Tag Archives: Financial Independence

Weekly wrap: Over-taxed rich, starving on bond yields, and the hazards of experts

Posted By Jonathan Chevreau | May 23, 2015

A week after his Globe & Mail article, Overtaxing the Rich: A Cautionary Tale, attracted widespread attention, Scotiabank tax guru Tim Cestnick has followed up with Overtaxing the Rich: Canada’s Tax Debate rages on.

In the original piece, Cestnick floated a colourful parable that suggested the rich are more than paying their share, to the benefit of those less fortunate. But if those with the highest incomes are pushed too far beyond the 50% rate, they may be inclined to leave, making the circumstances of those further down the pyramid that much worse.

With 650 comments and counting, it’s no hyperbole in this case to say there’s a true debate that’s raging here. And with an election coming up this fall, it’s safe to say this topic won’t be going away any time soon. The new higher TFSA limits are certainly a major element of this debate. No surprise that we at the Hub favour the new higher limits and I’d be surprised if Tim Cestnick or any of his well-heeled clients feels any differently.

The Bond dilemma

Meanwhile, rich or not and highly taxed or not, it continues to be a struggle finding yield at today’s paltry levels of interest rates, which of course are fully taxed outside registered accounts. This was one of several themes I picked up at a recent ETF and mutual fund conference in Chicago. Here’s my column in Motley Fool Canada on this topic, titled Caution Ahead: Why Bonds May Soon Become Much Harder to Manage.

In a similar vein, The Daily Reckoning’s Bill Bonner warned this week that Bonds are No Longer a Safe Haven. I guess that leaves cash or stocks. Continue Reading…

Googling Financial Independence

Posted By Jonathan Chevreau | May 22, 2015

When you run web sites themed on financial independence, you pay close attention to search engines, particularly Google. Curious about whether the term “financial independence” was making any headway against the incumbent term, Retirement, I entered both phrases into Google.

The results were about what I’d expect: 258 million results for Retirement but a decent showing of 18 million for Financial Independence.

And what about our pet contraction for Financial Independence, or Findependence? You had to ask, didn’t you? 43,600 results but the good news there is most of these hits come directly from Yours Truly and related enterprises (books, ebooks, websites and references to the term in other media).

Wikipedia’s definition still rules

The Battle between your Present and Your Future Self

Posted By Robb Engen | May 21, 2015

by Robb Engen, Boomer & Echo

Special to the Financial Independence Hub

Determining your financial priorities is like having a battle between your present and future self. Decisions that make your present-self happy and content might have dire consequences for your future-self.

Conversely, you don’t want to torture your present-self for the chance to be happy and prosperous in the distant future.

We’re raising a young family and with that comes a host of competing financial priorities to balance today. It’s easy to think we can put off saving for retirement, or even the next big purchase, until later in our working years when we’re more established in our careers and the pressures and impact of child care is lessened. But that means screwing over our future selves – making life more difficult tomorrow due to our choices today.

Weekly Wrap: Work may not end after Findependence, as Encore Careers beckon

Posted By Jonathan Chevreau | May 15, 2015

cf-old-and-new--timelines_500px — Graphic courtesy Challenge Factory Inc. and Retirement Redux

By Jonathan Chevreau

Financial Independence Hub

On Wednesday, the Financial Post ran an online column of mine it titled Life After Retirement: Your Working Career Probably Isn’t Over Yet — Welcome to the Encore Act.

Regular Hub readers will know that if I had my druthers, the headline would read more like “Why Work won’t end after your Findependence Day.” (that is, the day you achieve Financial Independence).

I don’t view the terms Retirement and Financial Independence as interchangeable. By definition, Retirement (or at any rate, traditional full-stop Retirement funded with a generous Defined Benefit pension) means no longer working for money. Financial Independence (aka Findependence), on the other hand, can occur years and even decades before traditional Retirement and so seldom means the end of productive work.

This very web site — which just passed six months in existence — is dedicated to clarifying this distinction. And of course the site also constitutes a big element of my own personal Encore Act: next Tuesday will be the one-year anniversary of my own Findependence Day. In my case, I define that as no longer working as an employee of a giant corporation or government entity, and having the financial resources to work if I choose to, and not if I don’t.

How to find your Encore Career

One Thing I Wish My Father had Taught Me

Posted By Michael Drak | May 13, 2015

By Michael Drak,

Special to the Financial Independence Hub

As I was growing up my father taught me many important lessons. I was taught about the importance of getting a good education and using that education to get ahead in the world.

He instilled in me the need for working hard, making good money and providing for family. He taught me the importance of saving and having the goal of eliminating debt as quickly as possible.

But what he didn’t teach me was about the important concept of Findependence and how it would positively impact my life once it was achieved.

It really wasn’t his fault for not making me aware of Findependence [a contraction of Financial Independence] because back when he was working the goal was to find a good-paying job with a solid company, try to stay there for the rest of your working life, and eventually retire with a defined benefit pension in your back pocket.

Days of a single employer for a lifetime are almost gone

Life was so simple back then but times have changed. Continue Reading…