What’s coming

The average tat costs about $200. So soon you can have a new one, thanks to Justin Trudeau’s government (he has a few). In the coming days the feds will table legislation to cut some taxes by increasing the basic personal exemption to $15,000.

That means no tax on that first fifteen grand (a $2,000 hike) so people earning less than $147,000 will see a small reduction in federal tax – about $600 per year per household when implemented. This will further remove some people from the tax rolls and cut federal revenues by $15 billion over four years, Scotiabank figures. You can be assured the shortfall will come from taxes on people earning over $147,000 annually.

Who’s that?

Well 90% of Canadians make less than $80,500.The top 5% earn just under $180,000. The bottom 90% (all people over 16) have an average income of less than $29,000, which clearly signals something is wrong in our society.

The top 20% of families (average $179,000) earn 49% of all income and pay 56% of all taxes. The top 1% earn 10% of all income and finance 15% of all revenues. This is the same tax bill as the bottom 50% (by income) of all citizens pay. So, that’s is how politics works. Tax success. Pander to the rest.

Of course, there is more coming. The T2 gang are now propped by the NDP (they want a wealth tax on top of income taxes) and the Bloc dudes, who hail from the highest-tax jurisdiction in the land. Likely targets are a higher inclusion rate for capital gains, some diddling with dividends, more grief for small business owners and professional corps, plus yet another whack at the $250,000+ income crowd. According to the latest StatsCan numbers, there are just 245,000 people in this category. That’s 0.65% of the population. In the US 5% earn that much (and in American dollars).

The conclusion: we don’t have enough rich people. If the 1%ers pay 50% more tax per capita than everybody else, don’t we need more? Now that 40% of families pay no net tax (and this week’s changes will increase that) it probably doesn’t make sense to create incentives for people (like medical professionals) to leave. But logic and politics don’t mix.

Anyway, this is all a reminder to the affluent and successful to exploit the tools you have left. The TFSA. The RRSP and the RRIF. A RESP or RDSP. Preferential rates on investment assets. Income-splitting with spousal RRSPs or low-interest family loans. Trusts, estate freezes or tax-deductible mortgages. If you earn over $150,000, you’re the enemy. Arm yourself.

        

A tale of two cities: Urban Montreal has 4.1 million people. Greater Vancouver has 2.4 Million. The average house price comparison: $350,000 vs $993,700. In Montreal last month sales increased, listings fell and condos were flying off the shelf at an average price of $290,000. In Vancouver, apartment sales were also way up while the average price of $651,500 was down 4%.

The median household income in Vancouver is $86,100. In Montreal it’s $82,000. So why are people in one (smaller) city willing to pay three times more for a house?

Sure, the climate’s better in BC. And Montreal is bilingual. Quebec has a long history of flirtatious separatism (take note Alberta), which has certainly repelled investors. But mostly it comes down to local culture. More than 45% of Montrealers rent, which is 10% more than Vancouver. There is no shame in the country’s second-largest metropolitan area in being a tenant. In fact it’s practically a city-wide party every July 1st when people move from one apartment to another. Moisters in Van seem to crave a Forever House to croak in. On the shores of the Saint Lawrence they get off on variety. Maybe it’s a French thing. Or perhaps BCers have turned into brain-washed property slaves.

It could be telling that this story got a lot of press in Van recently:

Forget paying for your home — in some Vancouver neighbourhoods it could take you as long as a century just to save up for a down payment. The findings were calculated based on median household incomes before taxes and benchmark home prices for detached homes and apartments, according to real estate firm Zoocasa.

The report showed that saving for a down payment of a detached home in Vancouver could be as far as 91 years away in East Vancouver, where the median household income is $65,000. Moving westward, it could take as long as to 217 years to save up for a down payment based on the same median household income.

“In the three priciest luxury neighbourhoods including Richmond, Vancouver West and West Vancouver, where benchmark home prices range between $1.5 to $2.9 million, it would actually take more than 100 years to come up with the needed funds,” wrote Penelope Graham, managing editor of Zoocasa and author of the report.

BC is an angry place lately. The government’s vindictive and grouchy. The kids are feeling disenfranchised. The household savings rate is, on average, negative. Financial stress is high and expectations higher. Tensions over income inequality and race pepper society. The Zoocasa nonsense fuels resentment and is typical of local media. This is why YVR is the country’s most indebted city, and will remain so. House porn is everywhere.

The point is not to compare Montreal with Vancouver. You can’t. Don’t even try. But if you choose to stay in a crazy, obsessed place, stop complaining.

Source: Zoocasa (Click to enlarge and feel inadequate)

 

130 comments ↓

#1 crowdedelevatorfartz on 12.08.19 at 1:46 pm

Taxes going up for Doctors….
That should help our Dr. shortage…..

Idiots.

#2 Dave on 12.08.19 at 1:46 pm

Everything is super expensive and people are streched to the limit.

Stoped by Safeway…everything is double the price and when you get to the till to pay…”would you like to make a donation”

Thanks but no thx

#3 BlogDog123 on 12.08.19 at 2:04 pm

FOMO
Mom and Dad had a nice house and so should I !
I deserve a backyard !

#4 Damifino on 12.08.19 at 2:06 pm

In the coming days the feds will table legislation to cut some taxes by increasing the basic personal exemption to $15,000.
—————————-

Where’s that “dollar=dollar=dollar” guy? He’s really going to be ticked about this.

So why are people in one (smaller) city willing to pay three times more for a house?
————————

We’s just ain’t the sharpest tools, is all.

#5 Millennial Realist on 12.08.19 at 2:11 pm

To summarize our situation for the poor, traumatized 1%ers and all the Paleos in denial of what they have done……

The question beneath all of this is as follows:

Do we stop life, to allow capitalism to continue, or do we stop capitalism, to allow life to continue?

https://www.cbc.ca/radio/thesundayedition/we-have-to-give-up-capitalism-to-save-the-planet-says-george-monbiot-1.5386783

OK, Boomers?

#6 Bob on 12.08.19 at 2:25 pm

Hello,
I have a question I am buying a house moving in on December 19th the sellers have tried to move the move in date 3 times after agreeing on the original date without offering any sort of financial compensation. Now with only 10 days left they again are trying to get us to push back the move in date. We told them absolutely no.
At this point we have terminated our contract with our rental, have utilities and deliveries scheduled etc… I’m just wondering is it possible that they just wont move out? what would happen if we arrive on the 19th at noon and they are still living there? From my understanding so far we are supposed to go the day before and inspect the home and if they haven’t started to move we can hold the payment with our lawyer… But then what? do we have to sue them and try to evict them? start looking for a new home? would they have to pay for the difference in price? this is such a strange situation I can’t even find information online about this in Canada.
Thanks to anyone who can offer some insight

#7 Ace on 12.08.19 at 2:29 pm

Basically you’re telling us the last blog post about compounding interest is essentially useless to nearly 90% of the population… because who can afford to save much of anything when you’re only making $29,000 or less a year??

#8 Brian Ripley on 12.08.19 at 2:34 pm

The point is not to compare Montreal with Vancouver. You can’t. Don’t even try. Garth

It remains interesting to note that the average of the summed prices of Vancouver, Calgary and Toronto condos are 45% (Nov 2019 data) more than a median priced single family dwelling in Montreal. If you remove Calgary condo prices from the measure, the premium is over 80%.

And speaking of Calgary http://www.chpc.biz/calgary-housing.html

… housing values are dropping quickly especially in the strata sector (condo prices down 28% from peak) and detached house prices are also showing signs of breaking below a 5 year “support” line.

The ratio of listings to sales in Calgary has jumped to 5.1 compared to Vancouver at 4.3 and Toronto at only 1.7.

There could be a canary in the oil well.

#9 Ian on 12.08.19 at 2:40 pm

Hi Garth,

I like your rule of 90, however, I was wondering if you would ever consider writing about where the old adage of utilizing only a multiple of x3 or x4 of your gross income to purchase a house, i.e. maximum price. I am sure there was logic in this assumption at one point, though in thinking about this I often wonder if this still applies with higher rates of taxation. Thank you, happily renting with my wife and dog; the motorcycle is garaged for winter!

#10 Camille on 12.08.19 at 2:43 pm

Quebec taxes its middle and less fortunate more than other provinces. This is required because average Quebec income is lower. So less wealthy households means more taxes are required on lower income to have the same revenue for the provincial government. Ironic in some ways but that is socialism.
BC may get angrier. Muskrat Falls hydro is bankrupting Nfld. Manitoba’s Keeyask demands 46% hydro increases in 5 years. What will BC’s site C do.
Interesting article in NP regarding a couple’s sorrow for having invested too much in RE. No great returns but losses. And job losses. Don’t underestimate this blog’s advice on RE, if I may say so.

#11 yvr_lurker on 12.08.19 at 2:46 pm

Does the huge difference in price between Montreal and Vancouver have anything to do with foreign buyers and speculators (both from within Canada and from outside) and the large pressure from immigration on YVR (and Toronto) as opposed to Montreal (where the language is a barrier). Of course not says our host and stop being xenophobic…

#12 Linda on 12.08.19 at 2:53 pm

Median income numbers can be alarming & lead one to believe we are all of us about to expire financially. While we all like to compare where we stand one must be careful to take in all factors. A person who only has $30K per annum might well be better off financially than someone whose income is much higher, because person A has no debt while person B is pickled to the eyeballs in it. Many people thinking about retirement worry about whether they can afford to retire, because they can’t see how they can pay for everything given the drop in annual income. The trick is to compare net income between the two states & to not include expenses one will no longer be paying when totting up the cost of living in retirement. It is truly shocking how much one pays for the privilege of working for a living!

#13 Russ on 12.08.19 at 2:56 pm

Hi Garth,

The missus and I are in Honolulu, marathon time. No need to engage locals about real estate prices here, it comes up in the conversation anyhow.

Similar to Vancouver is insane prices and high percentage of population indicated as a foreign or nonresident status.

One thing they have done right is a native, verified as 50% Hawaiian, can get a homestead house lease at one dollar per year for 100 years.
A forward thinking government could use some of these ideas to resolve our native problem eh.

Cheers, R

#14 Andrewski on 12.08.19 at 3:07 pm

We’re huffin’, puffin’ and doing all that we can to stuff in our $$ in to our TFSA!

#15 Alberta Ed on 12.08.19 at 3:22 pm

Sock Boy’s kids and likely his grandkids will have to pick up the slack, sooner or later. At least, if they don’t head south to greener pastures when they’re of age.

#16 crowdedelevatorfartz on 12.08.19 at 3:32 pm

@#5 Millennial Surealist.

Its been a while.
Mom finally paid the internet bill?

#17 TGF on 12.08.19 at 3:43 pm

People in Vancouver pay 3 times more for real estate than Montreal because they think real estate is fueled by international demand in Vancouver. The citizens of British Columbia believe there is a never ending supply of international millionaire buyers coming into the province. The people in British Columbia are gambling by treating real estate as a business investment. The house usually has the edge but maybe not in this case.

#18 Shawn Allen on 12.08.19 at 3:46 pm

Averages and Medians…

Are more relevant for bell curve distributions that are fairly tightly packed around the average. Adult heights and weights and even IQ’s are fairly tightly distributed around the average or median.

Income are very widely dispersed. Therefore average or median is not really typical. There is no typical.

I think the human mind tends to jump to the conclusion that average or median is typical. In incomes that is simply not the case.

We have to deal with averages and medians but let’s be careful on the implications.

Also, never aspire to be merely average.

Another point is that wealth and income must not extremely be tightly correlated. It’s possible to have great wealth and little income or the reverse.

#19 Last of the Boomers on 12.08.19 at 4:02 pm

Balanced Housing strategy:

A large problem in the area I live are vacant homes, foreign ownership, houses purchased with foreign capital, under utilized houses, and developer purchased property ( that sits unused until redeveloped into yet another McMansion) which has hollowed out the workforce available to provide services in the community.

Would it be reasonable to suggest a strategy which uses a sliding scale for property taxes based on income taxes paid to CRA, Considering duration of taxes paid.

With respect to developers: would a strategy of providing credits given for larger developments which makes a substantial portion of the development available at 3 x family income and restricts sale of these units to local workforce purchase (similar to the whistler strategy). Additional developer incentives may be to speed up permits and cut red tape.

Or to make it affordable must it be an initiative that cuts out the developer and makes it a project run by the district planners which focuses on a ” for the people, by the people” approach?

Any ideas out there how to bring back affordability to housing in communities that have completely run amok.

#20 AGuyInVancouver on 12.08.19 at 4:02 pm

#11 yvr_lurker on 12.08.19 at 2:46 pm
Does the huge difference in price between Montreal and Vancouver have anything to do with foreign buyers and speculators (both from within Canada and from outside) and the large pressure from immigration on YVR (and Toronto) as opposed to Montreal (where the language is a barrier). Of course not says our host and stop being xenophobic…
_ _ _
Yes indeed. The giveaway is our host considers Richmond a luxury market. A flat-as-a-pancake ‘burb voted most likely to disappear under the climate change waters. However it contains the airport, very handy for astronaut daddies from Country X to pop in and visit the “housewives and students” they dumped in Canada.

#21 BC_Doc on 12.08.19 at 4:17 pm

“What’s Coming?”

Fourth quarter bank earnings down.
Loan loss reserve allocations up.
Canada jobs down 70k in November.

Badness for Canada.

South of the border, the economy is on fire.

————————————————————————-
#1. Crowdedelevator

Government has disincentivized working for physicians. Once you’ve earned and saved a certain amount, financially it’s not worth working any more as the CRA taxes/takes the majority back. At this stage (M53BC) I am starting to wind it down and am focusing on my health (physical, mental, spiritual) instead. It’s good for me but not good for the local patient population.

Cheers,

BC Doc

#22 Figmund Sreud on 12.08.19 at 4:24 pm

The median household income in Vancouver is $86,100. In Montreal it’s $82,000. So why are people in one (smaller) city willing to pay three times more for a house?
_____________________________________

Household income is irrelevant to us rich Albertans! It’s true, …

Albertans move to LM and/or Vancouver Island in droves![ … up to Campbell River – but not further up north up the island!], because they can drive their convertibles and classic/exotic cars right through the year! They can look out of their windows, … or walk a short distance to the sea – a day in and a day out – and stare at the ever changing sea [ … for example, here is a cam view … oh, about 250 metres east from where I’m standing now, ~1:23 p.m.:

http://www.pointholmesrecreation.ca/rampcam/ ]

Plus, … they can golf and play tennis right through the year, too!

… and so, now you know.

Best,

F.S. – today the island!

#23 Shawn Allen on 12.08.19 at 4:27 pm

Around 1840 I suppose a 16 year old male was expected to be working?

Statistics Canada archaically measures unemployment and income figures for the population of people 16 years old and over. As per Garth’s link and same in labour force survey.

Median income $35,000: https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1110023901&pickMembers%5B0%5D=1.1&pickMembers%5B1%5D=2.1&pickMembers%5B2%5D=3.1&pickMembers%5B3%5D=4.1. – Garth

Meanwhile in today’s world very few 16 year olds are working let alone supporting themselves. This skews the average and median income figure down.

We are in the 2000’s not the 1800’s.

More relevant would be the incomes of people aged 25 to 65.

Median income, 25 to 54: $44,500. – Garth

#24 Sam on 12.08.19 at 4:29 pm

#60 Sam on 12.08.19 at 12:17 pm
Ryan ,No . It’s portfolio A that will return more after 15 yrs.

Math , my friend . Remembee they BOTH average 6%, the only difference is the beta

***

Math is hard. You should be using geometric mean for asset returns, not arithmetic mean. Both portfolios would return the same over that period, but portfolio B would be more volatile.

……………………

NO df, you should be looking at compound returns. And with THAT, Its a mathematical certainty that the less volatile portfolio will return more after 15 yrs (with BOTH hypothetical portfolios averaging the same amount over that time)

math, math,math…….MATH.

volallity of a portfolio is often not touched on

#25 crowdedelevatorfartz on 12.08.19 at 4:35 pm

@#22 BC Doc
“At this stage (M53BC) I am starting to wind it down and am focusing on my health (physical, mental, spiritual) instead. It’s good for me but not good for the local patient population.”
++++

Totally understandable for you to cut back on ridiculous hours when the idiots in Ottawa decide that the harder you work the more taxes you should pay.
Talk about taxing the life out of all incentive to get ahead.

I’m currently working 6-7 days a week to get the business to the point of selling it to some other schmoe that thinks working long hours for big bucks is “worth it”……

Enjoy your personal time.

#26 Flop... on 12.08.19 at 4:37 pm

AGuyInVancouver on 12.08.19 at 4:02 pm

#11 yvr_lurker on 12.08.19 at 2:46 pm
Does the huge difference in price between Montreal and Vancouver have anything to do with foreign buyers and speculators (both from within Canada and from outside) and the large pressure from immigration on YVR (and Toronto) as opposed to Montreal (where the language is a barrier). Of course not says our host and stop being xenophobic…
_ _ _
Yes indeed. The giveaway is our host considers Richmond a luxury market. A flat-as-a-pancake ‘burb voted most likely to disappear under the climate change waters. However it contains the airport, very handy for astronaut daddies from Country X to pop in and visit the “housewives and students” they dumped in Canada.

//////////////

Go easy.

If you read again Zoocasa calls Richmond a luxury neighborhood.

If the money hadn’t of gone to Richmond, it just would of gone somewhere else…

M45BC

#27 45north on 12.08.19 at 4:45 pm

The conclusion: we don’t have enough rich people. If the 1%ers pay 50% more tax per capita than everybody else, don’t we need more? Now that 40% of families pay no net tax (and this week’s changes will increase that) it probably doesn’t make sense to create incentives for people (like medical professionals) to leave. But logic and politics don’t mix.

I know two men who could leave tomorrow. Pretty sure they earn more than $180,000.

Andrew Scheer needs to figure out who he is. His message is simple. The government is running the country by running up the debt which ordinary Canadians are going to pay. The ones earning less than $180,000. The ones who see an extra $20 on their natural gas bill. For the carbon tax. Along with the carbon tax on the gasoline they need to get to work.

If that’s not the message, what is?

#28 Nonplused on 12.08.19 at 4:49 pm

Tricky Trudeau’s tax exemption will be more than made up by his carbon tax. That’s how politicians do. We are all going to be able to afford less starting Jan 1 and it will affect the poor most disproportionately, because the price of almost everything is a reflection of how much energy it costs to produce more than any other factor. Even potatoes are mostly energy. Those tractors and semis don’t run on sunshine.

And if we do get a wealth tax, what a total accounting nightmare that will be. The problem is wealth isn’t money until something gets sold. Nobody really knows what something is worth until that point. Elon Musk is not worth $20 billion until he sells his shares. But to whom will he sell them? And what happens to the price when they hit the market all at once?

Just look at the extreme contortions most municipalities have to go through each year to determine whether one taxpayer should pay $4200 per year while his neighbor is assessed at $4500. It’s crazy. Now imagine we had to do this with all assets.

And will it apply to just individuals, or does the tow truck company have to total up the value of their trucks every year and pay on that too?

Capital gains taxes are in effect a wealth tax, but the reason they work is that there is actually some cash you can tax. You know the buy price and the sell price and the asset has been monetized by the previous owner. But until the sale is made there is no cash, only a notional assumption of what the asset might fetch if it were sold.

And since there is no cash, people blessed with a wealth tax will either have to divert income to pay it, or liquidate some portion of the assets.

The main problem with wealth taxes from a functional point of view is that assets are not money. The main problem from a moral point of view is that they are the confiscation of productive capital from the producers. Every time that has been tried economic devastation was the long term result. You can’t take away a man’s boat and expect him to continue to fish.

#29 Grunt on 12.08.19 at 4:53 pm

More tax. More gas poured on Wexit. I totally get it out west folks. Get rid of the border get rid of the Fed’s and their bank cronies. There’s always going to be Calgary, Montreal, Toronto, Vancouver etc regardless. Just better corporate competition and lower tax overlords.

#30 Bye bye neighbor on 12.08.19 at 4:58 pm

#28 45North

“I know two men who could leave tomorrow. Pretty sure they earn more than $180,000”

My neighbor is in the process of doing just that. Since the economy in Alberta is dead and dying, he’s now working in Houston. He was commuting, but he’s said screw it and is moving. Taxes were the main reason. He still has family in Calgary, so he’ll still be commuting, but it makes no sense for him to remain a Canadian resident.

The phenomena is quite well documented in the US. As a general rule with few exceptions, the population in high tax states is falling while in low tax states it is rising. People vote with their feet when they can. Canadians do not have as many options, used to be you could move to Alberta or Saskatchewan but those options don’t look so good anymore. But the highly educated STEM talent still has a good shot at moving south. Why wouldn’t they? US cities are just like ours are, except usually bigger.

#31 Flop... on 12.08.19 at 5:00 pm

#24 Shawn Allen on 12.08.19 at 4:27 pm
Around 1840 I suppose a 16 year old male was expected to be working?

Statistics Canada archaically measures unemployment and income figures for the population of people 16 years old and over. As per Garth’s link and same in labour force survey.

Median income $35,000: https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1110023901&pickMembers%5B0%5D=1.1&pickMembers%5B1%5D=2.1&pickMembers%5B2%5D=3.1&pickMembers%5B3%5D=4.1. – Garth

Meanwhile in today’s world very few 16 year olds are working let alone supporting themselves. This skews the average and median income figure down.

We are in the 2000’s not the 1800’s.

More relevant would be the incomes of people aged 25 to 65.

//////////////////

I don’t think you have to go back that far.

In 1990, at the age of 16 I had already started my apprenticeship.

Red seal tradesmen by the age of 19.

No riches.

Has allowed me to feed and shelter myself, travel the world and generally take care of myself without getting into debt.

I did this in an affordable housing market and had a paid off house by the time I was in my early 20’s, could even be the only record I hold on here.

I would appreciate having the same house in Vancouver now, but that is not financially viable and the house was not a time and money pit as you would expect at the bottom of a country’s real estate market.

I appreciated the shelter at the time and money has definitely become harder to earn as life has gone by, which is the opposite to a lot of people on here, but getting the real estate fastination over and done with early in life was perhaps the biggest benefit of all of this.

One takeaway message to the masses.

Don’t let your shelter define you…

M45BC

#32 joblo on 12.08.19 at 5:13 pm

“Data is the new Oil”
Frontline: In the age of AI

Has T2 crew gotta plan?

https://youtu.be/tyGEejOBdFc

#33 dumpster fire on 12.08.19 at 5:27 pm

#60 Sam on 12.08.19 at 12:17 pm

Math is hard. You should be using geometric mean for asset returns, not arithmetic mean. Both portfolios would return the same over that period, but portfolio B would be more volatile.

……………………

NO df, you should be looking at compound returns. And with THAT, Its a mathematical certainty that the less volatile portfolio will return more after 15 yrs (with BOTH hypothetical portfolios averaging the same amount over that time)

math, math,math…….MATH.

volallity of a portfolio is often not touched on

***

I am looking at compound returns… Say you’re looking at 6% average compounded returns over 3 years. That’s a total return of: (1.06)^3 = 1.19 or 19%

A low volatility portfolio with the same average would be: +9%, +4%, +5%. Total return of 19%: (1.09)(1.04)(1.05)=1.19, average return of 6%: (1.19)^(1/3) = 1.06

A high volatility portfolio with the same average would be: -5%, 20%, 4.5%. Total return of 19%: (0.95)(1.20)(1.045)=1.19, average return of 6%: (1.19)^(1/3) = 1.06

There’s my math, where’s yours?

#34 RWZM on 12.08.19 at 5:31 pm

“So why are people in one (smaller) city willing to pay three times more for a house?”

I’m sure it’s a random psychological phenomenon, and not caused by any real external pressures that would offend the sensibilities of our bearded Lord and Saviour, Amen.

#35 PetertheSeparatistfromCalgary on 12.08.19 at 5:39 pm

Places like Boise, Idaho and Salt Lake city are having a housing boom. This is not being driven by hot Asian money but rather middle class people getting out of coastal California and buying more affordable digs.

“he recently worked with a couple moving from Los Angeles. They’d sold their 1,300-square-foot house in L.A. for $1.1 million and traded it for a $700,000 house, and nearly four times the size, in Draper.”

https://www.ksl.com/article/46687413/why-home-prices-in-salt-lake-county-are-higher-than-theyve-ever-been

Could this happen in Calgary with Vancouver playing the role of coastal California?

#36 FreeBird on 12.08.19 at 5:45 pm

@ #26 crowdedelevatorfartz

I’m currently working 6-7 days a week to get the business to the point of selling it to some other schmoe that thinks working long hours for big bucks is “worth it”……
————————
Did that a few yrs ago. Maybe better to wait until after next federal election. There can be hidden taxes depending on how the sale is structured. We sold shares plus assets. Presale due diligence was as fun as colonoscopy (minus sedation.) We’ve has a longtime very shrewd CA. There’s a crazy tax paid on sale but can be ‘earned’ back in credits over 7 yrs like from a new business. Can’t recall what the tax was but Garth might. I’m guessing new ones will be added. Plan now for the sale incl a good lawyer. Trust me. It can be a long hard process in some cases. We didn’t retire and one of us is working 7days/wk (again) but loves it. Entrepreneurs can be addicted to the challenge so don’t be surprised if post sale a new biz finds you. Good luck.

PS…We have great docs so hoping they’ll hang in.

#37 FreeBird on 12.08.19 at 5:55 pm

#33 joblo on 12.08.19 at 5:13 pm
“Data is the new Oil”
————————-
Yes, that’s how/why we fell into data analytics. Retirement was an option but demand was there and partner is a Sheldon like dataphile. I was asked (sort of) to go along for the ride and to keep the chaos in the wake of brain waves minimized and a structure around them but it’s fun.

#38 Montreal Bubbles on 12.08.19 at 6:03 pm

Those stats are true only when considering all of Montreal. The urban areas of Montreal, such as the Plateau, Outremont, and Westmount, have seen home prices almost quadruple in 20 years (triple in 15, and double in the last 10). Rents too have doubled in the past 15 years in these areas; particularly since 2012, when rents started increasing in these areas by aroun 10 percent annually, in spite of Quebec rent increases restrictions in law.

#39 wetcoastmom on 12.08.19 at 6:08 pm

As a renter in Vancouver, I wish one could rent. We have spent the last 10 years moving from one developer owned “soon to be demolished” home to another. There are thousands upon thousands of empty homes in Vancouver; and it is very obvious only a portion are paying the empty homes tax. Can’t wait to retire and/or finish last few years of career elsewhere

#40 Sam on 12.08.19 at 6:17 pm

I am looking at compound returns… Say you’re looking at 6% average compounded returns over 3 years. That’s a total return of: (1.06)^3 = 1.19 or 19%

A low volatility portfolio with the same average would be: +9%, +4%, +5%. Total return of 19%: (1.09)(1.04)(1.05)=1.19, average return of 6%: (1.19)^(1/3) = 1.06

A high volatility portfolio with the same average would be: -5%, 20%, 4.5%. Total return of 19%: (0.95)(1.20)(1.045)=1.19, average return of 6%: (1.19)^(1/3) = 1.06

There’s my math, where’s yours?

…………

good grief.

that’s a 3 yr time frame, over a LONGER time frame , the compound return will win as it will have less big flops…arent u a math guy? cmon geez

.Goldie/Murray have shown this, its not like this is some big breakthrough. Again proven in the academic world.

BUT, here ya go with ‘my math’

both portfolios start with $100,000. AFTER 10 yrs both averaged 10%. given the below yearly returns;

Standard deviation: lv- 4.5 , hv- 18.6
compound return; lv- 9.9%, hv -8.5%

year
1 lv-10% hv- 34%
2 5% -9%
3 14% +26%
4 9% -16%
5 13% +31%
6 2% -1%
7 12% +18%
8 16% -12%
9 6% +21%
10 13% +8%

plug in the numbers, whcih portfolio has a higher balance?…hint- math :)

this also speaks to successive return risk in early retirement

#41 Remembrancer on 12.08.19 at 6:38 pm

#20 Last of the Boomers on 12.08.19 at 4:02 pm
Balanced Housing strategy:
Would it be reasonable to suggest a strategy which uses a sliding scale for property taxes based on income taxes paid to CRA, Considering duration of taxes paid.
—————————————————–
No.

#42 whiplash on 12.08.19 at 6:48 pm

#1 crowdedelevatorfartz

Taxes going up for Doctors…
That should help our Dr. shortage..

Idiots

Wife got an e-mail from her doctor last week–last day, Jan 15. Practiced medicine not even 20 years.

Socialism

making everyone equally poor

#43 leslie on 12.08.19 at 6:52 pm

I am not sure why they bother taxing anyone less than 50k…they end up spending 99% of it anyways and it goes back to the economy. top earners are the ones that holds the cash and wait…and wait….and wait…and retire

#44 Dave on 12.08.19 at 6:57 pm

DELETED

#45 JacqueShellacque on 12.08.19 at 7:02 pm

Income inequality is the price of allowing people to be productive. Governments already do what they should in that scenario – tax progressively: lower income people pay proportionately less of their income than higher income people do. The alternative isn’t just bad, it’s horrendous. See what Stalin did to the kulaks in the Ukraine in the 30s. Those railing against the ‘rich’ today are really animated by the same spirit – jealousy, moral vanity, and making a virtue of invented victimhood.

#46 OlderbutWiser on 12.08.19 at 7:10 pm

France tried wealth taxes and all of the wealthy left…T2 needs to understand that capital is so very mobile. If you are a wage slave then you will be hit by any wealth tax. If not, then you leave. A 1% wealth tax on a net worth of $8 million is way more than what the best healthcare coverage can cost you south of the border. I will vote with my feet if it comes to that. I do wonder though, will the government include the estimated commuted value of ALL government workers defined benefit pension plans when assessing the wealth tax? To do otherwise would be truly unfair to those who have to fund their own retirement incomes….

#47 Shawn Allen on 12.08.19 at 7:11 pm

The New Math

Sam, not sure what you are thinking. You are wrong. By the way the compound return IS the geometric return.

When Ryan mentioned the average return, he was talking about the compounded average annual return. And you confirmed at 41 you are using the same compound return for each portfolio.

Volatility matters if you talking a portfolio with annual inputs and withdrawals. It also matters a lot emotionally.

But, for a single sum initially invested, the compound as well as the geometric (same thing) annual return is calculated using the ending value and the starting value and the number of years. Volatility is no part of the calculation.

I think you just got a little mixed upon this. It happens!

#48 Matt on 12.08.19 at 7:13 pm

Folks in the Big Smoke are getting antsy. No one is sure whether it’s the top or not. Money is still finding its way into the country.

Incomes don’t justify these housing prices but people are making it work with Bank of Mom, and combining incomes to just squeeze by with 20% down…

The price history says it all:

https://www.youtube.com/watch?v=TEykqhR9uXM

#49 Shawn Allen on 12.08.19 at 7:16 pm

#46 OlderbutWiser on 12.08.19 at 7:10 pm

France tried wealth taxes and all of the wealthy left…

************************************
I don’t particularly think there needs to be a wealth tax.

One difference there. The European Union allows people to move freely from France to any other European Union country.

What other countries can Canadians move to and work in as a matter of right? Are there any? Certainly not the U.S.A.

#50 Quebec Separatist on 12.08.19 at 7:19 pm

I demand that you have a Quebecois Francais version of this article. Please don’t use metro Parisian French. Use Quebec French (or French-Canadian) instead.

Sincerely,

A Quebec separatist.

#51 Remembrancer on 12.08.19 at 7:20 pm

#36 PetertheSeparatistfromCalgary on 12.08.19 at 5:39 pm
Could this happen in Calgary with Vancouver playing the role of coastal California?
—————————–
Critical analysis spill on Aisle 4 – that article is tragically short on the why?

To help answer your question, has Calgary got those two woorking couple “middle class” household jobs to support a housing boom fuelled by expat Vancouver residents looking for similar quality of life with less expensive housing?

#52 mnpr on 12.08.19 at 7:43 pm

Garth, my wife and I are retired and have about $80,000 in yearly income. With a paid off house. So we’re comfortable but far from wealthy. Some of our income is in the form of dividends and capital gains from unregistered investments. An increase in tax on these sources would hurt us. But people in our income range are supposedly not the target for increased taxation. It is presumed that anybody who has capital gains or dividend income is wealthy which is not the case. And yet you say this income is targeted. Is there any chance that any increase in taxation rate would only be applied to income above a certain amount? For example, the first 50,000 in capital gains still taxed at 50% inclusion and cap gains above that at 75% (or more). Same cutoff idea with dividends?

#53 Shawn Allen on 12.08.19 at 7:51 pm

Math – Ending Value

Sam…

For a single sum initially invested, the compound as well as the geometric (same thing) annual return is calculated using the ending value and the starting value and the number of years. Volatility is no part of the calculation.

Or equivalently if you know the starting value and the compound return and the number of years you can calculate the ending value and the volatility is not part of the calculation.

Ending value equal starting value times ( 1 plus the compound return in decimal form) raised to the power of the number of years.

I love the Y to the X key on a calculator.

#54 Flop... on 12.08.19 at 7:58 pm

pm
#46 OlderbutWiser on 12.08.19 at 7:10 pm

France tried wealth taxes and all of the wealthy left…

************************************
I don’t particularly think there needs to be a wealth tax.

One difference there. The European Union allows people to move freely from France to any other European Union country.

What other countries can Canadians move to and work in as a matter of right? Are there any? Certainly not the U.S.A.

//://////////////

Hey Shawn, I could look it up and give you a list, but it’s Sunday so I’ll shoot from the hip.

You can always apply for a year working holiday visa to places like Australia, Britain, Ireland.

These visas are age restrictive last time I looked, I intended on using them until I was 30.

I took advantage of this program and got a 2 year visa for the U.k, and then got one for Canada, which is what I was doing when I met my wife in Vancouver.

Already had an Irish work visa issued, but never validated it.

You can do this sort of thing for 4 or 5 years until any dark clouds blow over where you are from.

Someone young from Calgary that was not happy with employment outlook could go to Houston maybe, or apply for 2 year visa to Australia and suck in some smoke and work in the mining sector down there.

The most important point I could possibly make to someone that has never traveled is this take on one of Thor Turner’s favourite phrases.

They have ice-cream everywhere.

Everything else is noise…

M45BC

#55 gfd on 12.08.19 at 8:03 pm

Greater Toronto households are starting to show a few cracks, after a big debt binge. Office of the Superintendent of Bankruptcy Canada (OSB) filings show insolvencies jumped in Q3 2019. The Greater Toronto region isn’t just showing a large climb for insolvencies. It’s been accelerating recently as well.

Greater Vancouver Households Are Going Broke Mega Fast
Greater Vancouver households are going broke faster than usual. There was 1,393 insolvencies filed in the region in Q3 2019, up 25.27% compared to the same quarter last year. To contrast, BC saw a total of 2,926 filings in Q3 2019, up 21.87% compared to the same quarter last year. Greater Vancouver’s insolvency growth is over represented in the latest quarter. In other words, it’s hogging more of the debt failure.

https://betterdwelling.com/this-weeks-top-stories-canadian-mortgage-debt-explodes-in-growth-and-so-do-insolvencies/

#56 Christopher Mewhort, EA on 12.08.19 at 8:04 pm

#@13 Russ The missus and I are in Honolulu, marathon time. No need to engage locals about real estate prices here, it comes up in the conversation anyhow.

Similar to Vancouver is insane prices and high percentage of population indicated as a foreign or nonresident status.

One thing they have done right is a native, verified as 50% Hawaiian, can get a homestead house lease at one dollar per year for 100 years.
A forward thinking government could use some of these ideas to resolve our native problem eh.
————–
Congratulations on your marathon. I just finished my 16th. Thank you for contributing to our local economy- we need the cash.

Are you aware that the waiting period for a HomeLands home is now at 110 years – if there are no new applicants?

https://www.hawaiibusiness.com/hawaiian-homesteads-backlog/

Christopher Mewhort, EA
Mewhorttax.com
808-261-5005

#57 SJ on 12.08.19 at 8:36 pm

Apparently what’s coming – maybe not this year, maybe not next – is a pseudo-dictatorship where the government has its boot on your neck. Aka, the Liberal gun ban. Get them while you can.

#58 IHCTD9 on 12.08.19 at 8:39 pm

#53 Remembrancer on 12.08.19 at 7:20 pm
#36 PetertheSeparatistfromCalgary on 12.08.19 at 5:39 pm
Could this happen in Calgary with Vancouver playing the role of coastal California?
—————————–
Critical analysis spill on Aisle 4 – that article is tragically short on the why?

To help answer your question, has Calgary got those two woorking couple “middle class” household jobs to support a housing boom fuelled by expat Vancouver residents looking for similar quality of life with less expensive housing?
———-

Would not surprise me if true. Out here we have the same thing going on, but just not at a level to drive up the whole RE market.

Some little rural burbs out my way now have subdivisions that are full of retirees – many from the GTA. They cashed out, bought a brand new house, and put a pile in the bank on top.

Some of these places are designated by the builder as “adult lifestyle communities” (ie. no kids allowed), and the advertising pics are all blue hairs. Built specifically and exclusively for retirees. All the ads list time to travel to from Toronto…

Maybe the same thing is going on in SLC.

#59 Robert Ash on 12.08.19 at 8:50 pm

I was reviewing a recent article, about the Strategy to use QE, and Low Interest rates… In essense, the Bank Policies, have lead to huge, and startling, injections, of new money into the system, of all major Economic Regions, Fed 5.5T, EU 4.5T, Japan 4.3T, China estimated, 4.5T, this is money to increase the Money supply, and of course it has an inverse relationship, to the real value of any currency on Deposit or Saved. So one quesiton that came up, is this inflationary,… and of course the answer, is yes… and it is reflected in the Housing market, which conveniently is not used in Benchmark Inflation calculations, the subtleness, of this inflation, is a little perplexing, and many folks, studying this Monetary Policy, have concluded that the majority of the Inflation, or New money has made its way into Financial Assets… Corporate Debt, Share Buybacks, Financial Bubbles, as the Funds, are still created and have to be applied/circulated into some area of the Financial system..Conveniently for the Policy makers, Financial Assets, are not easy to assess, from an Inflationary evaluation metric… It is interesting how the Policy makers, are often also working as Academics, and leave one Bank Policy position, to transfer to another, often in the same region. Another interesting aspect was Negative interest rates, were initiated by small Sovern countries, like Denmark and Switzerland, to stop thier safe currencies, from appreciating, so rapidly that the target of the Negative interest rates, was really currency managment, as the Exports, for these run up value currencies, were very negatively impacted. So the lack of a standard currency in the EU, is problematic. It has caused a lot of challenges, to manage Monetary Policy… But the Inflation is there and will really be evident in the next Recessionary cycle, as the reversion to a market equilibrium materializes…. It’s different this time… no kidding, and Emergency Interest rates, will affect not only Housing, but many other asset classes…
The other aspect of this Strategy, is how unfair, the Policies, are to small Emerging markets, where the deflation of the various Regional Currencies, has negatively impacted Current accounts. It seems, that the Poorer members of the world club, keep being the object or recipients, of all this nice Social and Monetary engineering.
The stats cited above are 2015-16, and the Easing, is still being employed. The fact that the whole system, is artificial in many components, is very problematic. The propensity for our Policy Makers to invervene in Market Equilibrium, and Dynamics, is going to continue to cause distortions, for years to come… As for Justin Trudeau, when a PM goes to a Nato Conference and dosen’t know the Contribution of our GDP to Nato and national defense… or mentions, in interviews, that we can’t have the West making all the Economic gains, or the country would be run, from gasp.. Calgary….. you know we are in trouble, if you are a Mr. Market forces are the truest form of Financial Rationalization.
Look to the Bond Market, Investors accepting a very small return or gasp a negative one… are really saying, things, will get so bad in the future… I will take less in 20 years, as my forecasts are not very optimisitic… We need to get back to basics.

#60 Michael Mowatt on 12.08.19 at 8:53 pm

#23 Figmund Sreud

Those exotic convertibles and such have to have snow tires after October 1st..thats the law in B.C.
I grew up in Maple Bay and remained on the Island for most of 40 years. Its anything but warm right now. Its a far different kind of cold than the dry freezer like cold here in Alberta where I now reside. The moisture in the air will freeze your bones. An umbrella is a fully necessary fashion accessory because the Island is essentially rainforest and rain it does. You just have to visit Cathederal grove to realize that from your own pedestrian point of view…its just a bit south outside of Port Alberni. Tennis..not unless you like to show off your splits sliding on wet maple leaves. Im sending my sister an electric blanket for Christmas because shes a former ..much warmer wealthy Albertan but freezing in her home on Arbutus road in Maple Bay there because the house is built on rock shale and she cannot get gas in for heat. She has to live with baseboard for the time being. Your description reminds me much more of Hong Kong to be honest.

#61 SFD on 12.08.19 at 8:54 pm

@MillenialRealist
With all due respect, and, I do mean, all do respect. You are an idiot. Take a step outside and have a good look around. There’s two ways. West and not west. Spend a little time in the none capitalist West and then come back and spout off about Capitalism.
Ok pumpkin

#62 NoName on 12.08.19 at 9:03 pm

#56 Flop… on 12.08.19 at 7:58 pm

Someone young from Calgary that was not happy with employment outlook could go to Houston maybe, or apply for 2 year visa to Australia and suck in some smoke and work in the mining sector down there.

Some time ago I worked with an Ausi dude, in my opinion he was best foreign trained eng, i forked for so far. I remember him telling me about his work in mines and calling a quits to travel a world (on some of his travels he met his wife).

Now i am wondering what drove him ever the edge smoke of dust… Funny enough were we worked we were in business of making a dust, i guess had enough of dust or me who knows, went to alberta. Last i heard of him was he went home.

Very nice guy, but much funnier than you. :-)

Is that traveling around world australian thing or am i missing something.

#63 Don Guillermo on 12.08.19 at 9:07 pm

#48 OlderbutWiser on 12.08.19 at 7:10 pm

…T2 needs to understand….
**************************************

Nothing else needs to be said

#64 MaxBerniersShorts on 12.08.19 at 9:09 pm

#62 Michael Mowatt
Sure that must explain the great shift of BC retirees to Alberta we’ve all been hearing about…NOT.

#65 Don Guillermo on 12.08.19 at 9:16 pm

#23 Figmund Sreud on 12.08.19 at 4:24 pm
The median household income in Vancouver is $86,100. In Montreal it’s $82,000. So why are people in one (smaller) city willing to pay three times more for a house?
_____________________________________
Household income is irrelevant to us rich Albertans! It’s true, …
Albertans move to LM and/or Vancouver Island in droves![ … up to Campbell River – but not further up north up the island!], because they can drive their convertibles and classic/exotic cars right through the year! They can look out of their windows, … or walk a short distance to the sea – a day in and a day out – and stare at the ever changing sea [ … for example, here is a cam view … oh, about 250 metres east from where I’m standing now, ~1:23 p.m.:
http://www.pointholmesrecreation.ca/rampcam/ ]
Plus, … they can golf and play tennis right through the year, too!
… and so, now you know.
Best,
F.S. – today the island!
*****************************************

I spend winters in southern climates where the snowbird population is fairly equal between Canadians and Americans. Interestingly, the largest group of Americans are from the Seattle area and a disproportionate number of Canadians are from Vancouver Island. Many of the islanders retired there from Alberta to escape winters. Go figure.

#66 S on 12.08.19 at 9:18 pm

#5 Millennial Realist

If you had a brain you’d be dangerous.

#67 Shawn Allen on 12.08.19 at 9:31 pm

Paragrahs?

#61 Robert Ash on 12.08.19 at 8:50 pm
I was reviewing a recent article, about the Strategy to use QE, and Low Interest rates…

************************
Did the article use paragraphs? So should you. Until then, I shall not read.

#68 Shawn Allen on 12.08.19 at 9:35 pm

Math

I think what Sam is getting at is that if two portfolios have the same simple arithmetic average annual return. The one with more volatility will grow to a smaller end value.

If they have the same compound annual return the initial money will grow to the same amount by definition – no matter the volatility.

#69 AB on 12.08.19 at 9:57 pm

#66 MB Shorts
You underestimate the “BC political “ effect on Albertan’s. BC is no longer a choice retirement destination.

#70 Jessica Tan on 12.08.19 at 10:02 pm

There already is a wealth tax, it is called annual inflation and it is not 2% a year, more like 3% to 4% a year on the low, cautious calculation. This is not even including the compounding impact of annual inflation which is huge.

A $1,000,000 in a year wealth loses $30,000 to $40,000 a year but over 20, 30 years it works out to $50,000 to $60,000 a year in lost purchasing value. Thieves are thieves no matter where they come from.

#71 Sean Wiegel on 12.08.19 at 10:21 pm

Garth, is Canada in the next 5 to 10 years going to become a 2nd world country maybe 3rd world by 2040 maybe later?

These seem just like the old, socialist BS that Cuba and others use and have a way lower standard of living but we are worse off as a very cold country with large land mass higher transportation costs, our natural resources from oil, gas to mining, metals under attack by enviro wackos and UN. Canadians better wake up or the food bank increase I keep growing more and more will look like a minor problem compared to mass unemployment, mass food insecurity and mass poverty like we have never seen in Canada but anything close during the Great Depression.

#72 Lobster Man on 12.08.19 at 10:23 pm

#51 Shawn Allen,

There are other possibilities….. For example, try Malaysia, the “Malaysian’s – My Second Home Programme”.

Hong Kong people are heading there, instead of Vancouver, unless of course you dislike 32 degree temperatures, and the smell of durian.

LM

#73 DON on 12.08.19 at 10:27 pm

#66 MaxBerniersShorts on 12.08.19 at 9:09 pm

#62 Michael Mowatt
Sure that must explain the great shift of BC retirees to Alberta we’ve all been hearing about…NOT.

*****************

The cold damp air makes your bones ache. No one is golfing on Vancouver Island in the soggy months.

The black ice on the mid to north island is also fun and there is nothing like trying to drive through a monsoon. We still live in the North, and our lucky to see the sun in the winter, mostly sun just clouds. SAD

#74 Spectacle on 12.08.19 at 10:33 pm

#21 AGuyInVancouver on 12.08.19 at 4:02 pm
#11 yvr_lurker on 12.08.19 at 2:46 pm
Does the huge difference in price between Montreal and Vancouver have anything to do with foreign buyers and speculators………….. Of course not says our host and stop being xenophobic…
_ _ _
Yes indeed. The giveaway is our host considers Richmond a luxury market. A flat-as-a-pancake ‘burb voted most likely to disappear under the climate change waters. However it contains the airport, very handy for astronaut daddies from Country X to pop in and visit the “housewives and students” they dumped in Canada.

Hey, just some insights into Richmond the big burp! When the quakes come knocking. The airport is a convenience to those fly in temp flippers, but more important is the myopic views of investing ( safe laundry..). It’s not, notice that All essential services regarding Air transport are moved to Boundary Bay among other places. ( noticed those large red beacon towers are gone as well) They know it’s under water & useless when a medium Quake hits. Quake/flood insurance of that magnitude does not apply in Ricjmond, beyond a leaky sewage pipe or dishwasher.

2cents…

#75 Loonie Doctor on 12.08.19 at 11:06 pm

#22 BC Doc

Good for you! We recently decided to downsize and I will go part-time effective July. Looking forward to it. I still enjoy medicine, but will enjoy it more having a better balance with my own health and family. I am still in what would be considered peak-career years. However, it is also probably my physical peak and peak-parenting time for my kids too.

We are moving to a more average cost of living area. With that and moving out of the top tax brackets, we can live the same while I work half-time or less. You get way more bang for your after-tax buck by spending less than working more. Save on consumption taxes and bring ourselves out of the high-tax-target-zone. Blend in.

We are fortunate to have these choices. Of course, most successful professionals do have choices. Not a big deal as long as there are well-trained replacements, but that costs money too.
-LD

#76 meslippery on 12.08.19 at 11:30 pm

This will further remove some people from the tax rolls and cut federal revenues by $15 billion over four years, Scotiabank figures.
———-
Sadly free trade and globalization means no more middle class to tax.
So only people with lots of money are left to tax.
Or any money aka rich.

#77 Michael Mowatt on 12.08.19 at 11:56 pm

#66 MaxBerneirShorts.
Retirement in Alberta, Meh..nope. We are far too hard working and too busy working toward one.
Victoria Vancouver Island..NOT
Newly weds and nearly deads is the Victoria motto, All Manor of homeless misfits travel there just to panhandle down in what is a really old down town and yah.. crappy damp, cold ,wet weather most days. So, to what Sigmund said I will ad this stereo typical Island saying. “If you believe the weather man…you will believe anything” That’s the trouble with most of B.C. to date…if you get my drift.
when its time..Miami suits me fine thank you.
The weather is 30 plus most days, water at the ocean is gorgeous… Clean… and not a word of a lie..warmer than the hotel pool.
Right now I continue rent a modern 3,600 square foot house here in Edmonton at $1595 a month and I am saving money hand over fist even now. No user pay medical, no expensive icky bicky (ICBC) car insurance and No B.C. hydro monopolism. Gotta like it.

#78 CEW9 on 12.09.19 at 12:03 am

#51 Shawn Allen on 12.08.19 at 7:16 pm

#46 OlderbutWiser on 12.08.19 at 7:10 pm

France tried wealth taxes and all of the wealthy left…

************************************
I don’t particularly think there needs to be a wealth tax.

One difference there. The European Union allows people to move freely from France to any other European Union country.

What other countries can Canadians move to and work in as a matter of right? Are there any? Certainly not the U.S.A.

Plenty of options for wealthy people. Many stable nations offer citizenship to people in exchange for as little as $100,000 investment or less (invested in real estate or govt bonds, mostly, but also by donation).

Nations in Europe like Malta, Moldova & Montenegro do this, which then give access to the broader EU.

USA offers EB-5 investor visa which gives permanent U.S. residency and eventually citizenship when a person invests between US$500,000 and US$1-million in a new commercial enterprise that produces at least 10 full-time jobs.

So, no, there is no limit on where people with money can go, and if they are financially oppressed I do not think they will hesitate to leave.

Canada will become just a place to visit (on the cheap when our dollars tanks).

#79 Sean on 12.09.19 at 12:33 am

Exploitation is expanding at a rapid pace. No wonder the wealth gap is expanding, narrowing the tax base.

https://www.businessinsider.com/unemployment-vs-involuntary-part-time-work-underemployment-2019-1

#80 Politico on 12.09.19 at 12:49 am

I told you it would happen. Not even SNL can stand other world leaders mocking their president, love him or hate him.

https://www.youtube.com/watch?v=bfziU-pp1TM

Trudeau may have just committed a big influence in the 2020 race, bigger than anything the Russians did in 2016, only in favor of Trump. We are, unfortunately, governed by a twit.

Don’t get me wrong, SNL still mocks Trump in this video, but notice how they mock Trudeau even more. I told you this will happen. You don’t mock Americans. It’s their country, right or wrong.

#81 Al on 12.09.19 at 12:57 am

“So, that’s is how politics works. Tax success. Pander to the rest.”

So people who don’t earn high salaries are not considered successful. Gotcha. Clearly something is wrong in our society.

#82 Al on 12.09.19 at 1:20 am

“The bottom 90% (all people over 16) have an average income of less than $29,000”

Yes high school students and post secondary students don’t earn a lot, neither do those who can’t work. The median income for a full time worker ( one person, not household) in Canada is over 50K. Source- stats can.

#83 Space Cowboy on 12.09.19 at 5:11 am

Here’s the thing about being a multi- millionaire stock investor, when you never ever sell anything, and never crystallize capital gain you never pay a dime in taxes. Buying in tax deferred accts with dividend earnings, right, no tax. Buying on margin, right again, no tax. Why is Buffet rich, right right right, no tax. Any income should be cut off if it reaches taxable levels, zero tax. Earn too much, work less, pay zero tax. Doctors, why work 80 hrs when Trudeau screws you out of 60? Zap that taxable portion to zero. Awesome sunset btw.

#84 Peter Kook on 12.09.19 at 5:49 am

“…luxury neighborhoods including Richmond”

Google reports average $65,241 in Richmond.

Just visit Richmond and see how fishy the statistic is!
They have tons, tons, and tons of money. Probably not reporting income at all.

#85 NoName on 12.09.19 at 6:34 am

Hey ponzy the Krampus what’s up with this?

https://amp.theguardian.com/world/2019/dec/08/austria-struggles-with-marauding-krampus-day-demons-gone-rogue?CMP=Share_AndroidApp_Tweet&__twitter_impression=true

#86 Shaggy on 12.09.19 at 7:46 am

I’ll offer a perspective that I’m sure will get some backlash. I’m a 1% and I paid roughly $200k in income taxes last year. I recognize that my family is very fortunate and I don’t have any issue paying a disproportionate amount back into the country’s social security network because of it.

But, what many don’t realize (and what Garth has been trying to explain) is that the top tax bracket of 53% kicks in pretty early in Canada and makes us very non-competitive in comparison to many countries. In my case, the financial gains have come at a cost. Our family moved around quite a bit and we even lived outside of Canada for 8 years in not so nice places to get ahead. I currently leave for work before my kids get up and see them at best an hour a day during the week. Despite all of this, we have a mortgage on our (average) house, a 13 year old car, and are aggressively saving for our kids’ education. Yes, there are ways to defer income tax (RRSP, TFSA) and some government benefits have yet to be indexed to household income (i.e. RESP), but I assure you that these are limited and most tax breaks are geared to the lower/mid income earners.

Once again, I recognize that we’ve got it good, but my point is that being a 1% in Canada (particularly in Toronto or Vancouver) doesn’t mean that you’re living in the lap of luxury and jetting off to warm vacation spots multiple times a year. Lately, I’ve been questioning more and more if the $ are worth missing my kids childhood, and seriously debating leaving my job. Any further increase in taxes will make the decision very easy.

I leave you with one question, what truly world class company, product or service offering do we, as Canadians, provide the world? This is the society that we have built and the cost.

#87 jack on 12.09.19 at 7:47 am

#11 yvr_lurker on 12.08.19 at 2:46 pm

Of course it does, but not if you ask Garth. Canada is admitting 300k immigrants per year and the majority go to YVR and YYZ. That explains why the average income doesn’t match the house price – the majority bring big dollars with them, buy houses, and don’t necessarily work in Canada. Think about what would happen to housing prices in these areas if immigration suddenly stopped – The demand would drop, inventory would dramatically rise, and prices would drop. End of story.

According to the latest census, the average income of immigrants to Canada is $29,770. Newcomers are not the reason you can’t afford a house. – Garth

#88 Sam on 12.09.19 at 8:08 am

re.,Shawn Allen, um, ,thanks

back to my 10 yr example comparing a low volatility(lv) Vs high volatility (hv). So at the end of 10 yrs what were the balances. Note ; in yr 1 should read: lv: +10%, hv : +34%. I gave the hv a nice head start!! :) Again BOTH averaged the same over said period, 10%

final balances…..drum roll………..:

lv: $257,426
hv: $227,313

a WHOPPING $30,000 difference. And if someone doesnt believe the numbers? well, do the math…:)

#89 crowdedelevatorfartz on 12.09.19 at 8:25 am

@#63 SFd and 68 S

“Do we stop life, to allow capitalism to continue, or do we stop capitalism, to allow life to continue?”
++++

Not to worry.
Millenial Surrealist, copied and pasted ( what used to be called “plagarized” in boomer-speak ), another simplistic, catchy, phrase off the internet and smugly assumes intelligence.
Far from it.
Just another lamb bleating in the herd.
In a few decades, when he(or she), inevitably reaches the “age of Boomer-dom”…with minimal savings and the govt Nanny state is broke….they will realize…. while eating cat food…far, far too late ….that perhaps solely relying on the handouts from socialist taxation wasnt the answer.

#90 Dharma Bum on 12.09.19 at 8:33 am

In fact it’s practically a city-wide party every July 1st when people move from one apartment to another.
——————————————————————–
Montreal. A city of drifters.

drifter
noun

One that drifts, especially a person who moves aimlessly from place to place or from job to job.

#91 crowdedelevatorfartz on 12.09.19 at 8:34 am

@#87 No Name

https://amp.theguardian.com/world/2019/dec/08/austria-struggles-with-marauding-krampus-day-demons-gone-rogue?CMP=Share_AndroidApp_Tweet&__twitter_impression=true

Hilarious.
Once a year Ponzie gets to have fun.

#92 Space Cowboy on 12.09.19 at 8:40 am

Trudeau’s a loser, Trump’s a winner, facts are facts. Since Trump unleashed American Energy he has created over 7 million jobs.

https://www.breitbart.com/politics/2019/12/08/exclusive-treasurys-monica-crowley-on-the-explosive-trump-economy-success-boom/

What had Trudeau done? Addicted thousands more kids to pot, screwed up our financial , energy, mining, agriculture and foreign relations. Where are our new hospitals, super highways, bridges, schools? Where are Canada’s jobs, and not those phony public service jobbers stuffing a ballot box, the real jobs? Instead Trudeau is losing tens of thousands of real jobs in every province except Quebec, which he bribes with a tens of billion dollar ” transfer”.

Jobs not ghetto votes, instead of ghetto votes before jobs. What a thought eh?

#93 Tater on 12.09.19 at 8:40 am

#90 Sam on 12.09.19 at 8:08 am
re.,Shawn Allen, um, ,thanks

back to my 10 yr example comparing a low volatility(lv) Vs high volatility (hv). So at the end of 10 yrs what were the balances. Note ; in yr 1 should read: lv: +10%, hv : +34%. I gave the hv a nice head start!! :) Again BOTH averaged the same over said period, 10%

final balances…..drum roll………..:

lv: $257,426
hv: $227,313

a WHOPPING $30,000 difference. And if someone doesnt believe the numbers? well, do the math…:)
———————————————————-

Oh dear. So, you don’t know the difference between arithmetic and geometric averaging. And you claim to know math?

Take a guess what the G in CAGR stands for.

#94 Ken Neudorf on 12.09.19 at 8:47 am

the average income stats you quote are very misleading,
in that age 16, is not usually a full time worker, but more likely a student working part time for minimum wage while going to school. Using the website you listed, if you change the selection to age 25 to 55, when people are out of school and working full time, you get a much more reasonable average income of 54.8K, and a median income of 44.5K. I think these are the numbers that should be used when talking about income as they better reflect wages post school years.

#95 Dharma Bum on 12.09.19 at 8:49 am

#12 Linda

It is truly shocking how much one pays for the privilege of working for a living!
——————————————————————–

That’s a fact in many cases.

Ever since I stopped skittering about in the dreaded rat race, I keep a lot more income.

This is primarily due to the reduction in expenses I was required to pay for in order to work (transportation, fuel, nicer clothing, going out on more work related “social” occasions, showers, haircuts, lunches, but mostly the income tax.

Efficient investment income is taxed at a fraction of salary.

Why work? Unless you have nothing better to do.

#96 MF on 12.09.19 at 9:02 am

77 Loonie Doctor on 12.08.19 at 11:06
BC doc

-Hey I thought you told the medical school admissions officer that you were going into medicine “to help people”?

MF

#97 MF on 12.09.19 at 9:07 am

94 Space Cowboy on 12.09.19 at 8:40

Trump is also adding to the unsustainable deficit. Myself, and a lot of others, wanted the tax drop to occur with a drop in spending. Instead spending went up. Bad move.

Trump also attacked to fed to reduce rates. He campaigned on the message they left rates too low for too long, which is the problem. Now in office he wants more of the failed Nirp policy. Bad move 2.

I’m on board, but the current growth in the US is at expense of future growth.

MF

#98 MF on 12.09.19 at 9:12 am

8 Shaggy on 12.09.19 at 7:46 am

Magna (car parts), the big 5 banks (finance).

These are two Canadian products or services that we offer the world.

Literally just spent .02 seconds googling it to find your answer. Probably would find others if I spent upwards to 5 seconds.

MF

#99 jack on 12.09.19 at 9:16 am

“According to the latest census, the average income of immigrants to Canada is $29,770. Newcomers are not the reason you can’t afford a house. – Garth”

The average income of newcomers has no bearing on their ability to purchase a home if they bring money with them.

My neighbors are a case in point – no signs of anyone working yet they are living in $1M+ homes. This is definitely a large contributor to the disparity between home prices and median incomes in YVR and YYZ.

Wow. Your neighbours. That settles the argument. Build that wall. – Garth

#100 MF on 12.09.19 at 9:23 am

#80 CEW9 on 12.09.19 at 12:03

We seem to get a monthly post from Garth like this as a fear tactic. Never say never, but nothing of the sort of policies envisioned here has materialized yet.

Those countries you mentioned, or other countries where people with Money go to avoid taxes, are usually dodgy, full of scammers, and have high inequality. Some are dangerous too.

I have sympathy for a professional, or business owner, working hard to live a good life. I don’t have any sympathy nor care where some ultra rich person goes to avoid taxes.

The place I want to live in is one where the average person has a chance, not some place that ultra wealthy go to take advantage of out of greed.

MF

How is wanting to keep at least half your income ‘greedy’? – Garth

#101 crowdedelevatorfartz on 12.09.19 at 9:31 am

@#92 Dharma Bum
“Montreal. A city of drifters.”
+++++

Channeling your “inner James Mitchener” Dharma?

#102 Works in other counties on 12.09.19 at 9:36 am

20% flat tax for everyone!

#103 Jesse on 12.09.19 at 9:36 am

Garth – am I banned? Also, is there a reason why?

Apparently not. The blog infrastructure’s been a bit flaky lately. – Garth

#104 Jesse on 12.09.19 at 10:01 am

#105 Jesse on 12.09.19 at 9:36 am
Garth – am I banned? Also, is there a reason why?

Apparently not. The blog infrastructure’s been a bit flaky lately. – Garth

*******************************

I’ve been trying to post from a different account, but nothing is getting through. Not sure what’s wrong with the site, you need to sharpen your web troubleshooting skills! I would help but I don’t know enough about web dev to be useful…

But you know enough to criticize. – Garth

#105 Linda on 12.09.19 at 10:03 am

Have been doing some research, looking into where we might go should we decide to become expats. One thing I looked into that quickly eliminated a lot of places is water security. Water is life, quite literally. So if anyone is thinking of moving on, be sure to check whether the local water is both potable & likely to be available long term. Also be prepared to lower expectations. Have looked at quite a few ‘luxury’ properties online already which are frankly much less luxurious than the ‘average’ house we currently occupy & yes, I’m looking for homes that are similar in size (under 1,500 square feet). Quite the eye opener to see melamine countertops cited as a ‘high-end’ finish!

#106 Mattl on 12.09.19 at 10:09 am

#36 PetertheSeparatistfromCalgary on 12.08.19 at 5:39 pm
Places like Boise, Idaho and Salt Lake city are having a housing boom. This is not being driven by hot Asian money but rather middle class people getting out of coastal California and buying more affordable digs.

“he recently worked with a couple moving from Los Angeles. They’d sold their 1,300-square-foot house in L.A. for $1.1 million and traded it for a $700,000 house, and nearly four times the size, in Draper.”

https://www.ksl.com/article/46687413/why-home-prices-in-salt-lake-county-are-higher-than-theyve-ever-been

Could this happen in Calgary with Vancouver playing the role of coastal California?

————————————————————–

No matter where the money is coming from, California or China, it’s a migration of people with money.

Kelowna has seen this happen – in the 90s and into the 2000s is was a migration of money from Alberta. The last 5 years has seen a ton of people move from YVR to the central and south Okanagan. I’m part of this group, and homes here – to us – were incredibly cheap. Sell a house in some LM backwater and buy an acreage, water view with a big home? Sounds great! No problem bidding heavy, playing with house money.

This is also what happened in YYR. Were all buyers foreign? Of course not, but a large amount of money was injected into some of more expensive hoods and it snowballed from there. Lots of people hit it big on their house or condo in the city and bid up properties in places like Pitt Meadows and Maple Ridge. Those folks then cashed out and moved to the Interior or the Island. I know of ten+ people that made this move.

Will people and money migrate to Calgary? I doubt it. Calgary is a great city but there are much nicer places to live in this province. BC takes a beating on this blog but if you can afford them, Victoria and Kelowna are great places to live. That’s why so many Albertans retire out here.

#107 Loonie Doctor on 12.09.19 at 10:16 am

#98 MF on 12.09.19 at 9:02 am
77 Loonie Doctor on 12.08.19 at 11:06
BC doc

-Hey I thought you told the medical school admissions officer that you were going into medicine “to help people”?

MF

—————————————————————-

I do help people every day (whether at work or home) and I will continue to do so. Further, I didn’t say that I would mindlessly sacrifice myself and my family to do so. Life, people, and the world aren’t binary. Not sure that you can be helped if you think that way.
-LD

#108 Mattl on 12.09.19 at 10:18 am

#48 OlderbutWiser on 12.08.19 at 7:10 pm
France tried wealth taxes and all of the wealthy left…T2 needs to understand that capital is so very mobile. If you are a wage slave then you will be hit by any wealth tax. If not, then you leave. A 1% wealth tax on a net worth of $8 million is way more than what the best healthcare coverage can cost you south of the border. I will vote with my feet if it comes to that. I do wonder though, will the government include the estimated commuted value of ALL government workers defined benefit pension plans when assessing the wealth tax? To do otherwise would be truly unfair to those who have to fund their own retirement incomes….

—————————————————————

Capital may be mobile, but most of the folks in scope for tax increases aren’t as mobile as you may think. I think a lot of them would be employees.

Trudeau is counting on the fact that most of us can’t just pick up an leave. Even if I was willing to move my family to the US, away from our parents, siblings, I’d have to find new employment, sell a house, etc. I get that some are fully mobile, have little connection to family/friends and can work anywhere but I suspect that is the exception to the rule.

#109 Jesse on 12.09.19 at 10:46 am

#106 Jesse on 12.09.19 at 10:01 am
#105 Jesse on 12.09.19 at 9:36 am
Garth – am I banned? Also, is there a reason why?

Apparently not. The blog infrastructure’s been a bit flaky lately. – Garth

*******************************

I’ve been trying to post from a different account, but nothing is getting through. Not sure what’s wrong with the site, you need to sharpen your web troubleshooting skills! I would help but I don’t know enough about web dev to be useful…

But you know enough to criticize. – Garth

*******************************

Criticize who? Did I break any rules? I though the comments were for discussion? It would help if you let me know why I was banned, and I would change my behavior. I see a lot of off the cuff comments in here. I would help if you set the rules up front, at least let me know. Of all the comments I have made, I don’t think I violated any rules. Please advise.

#110 maxx on 12.09.19 at 11:11 am

@ #5 Millennial Realist on 12.08.19 at 2:11 pm

Capitalism took root long before boomers arrived on the scene, and – brace yourself – will persist long after mils have evaporated.

Got it?

#111 din on 12.09.19 at 11:16 am

Its not a coincidence that vancouver sales have rebounded since the unrest in hong kong began. Prices always lag sales. To think the real estate market in big cities is local, is being ignorant.

#112 Sail Away on 12.09.19 at 11:21 am

Why wait for retirement to eat cat food? Do you know how much you can save for the future if you preemptively eat cat food? Even the premium stuff.

Personal finance tip #32.

#113 Ponzius Pilatus on 12.09.19 at 11:28 am

#93 crowdedelevatorfartz on 12.09.19 at 8:34 am
@#87 No Name

https://amp.theguardian.com/world/2019/dec/08/austria-struggles-with-marauding-krampus-day-demons-gone-rogue?CMP=Share_AndroidApp_Tweet&__twitter_impression=true

Hilarious.
Once a year Ponzie gets to have fun.
————————-
Typical British myopia.
How about English soccer hooligans?
By the way, the event is on December 6th, not Dec 5th, as reported.
Sloppy journalism, to boot.

#114 S on 12.09.19 at 11:57 am

102 MF

“The place I want to live in is one where the average person has a chance, not some place that ultra wealthy go to take advantage of out of greed.”

Two such places have traditionally been the US and to a lesser extent Canada. Name another country where a twenty year old college drop out from a medium income middle class camily can start a company that not only makes countless people wealthy but also transforms the world. (And that story repeats itself in the US over and over) There is a reason why immigrants ( like myself) have been desperately trying to get out of places that socialism turned into economic and sociological basket cases and come to North America.

If you think this place needs fixing then you haven’t travelled or read or lived long enough. As it is The One With Fancy Socks already fixed it to the point that it will take years to unwind the damage. So glad I didn’t renounce my original citizenship. Once socialism was overturned there and free market economy was allowed to function the place is rocking.

Perhaps a good indicator of what Canada is becoming can be found in the minimal number of Hong Kongers with Canadian passports that returned here despite of what is happening on that island. Canada has become a place where, for an ambitious driven individual, there is little hope for success – only to leave for greener pastures. I’ve read that book in my youth and know it backward and forward. Countries that disincentivise success very soon begin to circle the toilet of economic failure. Around the world it happened over and over again. Why would you think this place is any different?

#115 bdwy on 12.09.19 at 11:58 am

#107 Linda on 12.09.19 at 10:03 am
be sure to check whether the local water is both potable & likely to be available long term
—————————–
the small town we often hang in mexico is very dry and relatively primitive for utilities. (beach is good though!) . tap water is not for drinking, yes, but the water truck came by our house every day,a buck or so for the 20l water cooler type jugs.
at first I brought out the empties to exchange for full ones but this seemed to be a problem with the driver. he insisted on carrying the full ones into the house himself.

#116 Quintelian on 12.09.19 at 12:00 pm

It’s not just Vancouver, it’s most of BC, even in the interior, where the weather is not much better than Montreal.

Housing is no longer shelter. It’s a status symbol, and an obsession. There is no connection between economic fundamentals and prices. By any measure it is a bubble.

Nobody can accurately predict when it will pop because it is held up by psychology, and not numbers that one can plug into the calculus. A couple of seasoned national media reporters have been writing about the nefarious goings on that have been contributing factors-but let’s leave that alone for now.

But talk about having a tiger by the tail. When this bubble pops, the bulk of the existing anger will shift from those who are currently frozen out of the market, to those who have been buying into the hype, and will wake up on a spring morning with a million-dollar mortgage, on a condo worth much less.

The madness can go both ways. What rational person would have thought prices could have reached these heights? I suspect the question will be: Who would have thought prices could reach these lows?

#117 Sail away on 12.09.19 at 12:25 pm

#88 Shaggy on 12.09.19 at 7:46 am

I’ll offer a perspective that I’m sure will get some backlash. I’m a 1% and I paid roughly $200k in income taxes last year.

————————————–

Wow, that’s painful. Why would you ever be comfortable paying disproportionately more than other people for no extra benefit?

The more money kept out of gov’t hands the better.

Provincial health used public funds to open an overdose prevention site near our office. It is now affectionately known as “Crime Alley”. Your (and my) tax dollars at work.

#118 baloney Sandwitch on 12.09.19 at 12:33 pm

#88 Shaggy
What’s stopping you from moving to a more economically better climate? The USA you won’t be alone. Don’t kid that you will be missed. There are 20 more people more than willing to take your place. Been there, done that.

#119 Linda Franzel on 12.09.19 at 12:36 pm

The Federal, Canada, Trudeau, Morneau Liberals carbon tax will cost $3,500 to $4,000 a year per family at the very least when done over the next 4 years.

Liberals show they want to cut taxes when pushed into it like under the Chretien, Martin Liberals back in the 90’s, early 2000’s. However, they give a $1 and take back $2, $3 or $ dollars depending how successful you are. I can’t believe people how so dumbed down these days.

Liberals, NDP, Green Party and other socialist ideologies and policies create more poverty and an ever higher cost of living for everyone and people still have not figured it out. Just like John Tory fake conservative really Liberal now that he has and will continue to increase taxes and add new taxes, fees etc. at 3, 4, 5 times the annual CPI, inflation rate by the Bank of Canada, StatsCan.

#120 Blog Bunny on 12.09.19 at 12:51 pm

Talking about taxes, do any of you give to charity here in Canada ? The more of a nanny state we will have, the less people will be generous.

#121 Tater on 12.09.19 at 12:51 pm

#104 Works in other counties on 12.09.19 at 9:36 am
20% flat tax for everyone!

—————

In theory, you could raise the same revenue with a flat tax of 25% on income over 22k as we do in our current system.

It will never be implemented though, because it would be a massive tax hike for those in the 45th to 95th percentiles and a massive cut for those at the top. I’d happily take it, but you’d have a bunch of people like IHCTD9 screaming about finally paying their fair share.

#122 N on 12.09.19 at 1:12 pm

While there hasn’t been a recession to accelerate insolvency filings, what we have seen in the last two years is a different pressure: a disproportionately large increase in those who can no longer balance their budget with debt….
This time around, financial distress isn’t due to a loss of income, but rather a shortage of income to cover expenses and debt repayment.
For an increasing number, the heavy debt loads and continuous borrowing they have maintained for several years now has reached the point of being unsustainable. Access to more credit to delay insolvency is no longer an option.
Our average client spends 40% of their monthly net income on housing costs. We also know that today, roughly 95% of those filing insolvencies in Ontario are renters.
https://www.hoyes.com/blog/10-top-debt-statistics/

#123 IHCTD9 on 12.09.19 at 1:48 pm

#77 Loonie Doctor

#22 BC Doc
——- —-

The two Docs nicely explain why trying to carve more out of well off folks just won’t work. T2 already learned this lesson last term, but I guess he has to do the course over again.

After a point, few will bust their ass to make any more. It’s not just working for half pay, but that there is value (like free time, and family time) in other things too. Quite a bit of value.

You only need so many dollars to live contentedly, after that the dollars bring diminishing returns.

#124 Sail away on 12.09.19 at 1:51 pm

#124 Tater on 12.09.19 at 12:51 pm

—————————————-

I’d happily take it, but you’d have a bunch of people… screaming about finally paying their fair share.

—————————————-

Don’t kid yourself; there is no such thing as ‘fair share’. The more money you allow gov’t to take, the more they will spend.

Drunken sailor rather than fair share.

#125 Midnights on 12.09.19 at 2:11 pm

61 Robert Ash on 12.08.19 at 8:50 pm
Lmbo………..
Why not just post the interview from Money Talks?
Plagiarism lol…

#126 the Jaguar on 12.09.19 at 2:16 pm

#119 Quintelian on 12.09.19 at 12:00 pm and also
#125 N on 12.09.19 at 1:12 pm

Very thoughtful posts, thank you.
The article on insolvencies provided via the link is certainly interesting. If 95% of insolvencies involve renters it would be interesting to know what other common characteristics are shared given solid strategies that support rent & invest versus taking on a big mortgage.
It’s also interesting that the consumer debt levels (Consumer credit is ‘coming home to roost’…love that reference) are largely unsecured (non HELOC). Can it be that in the “rush to technology and digital platforms” embraced by the major banks their ‘credit robotics’ didn’t get it right? Too many unsecured lines of credit to those who could not or would not show the necessary restraint with revolving credit? Robbing Peter to pay Paul only works for so long. Especially for those who demonstrate financial discipline along the same lines as the Britanny Spears tune “Oooops, I did it again..” .
As Garth has warned us many time—this won’t end well.

#127 YVR Expat on 12.09.19 at 2:29 pm

#122 Linda Franzel on 12.09.19 at 12:36 pm
The Federal, Canada, Trudeau, Morneau Liberals carbon tax will cost $3,500 to $4,000 a year per family at the very least when done over the next 4 years.

Liberals show they want to cut taxes when pushed into it like under the Chretien, Martin Liberals back in the 90’s, early 2000’s. However, they give a $1 and take back $2, $3 or $ dollars depending how successful you are. I can’t believe people how so dumbed down these days.

Liberals, NDP, Green Party and other socialist ideologies and policies create more poverty and an ever higher cost of living for everyone and people still have not figured it out. Just like John Tory fake conservative really Liberal now that he has and will continue to increase taxes and add new taxes, fees etc. at 3, 4, 5 times the annual CPI, inflation rate by the Bank of Canada, StatsCan.

******************************

I don’t understand how most Canadians don’t see this. Dark days ahead for Canada.

#128 SoggyShorts on 12.09.19 at 3:17 pm

#126 IHCTD9 on 12.09.19 at 1:48 pm
#77 Loonie Doctor

#22 BC Doc
——- —-

The two Docs nicely explain why trying to carve more out of well off folks just won’t work. T2 already learned this lesson last term, but I guess he has to do the course over again.

After a point, few will bust their ass to make any more. It’s not just working for half pay, but that there is value (like free time, and family time) in other things too. Quite a bit of value.

You only need so many dollars to live contentedly, after that the dollars bring diminishing returns.
********************************
I rarely go to the doc (for now) and my Family doctor is at a walk-in clinic where there are 3 other doctors. I just found out that they are now only open 4+ 2 half days a week down from 7.
Same docs, 20% fewer total hours worked.

Obviously I don’t know for sure why they’ve dropped, but none of them are hungry recent grads so seeking a better work-life balance in the face of diminishing returns seems like a reasonable explanation.

#129 NoName on 12.09.19 at 3:18 pm

Today, more like last night in a wee hours, at work I found same person to talk to and I found out that some Eu countries include estimated value of illicit activitys as a part of official GDP numbers.

I do remember seeing a table somewhere that depict percentage of GDP to funny stuff per country, ofcourse Greece is a distant leader.

Here is an older article with that table, on “that” topic. If I come across a list of the countrys that include illicit activities in GDP I’ll post it, but if I remember well they are all European countries. Funny for some countries could bump GDP growth for 0.1-0.2%…

https://www.forbes.com/sites/niallmccarthy/2017/02/09/where-the-worlds-shadow-economies-are-firmly-established-infographic/

#130 JonBoy on 12.09.19 at 6:32 pm

#123 IHCTD9 on 12.09.19 at 1:48 pm

After a point, few will bust their ass to make any more. It’s not just working for half pay, but that there is value (like free time, and family time) in other things too. Quite a bit of value.

You only need so many dollars to live contentedly, after that the dollars bring diminishing returns.

—-

Depends how you make it. I work 40 hours a week to make a really good salary. If I can make more, working the same 40 hours a week (and it is possible), then the returns are not diminishing, in my opinion, unless I take on a much more stressful role.

While I don’t like to see half my money going to the government, I’m still going to make more than I did before, with no greater cost (time, primarily) away from the things I do value.

Once you reach a certain income level, all of your necessities are covered. After that point, every additional dollar is gravy – you can invest, you can save or you can splurge on toys and still not really hurt your future. In those situations, even taking a 50% haircut on the dollar you earned is still making life pretty good. As such, those dollars are magnified, in my opinion – they’re a gateway to either higher savings or more toys, depending on your mindset. Either way, definitely worth it!

I haven’t paid 50% in actual income tax yet in my life, mainly due to RRSP contributions and charitable donations, but by the time I get to that point, I won’t really be too worried about it.

Living below your means, choosing to spend money on things that you truly enjoy and/or use regularly, and not having new vehicles all the time does wonders for financial freedom…