All posts by Jonathan Chevreau

Why retire if you still have mortgage or other debt?

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An image representing crushing mortgage debt.

My latest Financial Post article is available in the Wednesday paper and online under the headline Retiring with a mortgage? Why you might want to think twice about that.

As I confess at the outset, my bias is to what I often state in my book, Findependence Day: the foundation of financial independence is a paid-for home. Since Findependence is also a prerequisite to Retirement, to me it follows that seniors still weighed down by credit-card debt or even mortgage debt would be better off working at least part-time and use the proceeds to take down their debt to zero. After that, they can live rent-free and the pressure will be off to make the monthly nut (although of course property taxes and condo maintenance fees may remain for some.)

Payday loans an ominous sign for seniors

Check the reader comments at the end of the FP piece and it appears at least some seniors agree with me. Continue Reading…

The Big Red “Soak the Rich” Budget

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Depositphotos_1830058_s-2015My low expectations for Budget2016 apparently weren’t low enough, with a sea of red ink projected as far as the eye can see. Spending, spending everywhere. Not that we should be surprised: the die was cast with the election, this is merely the other shoe dropping.

In this article by Garry Marr, the Financial Post aptly describes it as a “Soak the Rich” Budget. It quotes CIBC Wealth’s Jamie Golombek to the effect “the government is taking away some key tax planning vehicles that allow the wealthy to rebalance their portfolios without incurring a deemed disposition, meaning they will face immediate tax consequences.” As of October 1st, there will no longer be tax-free switches for those in corporate class mutual funds.

And the return of a 15% federal tax credit for Labor-Sponsored Investment Funds is hardly any consolation!

As expected, income splitting for couples with kids under 18 will be eliminated but fortunately, pension splitting remains intact. (sigh of relief!)

Capital gains tax inclusion rate still at 50%

As for the rumoured  sweeping changes to capital gains taxes, you’ll need to dig into the supplementary budget documents that are aimed at measures for those in the new 33% tax bracket. We will update this paragraph as it becomes more clear but based on this report today by Advisor.ca, the capital gains inclusion rate remains at 50% and won’t rise to the feared 67 or even 75%.

GIS sweetened for low-income seniors and couples living apart

Continue Reading…

Federal Budget 2016: don’t expect much relief for personal finances or retirement

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Federal finance minister Bill Morneau selects Canadian-designed shoes for upcoming federal budget

Here’s my latest column in the Financial Post, which provides a look ahead to the federal budget, which will go live at 4 pm Tuesday afternoon.

You can find the column here by clicking on this headline: Why Tuesday’s budget may not hold much good news for your personal finances. It’s also in the print edition of today’s paper.

Here is info on the media lockup, which starts at 9:30 am.

Once the floodgates open on or shortly after 4 pm Tuesday, you should be able to get access to the budget by clicking on the Department of Finance website here. We will update this site as necessary and also watch my Twitter feed @JonChevreau, as we disseminate coverage once available. This feed also shows up on the right side of the Hub’s main page.

Closure of Hulbert Financial Digest a loss for all investors

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Mark_J._Hulbert_cropHere’s my latest Financial Post blog, which puts a Canadian spin on the announcement late last week that after 36 years, the influential investment newsletter ranking service is shutting down. Click on this headline: ‘A loss for all investors’: The Hulbert Financial Digest says goodbye.

As the blog notes, there aren’t too many Canadian investment newsletters but two of the majors had one or two newsletters that often did well in the Digest.

Here is Hulbert’s Wikipedia entry.

The good news is that Hulbert continues to be a columnist at MarketWatch.com. Check out his recent opinion piece, entitled Don’t be fooled by a bear-market rally in stocks.

Exploring the ExPat Lifestyle in Mexico’s San Miguel de Allende

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View of San Miguel from top of the Rosewood Hotel (Photo J. Chevreau)

Last week, my wife Ruth and I enjoyed a week’s vacation in San Miguel de Allende, which is located in central (and landlocked) Mexico. We’d been to Mexico several times over the years but never this particular community, which is not handy to a major airport.

It was also our first trip to Latin America in about five years, since we had been taking our February breaks in Florida in more recent years.

Ironically, San Miguel was prominently featured in the old magazine I published around the year 2000: The Wealthy Boomer. At the time, I remember being impressed by the fact the cost of living for semi-retired American and Canadian baby boomers was roughly half what it was in our home countries. This theme was also applied to various Asia locations in a Hub blog last year featuring the book Planet Boomer. See also my post, titled 5 Asian locations where retirement is more affordable than North America.

Trading high taxes for crime?

Back during the days of the tax-and-spend Jean Chretien Liberals, I found the Mexican expatriate fantasy quite compelling, so much so that I listened to Spanish instructional tapes on my long commutes to the National Post’s bunker then located in Don Mills. But the fantasy of becoming a tax exile/early retiree faded once the Conservative Party achieved power and seemed to offer at least the hope of more reasonable levels of taxation (the Tax-free Savings Account being a major positive example.)

Meanwhile, the unremitting press over drug-cartel-related crime in Mexico reached a crescendo in the last few years so we stopped visiting for a spell.  Continue Reading…