By Gordon Pape Special to the Star Fri., Feb. 1, 2019 In case you’ve missed all the advertising, it’s RRSP time again. Banks, credit unions, insurance companies, brokerage firms and wealth management companies are all competing for a share of your retirement savings. Which should you choose? I’ll get to that in a moment. First, let’s look at a few numbers. The Bank of Montreal released a report this week that showed that, on average, we are holding more money in RRSPs than ever before. The study, conducted on-line by Pollara Strategic Insights, found that the average amount held in RRSPs nationally is $101,155. That’s a 21 per cent increase from 2016. The Ontario figure was even higher, at $120,024. The study also found that withdrawals from these plans are declining, so fewer people are dipping into their retirement savings for other purposes. Most withdrawals are for the purchase of a house, under the government’s Home … [Read more...] about It’s RRSP season. Don’t forget rule No.1!
By Gordon Pape Special to the Star Fri., Dec. 7, 2018 Planning a trip to the U.S. to get away from the cold for a while? You should be aware that Big Brother will be watching at all times. I recently flew to the States for a visit. The U.S. immigration officer at Pearson Airport asked a few innocuous questions about the purpose of my trip (vacation) and how long I would be staying. As he was doing this, his computer scanned my passport and I was waved on. Seems simple enough. But there’s a lot going on in the background that most Canadians aren’t aware of when they cross the border. For example, that passport scan created an I-94 record for me. There is nothing in my passport to indicate this, but the file exists up in the cloud somewhere, to be called on by Homeland Security if necessary. Interestingly, only Canadians arriving in the U.S. by air or sea are issued an I-94. If you are crossing at a land border point, it isn’t required – … [Read more...] about Heading south for the winter? Here are some tax pitfalls to watch for
By Gordon Pape Special to the Star Fri., Nov. 23, 2018 Interest rates are rising. When that happens, bond prices drop. It’s one of the basic rules of investing. But how is that playing out in today’s investment climate? You may be surprised. The Bank of Canada has raised interest rates three times this year, with another quarter-point move possible in December. You would normally expect that such aggressive action would significantly knock down bond prices. However, the FTSE Russell Canadian Universe Bond Index was down only 0.12 per cent year to date as of the Nov. 16 close. In other words, only a tad below break-even. Government bonds took the biggest hit, off 0.22 per cent as a group. Corporate bonds were actually ahead 0.16 per cent. Not big numbers either way. And what about stocks? To that point, the S&P/TSX Composite Index was down 6.5 per cent for 2018. Where would you have rather had your money? Mutual fund returns reflect a similar … [Read more...] about Rates are heading up. Time to buy bonds?
By The Canadian Press Wed., Nov. 14, 2018 OTTAWA—The Bank of Canada is releasing data today that provides a closer look at just how much stricter mortgage rules and higher interest rates have helped slow the growth of new highly indebted households. The central bank is on a clear rate-hiking path and the pace of future increases hinges significantly on the ability of households — particularly those with high levels of debt — to adapt to higher borrowing costs. The bank’s analysis says tougher mortgage qualification tests have reduced the share of new high-leverage, insured loans — those of more than 4.5 times a borrower’s annual income — to six per cent in the second quarter of 2018 from 20 per cent in late 2016. The report also says another rule change this year aimed at uninsured mortgages dropped the share of these new loans to 14 per cent in the second quarter of 2018, compared with 20 per cent a year earlier. Senior deputy … [Read more...] about Mortgage risks fading thanks to higher rates, tougher rules, according to Bank of Canada
By Ellen Roseman Personal Finance Columnist Mon., June 18, 2018 Remember when 69-year-old Dr. David Dao refused to give up his seat on a United Airlines flight in Chicago and was dragged off the plane to make room for airline employees? A video of the bloodied man went viral in April 2017, leading many Canadians to ask about their rights as airline passengers. What rights? In Canada, airlines can make their own rules and enforce the rules. The only requirement is to disclose the rules in a legal document called a tariff. Canada lags far behind the European Union and United States, which introduced an airline passenger bill of rights more than a decade ago. But while we don’t have a bill of rights, we do have a route to get there. Article Continued Below Last month, the Transportation Modernization Act (Bill C-49) came into force, allowing the Canadian Transportation Agency (CTA) to define airlines’ minimum obligations to passengers and, in … [Read more...] about How much should an airline pay for bumping a passenger? Now you can have your say