Monthly Archives: June 2015

The parable of the twins (RRSP vs TFSA)

By Robb Engen, Boomer & Echo

Special to the Financial Independence Hub

Fashionable girls twins walk in the street

There’s a popular story told by banks and financial authors to encourage people to start saving for retirement at an early age. It’s called the Parable of the Twins and it goes something like this:

One twin puts aside $3,000 every year into his tax-free savings account starting at age 22, and stops at 32 – never adding another penny to the account. His sister starts saving $3,000 annually at age 32, and continues until 62. Who has the larger nest egg?

RelatedHow much of your income should you save?

You know how this story goes by now. Assuming an annual return of eight per cent, the twin brother wins hands-down. He ends up with $437,320 in his TFSA, compared to his sister’s $339,850, even though he contributed $60,000 less than his sister.

It’s a ubiquitous tale, but one that resonated with me at a young age. I was drawn to the awesome power of compounding – how money grows exponentially over time. Continue Reading…

Financial planners and eldercare professionals targeting aging Boomers

Real-estate agent giving house keys to senior couple

Here’s my latest MoneySense blog, which it titled Is your advisor retirement ready? It came out of a conference I attended in Niagara Falls last week: the National Elder Planning Issues Conference.  I had delivered the keynote address on why Longevity changes everything — a theme you’ll often see in the Hub’s Longevity & Aging section — but also sat in on a couple of sessions on which this blog is based. As you’ll see it’s also quite relevant to our Decumulation & Downsizing section.

For archival and one-stop shopping purposes, here’s the blog below, with a few photos and subheadings added: Continue Reading…

Eternal Truth # 5: Be an Owner, Not a Loaner

Depositphotos_3208371_xs-2Wednesday’s Financial Post ran the 5th instalment of the 7-part series I’ve been writing on The Eternal Truths of Personal Finance.

I originally headlined this one with a title that’s long been familiar to personal finance writers and investors: Be an owner, not a loaner, which is to say emphasize stocks over bonds. The headline in the print edition today (FP5) reads Eternal Truth No. 5: Embrace Risk, pay less tax.

When  I posted this blog, there was no online version available, so I took the liberty of posting my original draft, which may vary from the edited version in the paper. Here’s the link to the first in the series, and nearby should be links to at least instalments two to five.  Continue Reading…

Life at the cottage: What you need to know BEFORE you buy

Cottage On The Carpenter Lake, British Columbia
Cottage On The Carpenter Lake, British Columbia

By Erica Nielsen

Special to the Financial Independence Hub

After a long winter, summer is finally upon us For many, now is the time to look forward to the best part of summer: cottage season.

“Cottaging” has become a national pastime, and while there are many benefits to a family cottage, it’s important to fully understand the entire picture of owning and operating a home-away-from-home.

I learned firsthand how much was involved the first winter after we purchased our cottage when we were faced with repair costs for the road leading into our property.

When exploring the purchase of a cottage or vacation property, it’s important to consider all costs. These can range from the big ones like a down payment, to smaller costs that can add up — such as taxes, maintenance and winter plowing. In addition, if your cottage is not a primary residence, you may require a different type of mortgage and insurance.

Whether you’re experienced in the home buying process, or planning your first property purchase, there are some important considerations to evaluate before you buy the beach chairs:

Know the costs, all year round Continue Reading…

The 12 Tables of Financial Independence


Author photo 3
Horst Siegler

By Horst Siegler

Special to the Financial Independence Hub

The Twelve Tables formed the basis for Roman law. The twelve suggestions below form the foundation of a sound financial plan. It should be devised and agreed upon by you and your partner and should result in a secure financial future.

1.) Believe you can succeed

No enterprise, be it financial success or otherwise, can succeed without a belief that it is possible. Much else goes into accomplishing your goals but without a belief you can succeed, they are doomed to failure.

2.) Agree on the definitions of the terms in your financial plan

You and your partner must have the same idea of what wealth, risk, budget and a lot of other terms mean or you will be working at cross purposes.

3.) Assemble a financial team Continue Reading…