Tag Archives: Financial Independence

A post-budget TFSA primer

Posted By |
Adrian
Adrian Mastracci, KCM Wealth

By Adrian Mastracci, KCM Wealth Management

Special to the Financial Independence Hub

“Measures from last week’s Federal Budget provided the TFSA a healthy shot in the arm.”

Many investors are wondering whether to pursue a TFSA or RRSP strategy. Quite simply, the TFSA, which started in 2009, complements the RRSP and RRIF.

It need not be an either/or approach.
Wise investors embrace the TFSA in pursuit of long term goals.

We present our TFSA primer:

How the TFSA works

Eligibility:

• Canadian residents, age 18 or older, who have a Social Insurance Number can open a TFSA.

Contributions:

• TFSA contributions can be made in cash or “in kind.” The deemed disposition rules for “in kind” contributions are the same as those for RRSPs.

• Maximum TFSA deposits are as follows: Continue Reading…

Become financially independent to enjoy life!

Posted By |

money problemsBy Good Nelly,

Special to the Financial Independence Hub

It is no longer a universal vision to work towards having a better retired life. Instead, everyone is trying to achieve financial security or independence. This means you should have sufficient resources so you can choose whether or not to work on a daily basis; or, you can choose work where you’ll get complete job satisfaction, instead of worrying about the amount of your monthly paycheck. Here’s a discussion about why you need to work towards having financial independence or “findependence,” and how you can achieve it.

Why should you make Findependence your ultimate goal?

Continue Reading…

Experts: go ahead and make that extra $4,500 TFSA contribution now: I just did

Posted By |

By Jonathan Chevreau,

Financial Independence Hub

At least one of Canada’s big banks is giving clients the go-ahead to top up their Tax-Free Savings Accounts by the extra $4,500 amount specified in Tuesday’s federal budget.

CIBC Wealth’s Jamie Golombek says the Budget included draft legislation that allows for an increased TFSA dollar amount for 2015 to $10,000, up from $5,500, the current 2015 TFSA dollar amount.  But critically, he added:

2012-wm
CIBC’s Jamie Golombek

“We have received confirmation from the Canada Revenue Agency that, while the legislation is subject to Parliamentary approval, consistent with its general approach for proposed income tax changes, it is administering the measure on the basis that $10,000 is the new TFSA annual contribution limit. Clients may therefore proceed to contribute to their TFSA based on this proposed law.”

On Wednesday, the Hub ran an (since updated) blog that suggested investors contemplating such a purchase hold off a few days, pending comment from the Canada Revenue Agency and Continue Reading…

Why living off dividends no longer appeals to me

Posted By |
robb-engen
Robb Engen, Boomer & Echo

By Robb Engen, Boomer & Echo

Special to the Financial Independence Hub

When I envisioned my retirement years, I dreamed of being so unbelievably wealthy – so fabulously rich – that I’d happily live off the income generated from my multi-million dollar investment portfolio. As I began my investing journey, the idea of living off the dividends had tremendous appeal. After all, what retiree wouldn’t love the thought of collecting a steady stream of dividend cheques while their principal investment remains intact?

There were also some crazy assumptions about what it would take to generate the kind of income I’d need to maintain my lifestyle in retirement. Looking back, it was foolish to assume that a $1,200,000 portfolio can produce up to $90,000 in income each year, when less than half that amount is more realistic (assuming a 3.5% yield).

Related: Financial independence – Why I pushed it back five years

The trouble with a “live off the dividends” approach is Continue Reading…

Settling on the elusive definition of Financial Independence

Posted By |

Money flying out of cage birds , Financial independence , eps10Here’s my latest MoneySense column, which tries to nail down a definitive definition of Financial Independence. As I note in the above headline, this exercise is a bit more elusive than you might think, and the waters continue to be muddied by the mainstream term, Retirement, which I do NOT regard as synonymous.

As also noted in the Hub’s version below, I’m inviting reader feedback: Has Wikipedia’s definition nailed it, or can the term be improved?

Maybe I should grab the bull by the horns and create my own formal definition of Findependence, even though I view that term simply as a contraction of Financial Independence.

Reader input welcome! Continue Reading…