All posts by Financial Independence Hub

Men and women approach taxes & investing differently

Posted By Financial Independence Hub | April 6, 2017

By Gennaro De Luca

Special to the Financial Independence Hub

Anyone who is in financial services, and especially wealth management, knows there are big differences between men and women in terms of how they invest. But what isn’t as well known is that there are also big differences between men and women when they do their tax returns.

I started working at a bank at the age of 19, have been in financial services since 1990, and have spent the past 18 years in wealth management. But I also have a company that specializes in doing tax returns for small businesses, families and students. All this experience has provided a lot of insight into how men and women differ when it comes to financial matters.

Let’s first look at tax returns. Nine times out of ten it is the woman who takes the bull by the horns to get the family’s taxes done. Women tend to be more involved and are much more apt to ask questions of their accountant or tax preparer. Men may not ask any questions at all; they just hand over their documents and see you later.

What kind of questions am I talking about? Women want to know things like this:

What kind of tax credits are we eligible for?
Are there any government benefits we are eligible for?

That latter point is especially important for women who have small children. Indeed, many young families are really squeezed nowadays, so every opportunity for a tax break is vital.

Here is a perfect example from a client that illustrates what I mean. The woman is a teacher who could claim certain expenses for driving her car to work. Her husband is not a teacher, but does work for an employer. She asked us if her husband is also eligible for this same deduction because, like her, he drives a car for his employer and has lots of expenses.

As it turned out, he was eligible for what is known as a T2200, which is a declaration of conditions of employment –- effectively work-related expenses –- and in his case it meant deductions of $10,475, which resulted in a tax saving of over $3,000 on his tax return. But if his wife had never asked the question, none of this would have been claimed.

Men are more resistant to change

Another difference with doing taxes concerns technology. Today more than 80% of tax returns in Canada are done digitally, Continue Reading…

Making Canada great again

Posted By Financial Independence Hub | April 5, 2017

By Trevor Parry

Special to the Financial Independence Hub

I have to apologize to my CFL fan friends, particularly in Saskatchewan, where I have found it the rule rather than the exception to find a shrine to the fabled “Riders” in clear site in most offices. The game just doesn’t do it for me. The one, two punt monotony of the game isn’t overcome by the stoic resolution to play in Stalingrad like conditions on the Prairie in late fall.

With his second foray into Budget making, Finance Minister Bill Morneau’s attempt must be described as nothing more than a punt. In this instance they have kicked away the ball to see what the offense south of the border will do. For fiscal conservatives, who believe budgets should only go into deficit when faced with financial calamity, rather than to send the swag to the long list of Liberal sacred cows, pet projects and friendly consultants, this Budget was more of the same Keynesian dirge, although with veiled threats of further confiscation of wealth. Certainly Prince Justin and LSE alumni Billy are taking marching orders from the reconstituted politburo to lay low and wait to see what The Donald can get through.

The Trump tax reform package, which despite the recent (and what I am sure will be a temporary) hiccup in repealing and replacing Obamacare, will likely enjoy complete GOP support and support of Democrats concerned about re-election in 2018, is the most ambitious tax plan to see the light of day since the days of Ronaldus Magnus. It puts the Trudeauopian punitive “tax the hell out of everyone who wants to save 10 cents” dictum in definite jeopardy. It would reduce all tax rates, including the top rate down to 33% from to 39.60%.

Canadian top tax rates kick in at just $200,000, half that of the US

Canadians should know that the top bracket in the US doesn’t kick in until you hit an income of US$418,000 as an individual, $470,700 if you file jointly and $444,550 if you file as a head of household with dependents. Remember the Little Prince cancelled the miniscule Family Tax Cut ($2k) professing claims of “fairness”. Canadian top rates kick in at C$200,000.

Banks, Blockchain & Economic Liberty: A follow-up

Posted By Financial Independence Hub | April 3, 2017

By Adam Goldman

I wrote a piece last September titled ‘Why Our Economic Liberty Depends on the Blockchain’, providing an analysis on why I am certain distributed ledger technology is important to securing our rights under the law in the digital age.

In an ever-increasing realm of technology that is meant to improve (in positive ways) facets of our lives, the imperfection of humanity still exists while greed heavily plagues the banking world. As a firm advocate for the rule of law, I find recent revelations by CBC’s Go Public , that highlighted rampant fraudulent activity occurring amongst Canada’s largest financial institutions (TD, BMO, RBC, CIBC, and Scotiabank) disturbing to say the least.

‘This is why the only solution really is to have government step in and look after the Canadian people.’ says lobbyist Stan Buell as quoted in the CBC article.

Ultimately directives from above led to not only immoral, but also illegal tactics that chased their bottoms lines. Adding more bureaucracy at a government level will only exacerbate the climate.

Blockchain is the answer, not government

In my previous article I had given several broad examples of current institutions that could improve themselves, one being quasi-relevant to the financial fraud currently being exposed in Canada.

How Small Businesses can leverage SEO & the Internet for marketing

Posted By Financial Independence Hub | April 2, 2017

By Mike Carroll

(Sponsored Content)

Big company or small, marketing isn’t what it used to be. In fact, it isn’t what it was last week. Marketing and sales are so tied to technology that they are evolving almost faster than you can manage.

So businesses move quickly to find the consultant or manager to assume the demands of SEO, SEM, social media, and more of the contemporary tools available. Businesses simply don’t have the time or experience to optimize the business’s branding and identity.

What to look for?

Small businesses, perhaps through cost concerns, make the mistake of leaving these issues to an employee with some internet experience or some third party tech-savvy freelancer.

What they need is a full service consultancy, experienced in the intricate and specific tools and capabilities. You want experts who are ahead of the curve in technology and content. You want the firm with a demonstrated history of building and optimizing traffic to a company’s website.

What you want is a higher ranking for your website that sells candy. You want your Sweet Services online store to appear early when people use their browsers. The higher it appears, the more likely your site is to sell. Boosting your ranking takes skill and real time management.

Search Rankings

Adam Heitzman wrote in Inc.com that no one and no SEO firm can guarantee you #1 rankings. You can’t take the SEO firm’s word for it, but you can demand they show proof of what they have done for other customers.

Expertise

Rockstar Finance’s review of Victory Lap Retirement

Posted By Financial Independence Hub | April 1, 2017

By Hélène Massicotte, Rockstar Finance

Mike and Jonathan walk the talk. They both have made sound financial decisions that enabled them to leave their corporate lives (either through retirement or redirection), allowing them to shift their focus toward what they wanted to do next without having to have money be the primary driver.

How can we start stacking the deck in our favor to do the same? By:

Following the “Seven Eternal Truths of Financial Independence”
Focusing on one important formula
Forgetting traditional notions of retirement

#1. The “Seven Eternal Truths of Financial Independence”

When it comes to managing money, most of us want to improve our odds of success. That means ensuring we behave in a way that reduces the financial obligations that work to limit our personal and professional choices. The authors suggest the following behaviors can do a great deal to help us increase our financial flexibility:

Live below your means
Pay yourself first
Get out of debt
Buy a home and pay it off as soon as possible
Be an owner, not a loaner
Never say no to free money from your employer
Take the government up on its few offers of free money

Two of these include interesting twists on the theme beyond what is usually covered in what’s considered mainstream financial advice:

#4. Buy a home and pay it off as soon as possible. This is great advice for those among us who want to own a home, but the authors take it one step further: we should look at our home as part need and part want. Need is the bare minimum of what we need in a home: shelter, basic utilities, safety, minimum square footage, proximity to other needs, etc. Want are the extras beyond what we need: extra space, extra features, better privacy, less noise, better outdoor space, better-than-needed neighborhood, etc.

Looking at housing this way can help us consider the appropriateness of the largest physical asset class we’re likely to ever own. It’s easy to justify buying too much house, thereby turning a good purchase into a bad one, and this “need vs want” can help us keep the inflation in check.

#5. Be an owner, not a loaner. This suggests that, though bonds are lower-risk investment vehicles, they won’t offer the returns that equity can, even when these are risk-adjusted. The authors suggest a diversified portfolio that includes high-quality dividend paying stocks and stress that qualifying dividend-paying stock income also offers some tax advantages over bond-related income for investments that are held in non-tax-sheltered accounts.