All posts by Jonathan Chevreau

Budget 2015: The Findependence Trifecta comes home!

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Horse racingHere’s my latest MoneySense blog, covering Tuesday’s federal budget: Seniors Hit Jackpot with Budget 2015.

As you will note from the adjacent illustration of a horse race, we have focused on the big three measures we called earlier today the Findependence Trifecta.

As we noted on the Hub shortly after 4 pm, all three measures came through as telegraphed in the major media in recent days, including MoneySense. That is, almost-doubled TFSA annual contribution amounts ($10,000), reduced RRIF withdrawal rates and reduced tax on small businesses.

Now what’s all this about trifectas? Back in February, we ran a blog both at the Hub and at MoneySense about my reflections on harness racing in Florida, and its (somewhat remote) application to asset allocation. For those not familiar with the term trifecta, here is Wikipedia’s definition.

In a nutshell, horse-racing enthusiasts (“gambling” is such a harsh term!) make a bet on three specific horses placing one-two-three in a particular race. As you can imagine, this is not too likely: it’s a lot easier to bet on a single horse to “show” by coming in either first, second or third. But to  correctly identify the first-, second- and third-place winners in exact order involves considerably longer odds. So it’s a big deal if you actually get it right and win a massive bet called the trifecta.

Of course, when it comes to financial independence, the analogy breaks down a little. But as I note in the MoneySense piece linked above, I think we should all be happy with the budget. Enjoy your potential future winnings from the Findependence Trifecta! 

For convenience and archival purposes, we’ve also republished a version of the blog below: Continue Reading…

Budget 2015: Savers, retirees hope for more TFSA room, lower RRIF minimum withdrawals

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Finance Minister Joe Oliver (Department of Finance/Flickr)

By Jonathan Chevreau

Journalists and financial experts will be entering a “Lock-up” this morning in Ottawa, getting roughly a six-hour head start on the rest of us on the contents of the 2015 federal budget.

Even so, a combination of leaks and informed speculation give us a pretty good idea about the contents, which will gush forth within seconds of 4 pm, when the embargo is lifted.

Here at the Financial Independence Hub, we will be focusing on three main measures that if announced will do much to speed or improve our collective “Findependence.” Our hoped-for “trifecta” from Finance Minister Joe Oliver (pictured above) includes the much-delayed promise of a doubling of annual TFSA limits, a lowering of minimum withdrawal limits for RRIFs, and lower tax rates  for small business. Continue Reading…

How to Choose a Retirement Location

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By Billy and Akaisha Kaderli,

Special to the Financial Independence Hub

Chiang Mai, Thailand

So you and your spouse have decided to retire. At some point in your retirement planning you must ask yourself where you would like to spend your Golden Years. The following questions and insight should place you on the right path for finding just the location that suits your needs.

First things first

The first question you must ask yourselves is whether you want to stay in the home in which you are currently living or would like to move elsewhere. Retirement is a big step.  Sometimes people feel more secure staying in familiar surroundings because it makes the transition to your new lifestyle smoother. Others, for financial reasons, a change of pace, health reasons, or for better weather, want to relocate. In this case, the next decision you must make is whether you want to stay in your home country or move overseas.

If you want to stay in your home country you must decide what sort of climate is most attractive to you. Do you want to experience the four seasons or have a more moderate, year-round climate? Do you like mountains or beaches? What size of city or town do you most enjoy? These questions are important because they automatically exclude places you won’t need to research. Knowing what you prefer in climate, city size and geographical configuration carries a lot of weight in terms of your happiness quotient.

Another thing to consider is that if you choose a town or small city, are there adequate medical facilities nearby? Larger cities tend to have a full range of medical care. Smaller towns generally have clinics and a variety of doctor’s offices, but perhaps not the equipment needed for complex medical situations.

Narrowing your search

Continue Reading…

Poloz stands pat – but now what?

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Aubrey Basdeo Photo
Aubrey Basdeo

By Aubrey Basdeo,

Special to the Financial Independence Hub

Excerpt: With the Bank of Canada holding still on further rate changes, BlackRock’s Head of Canadian Fixed Income Aubrey Basdeo explains why this may not be the end of the story.

The Bank of Canada left its key overnight interest rate unchanged in its April 15 announcement –- no surprise there. Given that the central bank had been signalling for some time that it was taking time to assess the impact of the “insurance” it took out in January with a surprise 25 bps rate cut, most analysts expected Governor Stephen Poloz to stand pat. And he did.

With that out of the way, the more important factor now is what the Bank sees as the trajectory of economic growth for Canada, because that will be fixed-income investors’ guide for how it will react to disappointment or surprises along the way. For the record, we believe there is a lot of room for disappointments that may derail the Bank’s forecast growth trajectory.

Strong rebound expected in second & third quarter

But first let’s look at what the Bank had to say about the economic picture going forward. The storyline goes something like this: Yes, the first quarter was terrible, maybe even atrocious, but things are going to get better real fast. Continue Reading…

Weekly wrap: fingers crossed for TFSA doubling, how to spend your tax refund, looking under the Robo hood

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Gordon Pape (www.everythingzoomer.com)

Gordon Pape, author of the definitive TFSA book, Tax-Free Savings Accounts,  wrote a couple of good pieces this week for the Globe & Mail on what next Tuesday’s federal budget may have in store for the TFSA. In TFSAs benefit more than the rich, Pape listed various groups that can benefit from TFSAs, including seniors, savers, young people, income splitters and low-income Canadians. Or as I’ve said, pretty much every Canadian 18 years of age or more.

An earlier Pape column on Monday titled Oliver’s plan to raise TFSA limits raises many questions, looked at whether the promised “doubling” of an annual TFSA contribution limits would be double the original $5,000 limit, for a total of $10,000, or double the current $$5,500 limit for a total of $11,000. Hey, we’d be happy with either event! The other main question is how inflation indexing would be handled.

Over at Retirement Redux, Sheryl Smolkin looks at What Seniors Want in the federal budget. Continue Reading…