Monthly Archives: February 2015

TFSAs benefit everyone, not just the so-called “rich”

Canadian Tax-Free Savings Account concept word cloud

By Jonathan Chevreau

No surprise that the Broadbent Institute — a newish left-leaning think tank that counterbalances the rightish Fraser Institute — has concluded in its report Double Trouble that only the “rich” would benefit from the promised doubling of annual contribution limits for Tax-free Savings Accounts (TFSAs.)

You can read the Financial Post’s front page story by Garry Marr (aka @DustyWallet on Twitter) here and the Globe’s version here.

I was particularly interested in the CBC website’s coverage, and especially the almost 900 reader comments that have been piling on. For instance, one reader said:

What was the big surprise here? you need money to make it?

Or this:

The government doesn’t lose anything. The NDP lose votes. The TFSA is one of the few programs the average guy and gal can use. The NDP should be all over the TFSA and tell Canadians how they would make it better faster. This is really bad electioneering on their part. The NDP should be trying to convince the public TFSA were their idea.

Continue Reading…

5 reasons you could ignore the March 2nd RRSP deadline in favour of TFSAs

Ermos Erotocritou, CFP

By Ermos Erotocritou, CFP

Special to the Financial Independence Hub

With the deadline for Registered Retirement Savings Plans quickly approaching, thousands of Canadians will be getting out their cheque books to make their annual RRSP contributions. While saving for the future is always a good thing, the choice between RRSP or the Tax-Free Savings Account (TFSA) is not that simple.

Too many Canadians blindly make RRSP contributions without knowing if they will be better off in the future by making a TFSA contribution instead. Future RRSP withdrawals count as income and could increase your marginal tax rate whereas TFSA withdrawals do not count as income.

Here are five reasons why you should consider investing in your TFSA instead of your RRSP: Continue Reading…

Robo Advisors, A Personal Experience Part 1: Getting Started

Aman Raina, Sage Investors

By Aman Raina, Sage

Special to the Financial Independence Hub 

We’ve been hearing a lot of a new type of investing management model. A “Robo-Advisor”  is an online-oriented service that automatically selects and manages a portfolio that is conducive to an investor’s risk tolerance.

There has  been a lot of commentary about the prospects of this type of service gaining traction,  especially with younger people or those with minimal assets but who want to get exposure to the overall stock market without doing all the legwork.

Much of this revolves around offering investors more transparency as it pertains to costs as well as back-office efficiencies and back-office savings that investors can leverage. The robo-advisor investment ideology revolves around a passive investment strategy by utilizing low commission Exchange Traded Funds (ETFs) allocated across various asset classes and that are held for long periods of time. Periodically, the asset mix is automatically adjusted if certain percentage makeups become too high or too low. A wealth of research has shown that a passively managed portfolio of ETTs can outperform a portfolio of actively managed assets.

This is all well and good. Ultimately, what will drive this service is the performance of these algorithm-managed portfolios. Instead of writing about these services in theory, I thought I would put my money where my mouth is and actually invest some money with a Robo-Advisor service and blog about the whole experience. More importantly, I will track the performance and costs these services generate. Continue Reading…

Weekly wrap: Retirement is fun — who knew? And a plea to seniors to “unretire”

Cheerful old man having a great timeSheryl Smolkin’s Retirement Redux site passes on recent financial institution surveys that show The Majority of Retirees Enjoy Their Lifestyle. Well I should hope so, after spending decades slaving and saving for this pivotal life event!

But in this weekend’s lead editorial, on behalf of the Canadian economy, the Globe & Mail begs the nation’s seniors  to “please don’t retire yet.”  It invokes Sun Life’s Unretirement index survey reprised in Friday’s blog here at the Hub. Well, actually, Mr. Economy, there’s a lot of age prejudice in the workplace and people don’t always choose to retire.

For those just starting on their journey to financial independence, take heart from Punch Debt’s declaration that saving up The first $100,000 is the hardest. I dare say your first million is no walk in the park either!

Via Sliced Investing, The Chicago Financial Planner (aka @rwohlner) provides this primer on hedge funds.

This may not be as recent but I found an entry at to be eternally relevant: it’s entitled Two Roads: Debt or Financial Independence. I choose door number 2! Continue Reading…

Working till 66 is no tragedy

Senior man working on a computerBy Jonathan Chevreau

Earlier this week there was extensive mass media coverage of the latest Sun Life “Unretirement” survey, which found more Canadians now expect to work full-time at age 66 than the number who are retired.

Given that the traditional retirement age has been 65, and remains the age many older investors think of collecting Old Age Security and the Canada Pension Plan, the general tone of this coverage was that the idea of working to such an “advanced” age is in itself scandalous.

Regular readers of the Hub will know what I’m about to say, and did say Wednesday night on a CTV item on the survey, which you can find here at Findependence.TV’s Video Hub. With rising trends to longevity, more and more people are choosing to work longer or feel financially compelled to do so. Indeed, governments around the world generally would love to see us all work longer and pay taxes longer, which is why the age of OAS onset is being bumped up to 67 for younger Canadians.

Plan for Longevity, not Retirement

I still love the positioning of Mark Venning at, who says we should be planning not for Retirement, but for Longevity. Continue Reading…