Hub Blogs

Hub Blogs contains fresh contributions written by Financial Independence Hub staff or contributors that have not appeared elsewhere first, or have been modified or customized for the Hub by the original blogger. In contrast, Top Blogs shows links to the best external financial blogs around the world.

How to manage your first Credit Card

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a young business woman holding new credit cardBy Alyssa Furtado, RateHub.ca

Special to the Financial Independence Hub

When you become an adult is a matter of opinion. It could be when you turn 18, move out of your parents’ home, or land your first job. But for some, they joke that you’re not really an adult until you get your first credit card. I don’t know where the joke originated from but from a financial standpoint, getting your first credit card is practically a life event.

Depending on what province or territory you live in, you can legally get a credit card at the age of 18 or 19. Unfortunately, at that age, many of us aren’t making sound financial decisions, which is why you might be tempted to sign up for a new card on your college/university campus or even inside a grocery store or mall.

What credit card you select and the benefits it offers could affect you in the long run. So it’s a good idea to understand how to manage your first credit card before signing up for the first offer available to you.

Picking the right card

Receiving a free t-shirt or a travel mug may be tempting but if that’s the reason you’re signing up for a credit card, you can do a lot better. Continue Reading…

Retired Money: The Joy of Pension Splitting

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Elderly couple in a meeting with an adviser discussing a document as she watches across the desk in her officeThe third instalment of my new bimonthly Retired Money column at MoneySense.ca has just been published online and focuses on the important topic of pension splitting, or pension income splitting.

You can read the whole piece by clicking on this highlighted headline: How to keep more benefits with pension income splitting.

As the piece observes, pension splitting can be manna from heaven for retired or even semi-retired couples where one is collecting a generous Defined Benefit or other employer pension and the other is not.

Nor is it as complicated a process as it may seem at first blush: you don’t have to actually divide such a pension and send some to each spouse: it all happens at tax-time when for tax purposes you choose what percentage of the pension each spouse should receive. Naturally there are multiple things to consider, such as other income sources, relative tax brackets and so on.

But the bottom line is that in many cases, it should result in thousands of extra after-tax dollars a year in the pockets of the couple as a unit. And that’s how couples should behave, isn’t it?

For more information about pension income splitting, a good place to start is the Canada Revenue Agency’s web site, and in particular this explanation. Note too that it includes a short video.

 

FinTech wars heat up as Robo firm NestWealth hires former BlackRock sales director

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Chris Hogg heads up new Nest Wealth Pro unit

The fin-tech wars are heating up on the Sales front: Toronto-based robo adviser NestWealth.com today announced it has hired the former Director of National Accounts for iShares BlackRock to head up its new B2B offering, Next Wealth Pro.

The hiring of sales veteran Chris Hogg is a “huge day for Nest and I think for the industry as a whole,” says NestWealth founder and CEO Randy Cass.

Nest Weath Pro is a new digital wealth management platform: it provides traditional brokerage firms, advisors, and asset managers with a “white label” turn-key solution that includes know-your-client tools and customizable portfolio management.

Disruptive shift

In a press release issued this morning, NestWealth said Hogg has more than 20 years industry experience, including the last three years at BlackRock. The release quotes Hogg as saying that “I’ve seen many changes within the industry, but have never encountered a shift as meaningful and disruptive as what we’re seeing today.”

Case said Nest Wealth Pro demonstrates that “technology and tradition can co-exist in a way that supports advisors and benefits their clients.”

NestWealth describes itself as “Canada’s largest independent Robo-Advisor.”

Speaking of disruption, there’s a good piece on finch’s impact on the banks in Thursday’s Financial Post. See ‘Disruption here and now’: Pressure of Uber moment transforming banks, conference told.

With $100 billion in assets, can ETFs catch mutual funds?

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An image of a 3d investment strategies funnel chart.My latest Financial Post column can be found in the print edition of Wednesday’s National Post as well as online right now, under the title The market share battle between ETFs and mutual funds is heating up, as Canadian ETFs pass $100 billion milestone.

As noted earlier here on the Hub, the ETF (Exchange-traded Funds) industry recently passed the significant milestone of $100 billion in assets under management. See ETFs break $100 billion milestone in Canada. That’s “Billion” with a B, but is still less than 10% of the $1.1 Trillion (Trillion with a T) that the entrenched and much older mutual fund industry still enjoys.

As an aside, if you have difficulty grasping how big the number “Trillion” is then read a hub post by Ian Campbell: Can you put the number ‘Trillion’ in context?

The FP column asks the question why the huge disparity in Management Expense Ratios (MERs) of mutual funds (i.e. high at around 2.5% per annum) versus ETFs (typically around 0.55% but in some cases as low as 0.4 or 0.5%) hasn’t resulted in even more incursions by the ETF industry into the mutual fund space.

ETF sign is held by businessman.

Powerful bank distribution network

One reason is the entrenched positions of the Canadian banks, whose powerful distribution network (i.e. bank branches)allows them to sell their own in-house no-load mutual fund families. Of course, BMO, RBC and now TD all sell ETFs as well but I doubt you’ll see many recommended by your local friendly branch rep any time soon.

As the old saying goes, mutual funds are sold, not bought. Continue Reading…

Four fun Side Jobs you can do while still young enough to enjoy them

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Young girl playing piano in music lessonBy Cathy Habas

Special to the Financial Independence Hub

Time is money, as the saying goes. And if you’ve got extra time on your hands but not a lot of extra money, maybe you’ve thought about starting up a side gig. Whether or not you decide to turn your side job into a flourishing career of its own, it won’t really feel like a job if you’re enjoying yourself at the same time. Plus, having multiple streams of income is highly recommended as a safety net.

With the following side jobs, you can prevent yourself from getting run down and ragged by being your own boss. You can set your own schedule, accept or decline jobs as your availability dictates, and adjust your prices so that it’s all worthwhile in the end.

You can start getting clients by reaching out to friends and family and growing via word of mouth from there. In time, you might find that a web presence will help you reach even more people. It doesn’t necessarily have to be a website; a Facebook page can be just as effective if managed well. In some cases, professional certifications can also bolster your reputation.

House Sitting

House sitting is an excellent way to earn some extra cash on the side, and it’s a very relaxed gig. You’ll be responsible for making sure that nothing goes awry while the homeowners are away. Your mere presence will deter would-be burglars, but house sitting goes beyond just sitting in a house, as you may need to handle other emergencies or simply bring in the mail and take out the trash.

In exchange, you get paid a daily fee. However, Continue Reading…