Archive for June, 2010

This and That: TFSA penalty waivers and more…

June 17, 2010

  1. Rob Carrick has some good news for Canadians who are on hook for accidentally over contributing to their TFSA. He writes that “CRA is saying that relief may be available for people who mistakenly overcontributed to a TFSA”.
  2. There are actively managed funds. And there is the Mavrix Canadian Growth, which lost an annualized 9.6% over 15 years!
  3. Canadian Couch Potato constructs a portfolio that mimics the asset allocation of the Ontario Teacher’s Pension Plan out of ETFs.
  4. The Money Smarts Blog isn’t very impressed with the Canadian Share Owner brokerage.
  5. Michael James notes that TFSA excess amount penalties can apply to empty accounts under certain circumstances.
  6. Larry MacDonald says that investing in rent-to-own property may be one way for landlords to avoid that dreaded mid-night service call.
  7. Financial Highway suggests that going on a vegetarian diet can save you a lot of money. As a vegetarian myself, I can tell you that a meat-free diet ain’t all that cheap.
  8. Financial Blogger isn’t all that impressed with real estate as an investment.
  9. Kevin Press feels that Jim Flaherty’s pension reform proposals are reasonable.
  10. Preet has some definitive opinions on whether investors need a financial advisor.
  11. Million Dollar Journey on how to analyze Real Estate Investment Trusts using a metric called FFO.

Check out my Twitter feed for more articles worth your time. Have a great weekend everyone!

Modest CPP Changes in the Works

June 14, 2010


The CBC reported today that Finance Minister Jim Flaherty and provincial financial ministers agreed to consider changes to the Canada Pension Plan as a way to address the problem of Canadians saving too little for retirement.

What’s being considered

  1. “Modest” increases in CPP benefits.
  2. The boost to benefits will be “fully funded”, which means either a increase in the employee portion and/or the employer portion of CPP premiums or, far more likely, an increase in the Yearly Maximum Pensionable Earnings (YMPE).
  3. The changes would be “phased-in” likely in a gradual manner over a number of years.

What’s ruled out

  1. A doubling in CPP benefits as demanded by the Canadian Labour Congress.
  2. A supplementary Canada Pension Plan that employees could opt to participate in.

My first preference would have been a supplementary CPP with the option of opting out but it is hard not to favour modest CPP changes that would allow retirees who haven’t saved anything on their own maintain a certain minimum standard of living. Without a plan to address the epidemic of little savings, those who have managed to save diligently will be made to support those who did not through increased taxes. As there are lot more of the spenders than the savers, modest CPP changes are in the best interests of both constituents.