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moneysense.ca, 15/03/07
This and That
- The Canada Revenue Agency says that it has fixed the software glitch and has started accepting personal income tax returns. I don’t have an excuse anymore to put off working on our tax returns.
- If you are hoping for an early retirement, Money magazine offers a guide to achieving financial freedom long before 65. Of course, the biggest piece of the early retirement puzzle is accumulating a large enough nest egg and this article shows how.
- Conrad Black’s trial got underway in Chicago this week and irrespective of the results of the trial, there is a group of losers already: investors in Lord Black’s former media company.
- Rob Carrick says that ABM fees can be avoided with some effort on our part. For good measure, he suggests that we can profit from the greedy banks too.
- The Star’s Ellen Roseman answers reader questions on wills.
- Million Dollar Journey posted a primer on saving taxes using flow-through shares.
- Investing Intelligently debunks Smoke and Mirrors author David Trahair’s Myth # 1.
moneysense.ca, 15/03/07
I’m a new financial advisor and can only speak for myself but I see three kinds of people. Those who have accumulated a fair RRSP portfolio and are nearing retirement. To these people I look to increase diversification, reduce risk and look to incresaed capital preservation. I don’t ever suggest punping more money in unless they are looking for the tax break. Second are people who have done little to save so far and need to start saving something now. They have little hope of getting to 40% let alone 100% of pre-retirement income. I tell them to save as much as they can , period. Last are young peeople. I tell them if they start early (say 25) by investing $25/week over 40 years they will do fine, better if they increase savings later in life when they have more free cash to invest.
You should use the same screening process for flow-through shares as you would with investing in a labour sponsored investment fund. You have to evaluate the specific investment on its own merits, rather than just diving in for the tax break. The tax break should only be considered the “icing on the cake”, not a huge portion of the cake itself!
Excellent point Phil, after my experience with LSIFs I’m very leery of “special tax” investments.
I apologize to those going to my site and getting an ERROR 404. My web host is in the process of changing servers, and they were gracious enough to do this without notifying me first. :S
FT