All posts by Jonathan Chevreau

Life after Employment: what’s your Encore act?

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Encorecover

By Jonathan Chevreau

I’ve been reading several books on Encore Careers, second acts and the like. A few weeks ago, we reviewed Marc Freedman’s The Big Shift. Over a one-week break in Florida, I read Freedman’s earlier book, Encore, subtitled Finding Work That Matters In the Second Half of Life.

Last year, on our sister site, we also reviewed Stephen Pollan’s 2003 book on the same topic:  Second Acts.

All these books start with the premise that the baby boom generation may end up living a lot longer than they may have once imagined, which goes double for their own children and the generations coming after them.

Work that matters

If you believe that living to 100 is a distinct possibility rather than a one-in-a-thousand outlier event, then it follows that financial planning needs to take these extra years into account. Continue Reading…

How to overweight your portfolio for an oil comeback (and avoid Gambler’s Ruin)

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Oil pumps on sunset

By Jonathan Chevreau

Here’s my latest Motley Fool blog, entitled (nicely by them, I thought!) How to overweight your portfolio for an oil comeback — and avoid Gambler’s Ruin.

Gambler’s ruin is a phrase popularized by Rotman Business School finance professor Dr. Eric Kirzner and refers to having a good idea about a sector (example energy) but choosing the wrong individual stock to capitalize on it (example Enron back in the day or in the telecommunications sphere a stock like Nortel Networks). The risk reduction via diversification is the strength of specialized ETFs focused on particular sectors.

The piece explores the idea of whether Canadian investors already have sufficient exposure to oil and gas via ETFs or index mutual funds based on the broad indices.

Because the Motley Fool requires full disclosure of the individual holdings of the writer, those curious can see my personal holdings in the energy sector in the disclaimer at the end of the piece. As per the full article, there will of course be more exposure to the energy sector via the broad ETFs.

TFSA makes progressive retirement system slightly less so: Malcolm Hamilton

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Here’s my latest MoneySense blog, a followup to all the media coverage on two controversial reports that called for the Tories to renege on its promise to double TFSA contribution room once the federal books are balanced. The blog, entitled Leave the TFSA Alone, is based on an email exchange with retired actuary Malcolm Hamilton, who led off the MoneySense Retire Rich event last November. Speaking of which, another is scheduled this April.

By Jonathan Chevreau

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Malcolm Hamilton (L) & Jon Chevreau, 2012, MoneySense.ca

One of Canada’s better-known retirement experts, Malcolm Hamilton, doesn’t think limits need to be doubled on Tax-Free Savings Accounts but his reason for saying so is not the fiscal consequences for Ottawa. “I just think that a larger TFSA will ultimately threaten RRSPs and that the existing TFSA is sufficiently large for most Canadians.”

In an email exchange, Hamilton said he worries about the “apparently coincidental release of two reports highly critical of the TFSA in an election year.” Given its close affiliation with the NDP party, the critique of TFSAs is to be expected from the Broadbent Institute, he said.

Feds backing away from TFSA?

But the other report, from the Parliamentary Budget Officer (PBO) is more of a concern, since “it may signal that the federal government is backing away from the TFSA.”

Continue Reading…

At age 62, couple celebrating 25 years of Financial Independence

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Billy and Akaisha Kaderli

By Billy and Akaisha Kaderli,

Special to the Financial Independence Hub

At the age of 62, we are beginning our 25th year of financial independence. That is quite a feat!

From the beaches on Nevis, West Indies, to the shores of Phuket, Thailand we have travelled extensively through these decades, and what a ride it’s been!

Young and strong in those early years, we were willing and able to tackle just about anything. Now we tend to be a bit more cautious but we’re not letting up. We still climb into the backs of pickup trucks, ride the chicken buses and soak in volcanic hot pools. The time has passed quickly from when we were the youngest, grayless couple in a group of retirees, to now where we blend in with the retiree crowd.

Still, no one can take away the dance we danced and we are filled with gratitude for all the miles and smiles. Continue Reading…

Tax issues for Americans with ties to Canada (& vice versa)

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Brian preferred small
Brian Wruk

By Brian Wruk, CFP

Special to the Financial Independence Hub

As the Canadian tax deadline quickly approaches, the process of gathering all your tax slips, back-up for your deductions and getting them to your accountant begins or, maybe you are installing the latest tax software. Regardless, if you are a Canadian with some form of tax ties to the U.S., you may need to file a U.S. tax return as well. What kind of ties?

Let’s go through three of the most common ones:

  1. U. S. Citizenship – With all the media coverage, it is becoming common knowledge that being a U.S. citizen means you have to file a U.S. Form 1040 tax return. This is even more difficult to hide from the IRS since Canada signed an agreement that requires Canadian financial institutions to report all financial information tied to a “U.S. person.” This is all part of the IRS Foreign Account Tax Compliance Act (FATCA) initiative to crack down on U.S. citizens evading taxes through foreign accounts. Canadian financial institutions are reporting this information to Canada Revenue Agency, which in turn will provide that to the IRS as permitted by the Canada/U.S. Tax Treaty and the IRS will be looking for a tax return and the appropriate disclosures (FBARs).

Continue Reading…