadrigaCX cryptocurrency meltdown.
The mild-mannered 30-year-old Vancouver resident wasn’t making any clandestine, high-stakes trades when the online platform was shut down on Jan. 28 amid a storm of controversy and conspiracy rumours.
Instead, Zou was simply looking for an easy way to transfer U.S. funds into Canada for a down payment on a local property…”
https://vancouversun.com/news/local-news/a-vancouver-insiders-view-of-the-quadriga-meltdown-its-kinda-devastating
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It’s called a wire transfer, Zou. Everyday trillions of dollars move around based on them. They don’t go missing, they don’t get lost in a hard drive. Might have cost you $50, but I’d guess that seems cheap right about now.
#136 Whose Next To Resign on 02.19.19 at 2:36 pm
The President of the USA has short listed four names to become appointed for UN Ambassador. One of those names is Kelly Craft.
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Sure, why not? She’s done a great job keeping a lid on the homeland’s northern border with a declared US national security threat for the last 264 days…
#135 Ubul on 02.19.19 at 1:49 pm
#134 Remembrancer on 02.19.19 at 1:03 pm
#132 Howard on 02.19.19 at 12:43 pm
She hasn’t? CBC’s weekend edit department needs to be revamped big time then, this is David Mamet-class phrase twisting…
https://www.cbc.ca/news/politics/gerald-butts-resigns-pmo-1.5023675
The bombshell departure — Butts, along with chief of staff Katie Telford, are the two most senior staffers in Trudeau’s inner circle — comes amid allegations that senior members of the PMO pressured former justice minister Jody Wilson-Raybould to help Quebec-based multinational engineering firm SNC-Lavalin avoid criminal prosecution on bribery and fraud charges in relation to contracts in Libya.
—
Departure. Maybe sabbatical or working from home. Didn’t her departure tweet mention?
———————————————-
What are you talking about? There was no departure tweet from Katie Telford. Are you mixing her up with Jody Wilson-Raybould?
The CBC excerpt you posted puts the description of Butts and Telford between two dashes, as if to say “by the way, Butts is one of two most senior PMO officials along with Telford”. It was a tangent, it wasn’t extending the departure story to Telford. Sheesh.
# 15 –
…”tax large accounts, similar to the day trading rules for tfsas. “It’s a savings vehicle not a speculative vehicle” is similar to “it’s a savings vehicle, not designed to make you rich”…
And nobody knows what is exactly a “speculative vehicule”!
Making too much money? You’re a Day Trader..taxable, or you invested in a speculative vehicule…taxable!
We should have more definition on some terms.
#128 jess on 02.19.19 at 12:00 pm
bs sh
Calgary condo owners, facing millions in repair bills, find out their builder isn’t who they thought it was
Condo corp. files $6.5-million lawsuit after owners bought into Cardel Homes marketed project
Bryan Labby · CBC News · Posted: Feb 19, 2019 5:00 AM MT | Last Updated: 42 minutes ago
“Leaky roofs, windows and walls and defective balconies — all symptoms of the shoddy construction of four condominium buildings in northwest Calgary, according to a civil lawsuit filed in Alberta Court of Queen’s Bench.
You may be thinking that you’ve heard this leaky condo story before, but this one may be different. It includes a cautionary tale about who is marketing your condo, who is going to build it and who’s accountable if things go sideways.
The people who bought the 288 units at the Panorama West project are facing massive bills. And they’ve been told to keep quiet by the people whose job it is to protect them: their condo board and their lawyer. They were told in writing that speaking out could jeopardize any potential settlement.”
……………………………………………………………….
THAT IS WHAT YOU GET WHEN YOU BUY A CONDO OR LIVE IN ONE THAT IS RENTED OUT TO YOU! Just the tip of the iceberg here in the GTA. Shoddy buildings proliferate the landscape. It will be the investor / owners who ultimately pay the price. Even the buildings built in the 1980s have their hidden secrets slowly rising to the top now. Can we all say mould, pests, failing concrete, failing windows, failing electrical systems, failing HVAC infrastructure, and the best part raising insurance rates? Huh nothing built since the Roman age has been of any consequence. I would rather stick with a mud hut then a Condo.
The way the wind is blowing politically, socially and economically me thinks watching Doctor Zhivago maybe in order.
The way some people think reminds me of Communism and we know that system doesn’t work, the citizens of those counties probably thought leveling things down would make their lives better, big mistake.
WE HAVE NO ONE RUNNING OUR COUNTRY RIGHT NOW. YIKES. THINGS COULD GET BETTER WITH NO ONE AT THE HELM.
#142 Howard on 02.19.19 at 3:49 pm
as if to say “by the way, Butts is one of two most senior PMO officials along with Telford”. It was a tangent, it wasn’t extending the departure story to Telford.
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Its poor editing plain and simple. So why is Telford mentioned at all, for PMO news gender equality? Why not name numbers 3 and 4 et al?
#127 IHCTD9 on 02.19.19 at 11:53 am
Government will find it exceedingly difficult to make any rash moves towards regular folks’ life savings or on the wealth of rich folks.
France already tried that, and had to do a 180
Then – they tried to raise all kinds of other taxes – including a whopper on gas. This time they got a series of huge yellow vest riots. France had to rescind that gas tax too.
If our government has any brains at all, they will let sleeping dogs lie. They’re either going to lose a sizable chunk of their most valuable taxpaying demographic, a series of huge riots; or both.
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The French are well know to protest (riot?). Canadians quietly take it.
I am determined. Life throws me a lot of curve balls and I ready to hit. My mother was an Umpherville – a proud people. She never lost faith in me although I did stupid. My parents gave me decency.
When things go sideways on me I will tough it out. Calling me an apple will make me bristle. If you can share history on her name – I will be appreciative. They tended to be quiet but they were tough. Men would tell me stories about my father cleaning bars when he was angry.
One of my favoured movies is “Outlaw Josey Wales”. I liked Chief Dan George – he was a man I respected– never mind Clint. Million Dollar Baby made me cry which is tough to do. Grand Torino comes second. “God” only knows Clint will do next.
Mother Nature has lifted her boot on my throat – I love chinooks though De Crap knows zero about Alberta. I could say about same about spineless T2. Lets see what he can do without the ass….
#148 Democracy Is Mob Rule on 02.19.19 at 5:01
-umm maybe we are more content?
MF
#104 Marrisa
Reference tax brackets:
Federal tax rates for 2018
15% on the first $46,605 of taxable income, +
20.5% on the next $46,603 of taxable income (on the portion of taxable income over 46,605 up to $93,208), +
26% on the next $51,281 of taxable income (on the portion of taxable income over $93,208 up to $144,489), +
…..(does not apply to you).
Imho, plan to keep yourself out of the heavy-hit tax brackets and get as much money back as possible. Play with some calcs and options for your situation.
127 IHCTD9
What you say makes sense only up to a point. But think about the Patriot Act. Under normal circumstances such a law would never have passed but 9/11 made it possible. At the end of the day it all comes down to playing with ordinary people’s sentiments. As you say, at the moment the savers make a sizable portion of the electorate so politicians hesitate to directly confiscate but the middle class as we know it is fast disappearing. When those who do not have outnumber those who do, and savers everywhere are seen as the enemy of the state, it’s easier for the government to pass any law. Media will run government’s propaganda. Support for AOC’s ludicrous Green Deal is the prime example.
When there is going to be another 2008 in the world economy (I don’t think that day is too far away), politicians will use that as an excuse to pass the saver confiscation law overnight. They will tell you without it the system will collapse. That time politicians from both sides of the aisle will join hands.
At one point in Britain, nobody thought the government would raid private pensions but Gordon Brown did and he still ran his political career for another 14 years. Nothing is impossible for the lawmakers because we have given them too much of power.