http://canadianmoneyforum.com/ A Canadian Personal Finance Forum en Wed, 19 Jun 2013 01:54:08 GMT vBulletin 60 http://canadianmoneyforum.com/images/misc/rss.png http://canadianmoneyforum.com/ http://canadianmoneyforum.com/showthread.php/15724-fire-insurance?goto=newpost Tue, 18 Jun 2013 21:29:29 GMT Bought a property, and at the laywers office they told us that we need a fire insurance, even when we don't have a mortgage, who's wrong or right ? ]]> Real Estate abroad http://canadianmoneyforum.com/showthread.php/15724-fire-insurance http://canadianmoneyforum.com/showthread.php/15723-If-I-use-RBC-Direct-Investing-can-I-put-together-a-Couch-potato-model-portfolio?goto=newpost Tue, 18 Jun 2013 17:22:45 GMT Can I do that using *just *RBC DI? I want to put one of those model ports in an RRSP. Thinking Questrade is another option. Just not sure if I can... Can I do that using just RBC DI? I want to put one of those model ports in an RRSP. Thinking Questrade is another option. Just not sure if I can buy all the index mutual funds in something like the average Cough Potato that I want by only using one brokerage... thanks! ]]> Investing recklessrick http://canadianmoneyforum.com/showthread.php/15723-If-I-use-RBC-Direct-Investing-can-I-put-together-a-Couch-potato-model-portfolio http://canadianmoneyforum.com/showthread.php/15722-US-stocks-overvalued?goto=newpost Tue, 18 Jun 2013 15:08:15 GMT There's someone else in these forums (forget the person's name) who also likes the CAPE ratio. Shiller's cyclically adjusted P/E ratio. I think it's a very good measure because it uses a smoothed 10 year earnings figure, which takes out short-term volatility. The assumption is that over time, CAPE reverts to its mean of 16.

Long-term CAPE graph, current CAPE = 24

Analysis of 73 years of CAPE data which writes that "secular bear markets begin at valuations like we observe at present."

The data I'm seeing really shows an overvalued market, though nowhere near as overvalued as 2000 of course. But there's another interesting thing to note. Sure, the market crashed hard in 2008... but was it really cheap? Maybe for just an instant, imperceptible on the chart. Actually the stock market looks like it has been persistently over-valued since about 1992, except for that brief blip in 2008 before central banks flooded the world with money to ensure everything became overvalued again. At this point everyone has become complacent about the overvaluation and is just accepting it, without regard to the historical message. I guess "it's different this time".

When was the last time the market was actually cheap? Not for a long time. Stocks weren't even cheap in 2008/2009 after the crash! To me this just shows what a bizarre investment world we've gotten into, thanks to Greenspan & Bernanke policies (remember Greenspan started his magic in the 90s). Ever since the mid 1990s, we've had a persistent stock market bubble that still hasn't corrected.

At the 1982 bottom, CAPE = 6.5 (start of the longest bull market in history) ]]> Investing james4beach http://canadianmoneyforum.com/showthread.php/15722-US-stocks-overvalued http://canadianmoneyforum.com/showthread.php/15721-Vanguard-short-term-bond-(VSB)-bid-ask-spread?goto=newpost Tue, 18 Jun 2013 14:22:56 GMT I've been a fan of the iShares XSB for years. But for new purchases I've been thinking of switching to the Vanguard equivalent, VSB. Are any forum members using VSB? Have you found it to be liquid enough for your taste?

VSB: 0.19% MER, 60% AAA quality, average maturity 2.9 years, YTM 1.5% = 1.31% yield after MER
XSB: 0.28% MER, 54% AAA quality, average maturity 3.0 years, YTM 1.6% = 1.32% yield after MER

Fundamentally speaking, VSB looks slightly better: lower MER, higher credit quality, and the same yield to maturity net of MER. [ Aside: at these ridiculously low yields I would still prefer a high interest savings account or ISA, but sometimes people need a bond ETF in their portfolio ]

The downside I see with VSB is the bid-ask spread. For instance right now it shows bid 24.80 ask 24.83, i.e. 3 cent spread, and earlier this morning I saw an even wider 4 cent spread. XSB on the other hand has the tightest possible 1 cent spread.

This has come down from the 7 cent spread I saw in an article when this ETF was new, but at 3 cents that's still very wide... if the NAV is at the midpoint then you're losing 6 basis points (0.06% of yield) by purchasing VSB. That seems quite inefficient to me.

Thoughts? Anyone using it? Is the bid-ask spread normally tighter than what I'm seeing now? ]]> Individual Stocks/Equities james4beach http://canadianmoneyforum.com/showthread.php/15721-Vanguard-short-term-bond-(VSB)-bid-ask-spread http://canadianmoneyforum.com/showthread.php/15720-Taxes-in-TFSA-s-on-US-dividends?goto=newpost Tue, 18 Jun 2013 00:37:04 GMT I understand that there may be taxes in TFSA's on US dividends, despite TFSA's tax free status.

Now - bought a bit of TD's e series DJA and NASDAQ in my TFSA - since these e-funds are a sort of mutual fund & trade in Cdn$ don't know if the tax issue affects them or not. So - yes or no & if so, how?

Thanks! ]]> Investing PeeBee http://canadianmoneyforum.com/showthread.php/15720-Taxes-in-TFSA-s-on-US-dividends http://canadianmoneyforum.com/showthread.php/15719-Bond-Funds-or?goto=newpost Mon, 17 Jun 2013 23:15:39 GMT Being a bit older - my husband just retired - we have between 30-40 of our money in bond funds - stuff like TD Core +Bond, or Income Advantage (which... Being a bit older - my husband just retired - we have between 30-40 of our money in bond funds - stuff like TD Core +Bond, or Income Advantage (which also has some dividend stock) or CI Cdn bond. Wondering if these can tank - my advisor says they'll just 'slow down'. Are there any alternatives to these for fixed or less volatile investments? Are any of the market GIC's worth looking at? ]]> Investing PeeBee http://canadianmoneyforum.com/showthread.php/15719-Bond-Funds-or http://canadianmoneyforum.com/showthread.php/15718-Frugal-Disney-World?goto=newpost Mon, 17 Jun 2013 18:53:41 GMT Any tips for a frugal (if 'frugal' is a word you can even remotely associate with Disney!) for Disney World?

We are driving down simply because we have three weeks, and I love a good road trip! We're staying at military installations on the way (cheap, often $20/night for a decent to nice room), or tenting (again on military campgrounds if one is close by where we plan to stop for the night). We are also tent camping on Disney (not the cheapest but it's reasonable compared to the hotels and we can cook most of our meals at the campsite, and you get the added bonuses associated with staying on Disney property).

I've done a lot of research and have picked up some great tips, but always looking for more! We leave this Saturday so the count down is on!! :) ]]> Frugality Addy http://canadianmoneyforum.com/showthread.php/15718-Frugal-Disney-World http://canadianmoneyforum.com/showthread.php/15717-Rental-Restriction-help?goto=newpost Mon, 17 Jun 2013 18:44:36 GMT Thanks for taking the time to read this. I’m in a situation with my rental restriction… I bought my condo a few years ago. When I bought it... Thanks for taking the time to read this. I’m in a situation with my rental restriction… I bought my condo a few years ago. When I bought it initially, I was planning to live in it for at least 5 years and then buy up to a bigger property and rent it out. Because I wasn’t under any “time restrictions” at the time, I liked having the rental restriction, because it meant that the majority of the residences in my complex are owners and they care about the property. It has been proven that the people in my condo care a lot about our property and we have had no issues with large upkeeps and repairs as we have always planned far ahead so there are no large assessments.

Fast forward a few years after I purchased my condo. I met my fiancé during a work conference and he lives in Phoenix. We have been doing long distance (going back and forth from Arizona/BC) for the last 2 years. Recently, I got laid off and was able to find work almost immediately, but with a very big paycut (about $22,000). I am doing OK as I am fairly smart financially and don’t often splurge and I have an emergency fund. My paycut still allows me to cover my expenses, but I don’t have as much “free” money to invest or save as I use to. I’ve been, in the last few months, going paycheck to paycheck and only putting a very minimal amount into savings.

My fiance owns his own home so the move if pretty easy… outside of the visa issue. We were planning on making the move in 2015, but because of my job situation, we started looking at our future a little more seriously. I expressed that it’s been challenging to keep myself afloat these last few months and I have had to really plan my purchases and ensure that I can still put a small bit amount away. I am lucky that I am not going into debt each month like many of the people I’ve seen in our minutes that have requested to rent their units out because of financial distress.

We’re in limbo because 1) we don’t want to start the visa process in the event I can’t rent out my place. Our lawyers say it will take about 5-7 months for us to get approved and once I am approved, I have 90 days to move to the US and get married. 2) I have clients in the US who have expressed that they’d like to hire me, but would need me to verify my eligibility to work in the US before they bring me on board (very understandable). I can’t get an offer letter until I have my EAD from my K1 Visa. So… under the bylaw of getting an exception based on work will not work. 3) I can’t claim financial distress because I am technically, not in “financial distress”. I am pinched tightly on budget, but I am making my bills on time each and every month.

I have contacted our property management company and it’s been almost a week with no reply… I’m not too familiar with the bylaw’s and hoping someone can shed some light on how I can approach this situation? ]]> Real Estate lisalisa http://canadianmoneyforum.com/showthread.php/15717-Rental-Restriction-help http://canadianmoneyforum.com/showthread.php/15716-CRA-2011-tax-returns?goto=newpost Mon, 17 Jun 2013 16:19:07 GMT Hi, I became resident of Canada in 2011 in July, while my spouse was non-resident of Canada in 2011. I had specified this in letter to CRA... Hi,

I became resident of Canada in 2011 in July, while my spouse was non-resident of Canada in 2011. I had specified
this in letter to CRA attached with my tax returns. However CRA did not read it and I got full year credit
(federal as well as provincial) for me and my spouse.

We corrected the information in CCTB application and CCTB and GST/HST department of CRA has correct information
about my arrival date in Canada in 2011 and my spouse arrival date in 2012.

However, in my 2011 tax returs still I have incorrect credits for me and my spouse. I called CRA twice and talked with
agents, and they said since my income in 2011 was too low, even correcting the credits will not make any
difference, so dont write a letter and change the credits you have got.

I will be applying for renewing my PR card in October. When I submit my 2011 tax returns Immigration will
come to know that I have got a credit for myself and my spouse for full year, where as I was resident only for a
part of the year and it could trigger a issue which I dont want. So what I should do? are CRA agents reliable?

Please suggest. ]]> Taxation Linsay http://canadianmoneyforum.com/showthread.php/15716-CRA-2011-tax-returns http://canadianmoneyforum.com/showthread.php/15715-Take-home-pay-help?goto=newpost Mon, 17 Jun 2013 16:03:09 GMT Hello everyone. So just for a little background I am a US resident living in western NY (Buffalo, Rochester, Syracuse area) and I am being offered a... Hello everyone. So just for a little background I am a US resident living in western NY (Buffalo, Rochester, Syracuse area) and I am being offered a position in Montreal with an amazing company. My dream job if you will. I have a wife who is a stay at home mother to a 1 1/2 yr old and a 3 month old.

All of the following numbers I put in CAD currency since that what matters in Montreal given today's current rate of 1USD=1.02CAD. Right now I make just above $64k before taxes and $44.7k take home after taxes, med ins, etc. The position I'm being offered is $70k gross with a yearly percentage based bonus of 15%. I've tried to do research on cost of living differences and it seems to be about 14% higher in Montreal compared to where I am now. I intend to counter offer but I'm trying to maximize my pay without spilling over into the next tax bracket which would most likely costs me money. I am trying to determine my take home pay and figure out what the taxes would be, roughly, on the bonus.

Ok so let's see if I did this math right. Given my engineering background I sure hope I can do the simple math lol. I used this website for the federal reference and then applied the math the same way with this website for provincial taxes. I'm choosing not to factor in the bonus since it does have the ability to fluctuate from year to year.

So federal:


70000
-43561
26439
*0.22
5816.58
+6534

12,350.58 for federal taxes

Then Quebec taxes:

70000
-41095
28905
*0.2
5781
+6575 => this came from the 41095*.16 similar to first federal tax level

12,356.2 for Quebec taxes

12,356 + 12,350 = 24,706 in taxes making my take home 45,293.

So if this math is right then to me that means it's a 5.5% pay increase, however, the cost of living increase (based on my internet research) is somewhere in the ball park of 15%. This tells me just to cover that 15% increase I need a minimum base salary of 77k when I plugged it all into excel. So is my math right? ]]> General Personal Finance Talk jxm1092 http://canadianmoneyforum.com/showthread.php/15715-Take-home-pay-help http://canadianmoneyforum.com/showthread.php/15714-Big-Income-Tax-Debt?goto=newpost Mon, 17 Jun 2013 15:27:02 GMT Hello,

So I have a big problem. I've accumulated at least 53k in income tax debt, if not more with penalties and fees if they decide to slap those on, not include the 2012 tax year. What happened?

I was young, stupid and ignorant and did not file my taxes for many years. Since 2005. The last few years, I've been trying to get everything in order to take care of this and deal with it so I hired an accountant who's been helping me and we're now almost ready to file. He believe he can file in such a way as to reduce the chances of getting penalties and fees but, of course, there are no guarantees.

Meanwhile, CRA recently garnished an old employer of mine for GST / HST owing of up to 10k, which is an assessment that the CRA did. Hopefully filing my returns for the missing years will bring that down.

But now I'm concerned. I have a good job and I also run my own business which is doing very well. But there's so much differing information about how long the CRA will accept a payment plan for (must pay within 6 months - 2 years I've read, no consistency) and I've also read that they can use the information you provide them to pin you to the wall even if you verbally agree to a payment plan.

My credit is pretty bad so I'm not confident I can get a loan.

I'm unsure what to do. I want to face this and deal with it, even if it means working harder, and I'd rather avoid bankruptcy. A consumer proposal seems a good fit but I want to make sure that's right.

Help? ]]> Taxation spirodonfl http://canadianmoneyforum.com/showthread.php/15714-Big-Income-Tax-Debt http://canadianmoneyforum.com/showthread.php/15712-Stretching-too-thin?goto=newpost Sun, 16 Jun 2013 21:44:33 GMT Hi all,

Recently I've been looking at houses in my area and even got pre-approved. I was pre-approved at 225k purchase price with a salary of 40k (stable job, been here 3 years now) and I have about 45k in assets(includes rrsp,tfsa etc), zero debt. Of that I would be using around 30k (15%) for my downpayment so far and am hoping for a purchase price around 190k. Not a big house but a comfortable starter home where I can at least spend 10+ years. 2bedroom 2 bath type deal.

I'm 24, turning 25 in a couple months and currently live at home. My parents have been hinting of me moving out, and because of a situation with my gf's living arrangement ending (her basment apartments landlord is selling) now is looking like a good time to buy.

She would be living with me, but I want to make sure I can afford the house on my own without assistance. She would only be buying groceries and maybe internet anyway.

I've run the numbers and my max expenses for everything would be around 2000$ a month, while my net is about 2620/month. These numbers don't include anything she would be giving me but it's everything from food to gas to insurance, internet, etc.

I think 600 a month is workable to use towards saving and hidden costs that come up and I guess everyones tolerance is different but is this stretching it too much? I don't know and most of my friends still live at home anyway with no ambition to be on their own so they're no good to ask. Parents are biased :P

I should also note that I have a motorcycle that I rarely use. It costs me $110 a month for insurance and I've been thinking about selling it because I don't use it, and that money I got from the sale could get me close to 20% down to avoid insurance fees and then the monthly income I saved would help. But then again in a few months my insurance on it will drop by $50 a month from turning 25.

In before none and "housing is going to crash" :), but if I went with renting I feel like I would be throwing money out the door since the costs are pretty similar and I would need to rent at least a place for 1000/mo to avoid terrible areas.

Thanks for any input. ]]> General Personal Finance Talk Compounding1 http://canadianmoneyforum.com/showthread.php/15712-Stretching-too-thin http://canadianmoneyforum.com/showthread.php/15711-Advice-on-where-to-setup-RRSP-and-what-to-put-inside-it?goto=newpost Sun, 16 Jun 2013 14:30:14 GMT Hi!

I'd like some advice. Here's the question: I'd like to open an RRSP account somewhere... maybe the royal bank? I'd like to consolidate my RRSP, RESP, TFSA, and banking in one place. We're spread out all over the place now and I want to make it easier. What do you all use for something like that? RBC direct investing seems like a good solution. Others?

Second: What to put in that RRSP account? I like the couch potato model portfolios idea. Maybe the global or complete couch potato. Can this be done from a single account like I'd get from RBC direct investing?

Here is the situation:

• we are debt-free. House and cars paid for.
• want to concentrate on retirement savings now
• wife and I have lots of room in RRSP contributions and TFSA
• I work for a company that has a great pension. I pay 4.25%, they pay 7.25% of my gross salary.

We saw a financial advisor that a friend uses, he was quite helpful but in the end didn't want us as a client, we're too small financially speaking :) He said:

• concentrate on spousal and personal RRSP first before any other investing
• buy no load funds with low MER
• invest in quality investments that pay dividends. Quality meaning large companies/indexes that are established
• consolidate the RRSP accounts we have (they are small, about 10k worth spread over 3 different places because we moved around so much for the last few years)
• we currently bank with PC financial and have a manulife one account. I'll be getting rid of the manulife account because we just needed it to buy this new house. Now that we don't need the LOC of the mone account, I can cancel it and stop paying the $14 a month.

I'm no dummy, this agrees with what I was thinking. Again, I want to keep this simple and cost-effective because I don't want stuff spread across a number of accounts.

Let's start the discussion. Ask any clarifying questions you'd like :) ]]> Investing recklessrick http://canadianmoneyforum.com/showthread.php/15711-Advice-on-where-to-setup-RRSP-and-what-to-put-inside-it http://canadianmoneyforum.com/showthread.php/15710-Recently-married-(benefit-of-joint-account-)?goto=newpost Sat, 15 Jun 2013 19:01:26 GMT I've recently got married and been trying to decide if there's any benefits of opening up a joint account with my wife. Up to this point, we've had separate accounts for everything. We are both good at managing money and don't have trust issues with each other or any debt. We're trying to decide what to do with the money we've received for the wedding. We've already maxed out our RRSP and TFSA contributions and don't really want to put this money into anything long term. This is money that we'll one day use to spoil ourselves with. Technically, we haven't went on our honeymoon yet and were thinking of using this money for something fun; whether that will happen in 6 months or in 2 years, we are not sure.

Interest rates seem pretty down right now and nothing is really jumping out at us. If we don't end up going with a joint account, then we were thinking of just placing the money into our separate savings account (both 1.9% interest). It will build a little interest there and we'll remember to not use that 'x' amount of money until we want to.

Thoughts? ]]> General Personal Finance Talk Money4life http://canadianmoneyforum.com/showthread.php/15710-Recently-married-(benefit-of-joint-account-) http://canadianmoneyforum.com/showthread.php/15709-Good-Books-Thread?goto=newpost Sat, 15 Jun 2013 17:19:48 GMT I started a similar thread a few years ago - this might be of interest to those looking for a good read over the summer months. Heck - there might... I started a similar thread a few years ago - this might be of interest to those looking for a good read over the summer months. Heck - there might even be a potential Father's Day gift among the options listed in the thread today and tomorrow!

The idea here is for CMF 'ers to post good books that they are reading, read, or curious to learn more about. References to "e-books" and other electronic media. Our local library is a treasure trove of not just of books but a huge amount of information, how-to books, videos, DVD's (some very recent ones I might add - I can see why those video rental companies went out of business!). Apparently, it's possible to download "ebooks" from our local library via the internet! Haven't done this yet.

Presently, I'm reading/ going to read...

1. How the Scots invented the modern world (Arthur Herman) - great read so far
2. Contagious - How things Catch on (Jonah Berger)

For those of you who like to read books written by financiers and CEO's who "did time" - well how bout

3. Flight of the Eagle (Conrad Black) - see CBC transcript here. (say what I will about Black - the man is a very good author IMO).http://www.cbc.ca/q/blog/2013/05/22/...-next-chapter/

4. The Buy Side (written by a recovering hedge fund manager) Turney Duff
http://www.theglobeandmail.com/repor...ticle12579862/ ]]> General Discussion dubmac http://canadianmoneyforum.com/showthread.php/15709-Good-Books-Thread