# So will the TFSA limiit go up to 10000 dollars in 2015?



## Jay3

I don't know about you guys, but that would be a great christmas present.


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## AltaRed

deleted


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## swoop_ds

I really doubt it but that would be great!

It's sad how many joe blow Canadians don't use their TFSA, or use it for a savings account only that they take money out of constantly.


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## Nemo2

$10K would be quite a jump. But we'd take it.


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## abm

No the limit will not increase. Under the Tax Act annual TFSA limits are determined by indexing to inflation and rounded to the nearest $500. So the current limit of $5500 will still stand, however the unused contribution room can be carried forward to future years. So if you haven't paid into your TFSA then yes you could contribute $10000.


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## RonS

I'm torn on increasing the TFSA limit to 10K. While I would love to have the extra space for myself, there are a lot (LOT) of people who have a hard time putting $5 in their current let alone $5000 and there is NO WAY they will fill $10,000. I would prefer to see the equivalent savings taken off the lowest tax bracket (help almost everyone), or something else instead of benefiting those who have $10,000 ($20,000 couples) of unassigned disposable income.

Hell, I would prefer they take the money and offer a free finance class to every Canadian (or give it to the schools and force every kid to take a finance class in Gr10), so people can get themselves out of trouble, so many people don't know anything about finances it pains me.


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## rsyl

*left shoe*

I'm torn on increasing the TFSA limit to 10K. While I would love to have the extra space for myself, there are a lot (LOT) of people who have a hard time putting $5 in their current let alone $5000 and there is NO WAY they will fill $10,000. I would prefer to see the equivalent savings taken off the lowest tax bracket (help almost everyone), or something else instead of benefiting those who have $10,000 ($20,000 couples) of unassigned disposable income.

Hell, I would prefer they take the money and offer a free finance class to every Canadian (or give it to the schools and force every kid to take a finance class in Gr10), so people can get themselves out of trouble, so many people don't know anything about finances it pains me.


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## Just a Guy

Let's say the "average" salary is $50k in Canada...makes the average take home around $35k...after expenses, how much is left for TFSAs regardless of the limits.

It's like people who start a business to get the tax write offs...forgetting the fact that you need the income to write off in the first place...


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## banjopete

I think it would be a huge boon to those of us with the means to take advantage of the additional room. As we all know very few people use TFSA, and most that do fall into the "savings account" side of the coin where at best they hold cash, or if they're very adventurous some GIC's that the nice lady at the bank sold them. Looking ahead as our country seems to be heading to some times where public programs could be underfunded the lost tax revenues from these tax free accounts could mean something but I'm with Nemo, I'd certainly take advantage of it if it happened.


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## HaroldCrump

Just a Guy said:


> Let's say the "average" salary is $50k in Canada...makes the average take home around $35k...after expenses, how much is left for TFSAs regardless of the limits.


Income received (or expected to be received) in retirement is meaningful only as a % of average lifetime income.
Therefore, it doesn't make sense that everyone at every income level should be able to max out to the TFSA, esp. if the limit keeps increases over the decades.


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## rsyl

HaroldCrump said:


> Income received (or expected to be received) in retirement is meaningful only as a % of average lifetime income.
> Therefore, it doesn't make sense that everyone at every income level should be able to max out to the TFSA, esp. if the limit keeps increases over the decades.



If that is the case, why do we not set the TSFA limit to a percentage of earnings instead of flat $X, like RRSP? perhaps half of RRSP limits would make sense?


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## nobleea

If it hasn't been announced already, I doubt it. Might be part of the election platform next year, for a 2016 introduction.


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## HaroldCrump

^ That makes (political) sense, yes.
The idea would be that if a different political party gets in, the increase won't be implemented (both the opposition parties are against it).
Whereas, if it were implemented in the 2015 budget, it'd be hard for another party to roll it back.


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## sags

Regardless, the government will make up for the lost revenue somewhere else.......perhaps another fee hidden somewhere undetected in one of those omnibus bills governments are so found of.

Here take this...................and..........we will just take that.

The TFSA is meaningless to most people. They have little money left over each month to save. It does benefit the wealthy disproportionately, but what in this life doesn't ?

I am of the opinion, it will all work out in the end.........with a future government saying......."look, you have all this money in a TFSA......so you don't need OAS...........we will give to the poor folks"

The transfer or wealth will then just flow back the other way..........

Wealthy people have much power..........but they only have 1 vote, so until that changes.....the masses rule.


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## sags

All depends on oil royalties as well........no?

Right now.......the "projected" surplus is slowly drifting out the window.


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## savvybuck

Just a Guy said:


> Let's say the "average" salary is $50k in Canada...makes the average take home around $35k...after expenses, how much is left for TFSAs regardless of the limits.
> 
> It's like people who start a business to get the tax write offs...forgetting the fact that you need the income to write off in the first place...



Well if you are living with a spouse and she/he makes $50,000 as well, it is $70,000 take home.

Less $20,000 for TFSA
Less $5000 for RRSP

$45,000 annually for 2 people or $3750 per month.

Sort of difficult but completely doable.


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## Eclectic12

banjopete said:


> ... As we all know very few people use TFSA, ...


This does not seem accurate when it's reported that half of Canadians have a TFSA and on average planned a $3,625 contribution for 2014.




banjopete said:


> ... most that do fall into the "savings account" side of the coin where at best they hold cash, or if they're very adventurous some GIC's ...


Likely still the case ... but it's hard to tell what the shift has been as Canadians become aware that a TFSA can hold equity investments.

The BMO study categorizes by type of investment (ex. cash, MFs, GICs, stocks & ETFs), people appear to be counted multiple times.
When one adds up all the percentages - cash 57%, MFs 25%, GICs 23%, stocks 14% and ETFs 5% - this adds up to 124%.
I suspect people like me are being counted multiple times (i.e. cash, stocks and ETFs).


Cheers


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## nathan79

If you're looking at median income it's actually about 31K. Only about 45% of Canadians make over 35K, and 71% earn less than 50K... http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/famil105a-eng.htm


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## Just a Guy

savvybuck said:


> Well if you are living with a spouse and she/he makes $50,000 as well, it is $70,000 take home.
> 
> Less $20,000 for TFSA
> Less $5000 for RRSP
> 
> $45,000 annually for 2 people or $3750 per month.
> 
> Sort of difficult but completely doable.


Have kids and it's gone in a poof...plus those savings you had probably...

I wasn't complaining btw, I was explaining why most people don't use them.


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## PuckiTwo

savvybuck said:


> Well if you are living with a spouse and she/he makes $50,000 as well, it is $70,000 take home.


Only if you and your spouse ARE bringing $70,000 home. Assume that many couples/families don't. Often self-employed people don't - we didn't with two people.


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## Butters

Yes, doesn't matter if it goes up. We should be thankful we get our $5,500 a year.


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## BoringInvestor

banjopete said:


> I think it would be a huge boon to those of us with the means to take advantage of the additional room. As we all know very few people use TFSA, and most that do fall into the "savings account" side of the coin where at best they hold cash, or if they're very adventurous some GIC's that the nice lady at the bank sold them. Looking ahead as our country seems to be heading to some times where public programs could be underfunded the lost tax revenues from these tax free accounts could mean something but I'm with Nemo, I'd certainly take advantage of it if it happened.


Yup - starve the public sector & buy complacency with the public by targeted tax cuts for the well-off.


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## AltaRed

sags said:


> All depends on oil royalties as well........no?
> 
> Right now.......the "projected" surplus is slowly drifting out the window.


The Feds do not get oil/gas revenues except from Canada lands (offshore) and that is shared with the provinces, i.e. NF and NS. What does happen though is lower corporate income and less corporate income tax.... businesses providing goods and services making less money from the oil patch and thus also paying less corporate income tax, and fewer people holding down oil related jobs and lower personal income tax. The multiplier effect from indirects is as powerful (or more so) than the direct effects.


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## Tawcan

It'd be huge if it goes up to $10,000. It'd completely change the RRSP vs TFSA debate IMO. Somehow I doubt we'll see such increase.


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## steve41

OK..... average joe earns $50K, is 30 years old, retires at 65.

Investing fully in his RSP nets him a $35,967 yearly lifestyle. If he elects a full TFSA strategy, he secures a $35,865 'die broke at 95' lifestyle.

One good bottle of scotch for the RRSP side. (i.e. the RRSP is basically revenue neutral)

2% cpi, 6% ror, living in BC.


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## andrewf

I'm somewhat amazed at the cozy upper middle class bubble some people seem to exist in here.


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## GoldStone

BoringInvestor said:


> Yup - starve the public sector & buy complacency with the public by targeted tax cuts for the well-off.


Starve public sector? What planet are you on? The public sector ARE the well-off.


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## gibor365

If UK residents can have £15,000 ($27,500) ISA (analog of our TFSA) for every adilt and £4,000 ($9,000) for every kid..... why Canada cannot increase it to $10,000?!
We gonna vote for any party who: cut taxes and increase TFSA amd RRSP room... and we don't care about people who lives not per their means and don't have money to put into TFSA/RRSP...


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## banjopete

andrewf said:


> I'm somewhat amazed at the cozy upper middle class bubble some people seem to exist in here.


Really? a largely investment and personal finance based forum and you're surprised at the cozy bubble? Until you have extra money to worry about who cares about this stuff?


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## andrewf

Not surprised by the demographic of the people here, just that they are so out of touch with average people.


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## fersure

We should know by November 12... that's when good old uncle Joe delivers his "fiscal update." (I'll ignore the fact that this statement should be tabled in the House of Commons rather than the posh Canadian Club - rented with your tax dollars).


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## gibor365

andrewf said:


> Not surprised by the demographic of the people here, just that they are so out of touch with average people.


and who those "average people"?!


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## nathan79

gibor said:


> and who those "average people"?!


The ones earning 30K, not 50K.


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## fraser

Who knows?

It will be entirely dependent on the polling. If Harper believes increasing the number will help him win seats in the next election he will do it. If spending the money in a different way by offering other types of tax cuts or spending bennies will yield more votes, in his opinion, then you can be certain that the limit will not increase. Or perhaps by just a little to keep the base sweet.


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## Synergy

gibor said:


> and who those "average people"?!


Those that spend every last penny they earn in order to help stimulate the economy.:hopelessness:

Whether they makes 30 or 50K / yr doesn't really matter all that much, they often end up with the same result - more stuff, debt, etc. and no savings.


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## GoldStone

fraser said:


> Who knows?
> 
> It will be entirely dependent on the polling. If Harper believes increasing the number will help him win seats in the next election he will do it. If spending the money in a different way by offering other types of tax cuts or spending bennies will yield more votes, in his opinion, then you can be certain that the limit will not increase. Or perhaps by just a little to keep the base sweet.


This is democracy, is it not? Ask voters what they want.


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## sags

fraser said:


> Who knows?
> 
> It will be entirely dependent on the polling. If Harper believes increasing the number will help him win seats in the next election he will do it. If spending the money in a different way by offering other types of tax cuts or spending bennies will yield more votes, in his opinion, then you can be certain that the limit will not increase. Or perhaps by just a little to keep the base sweet.


Yup........and to some extent what Harper does will be a reaction to what the Liberals propose in their election platform.

The Harper government are boxing themselves into a corner a little bit, with some already announced spending, because they won't be able to claim the money isn't there to fund any Liberal proposals..........since he is spending it himself.

This is shaping up to be the election of the big giveaways......and people vote for whatever affects them.....


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## Just a Guy

GoldStone said:


> This is democracy, is it not? Ask voters what they want.


The problem with democracies is most people don't know what they want...and don't realize the consequences of what they ask for.

You ask most people what they want you'll probably get things like...

Higher wages
Free services
Lower taxes
Better conditions

Yet no idea how to pay for it, and they won't care as long as it's not them.

The government we elect is the one who promises to bribe us the best with our own money, so we get the government which we deserve.


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## banjopete

andrewf said:


> Not surprised by the demographic of the people here, just that they are so out of touch with average people.


care to explain?


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## gibor365

fraser said:


> Who knows?
> 
> It will be entirely dependent on the polling. If Harper believes increasing the number will help him win seats in the next election he will do it. If spending the money in a different way by offering other types of tax cuts or spending bennies will yield more votes, in his opinion, then you can be certain that the limit will not increase. Or perhaps by just a little to keep the base sweet.


True! This is why I sent email to MP from our district supporting Harper's initiatives and asking for more like doubling TFSA room, introducing TFSA to juniors, cancelling 2,000 cap refund on split income , increasing 50K available to transfer... MP replyed several times  and said that we should expect new announcments....


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## gibor365

jacofan said:


> It's not how much you earn, it's how much you save!


Exactly! When I see families with household income 3-4 times lower than us, buying much more expensive cars, houses, clothes, going constantly to expensive restaurans and so on , have constantly debts on their credit cards.... I completely understand why so many canadians don't have savings, RRSPs, TFSAs .... But it doesn't mean we should pay for their shopping spree with our taxes ...

I'm almost 50 and NEVER in my life had outstanding balance on my credit cards, even though I immigrated several times.... and there where times that after night shift (and sometimes I worked with 1 day off in the month ) I was walking home 5 km saving 50 cents...


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## protomok

Just a Guy said:


> The problem with democracies is most people don't know what they want...and don't realize the consequences of what they ask for.


Yep. For example, what would be best for our economy from a tax reduction standpoint is to cut income taxes...for example an increase to the basic personal tax credit. Then every Canadian taxpayer would benefit...as mentioned by The Fraser Institute:



> “Reducing personal income tax rates would provide broader-based tax relief and an enormous improvement in our tax competitiveness while strengthening the incentives for work effort, savings, investment, and entrepreneurship,” the institute said. “Canadians would get far bigger bang for their buck with big-picture reforms such as broad-based personal income tax cuts than tinkering with income splitting.”


[http://www.thestar.com/news/canada/2014/11/07/conservative_tax_breaks_leave_out_vast_majority_of_households.html]

The problem is that offering specific, targeted tax breaks seems to be more politically effective than implementing effective tax cuts.

Don't get me wrong we'll benefit from both income splitting and higher TFSA room but it's really too bad we can't just see income taxes go down. Actually the only party I could find that is actually willing to cut income taxes is the Green Party...but they seem to offer everything to everybody.


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## andrewf

I am guilty of it too. For instance, taking about student debt with coworkers and trying to politely say that you haven't had any debt since shortly after you started working. Hard to do when coworker has been working ten years and is still just making minimum payments.

Even then, I think a lot of people are oblivious to the experience of poor people. And these minimum wage/no benefits workers are what make your cozy upper middle class lifestyle possible. While everyone is screaming about food price inflation, imagine how much you would be paying if supermarkets couldn't find anyone who would work for less than $50k per year.


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## humble_pie

i once voiced the ridiculous idea in cmf forum that less-advantaged folks could sell their rights to a TFSA in return for solid benefits.

someone else had the same idea, i don't recall who it was.

more-advantaged folks could buy or acquire units of an organizing fund by paying a premium. Possibly a whopping premium. Theoretically speaking, these units would be in addition to their own personal maximum annual limit.

this one would be really fun to plan & create. There would be many ways to structure it. The rich would pay quite a lot of money for something with no immediate benefit, although tax-free in the end. The not-rich would receive immediate benefit (the premium.)


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## andrewf

Why not good money to poor people rather than engineering a comically complex scheme like transferring TFSA room?


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## Plugging Along

I think just giving money to the poor, though it sounds simple, will not solve any problems. 

To me, this doesn't incent for people to better themselves. There will be many who will take advantage of it. 

I am for giving those at a disadvantage opportunities, but not just giving them money. Sure, give them a much lower tax rate, provide more scholarships for their schooling, provided more training, etc.


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## humble_pie

what's so complex? there are at least a few members on here who could engineer such a fund in a twink.

a fund for co-sharing TFSA room has nothing to do with plain vanilla philanthropy. TFSA room is already everyone's birthright, so sharing the right is not in the same category as charity or alms, a lot of which can be wasted or misspent.


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## humble_pie

Plugging Along said:


> I think just giving money to the poor, though it sounds simple, will not solve any problems.
> 
> To me, this doesn't incent for people to better themselves. There will be many who will take advantage of it.
> 
> I am for giving those at a disadvantage opportunities, but not just giving them money. Sure, give them a much lower tax rate, provide more scholarships for their schooling, provided more training, etc.



plugging when i launched this nitwit idea a few years ago, the idea was that there'd be some restrictions on what the original sharers could withdraw. Like, withdrawal benefits would have to take the form of fees aid for training, further education, child care while working or attending school, children's sports (there are already tax creds for this), extra medical/dental such as physiotherapy or orthodontia, etc.

the fun part would be calculating just how big of a premium the Haves should pay. It can't be too big, it has to still give them a tax-free end result that would be an incentive to join.


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## fraser

Why not use the money to reduce the tax rates for the lower income earners? Perhaps some of the single parents or the working poor. I would not object to this.

The income splitting proposal looks good and will sell well but in reality it is not as effective as other measures. Latest numbers that I saw on the proposal is that 80-85 percent of households will NOT benefit. This is the reason why our late Finance Minister, Jim Flaherty, came out on the record as opposing the plan.


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## humble_pie

but ... the truly "poor" don't pay taxes anyhow.

also i'd wanted to avoid involving the big tax bureaucracies as primary administrators. OMG what a kiss of death.

what i was thinking was a semi-private fund, operated by the private sector. Obviously there'd have to be touch points, for example it would be necessary to verify that parties seeking to share their TFSA room didn't already have big fat maxed-out plans ... 

in a way it's like the concept of human capital. If everyone over 18 is entitled to a TFSA, then there's a lot of TFSA capital that has never been tapped. This is one way it could be put to use to quickly benefit less-advantaged souls. The gummint wouldn't have to pay, it's the more-advantaged souls who'd be paying.


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## gibor365

> Latest numbers that I saw on the proposal is that 80-85 percent of households will NOT benefit.


 very strange number.... my understanding that family where 1 spouse get 40K and other - not working will benefit as well as family where one spose gets 150K and the other 50K... the only families who won't benefit, those where both spouses have same salary, and it doesn't matter if each earns 20K or 200K


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## GoldStone

fraser said:


> Latest numbers that I saw on the proposal is that 80-85 percent of households will NOT benefit.


Tax policy expert Jack Mintz said not all changes to tax policy have to reach a large segment of the population to be fair.

"Yes, maybe 15 per cent (of all households) might benefit, but the main point is that there were 15 per cent that have been discriminated against under the tax system," Mintz said.

"This is correcting for discrimination."


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## Plugging Along

humble_pie said:


> plugging when i launched this nitwit idea a few years ago, the idea was that there'd be some restrictions on what the original sharers could withdraw. Like, withdrawal benefits would have to take the form of fees aid for training, further education, child care while working or attending school, children's sports (there are already tax creds for this), extra medical/dental such as physiotherapy or orthodontia, etc.
> 
> the fun part would be calculating just how big of a premium the Haves should pay. It can't be too big, it has to still give them a tax-free end result that would be an incentive to join.


I was responding to Andrewf on his remark to just give money to the poor, because it would be simpler. I think that idea is no less 'comical' nor less complex than your idea. The truth of the matter is that fairness is very subjective and therefore complex. I could see someone saying that your idea would exploit the poor because again the rich are getting benefit.

I often hear people complain that anytime a 'rich' gets any benefit, it is unfair. The mentality seems to be that it is only a 'fairness' if the rich don't get any benefit, and only the poor get anything. 

My question is really why are there so many that are unable to take advantage of the TSFA. I know there are some very valid reasons, but i truly believe that there are many that would be able to put money into the tfsa IF they made some changes.


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## andrewf

Two alternatives. The Tfsa transfer scheme costs the government money and results in cash in the hands of poor people. Also,adds a bunch of zero value added paper pushing positions in both the public and private sector. 

Option two is raise the HST rebate or equivalent. It costs the government money and puts cash in the hands of poor people. Only difference is that a bunch of overpaid zero value added paper pushing positions are not created. TFSA contribution room is no more a birth right than HST rebates.


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## humble_pie

why so much distortion? i never said anything like this.

i don't have a "TFSA transfer scheme." So far, it's just a lighthearted sharing fantasy involving private sector only. No bureaucracy, no cost to government.




andrewf said:


> Two alternatives. The Tfsa transfer scheme costs the government money and results in cash in the hands of poor people


i specifically said no cash. I said a long list of social benefits.




> Also,adds a bunch of zero value added paper pushing positions in both the public and private sector


zero public sector new positions. Any new private sector positions will have plenty added value since the enterprise would be self-supporting.




> Option two is raise the HST rebate or equivalent. It costs the government money and puts cash in the hands of poor people


bad ideas. In a TFSA sharing application, only the rich who wish to participate would pay. With an HST rebate increase, every taxpayer will pay whether willing or not.




> TFSA contribution room is no more a birth right than HST rebates.


only your opinion, not a fact. My opinion is that, at the present time, under existing legislation, TFSA contributions & HST rebates when applicable are indeed the rights of citizens.


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## Synergy

Plugging Along said:


> I know there are some very valid reasons, but i truly believe that there are many that would be able to put money into the tfsa IF they made some changes.


There's also a lot of people who would benefit from losing weight (global epidemic), but they can't "change" their habits and no body can figure it out. There's no excuse for the average individual for not using a TFSA. Just stop drinking 3-4 double-double's and a 1/2 pack of cigs per day and put that darn money into a savings account instead!


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## Guban

humble_pie said:


> i once voiced the ridiculous idea in cmf forum that less-advantaged folks could sell their rights to a TFSA in return for solid benefits.
> 
> someone else had the same idea, i don't recall who it was.
> 
> more-advantaged folks could buy or acquire units of an organizing fund by paying a premium. Possibly a whopping premium. Theoretically speaking, these units would be in addition to their own personal maximum annual limit.
> 
> this one would be really fun to plan & create. There would be many ways to structure it. The rich would pay quite a lot of money for something with no immediate benefit, although tax-free in the end. The not-rich would receive immediate benefit (the premium.)


I semi-seriously considered the idea of renting some TFSA room from a relative when they first came out, as he wasn't using it anyways. I could give him a cut of the interest, say 10%, rather than paying taxes to the government, and we would both win. He would get money for doing nothing, basically and I would be paying less than my marginal rate. 

Didn't think it was worthwhile given the small amounts back then and the low interest rates. The rates haven't improved, but the TFSA limits have increased greatly. The investments would really have to be in his name, so there is a trust issue, short of a contract of some sort.


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## jcgd

I think I would have to have really bad luck to be poor because I feel like surviving perpetually on so little would be many times harder that figuring out a way to get two-four years of education and get a decent paying job. But I'm the type to relocate if there is no local work and I'll work hard up front to make things easier later. 

If I was single with kids I would have a harder life but I simply made the choice not to do that.


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## Islenska

Not sure on why all the controversy here and everywhere about the TFSA

Isn't it really just a savings plan that should you be fortunate enough with spare cash sock some money away, if not your limit remains for a later date.

Might be a better plan to to play some road hockey with the kids or take the missus to the theatre or..................


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## HaroldCrump

BoringInvestor said:


> Yup - starve the public sector & buy complacency with the public by targeted tax cuts for the well-off.


Ha ! How many "starving" public sector fatcats do you see around you?
It is hilarious that someone could call the public sector "starved".


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## Just a Guy

I know plenty of well paid people who are on the verge of "starving". They are mortgaged to the hilt, have car loans, credit card maxed, etc. they live in perpetual fear of being laid off, and are always hoping for another raise to solve their problems ( or winning the lottery). 

Wealth has nothing to do with income from what I've seen. Many wealthy people I know never had big paycheques, it's not what you earn, it's how you spend it (and I consider investing as spending money).


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## HaroldCrump

Just a Guy said:


> I know plenty of well paid people who are on the verge of "starving". They are mortgaged to the hilt, have car loans, credit card maxed, etc. they live in perpetual fear of being laid off, and are always hoping for another raise to solve their problems ( or winning the lottery).


But JAG, that is regardless of whether they work in the public sector or the private sector.
That is their own choice.

To even suggest that public sector workers are underpaid is laughable.
To use extreme terminology like "starved" is just silly.

That argument is being used as an excuse to strike down the entire TFSA program, let alone the increase.
Left wing, pseudo-socialist groups like the CPA and USU have been baying for the blood of the TFSA since 2010.

I agree that it is good fiscal policy to reduce the federal debt.
But that should be done _in addition to_, not _in lieu of_ tax reduction via TFSA and other programs.

The TFSA increase could be replaced with across the board income tax rate cuts, that'd be alright.

But scrapping the TFSA program will lead to an increase in tax burden from current levels.
And the idea appears to be that such proceeds should be redirected to these mythical starving unionized, pensioned, guaranteed public sector paper pushers.
It is complete wrong direction.


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## Just a Guy

Logic has no place in a discussion about money, especially when it comes to government.

How many people can you name who think they are overpaid? How many people would willingly take a pay cut? For the most part, government jobs are work for welfare jobs. The people who take government jobs could rarely survive in the private sector.

You start cutting taxes, then you start cutting services and probably cash handouts back to the public...

It doesn't matter that people, at the end of the day, have more money to keep, they want the benefits and the government services and handout...

Many people believe government money is free money...few realize where it actually comes from.


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## andrewf

Islenska said:


> Not sure on why all the controversy here and everywhere about the TFSA
> 
> Isn't it really just a savings plan that should you be fortunate enough with spare cash sock some money away, if not your limit remains for a later date.
> 
> Might be a better plan to to play some road hockey with the kids or take the missus to the theatre or..................


It's a pretty simplistic way of looking at it. Why not cut taxes to zero?


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## nathan79

Just a Guy said:


> For the most part, government jobs are work for welfare jobs. The people who take government jobs could rarely survive in the private sector.


I don't agree with that. Have you ever actually applied for or been hired for a government job? 

I have applied and I can tell you it's not easy. People compete hard for those jobs because they offer such high pay and benefits that are rare in the private sector. Only the most qualified people get hired.

If there is a problem with the job being done by these workers, I believe it's more structural or top-down than related to the employee performance.


----------



## Plugging Along

Just a Guy said:


> Logic has no place in a discussion about money, especially when it comes to government.
> 
> How many people can you name who think they are overpaid? How many people would willingly take a pay cut? For the most part, government jobs are work for welfare jobs. The people who take government jobs could rarely survive in the private sector.
> 
> .



I don't quite understand why people think this. I came from the private sector, and took a public sector job. I took a pay cut, because I wanted more balance in my work life. I stay at my job not for the money, but it get to make a difference and work on some interesting projects that I wouldn't get in the private sector. 

I frequently get offered private sector jobs for at least 20% more plus stock options. I find it a little offensive saying that I work for a welfare job and couldn't make it in private sector. I consult for private sector too. I did take a pay cut willingly btw... Not because I was overpaid, but for other reasons.


----------



## Just a Guy

nathan79 said:


> I don't agree with that. Have you ever actually applied for or been hired for a government job?
> 
> I have applied and I can tell you it's not easy. People compete hard for those jobs because they offer such high pay and benefits that are rare in the private sector. Only the most qualified people get hired.
> 
> If there is a problem with the job being done by these workers, I believe it's more structural or top-down than related to the employee performance.


Yes, I worked in four levels of government for years...yes, we only have three levels, but I did some work for the UN as well. The higher up you go in government, the worse it gets. 

Was surrounded by a bunch of deadwood who had tenure and were waiting for retirement. Spent about 1/3 of my time defending myself against office politics they seemed to hate the fact that I was efficient and made them look bad. Saw waste galore, especially in the last few months of the fiscal budget (spend it or lose it). There's no indent ive for efficiency, but there's plenty for maintaining the bureaucracy.

Now, saying that, a lot of the grunts at the entry level worked like dogs...were they working on something useful, sometimes...sometimes not. 

I could stand working for government...I'd probably have gone insane had I stayed. Most of the good people I know left and found better jobs in the private sector or as contractors to the government which let them avoid the office politics. I'm sure there are a few good people working for governments...the odds say there must be, but most people I know whove donr both wouldn't touch a government job unless they were look for something cushy to wind up their career...since they'd be going in without worrying about being cut.


----------



## Just a Guy

Plugging Along said:


> I don't quite understand why people think this. I came from the private sector, and took a public sector job. I took a pay cut, because I wanted more balance in my work life. I stay at my job not for the money, but it get to make a difference and work on some interesting projects that I wouldn't get in the private sector.
> 
> I frequently get offered private sector jobs for at least 20% more plus stock options. I find it a little offensive saying that I work for a welfare job and couldn't make it in private sector. I consult for private sector too. I did take a pay cut willingly btw... Not because I was overpaid, but for other reasons.


Plugging, this wasn't directed at government jobs, this was an observation on people in general...I don't know anyone who thinks their overpaid in any job...


----------



## gibor365

> I have applied and I can tell you it's not easy. People compete hard for those jobs because they offer such high pay and benefits that are rare in the private sector. Only the most qualified people get hired.


 It's not easy, but because majority of those jobs are networking and not skills.... Most qualified people work not for government, but for private sector.... I worked for government, but not here, but in Israel, and looks like it very similar to Canada. For example the most talanted prosecutors, always switching to be lawyers


----------



## HaroldCrump

nathan79 said:


> People compete hard for those jobs because they offer such high pay and benefits that are rare in the private sector.


Which only goes to show how overpaid, and out of market realities, govt. compensation truly is.
The govt. (aka taxpayer) is the single largest employer (in aggregate) in the country today.

In this day & age of 6.5% general unemployment, and record levels of youth unemployment, the govt. ought to be able to secure a better deal on behalf of the taxpayers.
There will be sufficient labor supply at lower compensation levels to fulfill all govt. job positions (real and fake) at the required skill levels.

Labor compensation should be driven by market realities, not lofty ideals of welfare, income redistribution, and social equality.
Govt. total compensation comprises of market rate + a healthy dose of welfare.

It is risible to suggest that we need to limit (or completely dissolve) programs like TFSA in order to make govt. compensation even more generous, since them puir unionized pensioned welfared workers are "starving".


----------



## Eclectic12

Just a Guy said:


> Yes, I worked in four levels of government for years... especially in the last few months of the fiscal budget (spend it or lose it)...


Too funny!

Just like thirty years ago, people seem to love pointing out the "spend it or lose it" budgets in the gov't and ignore that generally, the private sector uses exactly the same budget system. 

I've seen *every* private company I have worked or consulted for blow money based on this budget system. 
Apparently following the budget method outweighs the ability to keep the budget flat.


Cheers


----------



## gt_23

Plugging Along said:


> I don't quite understand why people think this. I came from the private sector, and took a public sector job. I took a pay cut, because I wanted more balance in my work life. I stay at my job not for the money, but it get to make a difference and work on some interesting projects that I wouldn't get in the private sector.
> 
> I frequently get offered private sector jobs for at least 20% more plus stock options. I find it a little offensive saying that I work for a welfare job and couldn't make it in private sector. I consult for private sector too. I did take a pay cut willingly btw... Not because I was overpaid, but for other reasons.


Private sector thinks public sector is lazy and overpaid, public sector believes they are adequately qualified and compensated and "add value" to Canadians; the problem is, everyone is on either side of this argument and their view usually comes from their respective side; however, the evidence from apparently neutral organizations appears to lean towards the argument that public sector is overpaid, all else being equal.

As an interesting story and counter-argument, a colleague of mine recently made a move to the public sector. She was a low-performer and part of this came from her attitude to only do the bare minimum (i.e. only works 9-5, no initiative, etc.). The job she moved to in the public sector was at best, a lateral move, however, her pay is increasing $15k. When you consider this increase in pay with the added benefits of lower pressure/stress, almost zero risk of getting fired, pension, and 8 hours or less per day, I think the contrast to the private sector is pretty clear.

Overall, I think the issue can be summed up with this thought: the Private sector tends to reward high-performers quite well (promotions, $, prestige, etc.) and low-performers quite poorly (i.e. no promotions, same pay, isolation, no challenges, constant lateral moves between firms, etc.), so it's not surprising that the former tend to prefer the Private sector. The Public sector seems to have a much more tolerable stance of low performers, so it's not surprising that they tend to accumulate there.

Finally, I don't doubt that some high performers "choose" to work in the Public sector as you suggest, however, I also think the results speak for themselves: consider that year-over-year, outcomes (measures of health, education, transportation, etc.) tied to Government-led products and services continue to drop, while the associated expenditures increase much faster than inflation. Such outcomes in the private sector would not be tolerated for long.


----------



## fraser

Yesir. When I was a sales executive I was very happy when the IT director of a large multinational called me in mid December and told me that he had to spend $1.5 million by Dec. 31. It had to be invoiced and partially shipped. It was a resource industry. Not uncommon in my experience. Made it happen of course.

Emptying the budget is definitely NOT a attribute of only the public sector.


----------



## Eclectic12

gt_23 said:


> ... the Private sector tends to reward high-performers quite well (promotions, $, prestige, etc.) and low-performers quite poorly (i.e. no promotions, same pay, isolation, no challenges, constant lateral moves between firms, etc.)...


Interesting ... my private sector observation is that there are lots of high-performers who are under rewarded until they catch on to keep tabs on what other companies are paying, let their manager know they are willing to move, identify who is deciding then adapt to influence them or notice that management rewards those coming from other companies as they are "providing new ideas".

One fellow who eventually gave up on the lack of reward checked the market and was pleased to discover that switching companies would increase his salary 2x plus add the potential of a yearly bonus where in the existing company, there was no bonus.


Cheers


----------



## fraser

One advantage of the private sector is that you can more easily switch jobs/employers and significantly increase your compensation or your level/grade. 

Not so easy today when transferring within the public sector, and often within the same company in the private sector. The path of advancement in private industry often involves switching employers every five years or so.


----------



## Just a Guy

I think there are many private sector companies that grow to become their own bureaucratic nightmares and start to function in very similar manner to the public sector (IBM comes to mind). Them there are the quasi-government companies like petrocan, which started life as a crown corporation.

However, I know plenty of companies who reward efficiency, strive to come under budget and can easily make a profit, while paying a good wage, in areas where the public sector could only lose money at...and I'm not just talking the CBC.


----------



## Mortgage u/w

It would be great if it increased to $10k.....More room to shelter profits!


----------



## Eclectic12

Just a Guy said:


> I think there are many private sector companies that grow to become their own bureaucratic nightmares and start to function in very similar manner to the public sector (IBM comes to mind). Them there are the quasi-government companies like petrocan, which started life as a crown corporation...



It is true this can happen.

The companies I was referring to did not start life as a crown corp, had less than 300 employees and the last I checked, were no where near IBM size etc.


Cheers


----------



## gt_23

Eclectic12 said:


> Interesting ... my private sector observation is that there are lots of high-performers who are under rewarded until they catch on to keep tabs on what other companies are paying, let their manager know they are willing to move, identify who is deciding then adapt to influence them or notice that management rewards those coming from other companies as they are "providing new ideas".
> One fellow who eventually gave up on the lack of reward checked the market and was pleased to discover that switching companies would increase his salary 2x plus add the potential of a yearly bonus where in the existing company, there was no bonus.
> Cheers


My definition of a high performer is someone who not only does X number of tasks a day, but also builds relationships, challenges themselves, generates new ideas, and lots of other things. I think in most cases these people also have a good level of organizational and self awareness, in order to understand the value they add and highlight that to management if they don't take notice and/or adequately reward.

I also think that the private sector labour market for skills and experience is pretty efficient. While you cite a counter-example, I have many experiences with colleagues who feel they are under-rewarded and constantly talk about moving jobs. In most cases, with similar roles and industries, the grass is not greener as they anticipate. Or perhaps they were not as "high" a performer as they thought? I think it would be pretty hard to argue that the labour market for teachers, firefighters, police, transit workers, etc. is even remotely as efficient as that of the private sector.

While the outcome for high performers might be less than certain, I think we can all agree that most outcomes for low performers go down a similar path...


----------



## gt_23

Just a Guy said:


> However, I know plenty of companies who reward efficiency, strive to come under budget and can easily make a profit, while paying a good wage, in areas where the public sector could only lose money at...and I'm not just talking the CBC.


Yeah, just imagine what this could do for healthcare....transit....education....policing. Is it that hard to image a world where we get better services/outcomes AND lower taxes? All it requires is an open mind and a willingness to change.


----------



## Eclectic12

gt_23 said:


> My definition of a high performer is someone who not only does X number of tasks a day, ...


Be that as it may ... if management knows there is little to no risk the employee in question will leave, they will take into account to their benefit.
After, the point is to make more money so why pay out more than you have to?




gt_23 said:


> ... While you cite a counter-example, I have many experiences with colleagues who feel they are under-rewarded and constantly talk about moving jobs...


So do I ... and those who moved on did well while those who kept complaining where it was obvious they weren't trying to move ... ended up with whatever management decided. In several cases, a small raise would have kept the employee at least another year but once they were fed up enough to leave, two replacements had to be hired at substantially more than the raise would have cost.

When I chatted with an executive about it, the attitude was raises were an unnecessary expense but when the market dictated paying two people at substantially more was all that was available - c'est la vie. 

And it's not just one counter example ... one multinational categorically said that times had changed where no other company paid similar allowances for similar work. 
It wasn't said outright but the underlying message was to suck it up. The blatant message was if one didn't like the job requirements - find another job. 

Trouble was 98% of the staff had come from other companies, had contacts at multiple competitors and needed something like five minutes to confirm multiple competitors
still paid the allowances.




gt_23 said:


> ... In most cases, with similar roles and industries, the grass is not greener as they anticipate. Or perhaps they were not as "high" a performer as they thought?


If they haven't done their homework and especially where they aren't willing to move ... I'm not sure how one can know what is or is not a "greener grass".




gt_23 said:


> Yeah, just imagine what this could do for healthcare....transit....education....policing.
> Is it that hard to image a world where we get better services/outcomes AND lower taxes?


Is that the foundation of the US for-profit Health Care system?
Or the thinking behind California's changes to it's electricity system, which profit driven companies like Enron manipulated?

Neither system has a lock on better service at lower costs ...


Cheers


----------



## sags

Are there some examples where privatization has led to good results ?

Education......I recently read of some "private colleges" that charge high tuition fees and issue a diploma that is worthless.

Transit..........Highway 407 was privatized and the toll rate was increased.

Healthcare............privately owned nursing homes have been in the news lately.........for the bad conditions in them.

Policing.............Ontario privatized a brand new prison. It was so bad the government had to cancel the contract.

I have seen nothing but problems extending from privatization of public services.


----------



## sags

The "benchmarks" corporations use these days, with regard to employee wages.........is the lowest common denominator.

If Toyota is paying $26 an hour..........the other manufacturers only want to pay $26 an hour or less.

Police services across Canada got away with using the highest common denominator for awhile........and wages leapfrogged across the country from police service to police service.

That was an aberration and isn't illustrative of normal corporate goals..........which is to lower labor expenses.

Scotiabank is eliminating 1500 employees. How many of those employees were "high performers"....did it matter?

CPR brought in a new CEO....and he whacked jobs.....to the delight of investors.

The railroad was unable to keep up with demand, business was lost......and they had to replace many of the employees.

Employees are just a number.........an expense to be rationalized.

Understanding that takes time and experience.......and often results in employee apathy among those who remain.

People do what they have to do to keep their job.............and not much more.


----------



## HaroldCrump

gt_23 said:


> The job she moved to in the public sector was at best, a lateral move, however, her pay is increasing $15k. When you consider this increase in pay with the added benefits of lower pressure/stress, almost zero risk of getting fired, pension, and 8 hours or less per day


Which creates this perverse set of incentives/motivation where public sector workers are (quite literally) counting the months & days until their (early) retirement.
In another thread, I posted the typical aggregate time off benefits that most public sector workers are entitled to (my example was from an Ontario provincial agency).

I know of workers in the public sector that literally consider each day at work as an investment towards their severance "entitlement", since they tend to receive massive payouts in the unusual event that they do get laid off.
Each day is also an investment towards their pension accrual.
All of this creates negative incentives for the workers.

Whenever a study points to data on increasing absenteeism in the public sector, the unions scream out loud that this is because of the de-motivation and work related stress in the public sector.
Their "solution" is to increase pay & benefits even more (same argument as the previous poster that claimed the public sector is _starving_).

However, the dim witted union kingpins don't realize that the de-motivation and stress is not due to the _lack _of generous pensions & benefits, but precisely _because _of the overly generous benefits.

Over-generous compensation packages, when combined with a complete lack of accountability and performance-driven pay, leads to de-motivation and skiving.
That is why skiving and absenteeism is rampant in the public sector.


----------



## sags

HaroldCrump said:


> I know of workers in the public sector that literally consider each day at work as an investment towards their severance "entitlement", since they tend to receive massive payouts in the unusual event that they do get laid off.
> Each day is also an investment towards their pension accrual.
> All of this creates negative incentives for the workers.


Exactly why I trudged into my private sector job.......days, afternoons, nights, weekends and holidays.........every day was one day closer to leaving forever.

I certainly wasn't going in every day because I loved driving a fork lift truck so much.............


----------



## Guban

Wow! Is this a TFSA thread? Seems to have been hijacked.


----------



## HaroldCrump

sags said:


> Exactly why I trudged into my private sector job.......days, afternoons, nights, weekends and holidays.........every day was one day closer to leaving forever.


Umm...GM doesn't count as "private sector" :biggrin:


----------



## humble_pie

Guban said:


> I semi-seriously considered the idea of renting some TFSA room from a relative when they first came out, as he wasn't using it anyways. I could give him a cut of the interest, say 10%, rather than paying taxes to the government, and we would both win. He would get money for doing nothing, basically and I would be paying less than my marginal rate.
> 
> Didn't think it was worthwhile given the small amounts back then and the low interest rates. The rates haven't improved, but the TFSA limits have increased greatly. The investments would really have to be in his name, so there is a trust issue, short of a contract of some sort.




i feel that, outside the nuclear family, ie with a sibling or a cousin, there's too much risk of resentment & rancour. It would probably work better with the sib or the cuz to show him how to set up & manage his own tax-free account?

within the nuclear family, TFSA cross-funding is common. Spice donate to each other, parents might fund a TFSA for a handicapped adult child (though probably not a good idea for an able-bodied one.)

aging grandparents could be tricky. An adult son or daughter might build up pappy's or grammy's TFSA with the expectation that the funds will roll along merrily tax-free for several years or decades, but they will inherit everything in the end.

but widowed parents have been known to marry frisky new spice in their golden years. Then sometimes they have the audacity to write new wills bequeathing all to the new mate while disinheriting the adult children of the primary marriage, tch.

that's how come i had this harebrained idea that an anonymous professionally run 3rd party fund might work. No sibling sulking, no granpappy leaving his estate to a golddigger ...


----------



## HaroldCrump

humble_pie, any such scheme will have to kept strictly outside the control and governance of the financial institutions.
Once they get their hands on it by becoming custodians of such pooled TFSA accounts, they will slice it into tranches of collateralized obligations, and package it off as investment grade bonds to other institutions.

The whole thing will become a TFSA CDO.
Then they will sell credit default swaps against it to their clients to protect against the TFSA balances going down.
They will then slice the CDSs into tranches and sell it off to other investors.

We know the rest of the story :biggrin:


----------



## gardner

humble_pie said:


> parents might fund a TFSA for a handicapped adult child


More likely an RDSP in this case, but yeah.

It will be a while before TFSAs catch up with the 200K lifetime limit of the RDSP, and RDSPs attract grants that you'd want.


----------



## humble_pie

^^

the thing is, with the harebrained TFSA scheme, the original donor of the $$ gets something back in the end


----------



## gt_23

sags said:


> Are there some examples where privatization has led to good results ?
> 
> Education......I recently read of some "private colleges" that charge high tuition fees and issue a diploma that is worthless.
> 
> Transit..........Highway 407 was privatized and the toll rate was increased.
> 
> Healthcare............privately owned nursing homes have been in the news lately.........for the bad conditions in them.
> 
> Policing.............Ontario privatized a brand new prison. It was so bad the government had to cancel the contract.
> 
> I have seen nothing but problems extending from privatization of public services.


I'm not sure why or how either of you inferred I was talking about privatizing these. The point was that lower cost and higher service/value levels are attainable regardless of the product, service, public, or private sector. It's done quite regularly in the private sector where the incentive structure encourages such behaviors. If you can't even imagine this possibility, I would be willing to bet you are a public sector employee where the status quo apathy is somehow acceptable.

Also, if you insist on cherry-picking, I'm pretty sure that a Harvard diploma is quite worthwhile indeed.


----------



## gt_23

sags said:


> That was an aberration and isn't illustrative of normal corporate goals..........which is to lower labor expenses.
> 
> Scotiabank is eliminating 1500 employees. How many of those employees were "high performers"....did it matter?


I think your understanding is quite off base. You're right that most firms try to lower their overall labour expense, but they're not actively reducing wages of individual workers. Most firms will use tactics like attrition, absorbing growth, and redeploying resources internally before resorting to cuts. Finally, like it or not, technology is apart of our world now and firms (and Governments) have been replacing labour for technology for at least the last 70 years.

Scotiabank is cutting 1500 positions, wow what a bad corporation. Most of these are from one area of the bank, what's going on in the other areas? Are they growing and hiring? How many jobs has BNS created over the last 1,2, 5-years? How many will they create next year and the year after. Are they firing these people or doing it through attrition? Lastly, if they are actually cutting 1500 heads on a workforce of 75,000, chances are that exactly none of these people are high performers since firms typically use these initiatives to cut from the bottom of the talent pool. This is why they are usually quite surprised that these layoffs have little impact to the business, since many of these people were adding little value anyway.


----------



## fersure

Soooo, getting back to the original question - I guess the answer to the original question is NO, wait until 2016.

If they wait until 2017, the contribution rate should increase to $6,000 - double it and you have $12,000 in annual contribution room.


----------



## Jon_Snow

I'll be ready, whenever they decide to do it.


----------



## RBull

^+1


----------



## HaroldCrump

fersure said:


> Soooo, getting back to the original question - I guess the answer to the original question is NO, wait until 2016.


Why was this columnist expecting TFSA doubling announcement in the fall fiscal update?
That is not the purpose of the update.
If it is to be announced, it will be in the 2015 budget.


----------



## andrewf

They announced other tax measures in other fiscal updates. This government is not big on convention and using procedure for intended use.


----------



## HaroldCrump

The original TFSA was announced in the budget from what I recall.
The other tax credits - fitness, cultural, etc. were announced during various social events, campaign stops, etc.
I don't recall every single tax credit announcement, of course, so you could be right.
There are so many that I have lost count...

All these are political in nature.
We need across the board income tax rate cuts. At least 2% minimum at each tier.
And an increase to the personal exemption limit.

We also need a mechanism to prevent provinces from kyboshing federal tax cuts by raising provincial rates.
Ontario did that with income tax rates, and some Atlantic provinces did that with the GST cut.


----------



## andrewf

Why do we need a mechanism? Provinces have the constitutional right to levy taxes, if their elected representatives so desire. I know exactly where you are coming from, but just because team blue holds the reins right now doesn't mean they get to set the rules until the end of time. What you are asking for would require constitutional change to be legal. Harper could pass a meaningless bill prohibiting provinces from changing their taxation which would last exactly as long as it took one province to bring it to court to challenge its constitutionality. Harper has done that a few times now with other unconstitutional/meaninglessly unbinding legislation (fixed election dates, for one).


----------



## fraser

Agree with you Andrewf.

And I am getting very, very tired of hearing politicos like Joe Oliver brag about Canada's debt being 25 percent or so of GDP, yata, yata, yata. 

He should be saying Federal debt. Our actual debt to GDP ratio is much higher if you include Provincial debt in the picture. Unless of course you don't consider debt incurred by the Provinces to be part of our national debt load.


----------



## Guban

HaroldCrump said:


> We* need *across the board income tax rate cuts. At least 2% minimum at each tier.
> And an increase to the personal exemption limit.
> 
> We also* need* a mechanism to prevent provinces from kyboshing federal tax cuts by raising provincial rates.
> Ontario did that with income tax rates, and some Atlantic provinces did that with the GST cut.


What would happen if we don't get these things? This a financial forum. We *need* to distinguish between a need and a want. What you have written is about what you want, not what is needed.

What is needed is fiscally responsible government. The reduction in taxes should force this, if it wasn't for the ability for governments to borrow money and live beyond our means. Reducing taxes and while increasing the debt is possible, and has happened in previous governments. I maintain that generally the most responsible thing to do is to pay down the debts we have, national, provincial and personal. Don't give us tax cuts. Give us responsible governments. Don't give us what we want. Give us what we need. Don't buy us with our own money, and the money of the generations to come!


----------



## My Own Advisor

andrewf said:


> They announced other tax measures in other fiscal updates. This government is not big on convention and using procedure for intended use.


+10


----------



## GOB

andrewf said:


> Not surprised by the demographic of the people here, just that they are so out of touch with average people.


The average person where I live seems to be perfectly willing to lease luxury cars or buy $500,000 condos and million dollar tear-down homes with tiny lots. So yes, I am out of touch with them. 

I'm all for encouraging people to save money - it's obviously a problem for people of all incomes.


----------



## rsyl

Guban said:


> What is needed is fiscally responsible government. The reduction in taxes should force this, if it wasn't for the ability for governments to borrow money and live beyond our means. Reducing taxes and while increasing the debt is possible, and has happened in previous governments. I maintain that generally the most responsible thing to do is to pay down the debts we have, national, provincial and personal. Don't give us tax cuts. Give us responsible governments. Don't give us what we want. Give us what we need. Don't buy us with our own money, and the money of the generations to come!



I agree with this, my vote goes to whoever vows to drastically cut spending and allot that savings to the debts. Let's rough it for a while and get this debt under control!


----------



## Jon_Snow

andrewf said:


> I'm somewhat amazed at the cozy upper middle class bubble some people seem to exist in here.


Where is there eye-roll emoticon when you need it? Oh wait, here it is. :rolleyes2::rolleyes2::rolleyes2::rolleyes2:


----------



## lonewolf

I think a lot of investors are not going to be happy with having a lot of money in TFSA in the coming years. (reason being losses from deflationary crash will not be able to claim against gains)


----------



## HaroldCrump

Guban said:


> What is needed is fiscally responsible government. The reduction in taxes should force this, if it wasn't for the ability for governments to borrow money and live beyond our means. Reducing taxes and while increasing the debt is possible, and has happened in previous governments. I maintain that generally the most responsible thing to do is to pay down the debts we have, national, provincial and personal. Don't give us tax cuts. Give us responsible governments. Don't give us what we want. Give us what we need. Don't buy us with our own money, and the money of the generations to come!


I don't disagree with you at all.
My thoughts were exactly as you said - _The reduction in taxes should force this_
I don't understand why you quoted and bolded the word "need" in my post.

BTW, how do you propose we create "responsible governments"?
IMHO, every level of govt. is heading in the opposite direction, esp. where you & I live (province of Ontario).
I'm interested in hearing your thoughts on how we can extricate petty vote banking politics from economic and fiscal policies to create "responsible governments".


----------



## HaroldCrump

andrewf said:


> I know exactly where you are coming from, but just because team blue holds the reins right now


Where I am coming from has nothing to do with who's in power in Ottawa - it has to do with the escalating tax burden, in various forms, instituted by all 3 levels of govt.
Each level of govt. has the "right" to levy taxes of their own - and they use (abuse) that power to the fullest possible degree.

The net result is that people not aligned with any rent seeking vote banks (such as unions, etc.) are seeing their disposable incomes continuously reduced YoY.
For instance, the HST was a big blow to disposable incomes - the temporary Clean Energy Benefit notwithstanding.

Some like Guban above are fantasizing about "responsible governments".
I am all for that, too, of course (who wouldn't).
But in the meantime, I'll take any tax cuts we can get.


----------



## Guban

HaroldCrump said:


> I don't disagree with you at all.
> My thoughts were exactly as you said - _The reduction in taxes should force this_
> I don't understand why you quoted and bolded the word "need" in my post.
> 
> BTW, how do you propose we create "responsible governments"?
> IMHO, every level of govt. is heading in the opposite direction, esp. where you & I live (province of Ontario).
> I'm interested in hearing your thoughts on how we can extricate petty vote banking politics from economic and fiscal policies to create "responsible governments".


I bolded the word "need", to emphasize there is a difference between a "need" and a "want". 

I propose that we create responsible governments in the only way that we can: we vote for them. We do live in a democracy, so we strongly express our desire to have fiscally responsible governments, and pay down our debts. We don't let the governments distract us and have us fight for the (often borrowed) scraps they are throwing us. They are having us fight among ourselves instead of focusing on the real problem.

Perhaps you are right. Perhaps I am fantasizing.


----------



## Guban

HaroldCrump said:


> W
> Some like Guban above are fantasizing about "responsible governments".
> I am all for that, too, of course (who wouldn't).


Who wouldn't you ask? I am going to suggest the majority at present. I am going to suggest that the goal of the majority of voters is for short term selfish gains. Thus we get governments caving in to individual groups: parents, seniors, Power Plant neighbours (in Ontario), investors, ... whomever they think can be swayed. Thus we get governments we deserve.

Democracy may be the best government out there, but it certainly isn't without faults. It is slow, costly and short sighted. An enlightened majority can fix the last issue, however.


----------



## Eclectic12

Guban said:


> ... An enlightened majority can fix the last issue, however.


I suspect it also needs a much higher level of trust that any actions by the voters to put the overall good above their short term gain won't be subverted by the politicians or the bureaucrats.

Cheers


----------



## HaroldCrump

Guban said:


> I propose that we create responsible governments in the only way that we can: we vote for them.


I vote in every single type of elections (including municipal).
However, show me who I should vote for that is going to create "responsible government".
I assume you mean a fiscally responsible govt. i.e. no deficit, reduce debt, lower taxes, etc.
Among the 4 major political parties (I'm including the nascent "Green Party of Canada"), which manifesto includes real, concrete policies to create that type of fiscally responsible govt.?

All I see from their manifestos (which are slowly starting to emerge in preparation for next year's federal elections) are spending schemes.
The NDP wants to provide $15 a day daycare for everyone.
The Greens want to impose punitive carbon taxes, shut down the oil sands, and dismantle all pipeline infrastructure.
The Liberals want to...oh wait, what is it that they want to do again (other than legalizing MJ)?

The residents of Ontario just elected themselves a provincial govt. with a massive tax & spend agenda.
The policies are already being implemented...tax rates have been raised (more to come in following years), and the spending agenda is starting to trickle through as well.



Guban said:


> Who wouldn't you ask? I am going to suggest the majority at present. I am going to suggest that the goal of the majority of voters is for short term selfish gains. Thus we get governments caving in to individual groups: parents, seniors, Power Plant neighbours (in Ontario), investors, ... whomever they think can be swayed.


I agree with you...this is vote banking politics.
The parties have created their vote banks, and have figured out the math required to get them elected without having to garner a true vote % based majority.
Anyone not in the vote bank has been disenfranchised.

At this time, the federal as well as the Ontario govt. have less than 40% of popular vote share, yet command absolute majority governments.

In the case of Ontario, those that put the current administration in office are getting their wishes fulfilled...so-called high income earning professionals are getting crushed with taxes, families and households are losing disposable income (HST, punitive hydro rates, etc.), while the vote banks (unions, public sector workers, transit lobbies, etc.) are calling the shots.


----------



## Guban

Harold, I think that you and I agree on many things, including that the levels of government around us are not fiscally responsible. My priorities are exactly what you listed above, in exactly the order you listed them: no deficit, reduce debt, lower taxes.

Obviously just voting will not be enough to enact these changes. We should voice our preference for these priorities with each new trial balloon floated. Shoot it down, and try to get the government to refocus on being fiscally responsible. Don't fight among ourselves as to how much the TFSA room should increase or if it should increase! Think of how much it costs to service the national and provincial debts! (I'm not sure about how much debt municipalities are carrying) Think of just doing what is right.

According to the Fraser Institute, 11.1% of the national revenue went towards just servicing the debt in 2013/2014. In Ontario it was 9.1%. That means that if the debt was eliminated, our tax bills could be reduced this amount with no reduction in programs at all.
http://www.fraserinstitute.org/uplo...cations/cost-of-government-debt-in-canada.pdf


Just my two cents from fantasy land. Guban.


----------



## Synergy

Guban said:


> That means that if the debt was eliminated, our tax bills could be reduced this amount with no reduction in programs at all.


Now that's a good joke. If you can find a cure for greed, then maybe.


----------



## sags

A lot of the government debt was used to build infrastructure.........highways, bridges, water treatment plants, arenas and community centers........

The Fraser Institute has a myopic and faulty view of how the real world works. 

In their "debt free" world.........taxes would have to be a lot higher, as everything would be "pay as you go".


----------



## RBull

sags said:


> A lot of the government debt was used to build infrastructure.........highways, bridges, water treatment plants, arenas and community centers........
> 
> The Fraser Institute has a myopic and faulty view of how the real world works.
> 
> In their "debt free" world.........taxes would have to be a lot higher, as everything would be "pay as you go".



Some would see the Fraser Institute that way. 

Can you explain your last line? 

It seems to me a "debt free" world would reduce taxes and pay as you go would do the same.


----------



## HaroldCrump

sags said:


> A lot of the government debt was used to build infrastructure.........highways, bridges, water treatment plants, arenas and community centers........


Yeah...in the 1950s and 1960s...those days are long gone.

These days, no new infrastructure is being built.

How many highways, bridges, and roads have you seen built just in our southern Ontario in the last 10 years?
They have added 1 lane to the 401 between Innerkip and Woodstock, and converted 1 lane on the 403 to HOV - that's about it.

They don't even spend the $10M or so required to repair the Gardiner Expressway.

A couple of years ago, there was a proposal to build an alternative connecting highway between the Niagara QEW and the 410, but nothing was ever built.

Sorry sags, that rhetoric of govt. building roads, bridges, highways, etc. doesn't work any more.
Those excuses are over 50 years old...

No other infrastructure is being built, either.
Our misguided, militant environmental groups won't even allow us to build a West > East pipeline for carrying oil sands heavy crude for refining to the Atlantic coast.

All the debt being racked up by tax & spend governments these days are going towards placating unionized public sector workers, and simply staffing up various fake government departments, ministries, agencies, and crown corporations with more and more paper pushing bureaucrats, all of them Sunshine-list worthy.



> In their "debt free" world.........taxes would have to be a lot higher, as everything would be "pay as you go".


I am not advocating Fraser Institute, neither any other "think tank" such as the CPA, but these so-called services that most people are supposedly defending do not exist.
These are wistful memories of the Golden Age of the 1950s and 1960s.
All that we have left to show for it are massive debts and unfunded pension & benefit liabilities.
Which the current & future generations of taxpayers are on the hook for - via higher taxes and higher inflation.


----------



## sags

RBull said:


> Some would see the Fraser Institute that way.
> 
> Can you explain your last line?
> 
> It seems to me a "debt free" world would reduce taxes and pay as you go would do the same.


In my opinion..........for what little it is worth...........

In theory, debt could be eliminated and saving the 10% servicing cost could shave the cost of taxes.

But that doesn't allow for future capital spending........presumably "pay as you go" without accessing debt again. The money has to come from somewhere and regardless of what it is called.......special assessments, fees, or taxes.........it is all the same to the citizens.

It also doesn't recognize the time value of money. The government could "save up" for infrastructure projects.....possibly allocating capital to reserve funds over the course of 30 years to finance a project, but the future cost of the project would be significantly higher in the future and the savings from not servicing debt would be offset by the higher cost of the projects.

I don't disagree that Canada.........and Ontario in particular need to address a problem of rising servicing costs. 

There are different methods to reducing the cost.

Cutting services and benefits. Raising revenues. Refinancing the debt at lower interest rates. Growing the economy and tax base.

It appears that Ontario is trying to combine a few of the above to achieve their goals.

New revenue from "legal" online gambling websites, controlled by the government........higher charges to the breweries to compensate for the cheaper distribution costs the Beer Store represents........restructuring debt wherever possible......lowering public service costs in the future, prudent spending of tax payer dollars, collecting taxes from the "black market", developing resource industries, and strategic partnerships with business.........etc.

Whether the Liberal plan in Ontario will be successful remains to be seen, but I think it has potential if they are truly determined to follow it through to completion.

Federally, Harper has cut some taxes, but the cost of the tax cuts were added to our national debt.

He put the eligible age for collecting OAS back 2 years to 67........and hands money out today.

He has failed the same test that I expect of the Ontario Liberals...........to be determined to follow it through.


----------



## sags

There was a new exchange built at Woodstock, rail lines put in, and hydro towers built to accomodate Toyota.

Highway 400 north of Barrie has an ongoing expansion for years. It is a completely new highway......wider, new overpasses.......etc.

There was major construction everywhere around here for the past few years.........much of it with Ontario provincial subsidies.

A new water pipeline was built from Lake Huron........twinning the current pipeline.

Windsor, Ontario is building a new bridge and highways leading into it.

Solar farms are springing up all over the place, partly subsidized by the Ontario government.

New hospital expansions.........new schools.........lots of infrastructure being built or updated.


----------



## gardner

HaroldCrump said:


> These days, no new infrastructure is being built.


Aww, just last year they built two new gas-fired electric plants -- er, well -- didn't build -- er, well -- _bought_ two anyhow. So there!


----------



## andrewf

HaroldCrump said:


> Yeah...in the 1950s and 1960s...those days are long gone.
> 
> These days, no new infrastructure is being built.
> 
> How many highways, bridges, and roads have you seen built just in our southern Ontario in the last 10 years?
> They have added 1 lane to the 401 between Innerkip and Woodstock, and converted 1 lane on the 403 to HOV - that's about it.
> 
> They don't even spend the $10M or so required to repair the Gardiner Expressway.
> 
> A couple of years ago, there was a proposal to build an alternative connecting highway between the Niagara QEW and the 410, but nothing was ever built.
> 
> Sorry sags, that rhetoric of govt. building roads, bridges, highways, etc. doesn't work any more.
> Those excuses are over 50 years old...
> 
> No other infrastructure is being built, either.
> Our misguided, militant environmental groups won't even allow us to build a West > East pipeline for carrying oil sands heavy crude for refining to the Atlantic coast.
> 
> All the debt being racked up by tax & spend governments these days are going towards placating unionized public sector workers, and simply staffing up various fake government departments, ministries, agencies, and crown corporations with more and more paper pushing bureaucrats, all of them Sunshine-list worthy.
> 
> 
> I am not advocating Fraser Institute, neither any other "think tank" such as the CPA, but these so-called services that most people are supposedly defending do not exist.
> These are wistful memories of the Golden Age of the 1950s and 1960s.
> All that we have left to show for it are massive debts and unfunded pension & benefit liabilities.
> Which the current & future generations of taxpayers are on the hook for - via higher taxes and higher inflation.


They spent about a billion doubling the 401 in Mississauga. They also spend a huge amount on maintaining infrastructure. I think many people fail to realize how big of a job it is.


----------



## Guban

sags said:


> A lot of the government debt was used to build infrastructure.........highways, bridges, water treatment plants, arenas and community centers........
> 
> The Fraser Institute has a myopic and faulty view of how the real world works.
> 
> In their "debt free" world.........taxes would have to be a lot higher, as everything would be "pay as you go".


In a "debt free" world, taxes would not be consistently higher. Isn't the overall money spent the same, if the same services are provided? If the debt servicing costs are removed, taxes would necessarily be lower! The math can't go any other way. It seems to me that taxes would be lower until a major project came in, and then they would bump up, according to your scenario. Even if this was true, it would cause a significant discussion with each bump up. That in itself is a good thing in a democracy.

You are right that we don't have a "pay as you go" government. What we have now are "buy now and pay later" governments. Sound like a loud sales pitch from a retailer to be fiscally irresponsible? It is! How is your credit card debt going? I know what mine is, and I know that most people would like theirs to be zero. Buy now and pay later is generally not a good strategy for living. This is a personal finance forum. How many times have we seen people suggest that their debts be reduced or eliminated?

I have the answer for this "pay as you go" situation. The governments should plan, and build a reserve. Isn't this what happens to condo corporations that aren't allowed to run a deficit? Norway did this with their oil revenues. Isn't this what fiscally responsible families try to do? I understand that there may be unforeseen situations where a deficit is necessary (such as a world war), and that's why governments should be allowed to run deficits, but these days governments run deficits as a matter of habit without many people complaining. This is a personal finance forum. How many times have we seen an emergency fund in cash preached?

People may look at government debt as analogous to mortgage debt for families; they are both good debt used to build for the future. In this I must concede that there is a good argument. However, that point is long gone IMHO, and we are living beyond our means, and borrowing from our children's future. Harold wants to prevent this from happening by reducing taxes. I say get to the heart of the borrowing problem and strive to eliminate deficits, and kill the debt to the best of our ability.

I knew that the Fraser Institute reference I quoted would yield controversy, and thought about not using it. I find it interesting that nobody thus far has disputed the numbers, and that is all that I used. I did not look at their conclusions and implications, just the numbers.


----------



## HaroldCrump

andrewf said:


> They spent about a billion doubling the 401 in Mississauga. They also spend a huge amount on maintaining infrastructure. I think many people fail to realize how big of a job it is.


Sure, they might be _spending_ a "huge amount" of money, as you said.
But that is the cost of services question i.e. tax-payers overpaying for "services".

The 401 through Mississauga was not exactly doubled - they added a couple of collector lanes between Hurontario and Islington, where the Collector lanes used to begin earlier (i.e. as of 2004 - 10 years ago).
As for spending on maintenance, the Gardiner Expressway is proof of exactly how much maintenance is being done.

Regardless, whatever is being spent is clearly not enough...not even close.
They should be reallocating spending from public sector compensation into infrastructure development.
Reduce debt servicing costs (by paying off debt) and redirect towards infrastructure.

Stop overpaying for green energy contracts to private suppliers, and re-selling excess hydro at throw-away rates.
Once that is done, they can perhaps reduce the household tax burden by removing the HST from hydro.

Stop over-paying and over-staffing the unionized public sector.
There are many things that can be done to reduce the debt burden...

That is what they should be focusing on, not namby-pamby social schemes like "a pension in every pot".


----------



## Eclectic12

^^^^

The excess hydro bit, except when it's sold as a future credit - is not going to do anything. Unless there's some place to store for later, when it's excess, there's not much that can be done with. Dollars flowing in beats no dollars AFAICT.

Dealing with low bidders being paid despite the lines having no capacity to deliver the contracted power or "maintenance" shutdowns or other items that have a cash value would be better, IMO.


Cheers


----------



## HaroldCrump

Eclectic12 said:


> The excess hydro bit, except when it's sold as a future credit - is not going to do anything.


It has an economic cost if & when the power is being produced at an uneconomic cost i.e. not using the most cost efficient source of fuel.

Ontario has been canceling natural gas fired power plants (for political reasons) in favor of highly uneconomic wind power.
On top of that, they have been paying private producers as well as the vendors of technology premium prices for their services.

Part of that cost has been passed on to the consumers via higher hydro rates and HST.
The rest is being borne by current and future taxpayers in the form of higher provincial debt.

The other factor in the rising cost of power are the grotesquely overpaid hydro agency workers, the vast majority of whom are not en-field linesmen and technicians, but simply paper pushers filling up floors upon floors at the OPG, OPA, and Hydro One.
The benefits and pension liabilities of these overpaid and redundant "workers" is in hundreds of millions.

All of these factors are a fiscal drag on the province, and ultimately, at the national level since Ontario is the second largest receiver of equalization payments.
The fiscal drag from all this politically driven, misguided policies is significant because it crowds out long-term investment in infrastructure and other services.
And it will continue being a fiscal drag for future taxpayers and future administrations.
Current debt stands at $280 Billion...there is no easy way out of this, anytime soon.


----------



## Eclectic12

HaroldCrump said:


> It has an economic cost if & when the power is being produced at an uneconomic cost i.e. not using the most cost efficient source of fuel.


So the key factor is not so much selling the excess power rather it's the inefficient source.
The wording made it sound like selling excess power was by itself, a problem.

The other factors look to me like they will take a while (as well as political will). 
Why not get the low hanging fruit out the way that will affect the bottom line immediately?


Cheers


----------



## gardner

Excess power is a problem also. To shed unwanted power off the network -- which would be required for technical reasons -- may involve a NEGATIVE rate -- ie: PAYING HQ or NU or whoever to take the power away. This while simultaneously BUYING power from the wind farms at an inflated contractual rate because we are contractually obligated to buy everything they generate, whether we need it or not.

A few sources of power can be throttled up and down to deal with changes in load. All the FIT systems are contractually locked in -- and their actual output varies, complicating things. Coal and Nuclear take at least hours to throttle up and down and these changes are scheduled in advance. Gas and Hydro are "load following" so you can tune the output to match the actual requirements of the grid. But if the output of the non-tunable sources exceeds the demand, that is a very bad thing, and excess power must be shed to another network. And this may cost money to do.


----------



## RBull

Guban, we're on exactly the same page.


----------



## andrewf

Harold, you seem fixated on the Gardiner when it is a bit of an exception. It is under the jurisdiction of the City, which has very little fiscal capacity to make big infrastructure investments. The province spends quite a bit on roads. Driven the 400 or other northern highways lately? I drove to Sudbury last summer and witnessed what looked like some serious $ improvements to the highways up there. There are also significant improvements being made in KW. They just finished spending a bunch of money on the QEW in Oakville/Burlington, rebuilding bridges and overpasses.


----------



## Eclectic12

gardner said:


> Excess power is a problem also. To shed unwanted power off the network -- which would be required for technical reasons -- may involve a NEGATIVE rate -- ie: PAYING HQ or NU or whoever to take the power away.


Absolutely ... but even if one waves a magic wand to deal with the green part of the equation - the firms identified who make unrealistic bids based on knowing the transmission lines couldn't handle it yet were *paid* for power that couldn't be delivered are going to keep lining their pockets. 

Similarly, the companies who have been idling their generators excessively for similar reasons are going do the same.


Maybe I'm missing something ... but these seem like easy issues to fix that will deal with payments for phantom electricity.


Cheers


----------



## HaroldCrump

Eclectic12 said:


> So the key factor is not so much selling the excess power rather it's the inefficient source.
> The wording made it sound like selling excess power was by itself, a problem.


Selling excess power is indeed a problem because (under certain circumstances) it increases the GA (Global Adjustment).
This is the punitive charge that the OPA has been slapping on the consumers to account for the delta between wholesale market price and the rates paid to renewable generators under contracts.

This is explained in the following study (50 page PDF document)

_*What Goes Up...Ontario's Soaring Electricity Prices and How to Get Them Down*_

One excerpt:

_*Exports and imports*

These have significant and roughly opposite effects. Exports are associated with a GA increase of $0.005 per MWh, while imports are associated with a decrease of $0.007 per MWh. 
This suggests that the circumstances giving rise to exports are disadvantageous to consumers, whereas imports are helping to keep the GA lower. 
As discussed above, there are contrasting influences on both variables. 
The fact that exports have a significantly positive effect on the GA signals that reducing domestic electricity consumption amid a surplus
of baseload power should not be a goal, if our objective is to lower the consumer cost. 

Conservation programs, expensive in and of themselves, thus make especially little sense when the province has a shortage of demand to begin with. 
When we are in a surplus baseload situation, rather than spending money on conservation, the province should encourage consumers find beneficial uses for electricity to increase demand so as to minimize the amount that has to be dumped at a loss._


----------



## HaroldCrump

andrewf said:


> Driven the 400 or other northern highways lately? I drove to Sudbury last summer and witnessed what looked like some serious $ improvements to the highways up there. There are also significant improvements being made in KW. They just finished spending a bunch of money on the QEW in Oakville/Burlington, rebuilding bridges and overpasses.


Haven't driven to Sudbury, so will take your word for that.
I have seen the improvements on the QEW (the Third Line overpass, etc.) and the 400/410 ones.
K/W unfortunately leaves a lot to be desired.
Hwy 8 from the 401 into Waterloo needs serious improvements.

Anyhow, those improvements, while much appreciated, do not justify the debt & deficit burden we are carrying.
Those road improvements are not what has caused this fiscal situation.

I believe it stands at $285B and $15B respectively.
This is in spite of consistent tax increases since 2003 (in various shapes and forms).

It is clear that the current tax burden is not sufficient to eliminate the deficit, much less make a dent in the debt burden.
The question our "leaders" need to ask themselves is whether they want to keep testing the tax tolerance limits of individuals and businesses, or are they finally ready to acknowledge that the problem lies elsewhere.


----------



## andrewf

I didn't claim they did, only countering your claim that the government is spending nothing on infrastructure. Infrastructure investment is too low, but there are significant infrastructure investments being made.

I know your head will explode at this comment, but the fact is that in the Canadian context, Ontario is a low-spending jurisdiction, and relatively low tax.

Check the Canadian Taxpayer Federation (not exactly a Wynne-loving outfit),

http://www.taxpayer.com/media/Provi...ation, 1988-1989, 2000-2001, 2011-2012(1).pdf

Spending has risen in real terms (not as dramatically in % of GDP terms), but is still amongst the lowest in Canada in per-capita terms.


----------



## BoringInvestor

andrewf said:


> I didn't claim they did, only countering your claim that the government is spending nothing on infrastructure. Infrastructure investment is too low, but there are significant infrastructure investments being made.
> 
> I know your head will explode at this comment, but the fact is that in the Canadian context, Ontario is a low-spending jurisdiction, and relatively low tax.
> 
> Check the Canadian Taxpayer Federation (not exactly a Wynne-loving outfit),
> 
> http://www.taxpayer.com/media/Provi...ation, 1988-1989, 2000-2001, 2011-2012(1).pdf
> 
> Spending has risen in real terms (not as dramatically in % of GDP terms), but is still amongst the lowest in Canada in per-capita terms.


andrewf, please stop proving proper context, nuance, and math into this discussion.


----------



## HaroldCrump

andrewf said:


> I know your head will explode at this comment, but the fact is that in the Canadian context, Ontario is a low-spending jurisdiction, and relatively low tax.
> Check the Canadian Taxpayer Federation (not exactly a Wynne-loving outfit),
> Spending has risen in real terms (not as dramatically in % of GDP terms), but is still amongst the lowest in Canada in per-capita terms.


That is not the right way to look at it at all !
So is that the touchstone that we are measuring fiscal condition by now - which province spends the most per capita?
You make it sound like it is a gold standard to be aspired for by the provincial governments - to spend per capital the same as NFLD & Manitoba.

Ontario's fiscal situation is in terrible shape, thanks to profligate and corrupt governance since 2003.

Ontario's debt now stands at a staggering $285B










Since you so love per capita numbers, Ontario's debt per capita is second only to Quebec's.










The debt to GDP ratio is the highest it has ever been










The debt servicing cost is now 10% of revenue - the highest it has ever been










Ontario is now the second highest recipient of equalization payments, instead of being a contributor.

You are holding up that per capita spending number as if it is something to aspire for - it is not.
It is a symptom of economic sickness.
A symptom of an artificially pumped up economy being sustained by public sector spending.

And keep in mind that all these debt & deficit numbers do not include Ontario's massive unfunded liabilities for public sector pensions and benefits.
Which is the source of a lot of these fiscal problems, and economic sickness anyway.


----------



## andrewf

But harold, when Ontario is spending so little vs its peers, perhaps the problem is not strictly on the spending side.


----------



## el oro

Considering Ontario's relative population density and distribution, I would fully expect per capita [infrastructure and overall] spending to be at the low end. Thus, you can't dismiss mismanaged spending by referencing low per capita expenditure.


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## Guban

This discussion should really have a different title. Thread is officially hijacked?


----------



## OurBigFatWallet

Back to the original topic, my guess is that if they were going to do it effective Jan 1/15 they would have done it already. A spring 2015 announcement would be nice but likely wouldn't take effect until Jan 1 2016.


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## scorpion_ca

The TFSA limit remains the same for 2015.

http://www.cra-arc.gc.ca/nwsrm/fcts...-eng.html?utm_source=mediaroom&utm_medium=eml


----------



## My Own Advisor

Yup, same.

I suspect it will be a 2015 budget item for 2016, so, I agree with Dan (ourbigfatwallet).


----------



## Cal

I suspect if they do increase the limit to 10,000 that they will cease to have it indexed to inflation.....


----------



## HaroldCrump

Ha Ha, I'd rather take doubling of the TFSA room rather than the asinine indexation to "inflation".
They can keep their precious "inflation"...


----------



## Beaver101

HaroldCrump said:


> Ha Ha, *I'd rather take doubling of the TFSA room rather than the asinine indexation to "inflation".
> They can keep their precious "inflation"*...


 ... +1 ... but hey, they might de-commission the TFSA since investors are making a killing in the stock market such that it can be interpreted as a business or N-T-F-(S-A?). :biggrin:


----------



## HaroldCrump

I am getting the sense that at some point, the TFSA will be capped to a lifetime max.
I am thinking something like $50K.
Currently it is $31K for those 18 & above as of 2009.

TFSA room may or may not be doubled in 2015, depending on politics (it is purely a political matter, unfortunately).

But regardless, I get the sense that given the smear campaign waged by neo-liberal quasi social justice lobby groups like the CCPA, a lifetime max cap is coming in the future.

Under a Liberal or NDP controlled federal govt., most certainly sooner rather than later.
But even under a non Harper CP govt. in the future, I feel this will be capped at or around $50K.


----------



## the-royal-mail

Don't give the tax and spend freaks any more ideas, Harold. They've already pillaged enough of our hard-earned money to line their own pockets.


----------



## RBull

I think your post on the potential cap is right HaroldCrump. 

It seems the easiest way to fix what will be a real long term tax revenue drain otherwise.


----------



## HaroldCrump

The TFSA is not a revenue drain...it is the tax & spend policies that are a revenue drain.

Just to be clear - I was not _recommending _the TFSA be capped, I was saying it probably will be.


----------



## RBull

HaroldCrump said:


> The TFSA is not a revenue drain...it is the tax & spend policies that are a revenue drain.
> 
> Just to be clear - I was not _recommending _the TFSA be capped, I was saying it probably will be.


I am clear on the non recommendation and your tax & spend view points. A person need not be on here long to note that. (I'm pretty much on the same page)

TAX revenue drain.....other investment gains/income etc. registered and non will typically be taxed at some point. ie TFSA drains some of this away....


----------



## the-royal-mail

I think the whole revenue drain thing is a myth. First of all, TFSA money has already been taxed. So it's only the gains that might be construed as "lost revenue" -- but the tax is only a % of the gains. AND, it is only a small % of citizens who have maxed out TFSAs that are realizing good portfolio value increases. You know, the good ol' cracker jack investors that are commonplace in CMF? This is NOT representative of the population as a whole. Lastly, as one of the few people who fits this description there is no real loss because if the TFSA wasn't available to me to use thusly I would simply leave the money in a HISA gaining 1% interest. Last year, that was around $400 for me. What is the tax benefit to the govt on $400 of extra income for me? At 22% tax rate that is a whopping $88 available to the govt per year from me. Multiply that x of the tiny number of citizens who match this description and you might end up paying for 10 pothole repairs and a couple of road signs.

Big deal.

Personally, I think this whole issue of TFSA revenue drain is just a red herring, another societal villain fabricated by political opportunists and nothing more.


----------



## HaroldCrump

RBull said:


> other investment gains/income etc. registered and non will typically be taxed at some point. ie TFSA drains some of this away....


Right, so if the issue is retirement security, then the right solution is to increase the max RRSP room.
Ideally, remove the annual cap and just make it 18% of T4 income.

_*RRSP limits need increasing*_

Also, bring RRSP on par with registered pension plans by allowing RRIF income splitting prior to 65.
There are other things too that can be changed...

Coming back to TFSA, it is a solution looking for a problem.

It is not the best solution to retirement savings.
It is not the best solution to tax savings (i.e. if reducing taxes is the goal, just cut income tax rates/tiers).
It is not the best solution for cash savings (HISA, GICs, etc. are better options)

I love the program, don't get me wrong.
And I hope it doesn't get capped/dissolved/clawed back.

However, I feel that the structure and optics around TFSA has made it a very easy target for future tax & spend governments to claw back, cap, modify, or simply abolish.


----------



## Guban

HaroldCrump said:


> The TFSA is not a revenue drain...it is the tax & spend policies that are a revenue drain.


The TFSA is definitely a revenue loss. An increasing TFSA represents an increasing amount. You (and the Royal Mail), can discuss the amount, but it definitely represents a loss. 

Personally, I feel that the irresponsible government spending policies are far bigger drain; the scale of the waste in spending that we constantly see is truly staggering.


----------



## HaroldCrump

So by that logic any tax saving scheme is a "revenue drain".
The RRSP is also a revenue drain.
So is the dividend tax credit.
Where does it end?


----------



## the-royal-mail

Harold, you forgot about the public transit pass tax credit and child care benefit. 
Also, subsidizing public transit in general is a revenue drain.
Let people pay their own way to get around.
Why don't we start threads to talk about the revenue drains of these things?
Those who select the TFSA to pick on are merely affirming their ideogical bent to bankrupt the middle class.


----------



## Nemo2

the-royal-mail said:


> Personally, I think this whole issue of TFSA revenue drain is just a red herring, another societal villain fabricated by political opportunists and nothing more.


Yes....another "These TFSA investors are getting special treatment _just because_ they save their money" scenario.


----------



## Guban

Yes, any of these credits/deductions decreases revenue. We can debate whether they are worth it for the country (and people often do), but they do decrease the taxes collected by the government. That is often why we use them. Would you invest in a RRSP or TFSA without a tax benefit?

I'm not saying that they are necessarily a bad thing. Governments use these things to alter the way people behave. ie save for retirement, take the bus, keep kids healthier...
The government allows us to deduct child care expenses (with major limitations) to encourage parents to get back into the work force. Is this bad? Some would say so.

It is not about bankrupting the middle class, although it may seem that way.


----------



## Guban

I've written this before, but here it again. 

This whole TFSA debate (and the many more about things like income splitting for parents, or the Ontario Pension Plan, or ...) is just a distraction by governments. The spending needs to be reined in! Running continuous large deficits is irresponsible. 

As it may turn out, the predicted federal surpluses may not materialize anywhere near what they thought it would be. Oil revenue dropping, among other factors ... Didn't Harper promise TFSA contribution increases and other tax cuts when we had a surplus? I hope that Harold's strategy of decreasing tax revenue will force governments to decrease spending will happen, but since I live in Ontario, I'm not banking on it.


----------



## Toronto.gal

I wonder how many people could/would, if not max., at least contribute 1/2 to their their TFSAs, if they lived below their means.

I also wonder how many people have daily/weekly coffees/egg mcmuffins. Was at MCD one early morning for a rare breakfast meeting with a friend, and I noticed a long line-up of people that were ordering just that. 

Cost = $3.33 x 1 year = $865.80, and that was just for the mcmuffin. My point is that I'm sure many people spend at least double that amount eating out.


----------



## HaroldCrump

The Libertarian view is that decreasing tax revenue decreases spending as well.
But practical experience tells us that's not true.
All it does is increase debt & deficit i.e. instead of tax & spend, it becomes borrow & spend.

Spending reduction & efficiency has to come from within.

Part of the solution is profligate governments must be punished by being voted out next term, repeatedly.
But that does not happen because of general voter apathy (< 50% turnouts), and how vote banking rigs elections (unions, etc.)


----------



## My Own Advisor

Toronto.gal said:


> I wonder how many people could/would, if not max., at least contribute 1/2 to their their TFSAs, if they lived below their means.
> 
> I also wonder how many people have daily/weekly coffees/egg mcmuffins. Was at MCD one early morning for a rare breakfast meeting with a friend, and I noticed a long line-up of people that were ordering just that.
> 
> Cost = $3.33 x 1 year = $865.80, and that was just for the mcmuffin. My point is that I'm sure many people spend at least double that amount eating out.


The flipside about those people, lining up every day for that stuff, is they don't have to worry about retirement. They'll be dead if they eat that stuff all the time!

Kidding aside, I agree with your point, if you lived below your means, by a bunch, the TFSA would be easy to fill for most people. The RRSP, not so much.

Lots of YOLO mentalities out there as well (you only live once).


----------



## andrewf

the-royal-mail said:


> I think the whole revenue drain thing is a myth. First of all, TFSA money has already been taxed. So it's only the gains that might be construed as "lost revenue" -- but the tax is only a % of the gains. AND, it is only a small % of citizens who have maxed out TFSAs that are realizing good portfolio value increases. You know, the good ol' cracker jack investors that are commonplace in CMF? This is NOT representative of the population as a whole. Lastly, as one of the few people who fits this description there is no real loss because if the TFSA wasn't available to me to use thusly I would simply leave the money in a HISA gaining 1% interest. Last year, that was around $400 for me. What is the tax benefit to the govt on $400 of extra income for me? At 22% tax rate that is a whopping $88 available to the govt per year from me. Multiply that x of the tiny number of citizens who match this description and you might end up paying for 10 pothole repairs and a couple of road signs.
> 
> Big deal.
> 
> Personally, I think this whole issue of TFSA revenue drain is just a red herring, another societal villain fabricated by political opportunists and nothing more.


So, you think all the Finance department folks (including the CPC cabinet minsters running the department) should be canned for incompetence? As in all of their budget documentation they have associated a revenue cost to the TFSA in their projections.


----------



## none

My Own Advisor said:


> Kidding aside, I agree with your point, if you lived below your means, by a bunch, the TFSA would be easy to fill for most people. The RRSP, not so much.
> 
> Lots of YOLO mentalities out there as well (you only live once).


talk about only looking within your bubble. yeash. There are A LOT of people who scrape by and putting 5500 a year away PLUS money for RESP is far from 'easy'. Wow.

In case this hasn't been posted: http://business.financialpost.com/2...-gone-but-tfsas-will-live-on/?__lsa=f4d1-dfa6


----------



## My Own Advisor

@none, I wrote that "if you lived below your means, by a bunch, the TFSA...."

This assumes you can live below your means, by a bunch, and this is a choice.

I didn't say _everyone can_ nor _are they able _to max out the TFSA. The reality is, many people can't for many reasons.


----------



## Synergy

none said:


> talk about only looking within your bubble. yeash. There are A LOT of people who scrape by and putting 5500 a year away PLUS money for RESP is far from 'easy'. Wow.
> 
> In case this hasn't been posted: http://business.financialpost.com/2...-gone-but-tfsas-will-live-on/?__lsa=f4d1-dfa6


A lot of these same people who "scrape by" spend a ton of money per month on alcohol, coffee, fast food, cigs, high cell phone bills, expensive cable / satellite tv subscriptions, etc. Choices. I'm not saying it's easy for the masses but the masses do know how to spend money.


----------



## RBull

HaroldCrump said:


> Right, so if the issue is retirement security, then the right solution is to increase the max RRSP room.
> Ideally, remove the annual cap and just make it 18% of T4 income.
> 
> _*RRSP limits need increasing*_
> 
> Also, bring RRSP on par with registered pension plans by allowing RRIF income splitting prior to 65.
> There are other things too that can be changed...
> 
> Coming back to TFSA, it is a solution looking for a problem.
> 
> It is not the best solution to retirement savings.
> It is not the best solution to tax savings (i.e. if reducing taxes is the goal, just cut income tax rates/tiers).
> It is not the best solution for cash savings (HISA, GICs, etc. are better options)
> 
> I love the program, don't get me wrong.
> And I hope it doesn't get capped/dissolved/clawed back.
> 
> However, I feel that the structure and optics around TFSA has made it a very easy target for future tax & spend governments to claw back, cap, modify, or simply abolish.


Yes, my point was simply it is a revenue drain which may have been misconstrued as being an attack on it. I don't personally care about the revenue drain. I would rather see focus on government spending rather than ways to increase tax revenue.

My wife and I have taken full advantage of the TFSA and plan to continue in retirement through our non registered account. I hope that never changes but like you said think it is possible due to the attention it gets and the ease of capping it. 

Some of your other suggestions may well have merit.


----------



## lonewolf

Toronto.gal said:


> I wonder how many people could/would, if not max., at least contribute 1/2 to their their TFSAs, if they lived below their means.
> 
> I also wonder how many people have daily/weekly coffees/egg mcmuffins. Was at MCD one early morning for a rare breakfast meeting with a friend, and I noticed a long line-up of people that were ordering just that.
> 
> Cost = $3.33 x 1 year = $865.80, and that was just for the mcmuffin. My point is that I'm sure many people spend at least double that amount eating out.


 Read the other day that eating out was the number one budget blower in the United States. Eating out most likely number one budget blower in Canada also.


----------



## gaspr

Looks like TFSA limits may double to $11000 after all...

http://www.thestar.com/news/canada/2015/04/07/tax-free-savings-plan-contribution-limit-to-double-oliver-suggests.html


----------



## carverman

gaspr said:


> Looks like TFSA limits may double to $11000 after all...
> 
> http://www.thestar.com/news/canada/2015/04/07/tax-free-savings-plan-contribution-limit-to-double-oliver-suggests.html


Well, if it's more than just a rumour..it may be the best present for those who can save up to $11,000 a year.Those over 55, without too much debt
or any debt for that matter.


> 5: Per cent of those maximizing their TFSA contributions who are 25-34 years of age.
> 71: Per cent of those maximizing their TFSA contributions who are over age 55.


so that leaves about 24% of us that contribute whatever we can afford, but not taking advantage of the maximum

I know from past experience, any withdrawals in a given year will be added to the next years maximum after Jan 1st.
I was able to use that feature this year..as I really don't like having to declare interest earned on savings at my age...all my income should be tax free! LOL!


----------



## 1980z28

http://news.google.ca/news/url?sa=T...9YCoAw&usg=AFQjCNEWGckSmc1vIyUpjQq3Gu6arciJYA

Nice


----------



## Beaver101

carverman said:


> Well, if it's more than just a rumour..it may be the best present for those who can save up to $11,000 a year.Those over 55, without too much debt
> or any debt for that matter.
> 
> so that leaves about 24% of us that contribute whatever we can afford, but not taking advantage of the maximum
> 
> I know from past experience, any withdrawals in a given year will be added to the next years maximum after Jan 1st.
> *I was able to use that feature this year..as I really don't like having to declare interest earned on savings at my age...all my income should be tax free! LOL!*


... but do you feel any richer? :biggrin: 


Re the


> *5: Per cent *of those maximizing their TFSA contributions who are 25-34 years of age.


 ... 5% only? I wonder how it compares to RRSP contributions?


----------



## Retired Peasant

carverman said:


> so that leaves about 24% of us that contribute whatever we can afford, but not taking advantage of the maximum


Actually, I think that means that 24% of those maximizing their TFSA are 35-55.


----------



## Eclectic12

Beaver101 said:


> ... Re the ... 5% only? I wonder how it compares to RRSP contributions?


I expect it is similar and am not that surprised. How many are focused on finances that early, even if others are pointing it out?

Despite being able to grasp the advantage - when I suggested starting RRSP contributions when my university housemate made far more than he needed for the next term, the top end stereo won out as "I have decades to save for retirement so it's too early now".

Of course that ignores that later one usually has far more commitments/expenses so a little earlier makes a big difference.


Cheers


----------



## GoldStone

Doug Porter, chief economist of BMO, makes a great point in today's G&M. Governments reap huge benefits from the low/negative interest rates. They save billions of dollars on debt interest payments. That should be more than enough to offset any potential tax leakage from TFSA limit increase.

The budget and TFSAs: Is Ottawa admitting to ‘raw deal’ for savers? - The Globe and Mail

===========================================================

Mr. Porter has several thoughts on [doubling TFSA limit], the most important being the absence from the debate of the fact that *“savers have been handed an extremely raw deal” from years of ultra-low interest rates.

“And when the bevy of studies talks about the heavy cost of the TFSA program, why do none point to the massive interest savings governments have reaped (at the hand of savers) from years of negative real interest rates?” he said in a recent report.

“Perhaps Ottawa has decided to raise the TFSA limit in part as a sheepish admission that it may just be a tad unfair to tax interest earnings that are already well below inflation,” Mr. Porter added.*

“For example, an investor can now receive a princely 1.35 per cent for lending to Ottawa for 10 years, or less than 0.7 per cent if it is subjected to the top marginal rate, and then -1.3 per cent when subjected to 2-per-cent inflation.”

Some see doubling the limit as a “sop” to the wealthy, but Mr. Porter noted that tax-free savings of $11,000 a year won’t really do much to affect the finances of the rich.

*Some, too, worry about the cost to the government, which by some accounts could rise to $2.8-billion a year from the current $1.3-billion. To that, Mr. Porter pointed out that the government’s annual interest charges have tumbled by $6-billion since early 2008.*

“I recall precisely no complaints when the TFSA was first launched in 2009 (announced in the 2008 budget); on the contrary, it was applauded as being a welcome added vehicle to help Canadians save for retirement or other medium-term goals,” Mr. Porter said.

“Since that time, interest rates have all but collapsed, making pure saving much less attractive for the average person. While we have often noted that Canadians have done a solid job of building financial assets in recent decades, the issue now is that with very low expected future returns (especially from fixed income instruments), current savings need to be very high,” he added.

“Yet, the reported savings rate has been running at less than 4 per cent in recent quarters, down from nearly 5 per cent in the past five years (though up from the meagre 2.6 per cent in the five years before the recession and before TFSAs).”

The BMO economist, who believes it’s better to tax consumption than savings, said in a separate discussion that “effectively, we are seeing an example of financial repression (in much of the world) where savers are being punished by negative real interest rates.”

Raising the TFSA limit, he added, would “provide a small offset, at least for some.”

===========================================================


----------



## none

I kind of agree - increase TFSAs limit and increase GST by 3% -- That could make sense.


----------



## Chris L

none said:


> I kind of agree - increase TFSAs limit and increase GST by 3% -- That could make sense.


It also makes sense from an environmental and sustainability stand-point as well. 

Drop income tax too. The tax at every move of money is ridiculous. Tax when money consumes, because consumption is what requires input - from government, and businesses, and the environment.


----------



## carverman

Chris L said:


> *The tax at every move of money is ridiculous*. Tax when money consumes, because consumption is what requires input - from government, and businesses, and the environment.


As they say...the only certain things in life are taxes and death..or is that death and taxes?:biggrin:

For me, it probably will be beneficial for the next 4 years, as I have to move my $10K GICs into the TFSA each year and I hate paying taxes on what little interest
the money makes these days.


----------



## sags

$11,000 annual contribution means people would have to contribute $30.13 per day for 365 days a year.

Cutting back on coffees and burgers isn't going to do it, at least not as long as they are paying a mortgage, raising kids, and food prices keep rising.

The TFSA limit raise is mostly to the benefit of wealthy people...........and people know it.


----------



## sags

As to Doug Porter's observation that the wealthy don't gain much from an $11,000 TFSA.........he is right, but people who are wealthy can "lend" the money to all their family members and recoup it back tax free later. Would a wealthy person benefit from topping up 4 TFSAs a year for $44,0000............or even more of them.?

Maybe someday some enterprising business will "buy" TFSA contribution room from people.

The higher the contribution levels.........the more sharks are attracted.

In the US there are already companies that buy government pensions from people.


----------



## fraser

I fully expect it to go up.

This has nothing to do with fairness, tax policy, whatever.

It is 100 percent about playing to the base of voters and getting re-elected. Budgets are not really fiscal plans any more...they are all about politics.

Today's budget will not be any different. Directed at those who vote, and in particular those who vote, live in cities, and have above average incomes.

It is all about getting re-elected at any cost and remaining in power.


----------



## carverman

sags said:


> $11,000 annual contribution means people would have to contribute *$30.13 per day* for 365 days a year.


Before or after income tax?..I would guess at the middle income rate (32%), the contributor would need another $10 per day just to pay the taxes on what they could sock away. 

Even $30 a day is too much as that is about $930 a month. I doubt that most with high credit card debt and other financial pressures can even afford
that for more than perhaps a month or two..maybe using the tax refund as contribution..but if the kids new new shoes (unlike Joe Oliver), the family needs come first.


----------



## gibor365

sags said:


> $11,000 annual contribution means people would have to contribute $30.13 per day for 365 days a year.
> 
> Cutting back on coffees and burgers isn't going to do it, at least not as long as they are paying a mortgage, raising kids, and food prices keep rising.
> 
> The TFSA limit raise is mostly to the benefit of wealthy people...........and people know it.


It isn't so big benefit.... if you take sure rate that is 2.5%, from $5,500 total annual income is $137.5 per year...it's nothing!
If average people would stop buying product they really cannot afford (like new cars, furniture, doing home renovations etc), they will be able to use full TFSA room.... so everyone has their own choice what to do


----------



## none

sags said:


> As to Doug Porter's observation that the wealthy don't gain much from an $11,000 TFSA......



This is the rub and the problem with that argument. If the cost to the tax base is greatest via this policy due to high income people using it YET high income people aren't even going to notice it then WHAT IS THE POINT IN DOING IT?


----------



## fraser

Don't forget that there may be many people who, while not being able to save that much per year, can simply move some of their existing savings/investments from taxable accounts to a TFSA. We are retired and that is exactly what we will both be doing.


----------



## Eclectic12

sags said:


> $11,000 annual contribution means people would have to contribute $30.13 per day for 365 days a year.
> Cutting back on coffees and burgers isn't going to do it, at least not as long as they are paying a mortgage, raising kids, and food prices keep rising.


YMMV ... at $5 a coffee at StarBucks x four visits a day x five days a week x 11 months - that's forty percent of the way there from one change. Note that I'm using what co-workers were *doing* as my numbers.


Then too ... if there's investments in a taxable account - money isn't needed to make use of the contribution room.


Bottom line is that there are a lot more than just the wealthy who can use it ... a large number choose to do something different.


Cheers


*PS*

What's beer and wings at a bar for events such as the hockey play-offs? 
Redirecting some of that would add a lot to the TFSA pot.


----------



## Eclectic12

carverman said:


> Before or after income tax?..I would guess at the middle income rate (32%), the contributor would need another $10 per day just to pay the taxes on what they could sock away.


I don't see the issue with taxes ... unless they are paying a tax bill at the end of the year, the taxes have already been taken off.

Then too, if they are making RRSP contributions ... where they get a refund, they can redirect it to the TFSA.




carverman said:


> I doubt that most with high credit card debt and other financial pressures can even afford that for more than perhaps a month or two...


If they have a high CC debt - there could be bigger financial issues that a TFSA at play. 
In 2013 the average CC rate was supposed to be 14.95% with the instant approvals being at 28% and those with bad credit at 23%.


Do we really want to evaluate how "difficult" using TFSA room by comparing with people who likely could cut their interest costs in half (or better) but haven't?


Cheers


----------



## Eclectic12

none said:


> ... If the cost to the tax base is greatest via this policy due to high income people using it YET high income people aren't even going to notice it then WHAT IS THE POINT IN DOING IT?


If the user hasn't noticed, they won't use it. 

IAC, can you say "election goodie"? ... I thought you could ... :biggrin:




fraser said:


> Don't forget that there may be many people who, while not being able to save that much per year, can simply move some of their existing savings/investments from taxable accounts to a TFSA. We are retired and that is exactly what we will both be doing.


+1 ... 


Cheers


----------



## My Own Advisor

FWIW,

We are trying to max out TFSAs every year, but the limit will be tough for us to max out considering...

1. We are contributing a few hundred bucks each to our RRSP accounts every month, and
2. We are putting lump sum payments on the mortgage.

If a couple was to max out both TFSAs, contribute the max to both RRSPs and paydown the mortgage with lump sums, that is some great savings and a complete financial hat-trick in my book.

I'm not saying it's not possible but tough to do.


----------



## none

My Own Advisor said:


> FWIW,
> 
> We are trying to max out TFSAs every year, but the limit will be tough for us to max out considering...
> 
> 1. We are contributing a few hundred bucks each to our RRSP accounts every month, and


Hopefully using a T1213


My Own Advisor said:


> 2. We are putting lump sum payments on the mortgage.


Maybe a reason to slow mortgage payments and put cash in your TFSA instead. You have to admit saving a guaranteed ~3% at a cost of losing an average 7% is a bit of a tough sell.
One day I will convince you


----------



## Sasquatch

I'm hoping it will go up to $ 11000 pa. We'll simply be moving the money into our TFSAs from our HISAs.
BTW, no matter how high Harper and his trained seals set the new limit, we will not be voting for them....NO MATTER WHAT !
Just remember the simple phrase.....ABC


----------



## uptoolate

Yes it seems that any increase is mainly a benefit for the well off and the elderly have saved well. My mother will love the extra room as money that comes out of the RRSP each year will just go into the TFSA to the max. Ultimately it will benefit the cats at the shelter...:hopelessness:


----------



## Woz

Increased to $10,000. No longer indexed with inflation.


----------



## 0xCC

Budget docs released:
http://www.budget.gc.ca/2015/docs/nrc/2015-04-21-e.pdf

TFSA limit for *2015* raised to $10,000. Look at the bottom of page two of the document linked above, first point under the "Helping Families and Communities Prosper" section.


----------



## gardner

> effective for the 2015 and subsequent taxation years


Another $4,500 for this year, assuming the budget passes.


----------



## Soon Forget

gardner said:


> Another $4,500 for this year, assuming the budget passes.


So when will we know this?


----------



## gardner

They will crow it from the rooftops.


----------



## uptoolate

GoLong said:


> According to Oliver around 50% of the people who max out their TFSA currently are middle or low-income earners over the age of 55


Yes this is my 82 year old mother living in her paid for 600k house and with 500k in her RRIF. Sounds like it is benefiting someone other than the well off when you put it Mr. Oliver's way but I'm not so sure.


----------



## carverman

gardner said:


> They will crow it from the rooftops.


First of all the budget has to pass for any of the 2015 promises to take effect.

Trudeau mentioned that if they get elected in September, the Liberals will not go ahead with the doubling of the TFSA, as this just helps the wealthy.
So it all hinges on whether the Harper gov't will still be around after the election.


----------



## OptsyEagle

Anyone know what the new "lower" RRIF rates will be?


----------



## iherald

carverman said:


> Trudeau mentioned that if they get elected in September, the Liberals will not go ahead with the doubling of the TFSA, as this just helps the wealthy.
> So it all hinges on whether the Harper gov't will still be around after the election.


Why would they wait that long? They have a majority government, they could pass it tomorrow.


----------



## Woz

OptsyEagle said:


> Anyone know what the new "lower" RRIF rates will be?


The new RRIF factors will range from 5.28 per cent at age 71 to 18.79 per cent at age 94. The percentage that seniors will be required to withdraw from their RRIF will remain capped at 20 per cent at age 95 and above.


----------



## GoLong

uptoolate said:


> Yes this is my 82 year old mother living in her paid for 600k house and with 500k in her RRIF. Sounds like it is benefiting someone other than the well off when you put it Mr. Oliver's way but I'm not so sure.


Sorry, deleted my post since was a bit unsure of the exact number (it was also more than half of low income earners have set up a TFSA but that does not imply they get use out of it) and did not see someone had responded. 

Regardless of whether it is a 55 year old employee or your mother, the figure still shows it's not only the upper-class that are benefiting. I won't disagree that the wealthy will receive more use out of it but I think it's being blown out of proportion about how the middle and lower-class do not benefit from it at all.


----------



## carverman

iherald said:


> Why would they wait that long? They have a majority government, they could pass it tomorrow.


Yes, they could I suppose..ram it through the H of C..but this is an election year, and in this is an election budget for some of the benefit issues.
That's why they want to start paying the family benefits starting in July..August..September. By then families that qualify will be realizing that
unless the other parties basically guarantee that these benefits will not go way...they will vote for Harper. You can see that this is an election ploy
where they are hoping they will still be around for the next 4 years..to 2019.

As far as doubling the TFSA, all well and good, but a majority of the families out there are strung out financially and barely have enough to put
up to 5500 in the current TFSA...doubling it isn't going to help them..unless they have a source of income outside their normal personal expenses.


----------



## Charlie

A couple, who marries at 28 after spending time going to school...getting established etc...will now have $200K of TFSA room between them. With no restrictions or penalty for withdrawing funds...not even a loss of room.

This effectively eliminates taxes on investment income for most.

Helpful to them....but I'm not sure this is good policy.

I'd feel differently if there were withdrawal limitations as there are in the US for their plans.


----------



## pwm

Good news. They just announced the limit goes to $10,000 effective in 2015, so I can add another $9,000 to our TFSAs. Thank you Mr. Harper!


----------



## gibor365

pwm said:


> Good news. They just announced the limit goes to $10,000 effective in 2015, so I can add another $9,000 to our TFSAs. Thank you Mr. Harper!


 This is what i wanted to clarify..... Can I contribute $4,500 already?!


----------



## OptsyEagle

pwm said:


> Good news. They just announced the limit goes to $10,000 effective in 2015, so I can add another $9,000 to our TFSAs. Thank you Mr. Harper!


Not so fast. We still have an election to get through. You would not want to send in a cheque for this tomorrow and find out the budget didn't pass. That would be an expensive mistake.


----------



## gibor365

OptsyEagle said:


> Not so fast. We still have an election to get through. You would not want to send in a cheque for this tomorrow and find out the budget didn't pass. That would be an expensive mistake.


As per cbc.ca


> Tuesday's federal budget raises the amount Canadians can contribute to TFSAs each year to $10,000 *effective immediately*


 so, I'm confused


----------



## OnlyMyOpinion

I would expect the budget to be passed before the election, at which time the new limit will come into affect for 2015? I can't find confirmation of that yet however. It will happen soon enough though.


----------



## OptsyEagle

Well, I can't say whether they will pass the budget before or after the election, but I can say it is definitely NOT effective immediately. 

These are laws, and laws need ministers to vote on them and so far that has not happened.


----------



## mrPPincer

Great news! for me especially as most of my savings are in non-registered, but
I think it should be paid for with an increase in HST.

Consumption tax is the way to go, it's well known, problem is, the Harper gov't has decided to think short term for easy votes with regard to that, 
flying in the face of most of the advice from respected economists, typical behavior I suppose for a gov't as notoriously anti-science as this one.


----------



## none

OptsyEagle said:


> Well, I can't say whether they will pass the budget before or after the election, but I can say it is definitely NOT effective immediately.
> 
> These are laws, and laws need ministers to vote on them and so far that has not happened.


It is effective immediately. I'm putting in my $4500 tomorrow.


----------



## Chris L

It's not contingent on an election or up for a vote. It's the law, it's the BUDGET. Effective immediately.


----------



## Itchy54

Yup, from the national post

The new change is effective as of Jan. 1 this year, meaning Canadians who have maxed out their TFSA for 2015 will now have another $4,500 of room they can use. Over the lifetime of the plan, Canadians will have been able to contribute $41,000 as of 2015.


----------



## gibor365

Chris L said:


> It's not contingent on an election or up for a vote. It's the law, it's the BUDGET. Effective immediately.


and if Liberals winning election in Oct 2015, can they just cancel this law?! And if yes, can I still carry 10K room for next years?!


----------



## 0xCC

OptsyEagle said:


> Not so fast. We still have an election to get through. You would not want to send in a cheque for this tomorrow and find out the budget didn't pass. That would be an expensive mistake.


+1

Budgets need to be passed into law before the measures announced in them take effect. The measures can be made retroactive once they are passed into law but they need to pass first. This is an election budget that has stuff in it to be held out as a carrot for voters. Make your extra contribution before the budget passes if you want but you better hope the Conservatives win the election or the budget passes before the election happens.

EDIT: Canadian legislative process: http://www.parl.gc.ca/About/House/compendium/web-content/c_g_legislativeprocess-e.htm. Note that today's presentation of the budget was the "Introduction and First Reading" step in the process. There are a few more steps before the budget comes into force.


----------



## humble_pie

0xCC said:


> ... Make your extra contribution before the budget passes if you want but you better hope the Conservatives win the election or the budget passes before the election happens.



passing the budget will be pro forma, though? i mean, what's to stop it.

i don't see the Liberals being able to rescind this increase, or even wanting to, if they'd win the next election. The new TFSA limit will surely be wildly popular, for any party to campaign next fall on a platform of rolling it back to a lower level would be suicide.

some folks have indicated they support increased consumption taxes along with increased TFSAs. This seems like a good idea. The only proviso is that low-income canadians - who don't have a spare dime to save in a TFSA or anywhere else - should be exempted or compensated for higher prices.


----------



## fraser

I will take the bribe...ur um increase in TFSA and change to RRIF. 

but I will not be voting for them. Absolutely zilch in the budget to assist/incentive manufacturing or to recognize/ assist our economy in transition.

Thanks for nothing guys.


----------



## 5Lgreenback

fraser said:


> I will take the bribe...ur um increase in TFSA and change to RRIF.
> 
> but I will not be voting for them. Absolutely zilch in the budget to assist/incentive manufacturing or to recognize/ assist our economy in transition.
> 
> Thanks for nothing guys.


Tax cuts for one thing? I'm always a fan on keeping more of my hard earned money rather than it getting wasted in the government bureaucracy. As far as manufacturing, I assume you mean in Ontario? Is that not more the responsibility of the provincial government?


----------



## gibor365

> but I will not be voting for them.


 I will be  I don`t agree with everytging Harper is doing, but I don`t see any alternative....


----------



## 5Lgreenback

gibor said:


> I will be  I don`t agree with everytging Harper is doing, but I don`t see any alternative....



Yeah, sad reality.


----------



## Davis

You can contribute the extra amount if you want, but there is no guarantee what a new government will do if the legislation isn't passed before the election. The current government will probably introduce a budget bill soon, and we will see if they have included the necessary amendments, or have decided to defer them until the post-election parliament.


----------



## GoldStone

none said:


> I kind of agree - increase TFSAs limit and increase GST by 3% -- That could make sense.


I agree but why GST? Federal finances are in a relatively good shape. *Provinces* should be raising their sales taxes to deal with the deficits. They are the ones doing all the heavy lifting (healthcare, education).


----------



## 0xCC

humble_pie said:


> passing the budget will be pro forma, though? i mean, what's to stop it.


If the Conservatives want to pass the budget before dissolving Parliament and calling an election, there isn't anything stopping them from doing that. If they do that though they have a few less talking points for the election and will have to come up with more goodies to entice voters to vote for them. Somehow I don't see them giving up any extra campaign points before the election.


----------



## OnlyMyOpinion

Douglas Porter's Talking Points from a few weeks ago rightly called critic's concerns "poppycock" http://www.bmonesbittburns.com/economics/talkingpoints/20150410/talkingpoints.pdf.


----------



## My Own Advisor

Very happy to see the TFSA increase today. The limit is there for the taking. Hopefully we can take advantage of it in 2016. We'll sure as heck try.


----------



## Itchy54

Trudeau has just said that he would reverse the TFSA increase should he come to power....


----------



## My Own Advisor

0xCC said:


> +1
> 
> Budgets need to be passed into law before the measures announced in them take effect. The measures can be made retroactive once they are passed into law but they need to pass first. This is an election budget that has stuff in it to be held out as a carrot for voters. Make your extra contribution before the budget passes if you want but you better hope the Conservatives win the election or the budget passes before the election happens.
> 
> EDIT: Canadian legislative process: http://www.parl.gc.ca/About/House/compendium/web-content/c_g_legislativeprocess-e.htm. Note that today's presentation of the budget was the "Introduction and First Reading" step in the process. There are a few more steps before the budget comes into force.


The budget was announced, yes, but things in it are not law yet. This is my take, including the annual TFSA limit. The $10k limit would take effect as of Jan. 1, 2016 me thinks. This is not enough to get my vote although I'm not a fan of Trudeau taking my increase away.

Let the campaigns begin....6 months to go....!


----------



## Synergy

Itchy54 said:


> Trudeau has just said that he would reverse the TFSA increase should he come to power....


I figured he'd have to go out and say something stupid like that.


----------



## gibor365

Synergy said:


> I figured he'd have to go out and say something stupid like that.


Stupid politicians say (and do) stupid things


----------



## My Own Advisor

Lol


----------



## pedanticus

My Own Advisor said:


> The budget was announced, yes, but things in it are not law yet. This is my take, including the annual TFSA limit. The $10k limit would take effect as of Jan. 1, 2016 me thinks. This is not enough to get my vote although I'm not a fan of Trudeau taking my increase away.


The $10k limit (with no provision for inflationary increases) is effective this year. See page 483 of the budget document. Convention is such that a tax proposal takes effect as soon as the Ways and Means motion is tabled, despite the fact that Royal Assent may be some months off. That said, I'm too risk averse to throw in another $4500 until the GG has signed on the dotted line.


----------



## andrewf

Even if the Liberals do reverse the increase in TFSA, I expect that would include an exemption for 'overcontributing' in 2015. So even though the TFSA increase is not yet law, you are probably pretty safe if you contribute the extra $4500 now.


----------



## Ihatetaxes

andrewf said:


> Even if the Liberals do reverse the increase in TFSA, I expect that would include an exemption for 'overcontributing' in 2015. So even though the TFSA increase is not yet law, you are probably pretty safe if you contribute the extra $4500 now.


I was thinking the same thing and will be adding $9k to ours this week.


----------



## avrex

*The year is 2021*.

In the spring of 2021, a government committee files a report showing the large number of TFSA accounts that *now exceed $100,000 in value*.
It was demonstrated that the increased TFSA contribution room (i.e. increased to $10,000 in 2015) had cost the government an estimated $1.1 billion in reduced taxes in 2020 alone.

The Canadian government trying to contend with i) several consecutive years of high deficits, ii) a public debt to GDP ratio that now exceeds 150%, iii) high interest rates, decides to take action.

On October 31, 2021, the Finance Minister announces a 152 page document detailing how the government will proceed with the *taxation of Canadian TFSAs*.

Ironically, this announcement is exactly 15 years to the day of when the government ended the tax benefits of the Income Trusts.


----------



## mf4361

avrex said:


> *The year is 2021*.
> 
> In the spring of 2021, a government committee files a report showing the large number of TFSA accounts that now exceed $100,000 in value.
> 
> The Canadian government trying to contend with i) with several consecutive years of high deficits, ii) a public debt to GDP ratio that now exceeds 150%, iii) high interest rates, decides to take action.
> 
> On October 31, 2021, the Finance Minister announces a detailed 152 document on how the government will proceed with *taxing Canadian TFSAs*.
> 
> Ironically, this announcement is exactly 15 years to the day of when the government ended the tax benefits of the Income Trusts.


No they won't. But brace for 25% HST


----------



## none

I thought this was pretty good


*What a $10K TFSA contribution limit really means
You’ll save $3,708 over 10 years*

http://www.moneysense.ca/save/tfsa/what-the-10000-tfsa-annual-contribution-limit-really-means


----------



## sags

Synergy said:


> I figured he'd have to go out and say something stupid like that.


Talking about saying something stupid...........Finance Minister Joe Oliver must have been caught off guard with a question during his CBC interview with Amanda Lang.

She said that the TFSA increase doesn't amount to a lot of money today...........but it is estimated to cost Billions of dollars a year in lost revenue in the future.

She asked if the government was willing to saddle future governments with these problems.

Oliver's reply was that it wasn't his problem to worry about what impact decisions made today might have in 10-20-30 years into the future.

Isn't that great. We have a Finance Minister who doesn't care what debt or legacy problems he leaves to future generations. It will be their problem to solve, he says.

Truthful politics of the day maybe..........but an astounding admission nevertheless.

Good thing he wasn't the Finance Minister back when the CPP required changes that would affect 20-30 or more years in the future.

I wouldn't be surprised to see that video clip appearing in the election campaign.

http://www.cbc.ca/player/News/Business/ID/2665028375/

Interview in second section of the video.


----------



## yyz

I'd say few governments have much of a vision beyond getting re-elected in the next election.


----------



## GoldStone

none said:


> *What a $10K TFSA contribution limit really means
> You’ll save $3,708 over 10 years*


*That represents a 12% increase in after-tax investment income, based on a 5.5% rate of return.*


12% is nothing to sneeze at. Your union wouldn't hesitate to go on strike for a much smaller amount.

Also, my font is bigger than yours. :biggrin-new:


----------



## lonewolf

sags said:


> Talking about saying something stupid...........Finance Minister Joe Oliver must have been caught off guard with a question during his CBC interview with Amanda Lang.
> 
> She said that the TFSA increase doesn't amount to a lot of money today...........but it is estimated to cost Billions of dollars a year in lost revenue in the future.
> 
> She asked if the government was willing to saddle future governments with these problems.
> 
> Oliver's reply was that it wasn't his problem to worry about what impact decisions made today might have in 10-20-30 years into the future.
> 
> Isn't that great. We have a Finance Minister who doesn't care what debt or legacy problems he leaves to future generations. It will be their problem to solve, he says.
> 
> Truthful politics of the day maybe..........but an astounding admission nevertheless.
> 
> Good thing he wasn't the Finance Minister back when the CPP required changes that would affect 20-30 or more years in the future.
> 
> I wouldn't be surprised to see that video clip appearing in the election campaign.
> 
> http://www.cbc.ca/player/News/Business/ID/2665028375/
> 
> Interview in second section of the video.


 The only time the United States never had a deficit was during a time of no income taxes.
The more you make usually the farther in debt you go.

The government is in bed with the banks with registered accounts. The purpose of the TFSA, RRSPs etc to help make the banks rich


----------



## carverman

lonewolf said:


> *The government is in bed with the banks with registered accounts. The purpose of the TFSA, RRSPs etc to help make the banks rich.*


Banks use the TFSA and GIC money that seniors have to lend out to those that can't afford a TFSA. :biggrin:

Kinda makes sense. Joe Oliver in an interview with a CTV reporter mentioned that 60% of the users of the TFSA are those over 55.
I will assume that over 55 (means mostly retirees)..and I am one of them. I'm using TFSA as much as possible to save for assisted living because
of my health issues. Years ago, I had an RRSP, but I collapsed that to pay off a mortgage on my "after divorce" home.

Today, with more and more baby boomers reaching retirement age or already in those years..the high cost of assisted living care is a concern.

I also heard that for seniors, they were reducing the amounts that you could remove from a RRIF..after age 71 registered investment, to reduce the
tax hit on seniors. That is also a good thing. And the other goodie is the federal tax credit for seniors having to adapt their homes to wheelchair access.

Ontario started this a couple of years ago called the "Happy Homes Renovation tax credit", so I assume that once the budget is passed, this too
will be an additional tax credit for the 2015 tax year.

I hate paying taxes, so the more "gov't assistance" I can get to avoid paying taxes...the better for me...LOL!


----------



## My Own Advisor

yyz said:


> I'd say few governments have much of a vision beyond getting re-elected in the next election.


+1


----------



## cainvest

I wonder if, just before the next election of course, they could make the TFSA free from US withholding taxes like RRSP accounts ... that would be nice!


----------



## GoldStone

cainvest said:


> I wonder if, just before the next election of course, they could make the TFSA free from US withholding taxes like RRSP accounts ... that would be nice!


For this to happen, US has to recognize TFSAs as tax-exempt retirement accounts under the tax treaty between the two countries. It's not Canada's decision to make.


----------



## GreedIsGood

So as of when the budget was passed, does the limit come into effect immediately? Can we put an extra $4500 now or do we have to wait until this "law" is passed or elections or what?


----------



## pwm

This just in (Cut from National Post today):

_Justin Trudeau is starting to show some of his economic cards now that the Conservative government has laid its election hand on the table.
The Liberal leader says he’d reverse the Tories’ plan to almost double the maximum amount Canadians can sock away in their tax-free savings accounts._


----------



## carverman

GreedIsGood said:


> So as of when the budget was passed, does the limit come into effect immediately? Can we put an extra $4500 now or do we have to wait until this "law" is passed or elections or what?


The budget has to pass first, once that happens, I would guess that there will be information available if the additional $4500 contribution limit is added to this
year's $5500 limit. Certainly if Harper survives the election, that $10,000 will be available on Jan 1,2016.

JT (Trudeau) mentioned that if he is elected, he will "kill that additional contribution limit" as it only benefits the rich...how much does he know!
I am not rich and I need it as a tax free savings because, I hate paying taxes on what little interest the banks offer these days on your savings.
By the time you pay taxes on the interest earned (added to your income), the interest that you keep is well below the annual rate of inflation.

Kind of stupid of Trudeau to say that just after the budget is passed...once it is in place, it's pretty hard to take it away..shows how inexperienced
he is at the game of politics. I remember another Liberal (Chretien) telling us at one of his election promises all that if he is elected "king" he will kill the GST.
In the end, he did nothing to kill it...Harper was the one that reduced it from 7% to the current 5%.


----------



## GreatLaker

GoldStone said:


> For this to happen, US has to recognize TFSAs as tax-exempt retirement accounts under the tax treaty between the two countries. It's not Canada's decision to make.


And to qualify as a tax exempt retirement account, Canada would probably have to add restrictions on withdrawing funds from a TFSA before retirement age. A Roth IRA in the USA is a tax exempt account, and it imposes a tax on distributions prior to age 59-1/2. That would be a big change considering how many Canadians use TFSAs as short term savings, emergency funds, home savings accounts etc.


----------



## carverman

pwm said:


> This just in (Cut from National Post today):
> 
> _Justin Trudeau is starting to show some of his economic cards now that the Conservative government has laid its election hand on the table.
> The Liberal leader says he’d reverse the Tories’ plan to almost double the maximum amount Canadians can sock away in their tax-free savings accounts._


Classic "foot-in-mouth" moment from JT. He's just lost the vote of the rich and the seniors too. We need all the tax free savings we can find.
Too bad..nice young man, but no experience in politics to form a majority gov't.
Last week, he also said he would never form a co-alition gov't with the NDP.


----------



## 0xCC

My understanding is that when the budget is passed the limit is retroactive to January 1, 2015.

The problem is that we don't know what the Conservative's plan is for this budget and for calling an election. If the Conservatives want to basically turn this budget into an election promise they will hold off on passing it until the summer break and then sometime before the fall session they will call an election. On the other hand if they want to they can push it through before the summer break and all the measures in it (including the TFSA changes) will take effect. If a different party takes power after the election they can make any changes they want but they should provide some sort of amnesty to people that took advantage of the rules of the previous budget.

The grey area is what happens between today and when either the budget is passed or an election is called. I have no idea what to expect in this grey area and I will personally be waiting until we are outside of this grey area (one way or another) before making any additional contributions to my TFSA. I am also in a position where I have cash waiting to be invested in my TFSA right now anyway, adding more will just save me a little bit in tax on HISA interest. I'm not too concerned about the extra tax.


----------



## OnlyMyOpinion

From the other thread on this subject (http://canadianmoneyforum.com/showthread.php/41250-TFSA-limit-doubling-to-11k?p=659618#post659618
I don't mind admitting that I'm not a politician and I'm not familiar with all of the intricacies of our great institution. It seems like the increase may be effective now. From Financial Procedures - The Business of Ways and Means: Convention dictates that taxation proposals are effective as soon as the Minister tables a notice of a Ways and Means motion, even though the government’s taxation plans have not yet been officially adopted by way of legislation. [332] 
[332] It is the long-standing practice of Canadian governments to put tax measures into effect as soon as notice of the Ways and Means motions on which they are based are tabled in the House of Commons, with the result that taxes are collected as of the date of this notice, even though it may be months, if not years, before the implementing legislation is actually passed by Parliament (The Canadian Budgetary Process: Proposals for Improvement, p. 15).
From:http://www.parl.gc.ca/marleaumontpet...nguage=E#fn332


----------



## carverman

OnlyMyOpinion said:


> It seems like the increase may be effective now.


According to the Financial Post, it is retroactive to Jan 1, which really means it's effective as soon as the budget is tabled. I will go ahead and contribute
based on that pretext..and if CRA try to penalize me next year, I will use this arguement.



> The new change is effective as of Jan. 1 this year, *meaning Canadians who have maxed out their TFSA for 2015 will now have another $4,500 of room they can use.* Over the lifetime of the plan, Canadians will have been able to contribute $41,000 as of 2015.


http://business.financialpost.com/p...-limits-by-82-to-10000-a-year?__lsa=883d-72c9


----------



## gibor365

> JT (Trudeau) mentioned that if he is elected, he will "kill that additional contribution limit" as it only benefits the rich...how much does he know!
> I am not rich and I need it as a tax free savings because, I hate paying taxes on what little interest the banks offer these days on your savings.
> By the time you pay taxes on the interest earned (added to your income), the interest that you keep is well below the annual rate of inflation.


 True! I want to understand who is "rich" in JT understanding?! My mom is a senior with income much less than 10K per year and her TFSA is maxed up (from foreign old age security), my son is 2nd year university student and his TFSA is also maxed up -> he used RESP money and money from his co-op term to do so... and this is not even yo avoid income taxes (anyways they don't pay them), but because HISA TFSA offers a bit higher interest rate....
So what the Hell Mr. Justin is talking about?! What kind of "rich"?! imho, he just want to spread this money with his government workers ...


----------



## rikk

^ Well, if your moms income is "less than $10K per year", she isn't paying any tax on interest, but if a persons taxable income is in say the 50% marginal rate, they're paying 50% tax on the interest ... seems to me the higher the taxable income, the greater the benefit ... not that I'm siding with JT.

Oops ... just noticed you said that ... enjoy the day!


----------



## BoringInvestor

gibor said:


> True! I want to understand who is "rich" in JT understanding?! My mom is a senior with income much less than 10K per year and her TFSA is maxed up (from foreign old age security), my son is 2nd year university student and his TFSA is also maxed up -> he used RESP money and money from his co-op term to do so... and this is not even yo avoid income taxes (anyways they don't pay them), but because HISA TFSA offers a bit higher interest rate....
> So what the Hell Mr. Justin is talking about?! What kind of "rich"?! imho, he just want to spread this money with his government workers ...


It's a generalization.
Most of the benefits go to the rich.

JT is right in that it's a tax shift.


----------



## gibor365

> Most of the benefits go to the rich.


 Really?! We're middle class family and never got any benefits that "poor" gets .... like subsidized child care or housing, child benefits, HST/GST rebates, working income tax benefit, student loans and so on.... we only paying huge taxes in order "poor" will get those benefits... and now, when with 4,500 additional contribution we can have additional $112 untaxable income per year, JT and his supporters , making noise.... Ridiculous!



> the greater the benefit


 it depends how you look at it.... looks at % ... my mom has account in PT, with regilar HISA she has 1.8% interest and with TFSA 2.5%, so she will get (for 4,500 additional contribution) 112.5 - 81 = $31.5 per year.
% wise to her income it's much higher that I get ...


----------



## rikk

> The greater the benefit





> it depends how you look at it.... looks at % ... my mom has account in PT, with regilar HISA she has 1.8% interest and with TFSA 2.5%, so she will get (for 4,500 additional contribution) 112.5 - 81 = $31.5 per year.
> % wise to her income it's much higher that I get ...


Ok, but down the road, when both your mom and the guy in the 50% marginal rate have $100K in the account, the guy is not paying tax on that $2500/yr interest when otherwise he would be, and off topic a bit, chances are being "rich", with financial advice, he's doing better than 2.5% ... just saying, the higher the marginal rate (richer), the greater the benefit of a TFSA ...


----------



## none

I've kind of come around on the TFSA expansion. At least the indexing is gone while help reduce the impact.

One this I hadn't considered is this makes renting & investing even more attractive over helping to fuel the housing bubble. That at least is a good thing.

See this:
https://twitter.com/preetbanerjee/status/590627612994707456


----------



## gibor365

> with financial advice, he's doing better than 2.5% ...


 OK, this is speculation as you never know ... it can be better and can be worse....



> Ok, but down the road, when both your mom and the guy in the 50% marginal rate have $100K in the account, the guy is not paying tax on that $2500/yr interest


 in any case % wise to her income, she will benefit more... $2500/yr untaxable interest, in % to his income , for guy who get triple digit income will be much less than my mom's


----------



## BoringInvestor

gibor said:


> Really?! We're middle class family and never got any benefits that "poor" gets .... like subsidized child care or housing, child benefits, HST/GST rebates, working income tax benefit, student loans and so on.... we only paying huge taxes in order "poor" will get those benefits... and now, when with 4,500 additional contribution we can have additional $112 untaxable income per year, JT and his supporters , making noise.... Ridiculous!


You do realize you didn't actually refute my point, right?


----------



## gibor365

BoringInvestor said:


> You do realize you didn't actually refute my point, right?


Don't know what did you mean by "your point"..... you said


> Most of the benefits go to the rich.


 and this is absolutely wrong


----------



## BoringInvestor

gibor said:


> Don't know what did you mean by "your point"..... you said and this is absolutely wrong


The stats published by various research and the parliamentary budget office back my point.
What's your evidence?


----------



## gibor365

ust my personal experience


BoringInvestor said:


> The stats published by various research and the parliamentary budget office back my point.
> What's your evidence?


Just my personal experience ... I know very well so-called "poor families", what benefits they get and what we get.... 
tell me what kind of benefits I get that "poor" families dont! (except potential $112 untaxable as per new TFSA contr room)... 
P.S. I already listed above benefits that "poor" families get, and we don't


----------



## rikk

gibor said:


> in any case % wise to her income, she will benefit more... $2500/yr untaxable interest, in % to his income , for guy who get triple digit income will be much less than my mom's


But you said your moms income is less than $10K per year ... she's not paying tax, the TFSA in itself is of no benefit to her, it's the slightly higher interest rate such accounts pay, as you have said. What would help your mom is higher interest rates. And left unsaid, if your moms income is less than $10K, it's doubtful that her TFSA will accumulate to that $100K/$2500 per year interest. 

I'm retired, the TFSA helps me because interest adds to my taxable income while reducing my OAS ... as I've posted before, that adds up to a 55% "loss" for me ... or ... a 55% gain with the TFSA.


----------



## KaeJS

The benefit does mainly go to people who are better off financially. Most Canadians couldn't even keep up with the ~$5k limit.

gibor, if you have $41k in your TFSA, you DO NOT fall into the bracket of 'most Canadians'.
I don't even have a TFSA. So what does that tell ya?


----------



## BoringInvestor

gibor said:


> ust my personal experience
> 
> Just my personal experience ... I know very well so-called "poor families", what benefits they get and what we get....
> tell me what kind of benefits I get that "poor" families dont! (except potential $112 untaxable as per new TFSA contr room)...
> P.S. I already listed above benefits that "poor" families get, and we don't


Why do you think, when we talk about tax benefits/tax shifts, we use generalized population level data and not anecdotal data point?


----------



## Beaver101

KaeJS said:


> The benefit does mainly go to people who are better off financially. Most Canadians couldn't even keep up with the ~$5k limit.
> 
> gibor, if you have $41k in your TFSA, you DO NOT fall into the bracket of 'most Canadians'.
> I* don't even have a TFSA. So what does that tell ya?*


 ... don't work at a bank? they don't pay enough to afford a TFSA? :biggrin:


----------



## gibor365

> I don't even have a TFSA. So what does that tell ya?


 When I was your age I didn't have any savings at all and all income spent on basic food 
You don't have TFSA, and i don't trade option and doesn't have margin (or any non-registered) account at all


----------



## KaeJS

Beaver101 said:


> ... don't work at a bank? they don't pay enough to afford a TFSA? :biggrin:


They really don't. 

At this point, it's too much of a hassle to have a TFSA.
I've got a mortgage to pay and I rather trade in Non-Registered due to the use of leverage.

I could put _some_ into a TFSA but it would be nowhere close to maxing it out. It's just too much hassle to worry about contribution room levels for me at this point. Non-Registered with leverage is easier and also ends up being more money in the long run after paying the tax due to the use of leverage.


----------



## gibor365

> I rather trade in Non-Registered due to the use of leverage.


So you are richier than you think


----------



## none

KaeJS said:


> They really don't.
> 
> At this point, it's too much of a hassle to have a TFSA.
> I've got a mortgage to pay and I rather trade in Non-Registered due to the use of leverage.
> 
> I could put _some_ into a TFSA but it would be nowhere close to maxing it out. It's just too much hassle to worry about contribution room levels for me at this point. Non-Registered with leverage is easier and also ends up being more money in the long run after paying the tax due to the use of leverage.


The only reason I can max out my TFSA is because I don't own a house OR a car. I've made life choices that allow me to do that. Would I like to rent a house from the bank and own a car? Absolutely. I've just made the choice that those luxuries can wait until I have my financial house in order.

I make ~65K per year and am a 50:50 Dad. I seem to be able to do it. Is 65K per year salary rich? Maybe, you guys can tell me.


----------



## 5Lgreenback

"TFSA account only benefits the rich." thats pure exaggeration/propaganda. 

I'm middle class, my TFSA are close to being maxed, and I will try hard to do so for as long as I can. 

I make frugal/ conservative choices with my money. Many other people with similar wages to me go into debt buying $60,000 dollar trucks, going into credit card debt, and general reckless poor financial/life choices. Why should there not be a vessel to create and reward people who make smart choices with their money?

I'm fully aware that when I have a family one day and when I make a career change soon or I finally bite the bullet and get a mortgage, I may not be able to contribute to the TFSA. So its a nice to have this tool now and maximize it for the future use/ needs. 

Its a nice tool to finally benefit the the savers and people who plan for the future. And yes the wealthy will benefit as well but such as life.


----------



## none

I'd be OK if they abolished the TFSA program all together provided they also axe the tax free gains on housing.


----------



## gibor365

> Is 65K per year salary rich? Maybe, you guys can tell me.


 you're middle class, but from Liberal point of view toy are rich, and from NDP's - very rich


----------



## KaeJS

none said:


> Is 65K per year salary rich? Maybe, you guys can tell me.


I would kill for that salary. I make $42k.
If I had a salary of $65k... I would actually be so well off it would be stupid.


----------



## Retired Peasant

"TFSA account only benefits the rich"

Really?
from http://www.budget.gc.ca/2015/docs/plan/ch4-1-eng.html#Increasing_the__Tax-Free_Savings_Account_Annual_Contribution_Limit

"Individuals with annual incomes of less than $80,000 accounted for more than 80 per cent of all TFSA holders and about 75 per cent of TFSA assets as of the end of 2013. About half of TFSA holders had annual incomes of less than $42,000."


----------



## gibor365

KaeJS said:


> I would kill for that salary. I make $42k.
> If I had a salary of $65k... I would actually be so well off it would be stupid.


No way! There is never enough money  and when you have $65K, you will know it.....



> "TFSA account only benefits the rich"


 this is just Liberal propoganda and I'm surprised that so many cmf members repeat it...



> About half of TFSA holders had annual incomes of less than $42,000


 very likely.... in our family me and my wife make more than 42K, my mom and son less ... and all TFSAs are maxed up.


----------



## BoringInvestor

Retired Peasant said:


> "TFSA account only benefits the rich"
> 
> Really?
> from http://www.budget.gc.ca/2015/docs/plan/ch4-1-eng.html#Increasing_the__Tax-Free_Savings_Account_Annual_Contribution_Limit
> 
> "Individuals with annual incomes of less than $80,000 accounted for more than 80 per cent of all TFSA holders and about 75 per cent of TFSA assets as of the end of 2013. About half of TFSA holders had annual incomes of less than $42,000."


Consider that looks at income, not net worth.
Retirees who have a larger nest egg will likely have a lower income, and be included in the same category as the working poor, students, underemployed, etc.


----------



## jamesbe

KaeJS said:


> I would kill for that salary. I make $42k.
> If I had a salary of $65k... I would actually be so well off it would be stupid.



No you wouldn't....

I use to think that when I made $45k, Now I'm closer to $150k and I feel comfortable but still money is tight at times.


----------



## FinancialUnderdog

jamesbe said:


> I use to think that when I made $45k, Now I'm closer to $150k and I feel comfortable but still money is tight at times.


Mind boggling.

I can't comprehend how somebody can feel tight while making $150K


----------



## KaeJS

FinancialUnderdog said:


> Mind boggling.
> 
> I can't comprehend how somebody can feel tight while making $150K


I was just thinking this.

The thing is - I have everything I need. If I made $65k, that extra money would be purely for saving and investing.


----------



## gibor365

> The thing is - I have everything I need


 But your needs will be increasing.... when you have kids, your spendings will go up a lot.... just think about how much cost kindergarten


----------



## rikk

And then there's the divorce, support payments, that ever increasing bar tab ... speaking of which ...


----------



## Guban

none said:


> I'd be OK if they abolished the TFSA program all together provided they also axe the tax free gains on housing.


Easy for you to say. You don't have a house!

I would hate to keep records of every single improvement to adjust the ACB. Having the principal residence exemption allows for easier record keeping - you don't have to keep any. This is one huge benefit for registered accounts too - you don't have to keep records of each transaction (buy, sell, split, distribution). I am all for simplifying life where I can.


----------



## supperfly17

KaeJS said:


> I would kill for that salary. I make $42k.
> If I had a salary of $65k... I would actually be so well off it would be stupid.


Hmm interesting. Are you married, kids?


----------



## KaeJS

gibor said:


> when you have kids..


:eek2:



supperfly17 said:


> Hmm interesting. Are you married, kids?


Not married. No kids (that I know of) :biggrin:


----------



## KaeJS

rikk said:


> And then there's the divorce, support payments, that ever increasing bar tab ... speaking of which ...


This sounds like my worst nightmare. I already have an ever increasing Whiskey expense without the divorce and support payments.


----------



## gibor365

> This is one huge benefit for registered accounts too - you don't have to keep records of each transaction (buy, sell, split, distribution). I am all for simplifying life where I can.


 very true! This is why we have only registered accounts in discount brokerage.... 



> Easy for you to say. You don't have a house!


 good one 



> I would hate to keep records of every single improvement to adjust the ACB.


 this is just impossible.... even for major renovations...we own house more than 15 years, 10 or maybe 12 years ago we finished basement ... lost all papers/receipts long time ago, I even don't remember when we did it, not only how much we paid  , and how you can keep track on paint, windows/lock replacement and so on.... 
P.S. If you gonna pay taxes on capital gain home appreciation, it will be logically that you should be able to claim calipal loss on cars depreciation


----------



## Moneytoo

none said:


> I make ~65K per year and am a 50:50 Dad. I seem to be able to do it. Is 65K per year salary rich? Maybe, you guys can tell me.


Wow and I thought that you were 150% Mom lol No, seriously, I don't even remember why, but from your posts I pictured you as a prototypical female bookkeeper... go figure 

Anyways, I also made ~65K last year after taxes, more if we take into account that I invested half of it in the RRSP and got a third as a tax refund, but don't consider myself rich (but trying to help my husband who makes more than twice as much to become "richer than he thinks" )

Did the math again (on the news that the TFSA limit was raised yesterday) - we'll need to contribute 51K to our RRSPs by next March to receive 20K tax refund next spring (to add 10K each to TFSAs). My husband's TFSA was maxed, now he'll need to add 4.5K, and I have a 20K room left in mine. If we both keep working (making at least not less than now) - totally doable... The hardest part is committing to contributing 5K every month (almost my entire monthly earnings after taxes) for 11 months - and it just for me!)

Hope it'll get easier next year once we catch up, but I still can't fathom how people do it - there was an example for example in Garth's post from last week - a couple who were saving and obsessively investing for 40 months and tripled their portfolio to seven figures... I think we'll be lucky if we double our portfolio in 40 months (and mostly from saving )

Anyways, sorry for long post, another boring day at work with too much to ponder...


----------



## none

KaeJS said:


> I was just thinking this.
> 
> The thing is - I have everything I need. If I made $65k, that extra money would be purely for saving and investing.


And that's what I do. i figure I make about 45K after taxes - I save about 15K per year so I have about 30K disposable income which is less than 42K taxable ($33K disposable).

So yes, it's nice to be able to save. it's a nice feeling.


----------



## gibor365

> Did the math again (on the news that the TFSA limit was raised yesterday) - we'll need to contribute 51K to our RRSPs by next March to receive 20K tax refund next spring (to add 10K each to TFSAs).


 My wife maxed all RRSP room about 5 years ago when she got package from previous employer (and good think that she had this room , or she would be creamed with taxes) ... now, after reducing GRRSP contributions, my wife has only about $6,500 to max up and me just $3,200 -> so it's easy doable


----------



## none

Moneytoo said:


> Wow and I thought that you were 150% Mom lol No, seriously, I don't even remember why, but from your posts I pictured you as a prototypical female bookkeeper... go figure
> 
> Anyways, I also made ~65K last year after taxes, more if we take into account that I invested half of it in the RRSP and got a third as a tax refund, but don't consider myself rich (but trying to help my husband who makes more than twice as much to become "richer than he thinks" )


No, I make 65K *BEFORE *taxes. it's actually a bit more than that on occasion when I do consulting work. Being a single Dad and trying to save a lot is pretty tough but there's lot of 'free' stuff that my son and I do. We go for long bike rides and have playdates. Anyway, really it's my low rent ($1200) and lack of car that allows me to save as much as I do. I plan on keeping my nose to the stone for the next 3 years and I think by then the majority of the hard work will be done. I plan on maxing both my TFSA & RRSP (with spill going into non-reg) going forward. If there is a housing correction and it become cheaper to own rather than rent I'll buy a house. If not, I'm happy averaging 7% tax free on my investments. I win either way.


----------



## Moneytoo

gibor said:


> now, after reducing GRRSP contributions, my wife has only about $6,500 to max up and me just $3,200 -> so it's easy doable


I think we have ~230K of unused RRSP contribution room (ah, all those "wasted" years of earning and not saving... ), so it'll take us a while (I was horrified that they're also increasing the RRSP contribution limits - hope we won't die trying to use it lol)


----------



## Moneytoo

none said:


> I win either way.


I think I should stop reading these forums before I end up feeling like a loser... lol But good luck - or what's the appropriate wish when luck has noting to do with it?


----------



## none

Moneytoo said:


> I think I should stop reading these forums before I end up feeling like a loser... lol But good luck - or what's the appropriate wish when luck has noting to do with it?


A good financial plan goes a long way. For example, I'm 50% (as 1:1) US cash. I figure there are two scenarios when it comes to housing. 1) US raises interest rates and we follow suit (as we have always done) and there is a large housing correction. I buy a house at a reasonable price. 2) US raises interest rates and we don't -> out currency tanks and I win there instead. Risk management is what it's all about.

Of course if the US doesn't I don't think I'm worse off either way. anyway, I think it's a decent plan.


----------



## Moneytoo

Oh yeah, I love making plans, and made a similar plan (or rather "honey to-do list" for my husband's RRSP lol) on Sunday:

1) Sell 400 shares of XRE for ~$17.50
2) Buy 600 more shares of DLR
3) Journal DLR to DLR.U
4) Sell 1,500 of DLR.U (new and previously purchased 900 shares)
5) Buy ~5K USD of international stock (BTI - TBD)
6) Keep remaining ~10K USD for future purchases

Failed at step 1) because XRE (REIT ETF) went down instead of up - and tomorrow its ex-dividend date, so I just cancelled the order... 

But at least we're on track with our generic short-term plan (save + invest), and I guess I'll play it by ear - if gold goes up, will sell some of gold bouillon ETF and then buy some more USD (or maybe even a strip bond if rates go up - wasn't convinced that buying bonds ETFs was a good idea, so don't have any )


----------



## none

Sounds like a lot of gut guidance taking place. You know how I feel about that .

Gold bouillon ETF?? Wut? At the risk of going down that pissing contest thread we had before that's speculating rather than investing and should be avoided. That's my opinion at least.


----------



## donald

Wtf(excuse my French)
Can we or can't we?
Conflicting 
Nobody seems to know
Oh well....


----------



## Moneytoo

Our portfolio is fully invested and re-balanced, i felt bored and didn't have any cash to buy more USD, XRE was up almost 10% since last April when we bought it, seemed quite logical (even to my husband ) to sell some now ("taking profits off the table" so to speak) Trimming the position down to 3% since it most likely will go down before the rates go up - but plenty of time before that happens I gather... 

Gold bullion ETF is only 4.5% of our overall portfolio - and if it wasn't for my husband's greed, we would've sold half in February, making 10% on it in less than a year, but he decided to wait for 15% upside - and of course it went down, now slightly above our purchase price... 

Sorry, just like teasing you - and yeah, love at least some speculation (makes investing less boring ) - will go watch what today's dude will say about REITs on BNN's Market Call (maybe it was a blessing in disguise that I didn't sell XRE just yet?)

(Why there's a 4 images limit? Had to delete two smiles lol)


----------



## Cal

So who has transferred in the additional $4500 to max out the TFSA for this year....I know it hasn't even passed in legislature yet but it is a done deal....


----------



## gibor365

Cal said:


> So who has transferred in the additional $4500 to max out the TFSA for this year....I know it hasn't even passed in legislature yet but it is a done deal....


not yet... but today I've asked teller in TD branch, and she said that they just got internal email confirming new contribution room


----------



## andrewf

gibor said:


> Really?! We're middle class family and never got any benefits that "poor" gets .... like subsidized child care or housing, child benefits, HST/GST rebates, working income tax benefit, student loans and so on.... we only paying huge taxes in order "poor" will get those benefits... and now, when with 4,500 additional contribution we can have additional $112 untaxable income per year, JT and his supporters , making noise.... Ridiculous!
> 
> it depends how you look at it.... looks at % ... my mom has account in PT, with regilar HISA she has 1.8% interest and with TFSA 2.5%, so she will get (for 4,500 additional contribution) 112.5 - 81 = $31.5 per year.
> % wise to her income it's much higher that I get ...


Gibor, didn't you previously mention that both you and your wife earn 6 figure incomes? If you think you are middle class, you are laughably out of touch. A family with a gross income of $250k is will into the top 10% (probably top 5%) of incomes. Does that sound middle class to you?


----------



## none

I think middle class is a family income of 60-85K a year. 

(says google)


----------



## andrewf

KaeJS said:


> I would kill for that salary. I make $42k.
> If I had a salary of $65k... I would actually be so well off it would be stupid.


Kae, I've told you before. You are a smart guy, and could earn a lot more. Go get an engineering degree or something. It's not too late.


----------



## andrewf

Retired Peasant said:


> "TFSA account only benefits the rich"
> 
> Really?
> from http://www.budget.gc.ca/2015/docs/plan/ch4-1-eng.html#Increasing_the__Tax-Free_Savings_Account_Annual_Contribution_Limit
> 
> "Individuals with annual incomes of less than $80,000 accounted for more than 80 per cent of all TFSA holders and about 75 per cent of TFSA assets as of the end of 2013. About half of TFSA holders had annual incomes of less than $42,000."


Those stats don't really tell you about people who will benefit from the incremental $4500 per year. In the longer term (not counting all the low income retirees transferring non-registered savings to TFSA currently), the people who benefit from expanding TFSA are those that earn enough that at a reasonable savings rate would max out their RRSP and existing TFSA room each year. If a 'reasonable' savings rate is 25% of gross income (which is pretty aggressive), 18% of that can go into RRSP each year, leaving 7% to go into a TFSA. For 7% of your income to equal $5,500 or $10,000 would require before tax incomes of more than $78,000 and up to $142,000 per person to get the full benefit. People making less than $78,000 already have enough room to shelter >25% of their pre-tax income in registered accounts (more like 35% of their after tax incomes). So the middle class already has plenty of room (they aren't even using it all, not even close, on average). Thus, incremental increases in TFSA room over $5500 largely benefits those with incomes at the top of the income distribution, except for a outliers that save most of their income. We should not justify the design of our entire tax system to suit a couple of oddballs like the people who frequent this forum.


----------



## none

andrewf said:


> We should not justify the design of our entire tax system to suit a couple of oddballs like the people who frequent this forum.


BOOM. That.

I think it helps to level the playing field between home owners and renters and works really well for me. but see your note above.

I'd like the government to tax capital gains on house sales. That would make things more fair.


----------



## 5Lgreenback

So we should cater our taxes and economic system to the majority of people? Sounds logical I agree, until you break down the poor financial choices and decisions of the majority.


----------



## carverman

gibor said:


> .
> So what the Hell Mr. Justin is talking about?! What kind of "rich"?! imho, he just want to spread this money with his government workers ...


Justin has a habit, that in his criticizing of the Harper gov't, he puts his foot in his mouth and says things without thinking about what he
is saying.

He needs to get off his "poor little rich boy high horse"....ie: the millions that his rich daddy left him, (former prime minister and lawyer Pierre Elliot Trudeau) and try to get in touch with today's society out there facing rising costs. 

A senior with an RRSP or a RRIF while taxed at a lower rate than somebody working with a $100k a year salary, is still paying their fair share of taxes..income tax, property taxes, HST on just about everything except food. 

Having to pay income tax on HISA interest or just on the regular run of the mill savings account, is adding insult to injury for seniors..
it has nothing to do with the "wealthy and the rich"...we seniors are in a different class entirely!

While JT is a nice young man with a smiling face..he has been living in a dream world since he was born, and needs to get a clue on how ordinary people live out there.


----------



## 5Lgreenback

none said:


> BOOM. That.
> 
> I think it helps to level the playing field between home owners and renters and works really well for me. but see your note above.
> 
> I'd like the government to tax capital gains on house sales. That would make things more fair.


I agree with that for people who flip houses/ property for a living only. Not for gains on long term residences. 

Im personally shocked at how many people are asking for MORE taxes, we are already on a path of unsustainable government growth and shrinking private sector to fund it. If people were to calculate how much each dollar they earn is actually taxed already, I think they may be shocked.


----------



## OnlyMyOpinion

andrewf said:


> Thus, incremental increases in TFSA room over $5500 largely benefits those with incomes at the top of the income distribution, except for a outliers that save most of their income. We should not justify the design of our entire tax system to suit a couple of oddballs like the people who frequent this forum.


The benefits of the TSFA are not limited to incomes. Lump sums such as seniors receive when they sell their house to help fund their stay in a retirement home (as mine just did) will benefit, terminated employees receiving a severance, someone receiving an inheritance, etc. Trying to characterize it as a benefit to the rich is cherry picking.


----------



## Moneytoo

As a half of an oddball couple who came to Canada from former Soviet Union 21 years ago with a bit more than the current TFSA limit and a one year old daughter, sponsored 3 parents (so not expecting any inheritances), paid off the house and are finally making enough money to start aggressively saving and investing, I find the socialistic views from "poor" Canadians hilarious lol

Sure, let us pay 100K+ in income taxes and then "sponsor" the renters when we sell our house, since we stole the silver spoons from some infantile spoiled brats' mouths


----------



## none

5Lgreenback said:


> Im personally shocked at how many people are asking for MORE taxes, we are already on a path of unsustainable government growth and shrinking private sector to fund it. If people were to calculate how much each dollar they earn is actually taxed already, I think they may be shocked.


I think it's because most reasonable people realize the benefit that having a well funded and well running government make life and society better. As the quote goes:

*"Taxes are the price we pay for civilization."*


----------



## 5Lgreenback

none said:


> I think it's because most reasonable people realize the benefit that having a well funded and well running government make life and society better. As the quote goes:
> 
> *"Taxes are the price we pay for civilization."*


That quote doesn't convince me that unsustainable government growth and over 60% of my money going to taxes in one form or another should be acceptable. I'm more of a facts and proven stats type when it comes to finance/ political choices.


----------



## none

OK, how about this?

http://www.psychologicalscience.org...gressive-tax-system-makes-people-happier.html

Or is it that it doesn't fit your world view mean that it must not be correct?


----------



## Jon_Snow

Cal said:


> So who has transferred in the additional $4500 to max out the TFSA for this year....I know it hasn't even passed in legislature yet but it is a done deal....


Our 9k is going in tomorrow.


----------



## andrewf

carverman said:


> Justin has a habit, that in his criticizing of the Harper gov't, he puts his foot in his mouth and says things without thinking about what he
> is saying.
> 
> He needs to get off his "poor little rich boy high horse"....ie: the millions that his rich daddy left him, (former prime minister and lawyer Pierre Elliot Trudeau) and try to get in touch with today's society out there facing rising costs.
> 
> A senior with an RRSP or a RRIF while taxed at a lower rate than somebody working with a $100k a year salary, is still paying their fair share of taxes..income tax, property taxes, HST on just about everything except food.
> 
> Having to pay income tax on HISA interest or just on the regular run of the mill savings account, is adding insult to injury for seniors..
> it has nothing to do with the "wealthy and the rich"...we seniors are in a different class entirely!
> 
> While JT is a nice young man with a smiling face..he has been living in a dream world since he was born, and needs to get a clue on how ordinary people live out there.


carver, surely OAS (welfare for old people) compensates? Once you include OAS, do you pay any net tax?


----------



## 5Lgreenback

none said:


> OK, how about this?
> 
> http://www.psychologicalscience.org...gressive-tax-system-makes-people-happier.html
> 
> Or is it that it doesn't fit your world view mean that it must not be correct?


Interesting, but it really doesn't say much about the issues I bring up. It discusses progressive tax systems (very broadly and vaguely). It doesn't mention unsustainably, government growth and inefficient bureaucracy. Not to mention its citizens spending the majority of their lives working to feed such a system. As well, there are so many variables left out of that article (and it sounds like the study itself) that could be contributing to overall happiness or the perception of such happiness that have nothing at all to do with taxes/ progressive taxes. 

It also states very specifically, that higher government spending, contributes to lower happiness. Which is in fact closer to this discussion. And counters the very point your trying to prove.

I think it has more to do with having an idealistic world view compared to looking at the current reality, nothing to do with not "fitting my view". As you seem to be the one projecting a world view, involving more taxes and more government as your ideal. I'm stating its not economically possible in the long term, and its a slippery slope to go down in the short term.


----------



## andrewf

5Lgreenback said:


> we are already on a path of unsustainable government growth and shrinking private sector to fund it. If people were to calculate how much each dollar they earn is actually taxed already, I think they may be shocked.


http://www.macleans.ca/politics/ottawa/the-canadian-economy-101-a-primer-from-kevin-page/

You may be shocked, indeed.










I don't think the data supports your perception of a rapidly growing federal government. The fed government has shrunk by almost 25% as a % of GDP since Chretien/Martin took power in 1993 and cut federal spending. Harper drastically increased spending in 2008/2009 (to be fair, only some of that was stimulus, the rest was increases in EI payouts, etc.), but has brought it back down over the past 5 years to roughly where it was when they took office in 2006. 

Darn data doesn't always fit our narratives, but it's usually because our narratives are wrong. The story of the last 20 years is the Liberals cutting federal government spending drastically, the Conservatives increasing spending and then gradually bringing it back down again. Of course, the mix of _where_ the money was spent changed over time.


----------



## Moneytoo

none said:


> Or is it that it doesn't fit your world view mean that it must not be correct?


Seriously? lol So let's see how flexible is your world view... here's one of my first posts on this forum:



Moneytoo said:


> I almost doubled our downpayment money back in the 90's (turned 30K into 55K in less than a year and a half). My financial advisor back then advised me not to do it, my husband was having anxiety attacks when the stock went down right before the payment was due (but the house got delayed - and the prices went up again right before the new date) I knew almost nothing back then - and had no fear - and reeeeaaalllyyyy wanted the upgrades (oh the bleached hardwood floors! ) And wasn't even a bit surprised when everything worked out - because I had no doubts it would.


Now, this is you:



none said:


> Sounds like a lot of gut guidance taking place. You know how I feel about that .





none said:


> A good financial plan goes a long way. For example, I'm 50% (as 1:1) US cash. I figure there are two scenarios when it comes to housing. 1) US raises interest rates and we follow suit (as we have always done) and there is a large housing correction. I buy a house at a reasonable price.





none said:


> I think it helps to level the playing field between home owners and renters and works really well for me.
> 
> I'd like the government to tax capital gains on house sales. That would make things more fair.


And this is Garth:

"Nobody, after all, is entitled to a house. Getting a university degree doesn’t guarantee you to a six-figure salary. And maybe these virgins will have to do what so many in the past have done..."

(c) The Entitled (tm)

(Disclaimer: I'm not suggesting that you risk all your money to buy a house - especially since you're probably subsidized by the landlord - but thinking that every homeowner had it easy while playing it super-safe yourself is [insert the word])


----------



## none

I'm missing your point.. a little help?

I've owned houses before and extracted my generation of gains from it. What am I missing?


----------



## Davis

andrewf said:


> http://www.macleans.ca/politics/ottawa/the-canadian-economy-101-a-primer-from-kevin-page/
> 
> You may be shocked, indeed.
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> I don't think the data supports your perception of a rapidly growing federal government. The fed government has shrunk by almost 25% as a % of GDP since Chretien/Martin took power in 1993 and cut federal spending. Harper drastically increased spending in 2008/2009 (to be fair, only some of that was stimulus, the rest was increases in EI payouts, etc.), but has brought it back down over the past 5 years to roughly where it was when they took office in 2006.
> 
> Darn data doesn't always fit our narratives, but it's usually because our narratives are wrong. The story of the last 20 years is the Liberals cutting federal government spending drastically, the Conservatives increasing spending and then gradually bringing it back down again. Of course, the mix of _where_ the money was spent changed over time.


Thank you for this. Good research. I realized a while back that few posters here are interested in arguing on the basis of facts. I have provided evidence to support arguments, but I find that it does nothing to change deeply-held prejudices. I think you should expect to continue to see baseless rants about the expansion of government and rousing taxes here, and from the same posters. Sigh.


----------



## carverman

andrewf said:


> carver, surely OAS (welfare for old people) compensates?* Once you include OAS, do you pay any net tax?*


Pension income, CPP and OAS are all taxable in the hands of seniors. So is the interest earned on any savings outside of the TFSA.

In my case, besides the typical (age related) seniors tax credits (federal and provincial), I also applied for, and have a DTC (Disability tax credit)
that helps to stave off the tax payable. But, I live alone and find my living costs keep going up each year.

My argument with "poor little rich boy" Justin, is that he has never had to live as many seniors do, where their living costs eat up more than 60% of their
income.
Never mind the once a year tax refund, I get..that goes straight into my TFSA for any home repairs (leaking roof this year) or things like
stairlifts (had to buy another one this year for $5,000), or a powerwheel chair (another four to 6 thousand), and any personal attendant care as
we age and our disabilities take over where just getting getting out of bed and getting dressed in the morning these days is a major challenge!

I have an issue with someone who without thinking, immediately exclaims on national TV right after the federal budget was tabled that the
TFSA increase "just benefits the rich" and if he is elected "king", he would rescind that increase..or maybe even the TFSA and turn it into
just another taxable savings instead.

To JT: Ya, Justin.."in a pigs eye" will YOU EVER become king with your attitude!


----------



## Ihatetaxes

Our $9k was added which brings us up to $73k of new money added to investing accounts this month (and just over $110k YTD). Yet I am still excited about the $9k of additional TFSA room for us.


----------



## Grover

Are people so confident that they can contribute that 4500 to the TFSA immediately?

Do we know for sure if this is allowed or is there still a chance of some penalty later...maybe..?


----------



## GoldStone

andrewf said:


> http://www.macleans.ca/politics/ottawa/the-canadian-economy-101-a-primer-from-kevin-page/
> 
> You may be shocked, indeed.
> 
> <snip pretty chart>
> 
> I don't think the data supports your perception of a rapidly growing federal government. The fed government has shrunk by almost 25% as a % of GDP since Chretien/Martin took power in 1993 and cut federal spending. Harper drastically increased spending in 2008/2009 (to be fair, only some of that was stimulus, the rest was increases in EI payouts, etc.), but has brought it back down over the past 5 years to roughly where it was when they took office in 2006.
> 
> Darn data doesn't always fit our narratives, but it's usually because our narratives are wrong. The story of the last 20 years is the Liberals cutting federal government spending drastically, the Conservatives increasing spending and then gradually bringing it back down again. Of course, the mix of _where_ the money was spent changed over time.


Andrew, you just did a little sleight of hand. The poster you responded to was talking about government in general (post #318). He didn't single out federal government. But you did. Why is that? Because it helps *your* narrative? We, the taxpayers, have three levels of governments to support. As a taxpayer, I care the most about my total tax burden; total deficits; total debt. I care less about the breakdown between three government levels.











Oh-Oh-Oh-Ontario


----------



## GoldStone

Davis said:


> Thank you for this. Good research. I realized a while back that few posters here are interested in arguing on the basis of facts. I have provided evidence to support arguments, but I find that it does nothing to change deeply-held prejudices. I think you should expect to continue to see baseless rants about the expansion of government and rousing taxes here, and from the same posters. Sigh.


Look at the red line in my last chart. That's real per capita Ontario expenditures. If it's not a massive government expansion, then what is it? Are you going to change *your* deeply-held prejudices in the face of this evidence?


----------



## andrewf

You could include other levels of government, but the valid approach to looking at size of government is % of GDP and not real per capita spending. It doesn't really change the result. I used federal spending since that is what we are discussing. 









http://www.cato.org/publications/commentary/great-right-north


----------



## GoldStone

The last chart is 7 years old. It ends right before recession.


----------



## Moneytoo

none said:


> I'm missing your point.. a little help?
> 
> I've owned houses before and extracted my generation of gains from it. What am I missing?


My point was "No guts - no glory" lol, but maybe I misunderstood what you meant by "I think it helps to level the playing field between home owners and renters and works really well for me." Did you mean that if you paid capital gains taxes on the houses that you previously owned (or will own in the future) it would somehow help you as a renter now? *"That would make things more fair" - how?* It's not enough that renters are "subsidized" by their landlords - let's punish older people who owned their houses for decades? So they'll start selling their houses cheaper (to pay less taxes)? Or maybe they should just adopt the renters and let them inherit the hearth? lol


----------



## none

Well I'll go back on topic - I just dumped $4500 into my TFSA. Now I just have to buy something.


----------



## 5Lgreenback

The reality is we can find articles to prove whatever point of view we want. But its safe to say that over the long term, the demand on the tax payer generally gets higher, and we are already at pretty high levels. 

My point of view is not set in stone, in fact 3 years ago I was more of a lefty tax and spend (and redistribute wealth) type. But the more attention I pay to politics, markets, business and life experience, the farther from that view I drift. 

Anyways, enough rambling by me:biggrin: 

Back on topic for me too. Looks like people are going for it, I'll likely be adding 4500 next week. But just as none mentioned, no clue what to buy right now.


----------



## uptoolate

Is there no way to get these two threads merged or are they totally different topics?


----------



## Moneytoo

5Lgreenback said:


> My point of view is not set in stone, in fact 3 years ago I was more of a lefty tax and spend (and redistribute wealth) type. But the more attention I pay to politics, markets, business and life experience, the farther from that view I drift.


There's a very similar discussion on RFD Forum:



muppetslayer said:


> There is a saying "if you are not a liberal by the age of 20, you have no heart; if you are not a conservative by the age of 40, you have no brain"




Back on topic, us "rich people" won't add to TFSAs till after we learn in May if our daughter made it to the medical school and then comes back from her university post-graduation Eurotrip in June, so we'll know how much we'll owe and can invest the rest... lol


----------



## Jon_Snow

And with a few simple keystrokes, $9000 of tax sheltered goodness is born. 

And my energy names continue to soar. Great cup of coffee too. And I don't have to go to work. 

Great f****n' day so far. :biggrin:


----------



## Davis

Goldstone, do you have a source for those charts? I have higher standards for evidence than just lines on a chart. More importantly, the discussion is about the overall level of government spending and taxation, not about whether the governmnet of Ontario is a bad actor. What is the combined?


----------



## humble_pie

Davis said:


> Goldstone, do you have a source for those charts? I have higher standards for evidence than just lines on a chart. More importantly, the discussion is about the overall level of government spending and taxation, not about whether the governmnet of Ontario is a bad actor. What is the combined?



it looks like this was the source (didn't test it.)

http://worthwhile.typepad.com/.a/6a00d83451688169e201b7c6f71f2a970b-750wi

the chart itself (below) shows all provinces vs federal.

AFAIK the citizen taxpayer's burden is even greater than the aggregate cost of taxes owed & paid to the 3 levels of government, ie federal, provincial & municipal.

there's also the cost of paying independently for essential services formerly supplied by governments to all citizens (post office + numerous essential medical services are 2 examples), now that many services with the biggest deficits have been privatized. They're no longer part of government budgets because taxpayers are hiring their own services, if & when they can. 

EG citizens now have to pay costs of priority post/courier services plus in many provinces citizens are now required to pay for many routine medical diagnostics & medical/surgical procedures that, even as recently as a decade ago, they were able to receive without charge.

public schools? let's not even start on costs for parents.

if federal & provincial expenses are stable, it's only because costly services have been sloughed off to municipalities or privatized.
.


----------



## gibor365

> Gibor, didn't you previously mention that both you and your wife earn 6 figure incomes?


 i never mentioned it! ... and won't mention exact numbers....  I just was critisizing additional provincial tax on income above 150K...
Upper class imho are families with household income 500K+


----------



## gibor365

> Did you mean that if you paid capital gains taxes on the houses that you previously owned (or will own in the future) it would somehow help you as a renter now?


 It's funnywhen none advocates taxes on selling houses when he doesn't have one.... 
On my hand, I would support famous USSR "balls tax" -> all males with no kids should pay additional tax


----------



## none

gibor said:


> It's funnywhen none advocates taxes on selling houses when he doesn't have one....
> On my hand, I would support famous USSR "balls tax" -> all males with no kids should pay additional tax


but of course, that's how 90% of this forum works: every man or woman for him/herself? Selfishness abounds!

I just upped my charitable contribution at work to $1560 per year. That's going to hurt.


----------



## gibor365

> As a half of an oddball couple who came to Canada from former Soviet Union 21 years ago with a bit more than the current TFSA limit and a one year old daughter, sponsored 3 parents (so not expecting any inheritances), paid off the house and are finally making enough money to start aggressively saving and investing, I find the socialistic views from "poor" Canadians hilarious lol
> 
> Sure, let us pay 100K+ in income taxes and then "sponsor" the renters when we sell our house, since we stole the silver spoons from some infantile spoiled brats' mouths


 Same here  only we jeft USSR with $160US 25 years ago, and sponsored 2 parents  and about 4 years ago started "aggressively saving " ... so our numbers are pretty similar....



> socialistic views


 take from "rich" and give to "poor" is not socialistic , but stupid view 

Old saying "Instead of giving fish to poor, give him fishing rode"


----------



## Moneytoo

gibor said:


> Old saying "Instead of giving fish to poor, give him fishing rode"


Maybe new saying should be "give fish AND fishing rode to poor so they can retire early"? lol

http://www.lifeprinciples.net/SuccessatLife.html


----------



## gibor365

Moneytoo said:


> Maybe new saying should be "give fish AND fishing rode to poor so they can retire early"? lol
> 
> http://www.lifeprinciples.net/SuccessatLife.html


Some are retired whole life


----------



## Davis

humble_pie said:


> it looks like this was the source (didn't test it.)
> 
> http://worthwhile.typepad.com/.a/6a00d83451688169e201b7c6f71f2a970b-750wi


That chart shows the federal Department of Finance as its source. the other chart, the one show federal and Ontario expenditures and revenue on a per capita basis in rela terms provides no source, and does not look like the Dept of Finance. 



gibor said:


> i never mentioned it! ... and won't mention exact numbers....  I just was critisizing additional provincial tax on income above 150K...
> Upper class imho are families with household income 500K+


Invididuals with taxable income over $150,000 make up 2% of the population (220,000 Ontarians according to the 2014 Ontario Budget, p. 322). If they're middle class, then I don't know what would be considered "high income". I don't have figures on family income over $500,000, but that is super-rich, not just "upper class".


----------



## humble_pie

but davis i only posted about the first all-province chart, the 2nd one re ontario did look a little screwy to me ...

you've also skated over the point that taxpayers are reeling from the triple combo of federal, provincial & municipal taxation. Fed expenditures *should* go down, ottawa has offloaded services to the provinces who, in turn, have off-loaded to the municipalities, who have no resources whatsoever to cope.

goldstone pointed this out upthread. 

to the triple taxation burden i added the cost of paying independently for privatized services that until recently were routinely provided by the 2 top levels of government.

gosh in my muni there are so many new by-laws governing garbage disposal that a homeowner hardly dares to place a broken teacup in a biodegradable sack at the edge of the sidewalk on trash day, because the household waste technicians might refuse to pick it up.

asked how to dispose of this or that, city hall routinely instructs residents to hire their own waste disposal services.

i've read that in switzerland things are even worse. I've read that most trash must be driven or somehow hand-carried to distant & inconveniently located recycling centres. Evidently the swiss waste disposal czars (ie the guys on the pickup truck) have the right to tear open trash packages & write out humungous ticket fines if they don't care for what they see :biggrin:


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## nathan79

Here's how I'd define classes...

Total Household Incomes (Gross)

Poor: > 20,000
Working Poor: 20,000 - 39,000
Lower Middle Class: 40,000 - 59,000
Middle Class: 60,000 - 99,000
Upper Middle Class: 100,000 - 149,000
Upper Class: 150,000 - 399,000
Rich (1%): 400,000 +


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## gibor365

> Here's how I'd define classes...


There is a big difference between family w/o kids and family with several kids (+ supporting older parents)


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## CalgaryPotato

Trying to put numbers to it is hard cross country. The median household income in Alberta is pushing into your upper middle class range. I think it skews the categories to say that the average household in an entire province is upper middle class. Seems like reasonable base numbers though if you had to try.

Of course a household of 1 vs. a household of 5+ also makes a huge difference.


----------



## nathan79

Yeah, I guess you can never do more than give a rough estimate. There are definitely situations where a couple making over 100K would not be upper middle class, especially if they're supporting two or three kids.


----------



## CalgaryPotato

And on the flip side of the coin gibor, there are multi generational households where both generations are working that also skew the numbers. You have 4 + working adults in a house, they may push into the rich range.

They are making a tradeoff to live a different lifestyle but I don't know if that makes them richer, than if the two generations lived in two separate households.


----------



## gibor365

As per Natan's numbers we fell well into Upper Class, imho, maybe if we were living somewhere in NS or NB 
We own 15 years old pretty small house in GTA suburbs and 2 basic cars (10 and 5 years old) ... Except finishing basement - no any renovations, no expensive clothes or jewerly, dining out - maybe 2-3 times per year... all savings (include all cash and registrered accounts) combined are far even from 1 mil ... 
Most spendings: recreation, frugal travel and food.... 
So, couldn't tell that we're "rich"


----------



## Moneytoo

I liked the definition of wealthy from the "Millionaire Next Door":

"Another way of defining whether or not a person, household, or family is wealthy is based on one's expected level of net worth. A person's income and age are strong determinants of how much that person should be worth. In other words, the higher one's income, the higher one's net worth is expected to be (assuming one is working and not retired). Similarly, the longer one is generating income, the more likely one will accumulate more and more wealth. So higher-income people who are older should have accumulated more wealth than lower- income producers who are younger.

For most people in America with annual realized incomes of $50,000 or more and for most people twenty-five to sixty-five years of age, there is a corresponding expected level of wealth. Those who are significantly above this level can be considered wealthy in relation to others in their income/age cohort.

...

Given your age and income, how does your net worth match up? Where do you stand along the wealth continuum? If you are in the top quartile for wealth accumulation, you are a PAW, or prodigious accumulator of wealth. If you are in the bottom quartile, you are a UAW, or under accumulator of wealth. Are you a PAW, a UAW, or just an AAW (average accumulator of wealth)?"

I used to think that someone with income 400K+ is rich, but if they spend most of it - they're poorer than thou


----------



## gibor365

Moneytoo, I think we were talking not about wealth, but about income 

Family (esp. retired) can have 2 mil in Savings, but only 50K gross income per year (2.5% in interest) assuming there is no locked-in accounts like LIRA. Does such family "rich" or not?! Per natan's number it's Lower Middle Class 

If for example, we got laid off/retired tomorrow, from "Upper Class" we switch right away to "poor"


----------



## Moneytoo

gibor, I don't see the point of talking about incomes since someone who makes 50K and has a 500K portfolio is wealthier that someone who makes 500K and has nothing but debt - but, then again, I'm a CAW, so who cares what I think? lol


----------



## none

You need to equate it to working capital. 

Someone who makes 50K a year is equivalent to 1million in working capital.


----------



## Davis

humble_pie said:


> but davis i only posted about the first all-province chart, the 2nd one re ontario did look a little screwy to me ...


Ah, it was Goldstone who posted about the second chart. i'm not saying that it is wrong, I just don't believe random interweb graphics just because someone knows how to use software. 



humble_pie said:


> you've also skated over the point that taxpayers are reeling from the triple combo of federal, provincial & municipal taxation. Fed expenditures *should* go down, ottawa has offloaded services to the provinces who, in turn, have off-loaded to the municipalities, who have no resources whatsoever to cope.


I didn't address it because I don't disagree. Looking at the whole tax burden makes sense. The number of taxing authorities doesn't bother me - I'd rather pay $100 to three different governments than $500 to one. the other thing you have to consider is that in the 1970s and 1980s we were getting more services from governments than we were paying for - they just borrowed to keep giving us free stuff. So eventually taxes had to go up and services had to go down to balance. Paul Martin even started paying off the debt, then Harper came in and cut taxes so much that when we hit rough waters he had to start borrowing again. 

In Ontario, the Tories just kept running up deficits, and then the Liberals continued the practice. It will be interesting to see if they can actually get to balance in three years as they are trying to do.


----------



## CalgaryPotato

I guess it depends on what you consider rich. I consider it to be the opposite to poor. Is the person who makes $500K a year and spends it all poor? I wouldn't use that term to describe them at all. They may be stupid with their money (or maybe they are smart because they are enjoying it to the fullest), but they still fit the definition of rich, as long as they can continue to lead that lifestyle. If they lose their job tomorrow and the lavish lifestyle gets taken away, then they may be poor.


----------



## nathan79

gibor said:


> Family (esp. retired) can have 2 mil in Savings, but only 50K gross income per year (2.5% in interest) assuming there is no locked-in accounts like LIRA. Does such family "rich" or not?! Per natan's number it's Lower Middle Class


I think class is more related to earning and spending than how much you have in the bank.

Usually there is very little difference between earning and spending as most people spend a high percentage of their income.

But in your example I think that a couple with 2 mil in the bank and living on income of 50K gross is still lower middle class. Maybe slightly higher if they have no mortgage.

BTW, what about pensions, CPP, OAS, etc? It's highly unlikely that this theoretical retired couple is only making 50K gross... probably closer to 100K or more.


----------



## andrewf

GoldStone said:


> The last chart is 7 years old. It ends right before recession.


Can you find a more up-to-date data source? It's the most recent data I could find last night.


----------



## uptoolate

Yes the Beverly Hillbillies and me will be low class no matter how much money we's all got! Pass the moonshine Jethro! We'll be happy though.


----------



## Moneytoo

none said:


> You need to equate it to working capital.
> 
> Someone who makes 50K a year is equivalent to 1million in working capital.


What's the working capital? I was trying to use the modified target wealth formula:

*Target Net Worth = (Age – 27) X Annual Pre-Tax Income / 5*

and realized that I'm not sure if the house should be included or not?


----------



## andrewf

gibor said:


> Upper class imho are families with household income 500K+


Hilarious!


----------



## gibor365

> BTW, what about pensions, CPP, OAS, etc? It's highly unlikely that this theoretical retired couple is only making 50K gross... probably closer to 100K or more.


 not really! If couple is retired before age 60 - they won't have any CPP/OAS and only after 67 they can have both CPP and OAS.
And if couple are immigrants (like we're ), it never gonna have full OAS and CPP also will be very small (I approximate did calculations for my case).
And because if 50K income, I believe there is no GIS....


----------



## gibor365

andrewf said:


> Hilarious!


Reality!


----------



## Davis

gibor said:


> Reality!


Then it should be easy for you to provide the evidence. 

Except that it is not true. If only 2% of Ontarians have income over $150,000 (2014 Ontario Budget, page 323), then putting two of the higher-paid people in that group into the same household means that only a very, very, very small percentage of the population would qualify for your definition of "upper class". 

If you ask Canadians where they fall in the income range, 95% would say "middle class". That's how Canadians are. But it isn't useful in a policy discussion to treat everyone as being middle class.


----------



## gibor365

> only a very, very, very small percentage of the population would qualify for your definition of "upper class".


 Sad reality! Taxes are too high...



> If only 2% of Ontarians have income over $150,000


 I was talking about household income and your number looks like about individual.
I just cannot believe that only 2% of *household* income have 150K+



> That's how Canadians are


 that's how all humans are


----------



## carverman

gibor said:


> not really! If couple is retired before age 60 - they won't have any CPP/OAS and only after 67 they can have both CPP and OAS.
> And if couple are immigrants (like we're ), it never gonna have full OAS and CPP also will be very small (I approximate did calculations for my case).
> *And because if 50K income, I believe there is no GIS.*...


You are correct. But there are income maximums for couples different from singles. 

In my case the OAS + cpp (taken at 60) is about $13,468.08 yearly.
So I would get another $152.59 a month for a combine OAS/GIS income of $716.33 a month.

If I didn't have my DB pension, I could get maybe an extra $152.59 a month x 12months ( as a single divorced pensioner.) = $1831.00 per year

*$16,704* $747.11
http://www.servicecanada.gc.ca/eng/services/pensions/oas/payments/tab1-35.shtml

So with that extra GIS payement, I could live high off the hog with my "rich income" of $15,299 ..mmm that Kraft Dinner is mighty tasty! :biggrin:

But fortunately, my DB pension is still hanging in there for me...so with my combined income (around $32K)..I am out of luck to get more from the gov't.


----------



## Moneytoo

Huh, who would've thunken:

"Canada?s super-rich are largely married, middle-aged men who are senior managers, doctors or engineers.

Joining the top 1-per-cent club requires a total income of $191,100, or nearly seven times the median income. There are 272,600 members."

http://www.theglobeandmail.com/news...anadians-earn/article14269972/?service=mobile

The numbers are from 2013, but still...


----------



## Davis

gibor said:


> Sad reality! Taxes are too high...


This is before-tax income, so it has nothing to do with taxes.



gibor said:


> I was talking about household income and your number looks like about individual.
> I just cannot believe that only 2% of *household* income have 150K+


Yes, those numbers are about individual income. I was responded to your statement that "Upper class imho are families with household income 500K+". You've defined a narrow group of the super-high income there. Oddly, few Canadians feel comfortable defining themselves as high income. This makes it difficult when people who have high income _relative to the majority of other people_, say their taxes are too high and the middle class is being squeezed. The middle class may be being squeezed, but not by taxes on rich people. 

I don't see myself as being rich either, but I know that statistically, I fall into any reasonable definition of high income.


----------



## Davis

For some perspective, according to this report  using 2009 StatsCan data, the middle 60% of canadian families had total income between $40,000 and $125,000. So the top 20% of families had total income over $125,000, and the lowest income 20% had less than $40,000. This is a pretty reasonable definition, I think. 

Of course, this is about income, not standard of living. A working age family with children in the middle of that range -- say about $80,000 -- is going to have to scrimp to save for education and retirement, while a retired couple will be living pretty well with no child expenses, and no need to save.


----------



## gibor365

> is going to have to scrimp to save for education and retirement, while a retired couple will be living pretty well with no child expenses, and no need to save.


 this is what I was talking about....every situation is different...

The other thing... for how long family has specific income... If we were getting current household income for last 20 years, situation would be completely different... We're only 15 years in Canada and for first 3 years our household income was below 75K annually.

You asked about evidence  I just can say that we live in a bit below average area in West GTA (cannot compare even close to Thornhill, Richmond Hill where live all of my friends) and our house is below average in our area, we have old cars - and looking at cars our neighbours have - we are even "poor" , our kids didn't go to private school .... probably we have more savings than average , but I have no idea how much other have


----------



## andrewf

Income is just capacity to consume. You may choose to consume less while your neighbours consume more with a similar income. I think the problem is that you are using the wrong frame of reference. People who own houses in Thornhill are not representative of the whole of society. Sounds like you feel poor because the other couples at the country club have a bigger yacht.

If you want to measure wealth on the basis on consumption, I am not entirely opposed... we can have what is effectively a progressive consumption tax by reducing income taxes and raising the HST.


----------



## gibor365

> I think the problem is that you are using the wrong frame of reference. People who own houses in Thornhill are not representative of the whole of society. Sounds like you feel poor


 First of all I didn't say that I feel poor, I said I feel we're middle class ...

Thornhill was just an example.


> the other couples at the country club have a bigger yacht.


 and I'm not talking about lawyers, dentists or CEOs... all our friends just regular IT workers who came to Canada 10-15 years ago with bad English (like mine )



> reducing income taxes and raising the HST


 fine with me  HST can also vary depends on product...


----------



## gibor365

So, why CRA doesn't update their website?! It becoming ridiculous as no one can say 100% that I can use 10K room


----------



## mrPPincer

I'm not worried about it, I have all my cash in PCF HISA at 2.6%; as soon as I know for sure I'll move 4.5K into PT HISA at 2.5%.
If/when a big correction happens, I hope the timing is right so I can bump up equity in the TFSA.


----------



## Synergy

gibor said:


> So, why CRA doesn't update their website?! It becoming ridiculous as no one can say 100% that I can use 10K room


Don't worry, be happy :biggrin: Just do it!



> A Bank of Montreal official confirmed that the CRA has issued a notice making it clear that contributions can be increased to $10,000 for 2015, and will allow Canadians to take advantage of the increased limit right away, even though it will take weeks to get through all Parliamentary stages.


http://business.financialpost.com/p...anadians-top-up-tfsa-for-2015?__lsa=85a1-e634


----------



## carverman

gibor said:


> So, why CRA doesn't update their website?! It becoming ridiculous as no one can say 100% that I can use 10K room


CRA can't officially update their website until the H of C passes Harper's budget. Then it becomes law. 

In the meantime, all the cash greedy banks and investment firms will take your (additional contribution) TFSA money. 

If by some remote chance the Harper gov't doesn't get back in for a 3rd four year term, your ADDITIONAL TFSA money could be placed back
into a regular savings account, and you would (probably) receive a T5 for any interest over $50 from April 22 to the end of this year.

Stephen has told us..if you want the pre-election financial goodies we offer..better vote for us...
otherwise JT will take them away from you citing that these were only available to the rich in the first place..
and the average middle income earner wouldn't be using the additional contribution limit.


----------



## CalgaryPotato

andrewf said:


> If you want to measure wealth on the basis on consumption, I am not entirely opposed... we can have what is effectively a progressive consumption tax by reducing income taxes and raising the HST.


I have a feeling that HST/GST puts the squeeze on the middle class potentially more than other tax hikes.

The lowest classes will spend every cent they make, but mostly on exempt items.

The middle class will spend most of their money, however it will be a blended mix of exempt/non exempt items.

The rich, will buy a larger share of non exempt items, but will in theory save a much larger percentage of their income.

Of course I'm talking on the macro level, not about individuals. 

Then you'd have to look of the economic effect, if this cuts into non essential spending significantly.


----------



## mf4361

http://www.theglobeandmail.com/glob...ra-tfsa-contributions-ottawa/article24088860/

So I guess we can contribute up to $10k in TFSA now.


----------



## gibor365

> TFSA money could be placed back
> into a regular savings account, and you would (probably) receive a T5 for any interest over $50 from April 22 to the end of this year.


 And if you bought/sold stocks and got dividends with this additional room money?


----------



## CPA Candidate

I'm middle class and I'll be using the extra room. I also benefited from income splitting, got an extra $234 back.


----------



## Toronto.gal

gibor said:


> So, why CRA doesn't update their website?!


Direct source:
http://www.fin.gc.ca/n15/15-046-eng.asp


----------



## carverman

Toronto.gal said:


> Direct source:
> http://www.fin.gc.ca/n15/15-046-eng.asp


Whew!..common sense prevails for the little people....so there JT....you can't take our TFSA increase away..cuz you are not the king...Stephen is and we seniors will definitely remember what you said when it comes to the next election coming up.

Remember your Liberal predecessor (Chrietien)? who waved the Liberal "Red Book" in our faces and told us "it's all in there...
when we get elected we will 'KILL THE GST!"...Chretien lied to us..so why should we trust you either!


----------



## Toronto.gal

^ I had actually called the Dept. of Finance a couple of days ago, and they returned my call this afternoon with the above confirmation. I guess now I know why it took 2 days to get back to me. LOL.


----------



## carverman

Toronto.gal said:


> ^ I had actually called the Dept. of Finance a couple of days ago, and they returned my call this afternoon with the above confirmation. I guess now I know why it took 2 days to get back to me. LOL.


I got mine yesterday by email from the Retirement Information Center that I subscribe to. 

Glad that the initial confusion is cleared up, now we "rich upper crust seniors living on OAS/CPP" can sock away
a bit more of our after tax dollars, and keep more of what little interest it earns.

So JT......put that in yer Marijauna pipe..and smoke it!


----------



## Toronto.gal

After so much anxiety/hyperventilation on CMF the last few days over the 'proposed' increase wording :biggrin: & the bombardment of brokers that followed, I figured that the gov. would have been equally thrown for a loop with questions, and that as a result, they would have had some automated answer to stop the calls - and why I had called, LOL. 

As it turns out, it was all of the above that prompted the updated announcement yesterday by the Dept. of Finance. With so much passion, I wonder how many voters JT has lost/won with his immediate TFSA scrap comments. More interesting would be to hear his so far secret proposed policies, though it should be coming soon given that the unveiling of such, had initially been scheduled to have taken place last month following the original Feb. budget. JT's economic advisors must be hard at work after last week.

Speaking of policy reversal, he also said he would scrap income splitting & roll back the OAS eligibility from 67 to 65.


----------



## carverman

Toronto.gal said:


> As it turns out, it was all of the above that prompted the updated announcement yesterday by the Dept. of Finance. With so much passion, *I wonder how many voters JT has lost/won with his immediate TFSA scrap comments. *More interesting would be to hear his so far secret proposed policies, though it should be coming soon given that the unveiling of such, had initially been scheduled to have taken place last month following the original Feb. budget. JT's economic advisors must be hard at work after last week.
> 
> Speaking of policy reversal, he also said he would scrap income splitting & roll back the OAS eligibility from 67 to 65.


Just goes to show how immature and out of tune he is with today's population demographics and what it costs to live. His outspoken off the cuff comments since he has become leader of the Liberal party shows how immature and naive he is. 

JT should really adapt the old saying.... "make sure brain is engaged before putting mouth in gear":biggrin:

His post budget comments were noted by many out there watching. I predict that in the next election, he will still be playing "third fiddle" in the Parliament
Hill orchestra. He needs to grow up a bit more...when you have nothing better to offer.. just STFU!


----------



## Davis

But carverman, what do you *really* think about Trudeau? ;-)


----------



## sags

I doubt the TFSA will be a big election issue for most Canadians.

Their main concern is the economy..............and jobs, jobs, jobs.................not a TFSA contribution limit they will never use.

Look at what is happening in Alberta..........the heartland of Conservatism. The NDP are leading the polls and appear headed for a majority government.

http://poll.forumresearch.com/post/275/majority-government-seen-in-wake-of-debate/


----------



## Toronto.gal

sags said:


> I doubt the TFSA will be a big election issue for most Canadians.


But it was funny to see people's reaction here. Even those opposing it were some of the first to max. it. :biggrin:


----------



## zylon

*Off Topic*



> The NDP are leading the polls and appear headed for a majority government.


WOW! what a different way of reading the tea leaves.

Listening to the local chat shows, my take is that, while a refreshing new face and voice, Rachel's popularity has more to do with standing up to the unfortunate leader of a highly unpopular party, than anything the NDP stands for. Now, if she were to change parties ...?

A lesson could be taken from Trudeau Sr., join a strong party and change it from within.


----------



## sags

Toronto.gal said:


> But it was funny to see people's reaction here. Even those opposing it were some of the first to max. it. :biggrin:


Self interest triumphs over ethereal conviction ?

It appears that way for both those who have offered it (a government facing an uneasy election) and those utilizing it (intelligent people with money sense and cash to put away).

From what I understand though, the Conservatives haven't promised anything beyond this year's increase to $10,000. 

Automatic indexing was removed from what I understand, so what are the backroom plans for next year and beyond ?

A freeze..........a cap...........an annual increase ?

If Trudeau were to freeze the TFSA at today's level..........he may be doing nothing more than the Harper government plans to do in the future.

Good politics or bad politics, only time will tell..........but the latest online Liberal advertisement I saw featured an attack on the TFSA as a gift to the wealthy and had Joe Oliver's comment on leaving the debt to Stephen Harper's granddaughter front and centre.

So, I would conclude from that, the Liberals are all in on putting an end to the TFSA.........one way or another.


----------



## Guban

Toronto.gal said:


> But it was funny to see people's reaction here. Even those opposing it were some of the first to max. it. :biggrin:


Put me in that camp!

I'm thinking of the greater good when I opposed the increase. Decreasing revenues will increase the country's deficit or not go towards paying down the national debt. However, I'm not that ultraistic that I'll give the government money just because. I guess that I'll just have to dream that the government will have to be more responsible with taxes that it is collecting.

BTW, thanks T-gal for the updates on the clarification of when we can contribute the extra $4,500.


----------



## carverman

Well nobody is forcing you to put in that extra $4500 into a TFSA...
you can consider that $4500 as your patriotic duty to give it to the gov't as a donation to help them fight ISIS and crime and senator thieving.


----------



## sags

Election coming next..............let the games begin.


----------



## none

Toronto.gal said:


> But it was funny to see people's reaction here. Even those opposing it were some of the first to max. it. :biggrin:


I don't really see how maxing it immediately is any signal of hypocrisy if that's what you're implying. We manage our lives a different levels, day-to-day things at a personal level - long term at a national level. For example, I think vigilantism should be illegal - however, as I've stated before if anyone seriously hurt someone in my camp I'd be taking my baseball bat over to their house to give them a sound beating and a Bavarian necktie. Or the death penalty for that matter - I think it should be illegal but don't think that I wouldn't implement my own justice if I thought it was justified. I regress though..... 

Back to TFSA's: this increase is very beneficial to me - yes, it's great and I'll take advantage of it but that doesn't mean that I support it at a national level. 

It's bad long term policy for a simple reason: RRSPs & TFSAs are independent. They shouldn't be. You should get either a fixed amount (or %) of your income that can be tax sheltered - either before tax or after tax. 

The way it is set up now is that no one has to pay capital gains on investment income at all and people who invest (and invest well) are people who have money so yes, it does predominantly benefit the wealthy - with the exception of a few outliers. That's the ultimate effect of this policy - Canadian's don't have to pay tax on investment income wrapped up in a nice acronym and illusion of financial empowerment. Call it what you will but that's it.

So there's a new question: Should we just abolish RRSPs and TFSAs and just make investment gains/income tax free? Because that's for all intense and purposes have now.


----------



## Eclectic12

^^^^

The way it is set up now is that no one has to pay capital gains on investment income at all?
For all intents and purposes - RRSPs and TFSAs make investment gains/income tax free?

Apparently you see one or more loopholes I've overlooked that somehow people have the potential to get around ... like ... well - the RRSP/TFSA *limits*. 

Among other things - I'm curious how to make RRSP withdrawals tax free as plugging $12K of RRSP withdrawals into a 2013 Ontario tax spreadsheet results in a tax bill. (That's with no other sources of income, BTW).


Cheers


*PS* 

No capital gains taxes is going back to the way it was in 1971.


----------



## GoldStone

none said:


> So there's a new question: Should we just abolish RRSPs and TFSAs and just make investment gains/income tax free? Because that's for all intense and purposes have now.


You forgot to mention pensions. Why is that? Because you have one? Government created RRSPs to put pensioned and non-pensioned workers on equal footing.

RRSPs and pensions are tax-deferred accounts. Investment gains do get taxed eventually.


----------



## none

In my mind I think of RRSPs and pensions as the same thing mainly because they are -- pensions couldn't exist without RRSP room.


----------



## none

Eclectic12 said:


> The way it is set up now is that no one has to pay capital gains on investment income at all?
> For all intents and purposes - RRSPs and TFSAs make investment gains/income tax free?
> 
> Apparently you see one or more loopholes I've overlooked that somehow people have the potential to get around ... like ... well - the RRSP/TFSA *limits*.
> 
> Among other things - I'm curious how to make RRSP withdrawals tax free as plugging $12K of RRSP withdrawals into a 2013 Ontario tax spreadsheet results in a tax bill. (That's with no other sources of income, BTW).
> 
> 
> No capital gains taxes is going back to the way it was in 1971.


-- B/C combined RRSP+TFSA are in such excess of what the vast majority of people use the limits mean little. Seven years from now a 25 year old will have 70K of room plus all the RRSP room. So yes, for all intents and purposes the investments are tax free.

-- RRSP & TFSA are mathematically equivalent when tax brackets between in and out are the same. Best to think of it that way for clarity I think.

Yes and in 1971 we decided this was a bad idea and we changed it. Should we not have? Would we be better off if capital gains taxes never existed? Because we are pretty much back to pre-1971 policy.


----------



## Toronto.gal

none said:


> I don't really see *how maxing it immediately is any signal of hypocrisy if that's what you're implying.*


I was more referring to the deposit blitz, and anxiety about it as Andrew mentioned; and even though u were one of them, you found the blitz pretty amusing/puzzling yourself. 



andrewf said:


> I'm not sure *why everyone was so anxious* about whether they should contribute or not.


*April 24th:*


none said:


> That or *what was the rush* to get in the DAY OF. Not paying taxes on a week of gains should be trivial.


*April 23rd:* 


none said:


> I just dumped $4500 into my TFSA. Now I just have to buy something.


*Guban:* you're welcome!


----------



## none

I wasn't really worried about it b/c CRA are generally reasonable - you can get a pass on things if you have justification - the TFSA drama was not dramatic at all that's why I dumped it in. Actually I tried to: I've never done a within TDW account transfer and it 'didn't take' or something. The money hasn't moved over - anyway, I'm not too stressed about it. I'd like to know what my RRSP room is this year anyway. I think the superiority of TFSA over RRSP is a bit over stated at my age.

Anyway, fun stuff. Really though, this TFSA debacle is such a small addition to Harper's mismanagement over the last decade or so it's just a drop in the bucket.


----------



## Eclectic12

none said:


> In my mind I think of RRSPs and pensions as the same thing mainly because they are -- pensions couldn't exist without RRSP room.


It appears you are skipping over the historical record.

RRSPs were created in 1957, well after pensions.


> The Second World War is when pension plans really took off in Canada. To help attract the best workers, employers started to offer defined benefit pension plans.


http://www.milliondollarjourney.com/the-history-of-pension-plans-in-canada.htm


I'll have to find it again but I recall seeing a reference to a pension plan's early history as being the 1870's. American railroad workers in the 1920's are claimed to have pensions for 84% of them ... so I expect the Canadian railroads to be similar.


Cheers


----------



## avrex

Eclectic12 said:


> I'm curious how to make RRSP withdrawals tax free as plugging $12K of RRSP withdrawals into a 2013 Ontario tax spreadsheet results in a tax bill. (That's with no other sources of income, BTW).


See TaxTips.ca 2014 Canadian Income Tax Calculator. 
Let's say you are age 55, early-retired, with no income (i.e. no CPP, no OAS, etc.)
The basic personal amount in 2014 for Ontario is $11,138.

So here's a neat trick for early retirees.

Withdraw 10,000 out of your RRSP. It's *tax free* because you will be able to get the witholding tax back at the end of the tax year.
Deposit the 10,000 into your TFSA.

In the long term, *you've reduced your tax bill* because the money will compound tax free in your TFSA account and not in your RRSP/RRIF account.


----------



## none

Eclectic12 said:


> It appears you are skipping over the historical record.
> 
> RRSPs were created in 1957, well after pensions.
> 
> http://www.milliondollarjourney.com/the-history-of-pension-plans-in-canada.htm
> 
> 
> I'll have to find it again but I recall seeing a reference to a pension plan's early history as being the 1870's. American railroad workers in the 1920's are claimed to have pensions for 84% of them ... so I expect the Canadian railroads to be similar.
> 
> 
> Cheers


Well yes but there are merged in the context that pension room is linked to RRSP room. Much like (I think) TFSA room should be linked to RRSP room.


----------



## Eclectic12

avrex said:


> ... So here's a neat trick for early retirees.
> 
> Withdraw 10,000 out of your RRSP. It's *tax free* because you will be able to get the witholding tax back at the end of the tax year.
> Deposit the 10,000 into your TFSA.
> 
> In the long term, *you've reduced your tax bill* because the money will compound tax free in your TFSA account and not in your RRSP/RRIF account.


Built into this is the bigger trick of living on $0 income ... :biggrin:

I can see it would work for a while where one is married (or someone is willing to pay one's living expenses).



Cheers


*PS*

Maybe you'll volunteer to cover my living expenses so I can do this?


----------



## avrex

Eclectic12 said:


> Maybe you'll volunteer to cover my living expenses so I can do this?


Lol.

My neat trick works in theory, but you're right, there is that one small problem .... income to live on. 

I better start building up my non-registered assets.


----------



## sags

The most searched words under the letter T for April 25, 2015

_target 

twitter 

tmz 

ticketmaster 

time warner cable 

taylor swift 

translate 

tumblr 

t mobile 

thesaurus 

the imitation game 

tablet 

tv 

trampoline 

thermos 

the walking dead 

tv stand 

toms 

tory burch 

game of thrones 

transformers 

toys r us 

travelocity 

tripadvisor 

tractor supply 

tim duncan 

the age of adaline 

truffle butter 

target.com 

travelocity.com 

transportation from reno to tahoe 

translate english to spanish 

type in algebra problem get answer 

turbotax 

ticketmaster.com 

trap queen 

take me to church 

thinking out loud 

taylor swift style 

thinking out loud ed sheeran 

taylor swift blank space 

the weeknd earned it 

truffle butter nicki minaj 

the voice 
_
"tractor supply" and "take me to church"................but no TFSA.................just saying


----------



## Eclectic12

none said:


> -- B/C combined RRSP+TFSA are in such excess of what the vast majority of people use the limits mean little. Seven years from now a 25 year old will have 70K of room plus all the RRSP room. So yes, for all intents and purposes the investments are tax free.


If I understand, the idea is ...

tax sheltered amount > what most use = investments are tax free. The conclusion is that since it's tax free, let's get rid of the overhead by eliminating investment taxes.


Looking at the director compensation section of one company report for the increase in shares owned compared to the previous year (i.e. the single year increase):
director A ...+3000 (estimated to be $151K)
directory B ... +10,000 shares (estimate $500K)
director C .... +12,000 shares (estimate $600K).

(BTW ... on 12,000 shares there is also about $24K of dividend income.)


Note that they are on multiple boards so these numbers could be a drop in the bucket of the annual amount.


You really think that because of what Joe Average chooses to do - the Canadian gov't should forgo investment taxes on *everything*?


Cheers


----------



## cainvest

Eclectic12 said:


> Built into this is the bigger trick of living on $0 income ... :biggrin:


You live off what you have saved in your TFSA over those years ... assuming you've got some years to save up in the TFSA before retirement.


----------



## Guban

Eclectic12 said:


> Built into this is the bigger trick of living on $0 income ... :biggrin:
> 
> I can see it would work for a while where one is married (or someone is willing to pay one's living expenses).


Zero income is not really a problem, if one has lots of money in the bank, earning basically zero. 

That being said, I can't see the "neat trick" working, because if one really has these assets to live on, why are they outside the TFSA if one has contribution room?

It also won't work well for a couple. If one spouse has no other income and takes money out of his/her RRSP (to put into a TFSA, or spend it) then the working spouse will have a smaller spousal claim. Depending on the province of residence, this could be exactly the same as having the lower income spouse earn taxable money in the lowest tax bracket. In Ontario, a lower income spouse can make around $800 in 2014 without lowering the provincial spousal amount. No such freebe exists for federal tax.


----------



## gibor365

> It also won't work well for a couple. If one spouse has no other income and takes money out of his/her RRSP (to put into a TFSA, or spend it)


 If one spouse has no other income and takes money out of his/her RRSP , I think it's better that working spouse will contribute this money into SRRSP to reduce margin tax bracket


----------



## Guban

none said:


> The way it is set up now is that no one has to pay capital gains on investment income at all and people who invest (and invest well) are people who have money so yes, it does predominantly benefit the wealthy - with the exception of a few outliers. That's the ultimate effect of this policy - Canadian's don't have to pay tax on investment income wrapped up in a nice acronym and illusion of financial empowerment. Call it what you will but that's it.


Perhaps a more accurate statement that these changes mean that poorer Canadians don't have to pay taxes on investment income at all by using their TFSA's. This will apply to dividends and interest too, not just capital gains. The wealthy will easily max out their TFSA's, and RRSP's are tax deferred, not tax free. The people with the most money to invest will also max out their RRSP's, and have to face full, non-deferred investment taxes.


----------



## cainvest

avrex said:


> Withdraw 10,000 out of your RRSP. It's *tax free* because you will be able to get the witholding tax back at the end of the tax year.
> Deposit the 10,000 into your TFSA.
> 
> In the long term, *you've reduced your tax bill* because the money will compound tax free in your TFSA account and not in your RRSP/RRIF account.


There are a options to look at, 
1> Take out of your RRSP the tax free amount and the rest of your income comes from TFSA savings.
2> Take up to the first tax bracket out of your RRSP and the rest of your income comes from TFSA savings.


----------



## none

Guban said:


> Perhaps a more accurate statement that these changes mean that poorer Canadians don't have to pay taxes on investment income at all by using their TFSA's. This will apply to dividends and interest too, not just capital gains. The wealthy will easily max out their TFSA's, and RRSP's are tax deferred, not tax free. The people with the most money to invest will also max out their RRSP's, and have to face full, non-deferred investment taxes.


Growth is tax free. TFSAs and RRSPs are equivalent products (with the exception that the latter has superior tax protection) if your tax bracket doesn't change between when you put money in compared to when you take it out.

If TFSA's are 'tax free' then so are RRSP. Actually if your tax bracket changes, RRSPs superior to the 'tax free' TFSAs.


----------



## RBull

^I'm having trouble understanding what you mean by "superior tax protection" with an RRSP and how RRSP growth is tax free- unless your income upon withdrawal is always low enough not to incur taxes. Growth of the capital would otherwise be taxed. 

I also can't follow the logic of an RRSP being tax free because a TFSA is tax free. 

I see it as -one is simply contributions made with after tax dollars that grows tax free (why people call it tax free) and the other is a combination of tax deferral and tax reduction -if executed properly and not tax free. 

YMMV


----------



## none

RSP have better tax protection for foreign investment.

Perhaps this article will better illustrate why TFSA & RRSP are equivalent when tax brackets don't change.

http://www.theglobeandmail.com/glob...xplains-tfsa-or-rrsp/article1356709/?page=all


----------



## cainvest

RBull said:


> I also can't follow the logic of an RRSP being tax free because a TFSA is tax free.


Any RRSP withdrawal amount under ones basic personal amount would be "tax free", of course that assumes no other sources of income. TFSA principal was already taxed but any gains are indeed "tax free".


----------



## Guban

none said:


> RSP have better tax protection for foreign investment.


Do you mean that RRSPs allow for US dividends to be exempt from withholding taxes? This is by no means all foreign investments!


----------



## Guban

none said:


> Actually if your tax bracket changes, RRSPs superior to the 'tax free' TFSAs.


Do you mean that if your tax bracket decreases, then RRSPs are superior? Because if your tax bracket increases, then they are inferior!


----------



## none

^ I thought that was too obvious to make explicit. I assume a minimum of financial literacy when I post.


----------



## humble_pie

cainvest said:


> TFSA principal was already taxed but any gains are indeed "tax free".




this is an important point, imho, i hadn't seen it mentioned anywhere before.

capital gains in TFSA, along with dividend, distribution & interest income, have got to be the paradigm "tax free" income in canada. There's nothing comparable.

RRSPs with their eventual 100% taxation consequences - which apply to all of the capital plus capital gains plus all accrued income - are the polar opposite in this matter.


----------



## Guban

none said:


> Actually if your tax bracket changes, RRSPs superior to the 'tax free' TFSAs.


Wow, if you thought that what I wrote was too obvious to make explicit, why did you post something that was obviously wrong?


----------



## Guban

@none.

I am concerned with a few of your recent posts. They contain inaccuracies that for somebody who knows would find wrong, and for somebody who doesn't would be misleading. Either way, not good!

Post 396: "*The way it is set up now is that no one has to pay capital gains on investment income at all*"
Capital gains are not investment account gains, and it is now apparent to me, that this what you meant to write. Furthermore, it would only have a hope of being true for those that can put all of their investments in a TFSA. I take the RRSP argument you present with a grain of salt (please see my comments below) In any case, there are people that have both accounts maxed out. You may be one such person, otherwise, why could you have dumped the extra $4,500 into your TFSA last week? Remember, you think that TFSA's and RRSPs are equivalent. You jump on the extra TFSA room, but not any unused RRSP room?

Post 415: "*Growth is tax free. TFSAs and RRSPs are equivalent products (with the exception that the latter has superior tax protection) if your tax bracket doesn't change between when you put money in compared to when you take it out.

If TFSA's are 'tax free' then so are RRSP. Actually if your tax bracket changes, RRSPs superior to the 'tax free' TFSAs.*

*If TFSA's are 'tax free' then so are RRSP.* "
The growth in an RRSP is not tax free. (There was an ugly thread, started by Chris L, as I recall about this) The result may be mathematically equivalent if the tax bracket does not change, but for those people completing their taxes, withdraws are not tax free. I would also suggest that people's tax brackets do often change, so that making a blanket statement that RRSP's are tax free (even with the understanding that this only works for the same tax bracket calcualtions) would be misleading. Tax laws change. People's lives change. As I recall, you were looking at pulling money out of your RRSP (last year?) to take advantage of this bracket change. A person starting their work careers would, presumably, be in a lower bracket to start. Homebuyer's plan, Life long learners, or just withdraws when incomes fall (such as mat leave) are all thrown into the mix. <Sigh> They are definitely not "equivalent products". The flexibility of withdraws from a TFSA makes the two of them different.

Post 415: "*Actually if your tax bracket changes, RRSPs superior to the 'tax free' TFSAs*. "
I've already commented on this, but will reiterate in the greater context of your recent posts. This part of post 415 is just wrong. Just responding that it was "too obvious to make explicit", should be below you.

Post 417: "*RSP have better tax protection for foreign investment.*"
I've already commented on this, but will reiterate in the greater context of your recent posts. Post 417 is misleading. RRSP's are better to eliminate *US dividend* withholding taxes. Don't know of any other country that there is an RRSP advantage.

As I recall, you have at least one post graduate degree, and I would hope that your written communication would be more precise. Isn't this something that was expected in your education, as well as in your day to day work?


----------



## none

Everything I have written has been for all intents and purposes correct. Sure you can find subtle details I've glossed over but that's simply b/c I don't feel like writing a complete novel with every post. to your points:

1) 396: Indeed, I have no RRSP either.
2) This is how the math ultimately works out. It's simple logic. If a=b and b=c then a=c. I'm not going to go through the way of filling out tax forms. RRSP and TFSA are mathematically equivalent products when you look at how much money you have at the end. Go look at the G&M link I provided earlier.
3) See (2) - mathematically equivalent + better tax protection = better. Particularly for those with dual citizenship with the US. TFSA are not part of the US/CAN tax treaty. Indeed TFSA have no value to those with dual/
4) see above.

5) Sure, but like I said, I know how much I'm being paid for these posts and only put in about 150% effort for their worth.


----------



## gaspr

Lets say you have 10k of pre tax income, and that your MTR is 40%, and you are trying to decide between RRSP or TFSA.

For TFSA you have to pay tax at 40% first so you have 6k left to invest. Let's say you leave it alone and let it compound at 5% for 20 years. At that time you will have $15919.79 available to spend with no taxes owing.

For RRSP, you get to defer paying tax, and so get to invest the whole 10k. Compound at 5% for 20 years and you will have $26532.98. You decide to withdraw it all and pay tax at 40%. You will be left with $15919.79 to spend.

Looks like the same to me...


----------



## mf4361

gaspr said:


> Lets say you have 10k of pre tax income, and that your MTR is 40%, and you are trying to decide between RRSP or TFSA.
> 
> For TFSA you have to pay tax at 40% first so you have 6k left to invest. Let's say you leave it alone and let it compound at 5% for 20 years. At that time you will have $15919.79 available to spend with no taxes owing.
> 
> For RRSP, you get to defer paying tax, and so get to invest the whole 10k. Compound at 5% for 20 years and you will have $26532.98. You decide to withdraw it all and pay tax at 40%. You will be left with $15919.79 to spend.
> 
> Looks like the same to me...


But at one's retirement, the marginal tax rate is likely to be less than that in most of their working years.


----------



## Soon Forget

gaspr said:


> For RRSP, you get to defer paying tax, and so get to invest the whole 10k. Compound at 5% for 20 years and you will have $26532.98. You decide to withdraw it all and pay tax at 40%. You will be left with $15919.79 to spend.


Faulty logic, since not all of the RRSP withdrawal will be in the 40% MTR. In fact some may be in the 0% MTR upon withdrawal.


----------



## uptoolate

I have always shared Gaspr's and none's understanding of the RRSP and TFSA comparison and is what I have seen laid out in many descriptions from various sources. And as none points out, if your tax bracket is lower at the time of withdrawal, either in retirement or during a low income year, then the RRSP comes out ahead. Also, none's point about RRSPs working out superior (slightly) if holding US equities because of withholding tax treatment would be true as well as far as I can see. Personally, I'm very happy to have both vehicle's available and maximize both.


----------



## none

^ exactly. That's why for fairness tfsa and RRSP contribution limits should be linked. 

If not it's not that different from increasing RRSP room by (for those near the top) by 50%. If the question is put that was is it fair?


----------



## mf4361

^ I think it comes to the question whether boosting RRSP limit benefits the rich more.

Since RRSP limit is linked to income (up to a maximum), the higher the income the more room him/her to save tax free. Plus those in the top tax bracket have better chance to cash out RRSP at a lower marginal tax rate in their retirement than middle and lower-middle class.

Boosting TFSA limit, on the other hand, benefits the middle class just as much as the rich. (obviously, if one can't max out TFSA, any increase is meaningless)


----------



## gaspr

mf4361 said:


> But at one's retirement, the marginal tax rate is likely to be less than that in most of their working years.


Yes of course. That much is obvious. What is not obvious to many is that the RRSP choice can be far superior if one can manage to withdraw at low tax rates or even tax free. From age 65 to age 70, a retired couple who has no pension income, and who defer CPP and OAS to the max, can withdraw about 20k each year from RRSP's tax free! You will of course have to have some savings to make up your required spending needs.

The other thing that is not obvious to many is that as in my example above, that a tax paid 6k TFSA investment is exactly equal to a tax deferred 10k RRSP investment assuming a 40% MTR...same amount of income required.


----------



## Guban

none said:


> Everything I have written has been for all intents and purposes correct. Sure you can find subtle details I've glossed over but that's simply b/c I don't feel like writing a complete novel with every post. to your points:
> 
> 1) 396: Indeed, I have no RRSP either.
> 2) This is how the math ultimately works out. It's simple logic. If a=b and b=c then a=c. I'm not going to go through the way of filling out tax forms. RRSP and TFSA are mathematically equivalent products when you look at how much money you have at the end. Go look at the G&M link I provided earlier.
> 3) See (2) - mathematically equivalent + better tax protection = better. Particularly for those with dual citizenship with the US. TFSA are not part of the US/CAN tax treaty. Indeed TFSA have no value to those with dual/
> 4) see above.
> 
> 5) Sure, but like I said, I know how much I'm being paid for these posts and only put in about 150% effort for their worth.


Ok. We will have to agree to disagree. 

I have looked at the link, and don't find anything to disagree with. Fortunately, it doesn't say that RRSP's are tax free, nor does it say that they are the same as a TFSA, just a mirror image: post taxed vs pre taxed. 

re your response to 3) Do you understand how US citizens are taxed? It is certainly possible that there is a tax advantage for a US person to hold TFSAs. Passive FTCs may be used to cover the taxes that would be otherwise payable to the IRS. The real problem for US people holding a TFSA is the reporting requirements, not necessarily the tax owing to the IRS.

re 5) Oh that explains it all! I can do the math. Let's see: you are being paid zero, and your posts and effort are worth 150% times zero!

Do you see how being precise in your writing is important? Otherwise, as I read what you've written, it appears that you don't care about what you write!


----------



## none

Guban said:


> re 5) Oh that explains it all! I can do the math. Let's see: you are being paid zero, and your posts and effort are worth 150% times zero!
> 
> Do you see how being precise in your writing is important? Otherwise, as I read what you've written, it appears that you don't care about what you write!


I'm glad that comment didn't go over your head. Yes, any number times zero is indeed zero. That was the joke.

I'm more interested in accuracy rather than precision. My posts are more accurate than precise while your I would say are more precise than accurate. Choose your poison I suppose. Ideally both but I think the accuracy is more important when doing quick posts.


----------



## mrPPincer

I didn't have any trouble with the concepts none, you could have been a tad more precise I suppose, but I don't see a huge problem, we all know what you're saying don't we?
Your link to the excerpt from David Chilton's book explains all if people took the time to read it IMHO


----------



## none

mrPPincer said:


> I didn't have any trouble with the concepts none, you could have been a tad more precise I suppose, but I don't see a huge problem, we all know what you're saying don't we?
> Your link to the excerpt from David Chilton's book explains all if people took the time to read it IMHO


I know - that's what I thought too. You know what they say though:"you can lead a horse to water....."


----------



## Guban

none said:


> I'm glad that comment didn't go over your head. Yes, any number times zero is indeed zero. That was the joke.
> 
> I'm more interested in accuracy rather than precision. My posts are more accurate than precise while your I would say are more precise than accurate. Choose your poison I suppose. Ideally both but I think the accuracy is more important when doing quick posts.


How do you define accuracy?


----------



## mrPPincer

Guban said:


> How do you define accuracy?


http://en.wikipedia.org/wiki/Accuracy_and_precision


----------



## RBull

cainvest said:


> Any RRSP withdrawal amount under ones basic personal amount would be "tax free", of course that assumes no other sources of income. TFSA principal was already taxed but any gains are indeed "tax free".


I understand that. It was stated in the first and last sentences of my reply.


----------



## humble_pie

i also read the wealthy barber's linked article in the globe & mail. He offers a hyper-simplistic model that shows how TFSA = RRSP in the end.

then he goes on to explain that the model assumes every tax refund from RRSP contribution has been reinvested back into RRSP, but in reality that doesn't happen.

in reality, the barber says, folks spend their RRSP tax refunds on immediate purchases. At this point, barber's model begins to break down.

barber then goes on to explain that the model also assumes no withdrawals from TFSA across a lifetime, until retirement ... but in reality that doesn't happen either.

in reality, says barber, folks withdraw from their TFSAs to meet various financial needs as life goes along. Now the model has broken down so much that it's useless.

barber's conclusion? every saver, investor & taxpayer needs to hire a financial planner to create projections using individuated data based upon each saver's personal life style, barber says.

since i'm being paid 150% for my post, why would i waste those precious $$ reading links that tell me nothing more than go hire a financial planner each:


----------



## RBull

none said:


> RSP have better tax protection for foreign investment.
> 
> Perhaps this article will better illustrate why TFSA & RRSP are equivalent when tax brackets don't change.
> 
> http://www.theglobeandmail.com/glob...xplains-tfsa-or-rrsp/article1356709/?page=all


Thanks for the answer. I understand now what you are referring to. I have significant foreign holdings in my RRSP for this reason. 

I'm also clear on the differences between RRSP and TFSA. I am retired and my spouse and I have both these maxed out. 

Perhaps your posts needs a little more clarity, which seems to be happening with other subsequent posts.


----------



## humble_pie

to make the claim that RRSPs are better than TFSAs because they offer better terms for foreign stocks, one would have to build proof into the model that foreign stock portfolios always perform better than native canadian stock portfolios.

no need to confuse quantitative criteria with qualitative criteria. It's possible to hold foreign stocks in TFSA via canada-based funds & ETFs.

it's even possible to hold US dollar denominated foreign securities in TFSA that are not subject to any withholding tax from any foreign government, as has been well documented in countless cmf threads over the past couple of years.


----------



## none

humble_pie said:


> no need to confuse quantitative criteria with qualitative criteria.


That does not mean what you think it means.


----------



## none

humble_pie said:


> since i'm being paid 150% for my post, why would i waste those precious $$ reading links that tell me nothing more than go hire a financial planner each:


Scab off, that my joke


----------



## humble_pie

not a joke, _of course_ they pay me to post here :tongue-new:


----------



## none

humble_pie said:


> not a joke, _of course_ they pay me to post here :tongue-new:


au contraire, THAT'S the best joke I've heard all day.


----------



## Guban

mrPPincer said:


> http://en.wikipedia.org/wiki/Accuracy_and_precision


Thanks. By those definitions, I would suggest that none's posts lack both accuracy (as some of them are just wrong), and precision (as they differ ... eg capitial gains, growth eg. superior tax protection, tax protection for foreign investments)

I am trying to be accurate and precise in my language.

All of this being said, it seems that nobody else has any serious objections to his posts based on the responses thus far, so perhaps, it is just me voicing objections. Oh well ...


----------



## OnlyMyOpinion

Guban said:


> ..it seems that nobody else has any serious objections to his posts based on the responses thus far, so perhaps, it is just me voicing objections. Oh well ...


Or, we're letting you carry the flag while we eat popcorn


----------



## none

OnlyMyOpinion said:


> Or, we're letting you carry the flag while we eat popcorn


^ Something like that


----------



## humble_pie

was it inaccuracy or was it imprecision?

it was none who failed to understand the Wealthy Barber's article in the globe & mail.

perhaps she only got as far as the hyper-simplistic model, which appears early in the article.

Barber takes the entire rest of the article (apparently unread by none) to explain why the model does *not* work. 

first Barber shows why the model breaks down for RRSP projections, then he discusses the breakdown for TFSA projections. I posted his details upthread so not going to re-post. Everyone can read the article.

http://www.theglobeandmail.com/glob...xplains-tfsa-or-rrsp/article1356709/?page=all


in the end, the Wealthy Barber concludes by advising everybody to hire an expert financial planner, in the hope that individual personal data may help to shed some light upon a forecast that is, essentially, a mug's game.


----------



## supperfly17

humble_pie said:


> was it inaccuracy or was it imprecision?
> 
> it was none who failed to understand the Wealthy Barber's article in the globe & mail.
> 
> perhaps she only got as far as the hyper-simplistic model, which appears early in the article.
> 
> Barber takes the entire rest of the article (apparently unread by none) to explain why the model does *not* work.
> 
> first Barber shows why the model breaks down for RRSP projections, then he discusses the breakdown for TFSA projections. I posted his details upthread so not going to re-post. Everyone can read the article.
> 
> http://www.theglobeandmail.com/glob...xplains-tfsa-or-rrsp/article1356709/?page=all
> 
> 
> in the end, the Wealthy Barber concludes by advising everybody to hire an expert financial planner, in the hope that individual personal data may help to shed some light upon a forecast that is, essentially, a mug's game.


Am I correct in assuming that net outcome will only be the same at retirement ( assuming same tax rate) if the person investing in the TFSA invests 1000$, while the person investing in a RRSP invests a 1000$ plus their refund (~400$)?


----------



## none

This provides all the scenarios that apparently humble can't seem to work out. Start page 14.

http://api.viglink.com/api/click?fo...ww.canadianmoneysaver.ca/fil..._bookmarks.pdf


----------



## cainvest

humble_pie said:


> Barber takes the entire rest of the article (apparently unread by none) to explain why the model does *not* work.


The model does work but only if people choose to follow it ... yup, the solution is that simple.


----------



## CalgaryPotato

cainvest said:


> The model does work but only if people choose to follow it ... yup, the solution is that simple.


A lot of the reasons why the model doesn't work though, are tax assumptions, benefits assumptions etc. though. Not just the person not investing their tax refund.


----------



## none

^ I know Humble is giving me a migraine this morning from all the eye-rolling he's causing. It's painful....


----------



## humble_pie

none said:


> This provides all the scenarios that apparently humble can't seem to work out. Start page 14.
> 
> http://api.viglink.com/api/click?fo...ww.canadianmoneysaver.ca/fil..._bookmarks.pdf



please don't switch topic to canadianmoneysaver to save your face at this moment in time.

the only link you specified was to the globe & mail article. The problem is, this article doesn't prove what you believe. The situation is so messy, says article author Wealthy Barber, that his readers must hire expert financial planners to make individual sense out of it for themselves.


----------



## humble_pie

gosh, it's something like 11:30 am pacific time & yonder is none, who might be supposed to be at work on a monday morning?

but there she is, logged onto cmf forum since early this am & beavering away, possibly out of her government service cubicle on the taxpayer's dime.

no wonder goldstone gets so worked up when he sees civil servants fooling around.


----------



## none

humble_pie said:


> gosh, it's something like 11:30 am pacific time & yonder is none, who might be supposed to be at work on a monday morning?
> 
> but there she is, logged onto cmf forum since early this am & beavering away, possibly out of her government service cubicle on the taxpayer's dime.
> 
> no wonder goldstone gets so worked up when he sees civil servants fooling around.


Nice try - as I've said repeatedly, I manage my own time. I'm beyond the level of needing someone holding a stop watch behind me. I put in my time and then some. I don't work 9-5.


----------



## none

humble_pie said:


> please don't switch topic to canadianmoneysaver to save your face at this moment in time.
> 
> the only link you specified was to the globe & mail article. The problem is, this article doesn't prove what you believe. The situation is so messy, says article author Wealthy Barber, that his readers must hire expert financial planners to make individual sense out of it for themselves.


yes and I suppose I should link to all of the CRA tax documents. You're ridiculous.


----------



## humble_pie

CalgaryPotato said:


> A lot of the reasons why the model doesn't work though, are tax assumptions, benefits assumptions etc. though. Not just the person not investing their tax refund.



exactly, Wealthy Barber discusses the unreliability of the assumptions very clearly in his article.


----------



## humble_pie

none said:


> Nice try - as I've said repeatedly, I manage my own time. I'm beyond the level of needing someone holding a stop watch behind me. I put in my time and then some. I don't work 9-5.



ah, you're like me, you work when you please, on your own time?

a big difference though is that you are, by your own admission, a very recently-hired junior civil servant who might even still be on preliminary approval basis, i am so very sorry but somehow your story is too difficult to believe ...





none said:


> ^ I know Humble is giving me a migraine this morning from all the eye-rolling he's causing. It's painful....



perhaps a bad idea to embarass yourself with these hysterics?


----------



## none

humble_pie said:


> ah, you're like me, you work when you please, on your own time?
> 
> a big difference though is that you are, by your own admission, a very recently-hired junior civil servant who might even still be on preliminary approval basis, i am so very sorry but somehow your story is too difficult to believe ...


Junior? No.

Anyway, humble - you're starting to get a little too stalky and creepy so I'm out.


----------



## humble_pie

you've told the forum a 65k salary, which is not exactly up there


----------



## OnlyMyOpinion

Hey folks, sometimes the odd little poke is too much to resist but let's stay civil. We all have different lives, opinions and ideas - that's what brings us here?


----------



## cainvest

CalgaryPotato said:


> A lot of the reasons why the model doesn't work though, are tax assumptions, benefits assumptions etc. though. Not just the person not investing their tax refund.


Sure there are assumptions, as with pretty much anything financial projecting into the future. Point is, if you start breaking the main rules what's the point of starting in the first place. Also, one can make changes as time goes one, save more if you think you'll need it but remember there are no guarantees to how it will work out.


----------



## humble_pie

none said:


> You're ridiculous.



this is an example of how & why you often fail in debate. You don't stick to the discussion at hand. You promptly break down into hysterical insults. These do make you sound infantile imho.

returning to the discussion, you linked only the globe & mail article, which you failed to understand while insisting upon your own interpretation of it in several posts upthread.

confronted with how fuzzy the article actually was, you sought to switch topic to a magazine, then to the CRA, then to a hysterical migraine, then to personal attack ...


----------



## BoringInvestor

humble_pie said:


> this is an example of how & why you often fail in debate. You don't stick to the discussion at hand. You promptly break down into hysterical insults. These do make you sound infantile imho..


Ehhh.. didn't you post this not a few hours ago?



> gosh, it's something like 11:30 am pacific time & yonder is none, who might be supposed to be at work on a monday morning?
> 
> but there she is, logged onto cmf forum since early this am & beavering away, possibly out of her government service cubicle on the taxpayer's dime.
> 
> no wonder goldstone gets so worked up when he sees civil servants fooling around.


----------



## Davis

humble_pie said:


> gosh, it's something like 11:30 am pacific time & yonder is none, who might be supposed to be at work on a monday morning?
> 
> but there she is, logged onto cmf forum since early this am & beavering away, possibly out of her government service cubicle on the taxpayer's dime.
> 
> no wonder goldstone gets so worked up when he sees civil servants fooling around.


Do you think that all civil servants work 9 to 5 and don't take days off? No vacation? No flexible work hours? While I disagree with None on a lot of things, this behaviour by Humble and Goldstone is hostile and aggressive. They don't know the work or hours of work that anyone here has, and have no business sitting in ignorant judgement.

Discuss the issues, folks, and leave out the personal attacks. That just drives people away form these forums - not just the people you're attacking, but also other readers who don't want to get involved in internet pissing matches. That sort of behaviour is standard on news website discussion forums. CMF can be better than that. If it isn't, it will wither until it's just a few bitter people sniping at each other.


----------



## Cal

none said:


> ^ exactly. That's why for fairness tfsa and RRSP contribution limits should be linked.
> 
> If not it's not that different from increasing RRSP room by (for those near the top) by 50%. If the question is put that was is it fair?


If you look at it like that, yes it could be considered to increase RRSP contribution room by 50% for some higher earners. On the other hand, with that reasoning, it could be a 100% increase for some lower income earners...is that fair?


----------



## 1.5M

What would happen to Canadian economy if everyone who qualifies would contribute $10k/year to TFSA? 
Those money would have to come out from consumption for the vast majority of people. So the question can be reformulated, what would happen to Canadian economy if $250 billion are removed from consumption (people stop buying new cars, furniture, dining out, etc.)?


----------



## OnlyMyOpinion

I don't think the Canadian economy is at any risk of a sudden rash of massive saving. People will continue to consume not just the necessities but the discretionary items as well - because they think they need them. It certainly would be nice to see more saving though.


----------



## My Own Advisor

Couldn't agree more. Sadly though there seems to be no real incentive to save.


----------



## janus10

In order for my wife and I to max our RRSP *and* TFSA contributions, I'm going to need getting paid 200% for my posts going forward.

If this new limit does not get rescinded, this will be helpful for couples like us who plan to downsize our house and release a large amount of equity to help fund retirement savings.


----------



## 1.5M

OnlyMyOpinion said:


> I don't think the Canadian economy is at any risk of a sudden rash of massive saving. People will continue to consume not just the necessities but the discretionary items as well - because they think they need them. It certainly would be nice to see more saving though.


I don't think it would really be good for Canadian economy if people start saving (substantially) more. 
People spending $100B less/year => less profits for corporations => lower stock prices => everyone loses.

It's good for the individual saver, but if everyone was saving the economy would collapse. The real job creators are the spenders.

However, this illustrates that the TFSA increase was never intended to be used by 95% of Canadians, it's just a tax cut for the rich, paid for by the poor.


----------



## Guban

1.5M said:


> However, this illustrates that the TFSA increase was never intended to be used by 95% of Canadians, it's just a tax cut for the rich, paid for by the poor.


You keep saying this, but how do you know what Harper *intended* for the TFSAs? Do you have quotes or sources? Or is this just your feeling about the matter?

I think that it has been well established that, no matter what the *intention* was, the TFSA is being used by many Canadians rich and poor.

When you wrote "paid for by the poor", you do realize that many poor pay little or no income tax, right? With the reduced taxes, everybody's tax burden effectively increases. Certainly not just the poor.


----------



## Eclectic12

^^^^

I will have to find it again but I seem to the recall the 2011 graph breakdown of TFSA contributions by income was showing that those making up to $20K had what looked like 15% of the total 2011 contributions. While the unused room and use by high earners is getting press ... this seems to show that low income people are using it.


Cheers


----------



## uptoolate

Yes it is an interesting comment... 'paid for by the poor'. I am all for looking after my fellow man but is this where we have arrived in terms of sense of entitlement?


----------



## Cal

1.5M said:


> What would happen to Canadian economy if everyone who qualifies would contribute $10k/year to TFSA?
> Those money would have to come out from consumption for the vast majority of people. So the question can be reformulated, what would happen to Canadian economy if $250 billion are removed from consumption (people stop buying new cars, furniture, dining out, etc.)?


I don't think it would necessarily be removed from consumption. IMO if someone is going to save/invest money, they are probably going to do it anyways. So the TFSA money would only be removed from the non registered account tax base, not from the economy.

Or gov't pensions are designed as supplements, so having something, other than the taxed RRSP is a great option for some to have. IMO the RRSP only offers tax free compounding, you still get taxed at withdrawl, to even out the credit upon putting the money in.

And I too, don't agree with the 'paid for by the poor' comment, there are lots of high income earners living paycheck to paycheck, b/c they spend everything. You should thank them, they don't have enough money to put in a TFSA either, yet use all of their money to stimulate the economy.


----------



## Toronto.gal

Speaking of taxes 'paid for by the poor'......










*$8.5 billion:* Total value of charitable donations claimed (2011).
http://www.cbc.ca/news/business/taxes/tax-season-facts-and-figures-1.2504140

*Gibor,* are you the 1%ter taxpayer?


----------



## mrPPincer

Cal said:


> there are lots of high income earners living paycheck to paycheck, b/c they spend everything. You should thank them, they don't have enough money to put in a TFSA either, yet use all of their money to stimulate the economy.


I agree all that spending does help the economy, and not to complain, but if more of them vacationed within our borders more, it would be even more beneficial; our vast country has a lot to offer in that regard.


----------



## Westerncanada

I really do not believe the increase limit will compel anyone who was not already saving to begin doing so.. and those of us who were already saving willl increase that to the best of our ability. 

I am reminded daily that people do not save... they live a consumer and debt ridden life. 

I do not know more then 1 or 2 people who are debt free (beyond mortgage). Everyone has vehicle, credit card, boats, student loans etc. 

Its society.


----------



## 0xCC

Toronto.gal said:


> Speaking of taxes 'paid for by the poor'......


Maybe my math is wrong but if 26.1 million people filed taxes shouldn't there be 261,000 people in the 1%, not 258,465? What about those other 1% of the 1%ers (261,000 - ~258,500 = 2,500 = ~1% of 258,465)?


----------



## Toronto.gal

0xCC said:


> Maybe my math is wrong but if 26.1 million people filed taxes shouldn't there be 261,000 people in the 1%, not 258,465?


Oh, idk, maybe the 1% is actually closer to .99%.


----------



## 1.5M

Top 0.1% pay most taxes because they own almost everything including the poor, who are working to make them richer. They are so rich because they are the ones making the laws, the politicians work for them, because the very rich are paying for their election. 

The prove that the rules are favoring the rich is the fact that income inequality continues to grow and during Con rule the rate of income inequality increase has accelerated.

How the poor are going to pay for the this new tax cut for the rich? Well, 2 years of extra work due to deferred OAS payments is just the down payment. When the deficits will increase due to this irresponsible tax cut, the following will happen: health-care premiums will increase with reduction in services, CPP will start to be raided to cover the deficits and CPP contributions will be raised and paid benefits reduced. 
As a result the income inequality will further increase which will lead to street riots and a police state, just like in US.


----------



## Guban

1.5M said:


> Top 0.1% pay most taxes because they own almost everything including the poor, who are working to make them richer. They are so rich because they are the ones making the laws, the politicians work for them, because the very rich are paying for their election.
> 
> The prove that the rules are favoring the rich is the fact that income inequality continues to grow and during Con rule the rate of income inequality increase has accelerated.
> 
> How the poor are going to pay for the this new tax cut for the rich? Well, 2 years of extra work due to deferred OAS payments is just the down payment. When the deficits will increase due to this irresponsible tax cut, the following will happen: health-care premiums will increase with reduction in services, CPP will start to be raided to cover the deficits and CPP contributions will be raised and paid benefits reduced.
> As a result the income inequality will further increase which will lead to street riots and a police state, just like in US.


The more that is written, the less sense this makes ...

Your proof would then apply to *any* law that is passed.

The OAS deferral applies to everybody, rich and poor. Do you mean the maximum on CPP? or the % of CPP eligible earnings? The poor don't reach the cap, and if the % increases, everybody pays.


BTW, I agree about the TFSA increase being generally irresponsible. Governments (especially Ontario's) need to spend more responsibly, and use less debt financing. Let's pay off our debts!


----------



## 1.5M

Guban said:


> The OAS deferral applies to everybody, rich and poor.


LOL, the OAS deferral applies to everybody in the same way that the increase of TFSA to $10k applies to everybody.
The rich don't get OAS (at least now, with the TFSA increase they might get it soon enough).
The TFSA increase benefits the rich, the OAS decrease negatively affects the poor.



Guban said:


> Do you mean the maximum on CPP? or the % of CPP eligible earnings? The poor don't reach the cap, and if the % increases, everybody pays.


No they will not rise the cap, they'll never ask the rich to pay more, what they'll do they'll start using the CPP fund to cover deficits and increase the CPP premium, you'll have to pay 15% of your income for CPP if you're poor.


----------



## OnlyMyOpinion

1.5M said:


> Top 0.1% pay most taxes because they own almost everything including the poor, who are working to make them richer. They are so rich because they are the ones making the laws, the politicians work for them, because the very rich are paying for their election.


Sorry but I know for a fact that you are wrong. But that's ok, demonstrating your woeful ignorance means that in the future we can quickly disregard your opinion.


----------



## Moneytoo

OnlyMyOpinion said:


> Sorry but I know for a fact that you are wrong. But that's ok, demonstrating your woeful ignorance means that in the future we can quickly disregard your opinion.


Oh I thought he was talking about himself as one of the rich (bragging, actually - owning everything including the poor etc. ) But I guess "M" in the username could stand for "Meters", not for "Millions" as I thought lol


----------



## gibor365

Toronto.gal said:


> *Gibor,* are you the 1%ter taxpayer?


I'm very far from it.....but my wife is much closer 

What about you Money2 
Generally , families like ours contribute to Canada much more than those who was born here...for all our education: kindergarten, school, university paid USSR and Israel, we didn't get anything from Canada (much differ from Israel or Germany where government really helps new immigrants) and we don't get any social benefits like child money, WITB, subsidized child care, HST reabtes etc... even if Canada sfter 5 years allows to bring our parents, they cannot get any OAS/GIS first 10 years (and would they be alive after?!)


----------



## gibor365

There were survey on public Tellwut survey website, majority of responders are poor and low-middle class (like my mom, whom I asked to publish this survey ), so I was surprised to see numbers supporting TFSA increase....
1.
Do you support governmnet decision to increase TFSA room?

Yes | 25.21% | 305 votes
No | 12.07% | 146 votes 
Undecided | 16.53% | 200 votes
Not Applicable | 46.20% | 559 votes 


2.
Do you agree with opposition statement "TFSA benefits only rich"?

Yes | 16.12% | 195 votes 
No | 21.16% | 256 votes 
Undecided | 16.28% | 197 votes
Not Applicable | 46.45% | 562 votes 


3.
Liberals and NDP said that they will reverse TFSA increase law if they win at election. Would you support this decision?
Yes | 11.07% | 134 votes 
No | 19.17% | 232 votes 
Undecided | 21.07% | 255 votes 
Not Applicable | 48.68% | 589 votes 

4.
Are you planning to max up TFSA this year?
Yes | 9.83% | 119 votes 
No | 21.40% | 259 votes 
Undecided | 13.06% | 158 votes 
Not Applicable | 55.70% | 674 votes 

P.S. big N/A % because this is joint (US/Canada) website

I likkes some comments:


> I do not understand why Mr. Trudeau say is for rich pelople. My family is working class and we save in RRSP and TFSA. We are not rich . It is personal situation if you have the money save if you do not , please do not make a big deal about it.





> TFSA's help the little guy. Rich people are not going to get as much benefit from investing what to them is a small amount of money as the rest of us who are just trying to hedge our bets for the future.


http://www.tellwut.com/surveys/busi...-would-be-increased-from-5-500-to-10-000.html


----------



## gibor365

Interesting that majority of responders support Liberals, so it's really stupid from JT to say about TFSA increase revert
1.For what party you are going in 2015 Canadian elections?
Conservatives | 8.75% | 173 votes 
Liberals | 9.10% | 180 votes 
NDP | 6.52% | 129 votes 
Green | 2.88% | 57 votes 
Bloc Québécois | 1.21% | 24 votes 
N/A | 69.72% | 1,379 votes 
Other (please specify) | 1.82% | 36 votes


----------



## Moneytoo

gibor said:


> I'm very far from it.....but my wife is much closer
> 
> What about you Money2


Omg ater his latest promotion earlier this year my husband barely made it in the top 1%! Well, those are 2011 numbers, I guess now it's higher, but maybe he'll get a bonus - so yay, I'm finally married to the rich! lol

I just got promoted myself, but only got the title, no raise - so still "upper middle under 100K" - what is it, 20%? 

Gave a dollar to the homeless guy on the bus (no car for me, just TTC - sometimes with crazies and bums who smell like pee, so I don't feel bad about smoking right before I got on the bus) Wanted to give him $5, but only had a $10 and a $20, and nobody else gave him anything at all, so didn't want to look rich... :stupid:

Oh and happy May 1st!


----------



## Toronto.gal

You're 2 funny Money2.

Happy Labour Day [?]. 

Next celebration is Cinco de Mayo.


----------



## Moneytoo

Thank you, Toronto.gal (I remember liking your username and regretting that I can't use my other one, Torontella, that I've used on a couple of forums before as we might get mixed up )

Yep, May 1st was a statutory holiday back home - and was called International Workers’ Solidarity Day 

For me, next celebration is May 3rd. My birthday  And we start tomorrow - going for dinner with husband and daughter first, then to a pub where my former coworkers are performing (and celebrating 3 more birthdays!) We had a great gang at my second job in Canada, thanks to them I thought Canadians are so much fun, almost like Russians!


----------



## 1.5M

Moneytoo said:


> Oh I thought he was talking about himself as one of the rich (bragging, actually - owning everything including the poor etc. ) But I guess "M" in the username could stand for "Meters", not for "Millions" as I thought lol


If you think 1.5M net worth is rich, you deserve what you got.


----------



## 1.5M

gibor said:


> There were survey on public Tellwut survey website, majority of responders are poor and low-middle class (like my mom, whom I asked to publish this survey ), so I was surprised to see numbers supporting TFSA increase....
> ....
> P.S. big N/A % because this is joint (US/Canada) website
> I likkes some comments:
> 
> http://www.tellwut.com/surveys/busi...-would-be-increased-from-5-500-to-10-000.html


That's the brilliance of what the CONs are doing to the poor. Some are actually believing it's good for them. The same way Bush tax cuts in 2001 (which 7 years later contributed a large chunk to the US biggest deficit ever) were good for them. LOL, that's why the income inequality grows so fast.


----------



## Moneytoo

1.5M said:


> If you think 1.5M net worth is rich, you deserve what you got.


I still have a $10 and a $20 - would you like me to give them to you so you can go have a drink and lighten up?


----------



## gibor365

> That's the brilliance of what the CONs are doing to the poor. Some are actually believing it's good for them.


 Maybe this is what LIBs did to you ?! You actually believe that whatever CONs do, benefit only "rich" ?! 
.... or maybe you are one of army of government "workers"?!


----------



## gibor365

Moneytoo said:


> happy May 1st[/URL]!


Moneytoo, Happy International Workers’ Solidarity Day to you too 
and Happy B-Day


----------



## Moneytoo

Thank you


----------



## Toronto.gal

Moneytoo said:


> 1. (I remember liking your username and regretting that I can't use my other one, *Torontella*, that I've used on a couple of forums before as *we might get mixed up* )
> 2. I thought *Canadians are so much fun*, almost like Russians!
> 3. For me, next celebration is May 3rd. *My birthday *


*1.* Cool name! Speaking of mix-ups, believe it or not, there were a few mix-ups between MoneyGal and me, so you would have been ok. as it appears that the confusing part was the latter bit, lol. I remember after the 3rd mix-up, I had asked former admin. to change my username to T.gal [as most addressed me as such anyway], but he said that some might no longer recognize me, hence suggested I leave as is.

*2.* You haven't changed ur opinion, have ya?!

*3.* С днём рождения in advance! Here's a 15 layer honey-cake to wish you a sweet year ahead [sorry, could not resist taking a piece]. each:


----------



## Toronto.gal

I'm not sure why so many discussions end up attacking what the 'rich' make, but not what they pay.

I personally know many 1%ters [as I'm sure you do, too 1.5M], who don't own but rather do plenty for the poor & not so poor, not only via their jobs/professions, donations, but valuable time & other. 



1.5M said:


> *Top 0.1% pay most taxes because they own almost everything including the poor*, who are working to make them richer. They are so rich because they are the ones making the laws, the politicians work for them, because the very rich are paying for their election. The prove that the rules are favoring the rich is the fact that income inequality continues to grow and during Con rule the rate of income inequality increase has accelerated.


Here is someone who may not be in the top 0.1% to .99% [the latter based on post 483, lol], but who is doing something about helping 'the poor', how about you, do you do same?

*"...if you feel that the government should be taking more of your money, then voluntarily send it back to them. I think we'll see how many people actually do that."*
http://news.nationalpost.com/news/c...fter-refusing-to-take-income-splitting-credit

As for the evil 'top 0.1%ters', here's how some spend their fortunes.........

"The latest announcement brings the* total of DeGroote’s contributions to McMaster to $175 million. At this rate they’re going to have to rename the whole university after him."*

"Business and *medicine faculties are customary destinations for donor dollars*; music is not. But Schulich’s $20 million gift to alma mater McGill University resulted in the Schulich School of Music, the first instance of a program at the institution being named after an individual. The former Franco-Nevada CEO’s contribution to Western University’s School of Medicine and Dentistry was similarly historic, as the largest donation in the university’s history.
Little wonder, then, that when Schulich was promoted to an Officer of the Order of Canada in 2012 it was for “his transformational philanthropy in support of education and health care institutions.”

"Dan began building his fortune in the 1960s, and has spent much of the last few decades giving it away. “I certainly think corporations have the obligation to pursue philanthropy, as well as individuals,” he told PROFIT in 2009. *“Once you’re at a certain level, you have to open up and be involved in the community"*

"Rowe isn’t likely to be caught counting his money: *“If someone knows what they’re worth, they’re usually not worth a lot*,” he joked to us in 2012. But it’s not hard to tally up the amounts he’s given away, including support that built part of the Canadian Museum of Immigration in Nova Scotia."

http://www.canadianbusiness.com/lis...-business-schools/?gallery_page=1#gallery_top


----------



## Moneytoo

Toronto.gal said:


> *3.* С днём рождения in advance! Here's a 15 layer honey-cake to wish you a sweet year ahead [sorry, could not resist taking a piece]. each:


Thank you so much (большое спасибо), T.gal!  I made myself an early present - filled out or rebalancing spreadsheet (I still do it once or twice a month - just loving it ) After changing the asset allocation every other month during our first year, I think my husband and I have finally found what works for us:
View attachment 4362
- wish I could share a piece of this 15 layer money-cake with you!


----------



## 1.5M

Toronto.gal said:


> I'm not sure why so many discussions end up attacking what the 'rich' make, but not what they pay.
> 
> I personally know many 1%ters [as I'm sure you do, too 1.5M], who don't own but rather do plenty for the poor & not so poor, not only via their jobs/professions, donations, but valuable time & other.
> 
> 
> 
> Here is someone who may not be in the top 0.1% to .99% [the latter based on post 483, lol], but who is doing something about helping 'the poor', how about you, do you do same?
> 
> *"...if you feel that the government should be taking more of your money, then voluntarily send it back to them. I think we'll see how many people actually do that."*
> http://news.nationalpost.com/news/c...fter-refusing-to-take-income-splitting-credit
> 
> As for the evil 'top 0.1%ters', here's how some spend their fortunes.........
> 
> "The latest announcement brings the* total of DeGroote’s contributions to McMaster to $175 million. At this rate they’re going to have to rename the whole university after him."*
> 
> "Business and *medicine faculties are customary destinations for donor dollars*; music is not. But Schulich’s $20 million gift to alma mater McGill University resulted in the Schulich School of Music, the first instance of a program at the institution being named after an individual. The former Franco-Nevada CEO’s contribution to Western University’s School of Medicine and Dentistry was similarly historic, as the largest donation in the university’s history.
> Little wonder, then, that when Schulich was promoted to an Officer of the Order of Canada in 2012 it was for “his transformational philanthropy in support of education and health care institutions.”
> 
> "Dan began building his fortune in the 1960s, and has spent much of the last few decades giving it away. “I certainly think corporations have the obligation to pursue philanthropy, as well as individuals,” he told PROFIT in 2009. *“Once you’re at a certain level, you have to open up and be involved in the community"*
> 
> "Rowe isn’t likely to be caught counting his money: *“If someone knows what they’re worth, they’re usually not worth a lot*,” he joked to us in 2012. But it’s not hard to tally up the amounts he’s given away, including support that built part of the Canadian Museum of Immigration in Nova Scotia."
> 
> http://www.canadianbusiness.com/lis...-business-schools/?gallery_page=1#gallery_top


Yeah, after they made their wealth on the back of the poor, some of them give a tiny amount of it back. I actually find it degrading to have to go to hospitals and other government institutions named after billionaires. 

If they were paying decent salaries and fair taxes, people would not need their charity and the government would be able to actually pay for schools and hospitals. The fact that the poor need charity is a sign of the increasing income inequality. 

This is almost identical to praising the "good" slave owners, who were treating their slaves in a more humane manner.


----------



## uptoolate

Obviously 1.5M has some rather extreme views. Having spent a good deal of time in Africa I would say that there are much worse things that local millionaires and billionaires could do with their money. In fact, one of my African colleagues who had occasion to visit Canada said he was struck by how much money 'wealthy people' contributed to projects dedicated to the public good while in his home country this would be seen as folly. 

Last I checked, the government was paying for schools and hospitals. As well as for the teachers, nurses and doctors to staff them.


----------



## 1.5M

uptoolate said:


> Obviously 1.5M has some rather extreme views.


It's a sad thing that wanting a stop in the increase in income inequality is seen as "extreme view" these days. Which means the propaganda machine is working as intended.



uptoolate said:


> Last I checked, the government was paying for schools and hospitals. As well as for the teachers, nurses and doctors to staff them.


Then why do I have to go to a hospital named "Jim Pattison Outpatient Care and Surgery Centre"?


----------



## gibor365

> filled out or rebalancing spreadsheet


 Interesting spreadsheet  
I just don't really understand how you differentiate between (as an example): US Index, US Growth, US Dividend etc...
Where would you put ETF like QQQ or stocks like LMT, AAPL, XLNX?!

I have it simplier  From ALL our assets: 45% (+/- 5%) Cash equivalents , 55% - equities; withing equities 60% Canada, 40% international,


----------



## Moneytoo

gibor said:


> Interesting spreadsheet


Here's the original spreadsheet (downloaded it from the MoneySense last summer when we opened two TFSAs in addition to two RRSPs and it got harder to rebalance between the accounts) and kept simplifying it and modifying it until its current (but not final lol) form 




gibor said:


> I just don't really understand how you differentiate between (as an example): US Index, US Growth, US Dividend etc...
> Where would you put ETF like QQQ or stocks like LMT, AAPL, XLNX?!


Just trying to separate Index ETFs and individual stocks (bonds - don't have them yet, but watching some strips ) So here for example (from the Input tab):
View attachment 4370


I sold some of the stocks earlier this year, so it's only Apple now in US Growth category - and still have 3 ETFs for Emerging Markets, thinking to sell VEE as it grew the most... So it's "a work in progress" - the one I'm gladly doing (and adjusting based on what we've learned so far)



gibor said:


> I have it simplier From ALL our assets: 45% (+/- 5%) Cash equivalents , 55% - equities; withing equities 60% Canada, 40% international,


Well maybe I'll have it simpler in a few years, too - but for now, while we learn and experiment, I want it to be more detailed. I also keep track of bought/sold, even though we only have registered accounts right now - not too detailed, just to have an idea of what worked better and what didn't. Still debating whether to include ~20K TFSA "play money" in it or keep it separate, like we do with ~45K HISA? )


----------



## cainvest

1.5M said:


> It's a sad thing that wanting a stop in the increase in income inequality is seen as "extreme view" these days. Which means the propaganda machine is working as intended.


Nothing to do with propaganda, most people just don't see the income inequality as you do. I have no problem with rich people and I'm certainly not rich.



1.5M said:


> Then why do I have to go to a hospital named "Jim Pattison Outpatient Care and Surgery Centre"?


You don't "have to go", find a hospital that doesn't have a name on it if it bothers you that much.


----------



## gibor365

> Well maybe I'll have it simpler in a few years


 Across 6 registered accounts we have, I also have different ETFs like VTI, DEM, VEA, VGK, XIU, XIC, QQQ etc, but much more individual stocks, also some bond ETFs CBO, VSC, PCY, HFR.... but in many cases I don;t really undestand difference between growth vs dividend equity, so I count them together


----------



## Toronto.gal

cainvest said:


> You don't "have to go", find a hospital that doesn't have a name on it if it bothers you that much.


That simple! And I see that it's quite a nice one.
http://www.newsroom.gov.bc.ca/2011/05/jim-pattison-outpatient-centre-officially-opened.html

'His story is legend: A job washing cars at a gas station turned into an opportunity to sell a car when the regular salesman was away. By 1961, he opened a Pontiac dealership and never looked back.
Mr. Pattison has never been shy of philanthropy, either. The Globe and Mail notes he consistently donates 10 per cent of his income, in the past year or so giving $5-million to Victoria Hospitals Foundation alone.'

http://www.theglobeandmail.com/repo...ace-in-world-of-rapid-change/article20007208/

I wonder if 1.5M is bothered by other names, like the Pierre Elliott Trudeau International Airport.


----------



## none

Toronto.gal said:


> I personally know many 1%ters [as I'm sure you do, too 1.5M], who don't own but rather do plenty for the poor & not so poor, not only via their jobs/professions, donations, but valuable time & other.


In my experience it seems the more wealthy people become the more selfish they get. At least in the middle class and upper middle class zone.

There are some many people where i work that are patting themselves on the back for giving a paltry $12 per paycheck to charity. How 'rich'.


----------



## none

Toronto.gal said:


> I'm not sure why so many discussions end up attacking what the 'rich' make, but not what they pay.


B/c there is ultimately a finite amount of money that the economy generates and it is felt that theses people extract more than their fair share.

I'm really surprised you needed that explained to you.


----------



## Moneytoo

@gibor, "whatever works"  

(And I'm out of this bitter thread or I might start thinking that it's unfair that those skinny Hollywood bitches are 80 pounds lighter and look 20 years younger than me, so they should take some of my pounds and years as it's my birth right to be as pretty as any other gal lol)


----------



## mrPPincer

Try canvassing for cancer in wealthy neighbourhoods vs not so wealthy and you'll see the proof.

My neighbour, a cancer survivor could tell you about it, people who you wouldn't think could afford it do, and in wealthier areas, the cars are in the laneway, you know somebody is there, but they don't even answer the door, or they don't have their chequebook or some similar thing (from a small town where everybody knows everybody).


----------



## gibor365

I never donate money to those "organizations for poor" ... by chance , I know how much salaries are getting workers who works for Salvation Army... I highly doubt that majority of donated money going to where it should go.... instead we donate a lot of clothes (sometimes completely new - just too small for my kids) and toys (my kids are too big for them)....


----------



## Eclectic12

none said:


> In my experience it seems the more wealthy people become the more selfish they get. At least in the middle class and upper middle class zone.


YMMV ... the more I've observed where I'm getting more of the info - the more it seems that what is already in the person comes out.




none said:


> ... There are some many people where i work that are patting themselves on the back for giving a paltry $12 per paycheck to charity. How 'rich'.


Agreed ... though I guess I've been lucky to work at better places as the lowest contribution rate to United Way across four companies is 80%. In one company - the VP who I would have sworn was not giving anything turned out to be one of the top givers.




mrPPincer said:


> Try canvassing for cancer in wealthy neighbourhoods vs not so wealthy and you'll see the proof.
> 
> My neighbour, a cancer survivor could tell you about it, people who you wouldn't think could afford it do, and in wealthier areas, the cars are in the laneway, you know somebody is there, but they don't even answer the door, or they don't have their chequebook or some similar thing (from a small town where everybody knows everybody).


 ... Didn't know I was wealthy. 

I don't answer the door for canvassers I don't know - whether it be for the cancer society, boys/girls clubs, Red Cross or whatever.


Cheers


----------



## 1.5M

I think the way most people see charity is all wrong. If the rich were not so rich and the poor not so poor, there would not be the need for charity. 

I think it's the government job to ensure a stable gap between the rich and the poor so that charity is not needed and the rich would not get so rich as to be able to name hospitals after themselves (while alive). 
Instead, the income inequality continues to rise, so more (optional) charity is needed. 

In my opinion, asking for charity is the same as begging for money. It's a sad thing that hospitals and some people have to beg for money in a country that is so developed and rich like ours.


----------



## 1.5M

Toronto.gal said:


> That simple! And I see that it's quite a nice one.
> http://www.newsroom.gov.bc.ca/2011/05/jim-pattison-outpatient-centre-officially-opened.html
> 
> 'His story is legend: A job washing cars at a gas station turned into an opportunity to sell a car when the regular salesman was away. By 1961, he opened a Pontiac dealership and never looked back.
> Mr. Pattison has never been shy of philanthropy, either. The Globe and Mail notes he consistently donates 10 per cent of his income, in the past year or so giving $5-million to Victoria Hospitals Foundation alone.'
> 
> http://www.theglobeandmail.com/repo...ace-in-world-of-rapid-change/article20007208/
> 
> I wonder if 1.5M is bothered by other names, like the Pierre Elliott Trudeau International Airport.


The problem is that a car salesman can get so rich when so many are so poor. If our tax system would not be so skewed in favor of a few then we wouldn't have this situation.

And the difference between the two names you mentioned is that one is a historical (dead) figure and the other is a (living) billionaire who likes to name hospitals after himself.


----------



## mrPPincer

Red Cross I think is pretty efficient in getting the money to actual aid, I donated I think it was a couple grand to them after the tsunami when the gov't was matching.
Now, after the earthquake in Nepal, the government is again matching private donations, but although I have more savings, my income is a fraction of what it was, so instead I'll hope there's a 10 year younger me out there somewhere that steps up.


To gibor's point I know there's a lot of charities out there that are not efficient, that's why one should research beforehand, but i think the Canadian Cancer Society is pretty good, but even so, if not, who cares, it's your neighbour, and what's 5 bucks or whatever in the grand scheme of things.

That said, I no longer pick up the phone if I don't recognize the number on call display and I don't give to those sponsered charities that the checkout girl at the grocery store has to ask everybody for, but when the firemen have an annual toll in town I cough up and similarly when Salvation Army does their thing or the local hospital, or Easter Seals or for cancer.

Stupid thought, but maybe there's some kind of thresh-hold area where you eventually give nothing, and then another later if you turn into a bill gates or warren buffett and eventually give everything :stupid:


----------



## cainvest

Eclectic12 said:


> In one company - the VP who I would have sworn was not giving anything turned out to be one of the top givers.


Exactly ... and that's the problem with judging people from a distance, more often than not that opinion will be wrong.


----------



## gibor365

1.5M said:


> I think the way most people see charity is all wrong. If the rich were not so rich and the poor not so poor, there would not be the need for charity.
> 
> I think it's the government job to ensure a stable gap between the rich and the poor so that charity is not needed and the rich would not get so rich as to be able to name hospitals after themselves (while alive).
> Instead, the income inequality continues to rise, so more (optional) charity is needed.
> 
> In my opinion, asking for charity is the same as begging for money. It's a sad thing that hospitals and some people have to beg for money in a country that is so developed and rich like ours.


If you are telling that there are "poor" people in Canada, you don't know what is a real poverty!

Government already doing too much by helping so-called "poor" people.... the only thing that imho need improvement , increase number of subsidized housing and simplify process that people won't need to wait 15 years to get such place... and build those houses in suburbs...


----------



## Eclectic12

gibor said:


> I never donate money to those "organizations for poor" ... by chance , I know how much salaries are getting workers who works for Salvation Army... I highly doubt that majority of donated money going to where it should go....


Interesting considering that pulling up the CRA reports ... the most common salary range is $40,000 - $79,999, with a bunch below $40,000.
I did see one for $80,00 - $119,999.

The few I've known personally match up with this.

Where I have heard of big money (ex. $144K+) for the private drivers where the charity is getting a flat fee or where the bin is for "local charity" where the whole setup is private. Though according to a 2012 article (see link below), Salvation Army was still collecting themselves from their own bins.

In 2010, Canada exported worn clothes valued at $174 million where Ontario's share was $132 million.

http://www.cbc.ca/news/canada/clothing-donation-bins-spark-turf-war-in-ontario-1.1246132


Cheers


----------



## nathan79

gibor said:


> If you are telling that there are "poor" people in Canada, you don't know what is a real poverty!
> 
> Government already doing too much by helping so-called "poor" people.... the only thing that imho need improvement , increase number of subsidized housing and simplify process that people won't need to wait 15 years to get such place... and build those houses in suburbs...


You consider a family income over 200K to be "middle class", but you can't see how minimum wage (roughly 22K before taxes) could be poor?


----------



## Eclectic12

^^^

I suspect what is meant is that there's a big difference between the poor in other parts of the world who are digging through garbage dumps for one meal a day versus what Canada calls poor.


Cheers


----------



## Eclectic12

mrPPincer said:


> Red Cross I think is pretty efficient in getting the money to actual aid, I donated ... after the tsunami ... I know there's a lot of charities out there that are not efficient ...


If the tsunami is the 2004 Indian Ocean one in does not look promising then ... two years after the tsunami, $2.2 billion was donated to the Red Cross worldwide but only $0.9 billion was spent ... of the 50,000 homes promised - 2,000 had been built. 

http://www.smh.com.au/news/world/ha...still-not-spent/2006/12/20/1166290586728.html


For the American Red Cross ... a year in - it was $567 million with $166 million, or about 29 percent spent.
http://www.sfgate.com/news/article/1-8-billion-in-tsunami-aid-from-U-S-half-spent-2556060.php


They were also criticized for Hurricane Katrina, Sept 11th and recently Sandy Hook.
http://socialistworker.org/2012/11/19/red-cross-missing-in-action

There's also that ...


> Red Cross: How We Spent Sandy Money Is a ‘Trade Secret’


http://www.propublica.org/article/red-cross-how-we-spent-sandy-money-is-a-trade-secret


Cheers


----------



## 1.5M

gibor said:


> If you are telling that there are "poor" people in Canada, you don't know what is a real poverty!
> 
> Government already doing too much by helping so-called "poor" people.... the only thing that imho need improvement , increase number of subsidized housing and simplify process that people won't need to wait 15 years to get such place... and build those houses in suburbs...


I know what's real poverty and I know Canadians are not poor compared to the poor of other countries.
However if some need charity and "subsidized" housing, then they are poor for a country as rich as ours. And we all are poor if we need to rely on charity to build hospitals and schools.

Subsidizing housing for the poor is not a solution to the increasing income inequality problem we are having. The government needs to stop adopting laws that increase inequality and we need a fair tax system (where taking advantage of other people's work would be properly taxed). If we had that, we wouldn't have the need for all those wasteful government programs to help the poor. We could just have a guaranteed minimum income (GIS for everybody).


----------



## gibor365

> we need a fair tax system


 As I said the only fair tax system is flat tax system, where everyone pays same % in taxes... If somebody works much harder than other and earn more money, it's not fair that he will pay higher % than other who doesn't want or not able to work hard.



> You consider a family income over 200K to be "middle class", but you can't see how minimum wage (roughly 22K before taxes) could be poor?


 In countries like Canada about 90% is a middle class... and as I said before, "poor" is Canada is ONLY relates to average income here... they are not really poor by World standards


----------



## gibor365

Eclectic12 said:


> ^^^
> 
> I suspect what is meant is that there's a big difference between the poor in other parts of the world who are digging through garbage dumps for one meal a day versus what Canada calls poor.
> 
> 
> Cheers


Exactly! but in many parts of the world people are not "digging through garbage", because there is nothing to dig for ...


----------



## none

gibor said:


> As I said the only fair tax system is flat tax system, where everyone pays same % in taxes... If somebody works much harder than other and earn more money, it's not fair that he will pay higher % than other who doesn't want or not able to work hard.
> 
> In countries like Canada about 90% is a middle class... and as I said before, "poor" is Canada is ONLY relates to average income here... they are not really poor by World standards


You equate the amount someone gets paid with how hard someone works. That's so obviously disconnected from reality I wouldn't even know where to start. 

Flat tax gets rejected by both the US and Canada repeatedly because it's tremendously unfair, overly simplistic and stupid.


----------



## andrewf

Not sure where gibor draws the line on wealthy. Somewhere less than $50 billion in net worth?


----------



## sags

There are lots of children in Canada who go to bed hungry. 

There are lots of old people in Canada barely surviving on OAS/GIS and have to choose between buying medicine or food. 

There are lots of people in Canada on welfare who have to choose between paying their rent or feeding their kids.

It matters nothing that some people are poorer than others. Poor is poor. It isn't quantified by degrees of poverty.


----------



## 6811

none said:


> You equate the amount someone gets paid with how hard someone works. That's so obviously disconnected from reality I wouldn't even know where to start.
> 
> Flat tax gets rejected by both the US and Canada repeatedly because it's tremendously unfair, overly simplistic and stupid.


While I agree with your first paragraph I would really like to understand how you've reached your point of view on having a flat tax.


----------



## RBull

1.5M said:


> The problem is that a car salesman can get so rich when so many are so poor. If our tax system would not be so skewed in favor of a few then we wouldn't have this situation.
> *
> And the difference between the two names you mentioned is that one is a historical (dead) figure and the other is a (living) billionaire who likes to name hospitals after himself.*


You avoided answering the question.


----------



## Toronto.gal

^ Indeed he avoided it.



1.5M said:


> I think the way most people see charity is all wrong. *If the rich were not so rich* and the poor not so poor, there would not be the need for charity.


You say you don't hate the rich, but some of your comments say the opposite, as you in effect seem to believe that it's the 'so rich' that are inflicting all the poverty in this world, and that 'the poor' are blameless for not being able to do better for themselves. How much do you think Pattison got paid/or should have gotten paid for as a 'laborer building bridges in the mountains/at the Canadian Pacific Railway as a dining car attendant/washing cars at a gas station' and so on? These were not summer jobs like 'trumpet in children's church camps/picking fruit (raspberries, cherries, and peaches)/selling doughnuts in the school parking lot, selling seeds door to door, delivering newspapers, and working as a page boy at the Georgia Hotel.' 

I will say that I'm all for increasing the current min. wage. 

You admire the world's #1 richest in the world [you don't mind academic buildings named after this 'living billionaire' like at Standford U, et al., I presume], but not a Pattison type. Here are other facts about Gates in case you were not aware:
http://www.businessinsider.com/19-crazy-facts-about-bill-gates-house-2014-11

'At 83, Pattison is long past the age when most CEOs would have retired for the golf course....Pattison is one of a dying breed of Canadian businessmen, a self-made man from humble beginnings, in this case in rural Saskatchewan and East Vancouver.'
http://www.macleans.ca/economy/business/the-warren-buffett-of-b-c/



1.5M said:


> the rich would *not* get so rich as to be able to* name hospitals after themselves (while alive)*.


Why should such public donations/honours be anonymous & so problematic for anyone? Look how his $5M donation was quickly matched by the community at his challenge. Publicity has its good side as it can motivate the 'selfish rich' & others to do same. The last thing that enters my mind about rich donations, is the motivations for such when the public is clearly better off for it. 

How much richer will they get with the TFSA increase.
http://www.canadianbusiness.com/lists-and-rankings/richest-people/top-100-richest-canadians-2015/


----------



## Toronto.gal

none said:


> In my experience it seems *the more wealthy people become the more selfish they get*. At least in the middle class and upper middle class zone.


I'm sure that's the case with some. People are selfish in many ways, not just money. For example, how many volunteer in their community? 



none said:


> B/c there is ultimately *a finite amount of money that the economy generates* and it is felt that *these people extract more than their fair share*. I'm really surprised you needed that explained to you.


And you don't extract what you can as well, whether freely/deservedly given to you or not? You're at least honest about it in below post. At any rate, I was more referring to the level of demonization of the rich by some [and not only on CMF], that's the part I don't quite get. 



none said:


> Here's the deal, now that I'm divorced, even with my solid income the government classify's me as a 'family in poverty'.  The pro to this is that I've been automatically enrolled in all of these poverty based programs such as the National child benefit supplement. Anyway, basically I get $400 from the government each month because of my 'official poverty'.
> 
> *This is obviously ethically shaky but I'm OK with it.* Middle and upper middle class people who use the TFSA and clamour for it's expansion under the guise that it helps low income people really are not ethically better so I feel like I'm in good company here.
> 
> So my question is: What else can I apply for? Free bus passes? Child care supplement? What other programs are based on Notice of assessment Total income records?


This article reminds me of all the crowdfunding that goes on these days; some I have contributed to, but others looking to suck strangers into paying for their vacations, etc., is plain laughable.
http://www.huffingtonpost.com/kathy-kemper/stop-demonizing-the-wealt_b_1686398.html


----------



## cainvest

Toronto.gal said:


> How much richer will they get with the TFSA increase.
> http://www.canadianbusiness.com/lists-and-rankings/richest-people/top-100-richest-canadians-2015/


Well if you take the lowest on the list they'll be able to put 0.005% of their net worth away in the TFSA ... I'm sure they'll sleep better at night knowing that!


----------



## Moneytoo

Oh this is hilarious:



none said:


> Anyway, basically I get $400 from the government each month because of my 'official poverty'.
> 
> This is obviously ethically shaky but I'm OK with it.





none said:


> I just upped my charitable contribution at work to $1560 per year. That's going to hurt.


So, basically, your charitable contribution is your "guilt money" that you're returning to the real poor?


----------



## Moneytoo

Speaking of hurt:



Sasquatch said:


> I have to admit that it hurts a little to have to pay a large amount like this every year and it is tempting to increase our "at source" deductions to reduce it.
> However, at the end of the day I think it's the right way to do it rather than lending the CRA my hard earned money interest free for a whole year just to get a big refund at the end.


(c) http://canadianmoneyforum.com/showthread.php/42561-Big-Income-Tax-Refunds

I just looked at my pay stub - I pay $1879 per month in Federal Taxes. So I guess if I don't want my tax money to be misused (as I don't feel like paying for bus passes for healthy adults who are younger than me), I'd better set up automatic RRSP withdrawals at work. And use the extra cash to give directly to homeless (bypassing charities, as I don't feel like paying their salaries, either)

Gave a $5 to another homeless "dube" last night. Don't care how he's gonna use it - he can buy himself some boose for all I care


----------



## none

Toronto.gal said:


> And you don't extract what you can as well, whether freely/deservedly given to you or not? You're at least honest about it in below post. At any rate, I was more referring to the level of demonization of the rich by some [and not only on CMF], that's the part I don't quite get.


I don't see how those two issues are linked but I'll bite anyway.

I agree it seems wrong and I therefore asked the forum for their opinion about what they though and the general consensus was: it's legal and therefore morally fine and that I shouldn't worry about it. I'm not sure if I'm convinced and cognitive dissonance is an uncomfortable thing and therefor I don't think about it. We all do things like this of course, I'm aware that when I go out for a pint that I could have spent that $7 on a Vaccination for a child in a developing country and I chose that my 1 hour buzz was worth more that a pretty solid increase in their quality of life. We all choose the level of hypocrisy that we can live with. The best method I've found is just try not to think about it. Not a great solution but it seems to work anyway. Regardless, I always have this forum to go to which is filled with an astounding level of hypocrisy and self entitlement that frequently gives me the satisfaction that: "at least I'm not THAT bad". Everything is relative so that makes me feel a bit better. I'm sure however, if I went back to Cambodia I would feel a bit ashamed as many people on this site would besides the healthy bunch of borderline sociopaths who seem rather incapable of empathy to those who have had fewer opportunities in life compared to them.

Anyway, back you your dig: I suppose I chalk it up to examining issues on a case by case basis like that glosses over how these programs are implemented as a whole. For example, I only have one child, don't really support the Canadian military, and socialized medicine sucks (for me) but I still pay without too much complaint. Therefore one could argue that I pay more than my fair share for those things but it comes out in the wash. Anyway, I'm sure you get the point.


----------



## none

cainvest said:


> Well if you take the lowest on the list they'll be able to put 0.005% of their net worth away in the TFSA ... I'm sure they'll sleep better at night knowing that!


That is the outcome of bad policy. Someone derives a benefit at the expense of others but they don't actually benefit from it at all.

Let me put it another way: lets say we give $5000 to everyone person who has over $300K net worth after ten years (that's a revenue loss to this this TFSA policy change I read somewhere but take it with a grain of salt). This is what the policy effectively results in.

You're argument is that these people won't even notice it so there's no harm in it..... You see the problem now right?


----------



## Toronto.gal

none said:


> I don't see how those two issues are linked but I'll bite anyway.


You linked them the moment you brought up the TFSA [why I had remembered the post in the 1st place] - was not a dig.



none said:


> Middle and upper middle class people who *use the TFSA and clamour for it's expansion under the guise that it helps low income people really are not ethically better* so I feel like I'm in good company here.


No argument on hypocrisy levels in general; plenty of it to go around.


----------



## none

Toronto.gal said:


> No argument on hypocrisy levels in general; plenty of it to go around.


Absolutely.


----------



## gibor365

sags said:


> There are lots of children in Canada who go to bed hungry.
> 
> There are lots of old people in Canada barely surviving on OAS/GIS and have to choose between buying medicine or food.
> 
> There are lots of people in Canada on welfare who have to choose between paying their rent or feeding their kids.
> 
> It matters nothing that some people are poorer than others. Poor is poor. It isn't quantified by degrees of poverty.


It just Liberal/NDP propoganda and it's a lie! 


> There are lots of old people in Canada barely surviving on OAS/GIS and have to choose between buying medicine or food.


 Low income seniors get medicine for free. So , another lie! 
Full OAS/GIC is $15,600 per year, it's more than enough to live in Canada! My mom doesn't get any OAS/GIC , I'm doing for her spending reports, she lives a good life and spent much much less than $15,600 per year


----------



## gibor365

> Flat tax gets rejected by both the US and Canada repeatedly because it's tremendously unfair, overly simplistic and stupid.


It's simple, but fair and smart! It's rejected in Canada and US because majority of people gets more than they pay, so it's never gonna pass.... also CRA/IRS could've been cut by about 80% and who can fight this "mafia"?!


----------



## none

No, it won't pass because it's stupid. It's an idea worthy of an 8 year old.

Here is a VERY easy read:
http://www.demos.org/blog/3/10/14/arguments-flat-taxes-are-universally-bad


----------



## gibor365

none said:


> No, it won't pass because it's stupid. It's an idea worthy of an 8 year old.
> 
> Here is a VERY easy read:
> http://www.demos.org/blog/3/10/14/arguments-flat-taxes-are-universally-bad


On opposite , it's very smart!


> persuasive feature of a flat tax for many people is its fairness.


Here is a VERY easy read 
http://www.heritage.org/research/commentary/2006/03/flat-tax-is-the-way-of-the-future


----------



## none

That article is idiotic. Read the last line:

*"There will never be a tax that is good for the economy"
*


Taxes aren't good for the economy? WTF? Who builds the roads, maintains infrastructure, provides the social safety net when business owners take risks that don't pan out??? The government which is supported by taxes. Taxes aren't good for the economy..... That's class A retarded thinking.


----------



## gibor365

You misunderstand what author is saying



> If enacted, a flat tax would yield major benefits, including:
> 
> Faster economic growth. A flat tax would spur increased work, saving and investment.
> 
> By increasing incentives to engage in productive economic behavior, it would also boost the economy's long-term growth rate.


Flat tax was introduced in majority of Eastern Europe and their economies are boosting


----------



## none

No, I got it. It's basically 'trickle down' economic theory under a different label. A policy regime that has shown to be ineffective and a failure to produce it's promised results. Reagan is dead.


----------



## cainvest

none said:


> You're argument is that these people won't even notice it so there's no harm in it..... You see the problem now right?


No ... the point is will they even bother to use it. Its like paying special attention to a single blade of grass in a forest.

Then again, I'm okay even if they do use it. I know I will be using the TFSA to the limits so why shouldn't they as well, we'll both be sheltering the same amount.


----------



## none

_Whoosh_


----------



## Barwelle

Jumping in here... I did a quick search but didn't see this, apologies if it's already been mentioned... but I saw today (didn't know this before) from the taxtips website that the new 10,000 limit is *not* indexed to inflation.

Confirmed by the CRA's website.


----------



## gibor365

> new 10,000 limit is not indexed to inflation


 Yes, we talked about it.... The question if Harper (in case he's elected) has intention of rising 10K limit in future.... if not , in 20 years 10K limit practically becomes last year' $5500 (considering average 3% inflation)


----------



## 1.5M

Toronto.gal said:


> Why should such public donations/honours be anonymous & so problematic for anyone? Look how his $5M donation was quickly matched by the community at his challenge. Publicity has its good side as it can motivate the 'selfish rich' & others to do same. The last thing that enters my mind about rich donations, is the motivations for such when the public is clearly better off for it.


This is not real charity, the guy paid a very small amount of his income to have an hospital named after him. It's like someone with a net worth of $1M, would pay $500 to have an hospital named after him. And as far as I know, the guy does not actually pay for the running costs of the hospital, which are probably substantially more each year than his "donation". Probably the guy got this deal because he is in bed with BC politicians, like all billionaires are. I bet a lot of his fortune is based on lucrative jobs for the government anyways.

The public is much worse off. The public were better off if that guy were properly taxed while he benefited from the work of others so that he would not became so obscenely rich. It's government's job to build hospitals and schools and "help" the poor and it should do so by properly taxing all rich people not by relying on the "charity" of a few of them. 

I don't have anything against the rich. I think some level of income inequality and net worth disparity is very important as an incentive for growth. What I have something against is a system that allows some people to become *obscenely* rich while others have to rely on charity for their food and shelter.


----------



## 1.5M

gibor said:


> Yes, we talked about it.... The question if Harper (in case he's elected) has intention of rising 10K limit in future.... if not , in 20 years 10K limit practically becomes last year' $5500 (considering average 3% inflation)


LOL, so it would be an even worst deal for future generations. Not only they need to work more(due to OAS age req increase) but the amount they can shelter from tax will be less.


----------



## 1.5M

gibor said:


> Flat tax was introduced in majority of Eastern Europe and their economies are boosting


If by "boosting" you mean that a very small minority has become very rich and the vast majority is worst off economically than they were in "socialism", you're right.


----------



## gibor365

1.5M said:


> If by "boosting" you mean that a very small minority has become very rich and the vast majority is worst off economically than they were in "socialism", you're right.


Sorry 1.5, you don't know what you are talking about....


----------



## 1.5M

gibor said:


> Sorry 1.5, you don't know what you are talking about....


Sorry gibor but I know. I know that "socialism" as implemented in Eastern Europe was a terrible system because I lived there.
And if a majority of people in a former "socialist" country, now with a flat tax you so much admire, thinks that terrible system was better than what they currently have is a very strong statement about the kind of "improvement" 19th Century style capitalism brought: http://www.balkanalysis.com/romania/2011/12/27/in-romania-opinion-polls-show-nostalgia-for-communism/


----------



## gibor365

> Sorry gibor but I know. I know that "socialism" as implemented in Eastern Europe was a terrible system because I lived there


My extended family and many friends live in Russia and I talk to them and know exactly how life changed from "socialism" to current "capitalism"


----------



## Toronto.gal

1.5M said:


> 1. ....the guy *paid a very small amount of his income to have an hospital named after him.* It's like someone with a net worth of $1M, would pay $500 to have an hospital named after him.
> 2. the guy *does not actually pay for the running costs of the hospital*, which are probably substantially more each year than his "donation"
> 3. don't *have anything against the rich*.


*1.* Did you want him to pay for the entire cost?! And do you think that was his only donation over the years?! The G&M article reported that he regularly donates 10% of his income, which is what, any idea of what that 'very small amount' might be? I guess nothing short of giving 99% of his fortune would satisfy you. 

Here is another one of his smallest donations over a decade ago!

*'The donation, announced at a reception Wednesday night, is being called the largest individual gift to a health care facility in Canada.'*
http://www.cbc.ca/news/canada/b-c-mogul-donates-20-million-to-cancer-research-1.191445

*2.* LOL. And what makes you think that his 'small donations' are conditional upon naming hospital*S* or their wings after him? After all, the guy gives most donations to hospitals, you know the places that might one day save your lfe or that of a loved one?! 

*3.* Oh no, you made it quite clear that you have nothing but respect for the Pattisons of this world. 

You're certainly entitled to your opinion and obsession with the super rich I suppose.


----------



## OnlyMyOpinion

Still trying to decide whether 1.5m is just a flame-fanning, troll-like individual, or whether someone who makes so many ill-considered comments actually thinks they are contributing? They are certainly not on CMF with any financial knowledge.


----------



## 1.5M

OnlyMyOpinion said:


> Still trying to decide whether 1.5m is just a flame-fanning, troll-like individual, or whether someone who makes so many ill-considered comments actually thinks they are contributing? They are certainly not on CMF with any financial knowledge.


Nice, attack the person not the ideas. 
Anyway, too many right wingers on this forum for my taste (probably you chase out people who don't agree with you).
I'm out, peace.


----------



## Eclectic12

1.5M said:


> This is not real charity, the guy paid a very small amount of his income to have an hospital named after him. It's like someone with a net worth of $1M, would pay $500 to have an hospital named after him...


I understand the point that this particular donation might not crimp the overall wealth. 

At the same time ... I'm not sure we know what he gives in total (most people I know who give - don't give to only one place) or whether he wanted his name on the place. 

IAC as there seems to be a general feeling that the rich don't have empathy or don't give anything - IMO it is real charity. He could done like others where a charity is setup that pays lots of staff but does little to no charitable work. To me, those types are the "not real charity" types.




1.5M said:


> And as far as I know, the guy does not actually pay for the running costs of the hospital, which are probably substantially more each year than his "donation".


So when those around you or you give to charity - the annual running costs are included, right?




1.5M said:


> Probably the guy got this deal because he is in bed with BC politicians, like all billionaires are. I bet a lot of his fortune is based on lucrative jobs for the government anyways.


 ... go to know that Jean Coutu, a pharmacist or Jeffory Skoll are in bed with BC politicians.




1.5M said:


> ... The public is much worse off.


The situation isn't going to change anytime soon so in the short term, the public is not worse off - they are better off.




1.5M said:


> ... The public were better off if that guy were properly taxed while he benefited from the work of others so that he would not became so obscenely rich.


I doubt it ... after a certain point - the gov't tax revenue is going to slow down, if not dry up. Those taking on the risk have to believe there is going to be enough reward or they will take their ideas/expertise elsewhere.




1.5M said:


> ... I don't have anything against the rich. I think some level of income inequality and net worth disparity is very important as an incentive for growth.


At the same time as you "don't have anything" against the rich, you also seem to think that they are "bed with BC politicians, like all billionaires are", the main idea of where the fortune came from was gov't contracts and their charity is defined by a single donation compared against income.

There's lots of room for the individual billionaire to be something other than the picture you are painting.




1.5M said:


> ... What I have something against is a system that allows some people to become *obscenely* rich while others have to rely on charity for their food and shelter.


What are doing to try to change it?

Why do you think that someone who refuses all work because "I'm educated and should be stepping into job X instead of starting in the mailroom" should be taken care of?


Cheers


----------



## gibor365

> while others have to rely on charity for their food and shelter.


 I have impression that 1.5 and myself live in 2 different Canadas


----------



## RBull

1.5M, I was about to respond to your posts and ask some questions to try and understand how and why someone holds such strong views against anyone with wealth, and scorn a person whom some would see as great philanthropist. 

I won't pursue it now since you've waved the white flag, along with a parting shot. I would have been a lot more interested in reading a meaningful response to Tgals last post.


----------



## pwm

1.5M said:


> I'm out, peace.


Thank you.


----------



## sags

The Liberals made a big announcement today.

They announced they will roll back the FTC and TFSA programs that benefit mostly wealthy Canadians, and will replace it with programs that will benefit 90% of Canadians.

The difference is Trudeau's policies were developed by a independent economists, while Harper called a few wealthy friends to see what they wanted.


----------



## 0xCC

sags said:


> The Liberals made a big announcement today.
> 
> They announced they will roll back the FTC and TFSA programs that benefit mostly wealthy Canadians, and will replace it with programs that will benefit 90% of Canadians.
> 
> The difference is Trudeau's policies were developed by a independent economists, while Harper called a few wealthy friends to see what they wanted.


That's 90% of Canadian *families*, not Canadians. Where families are defined as households with kids under 18:


> According to the Liberals, all families with kids under 18 and an annual income below $150,000, or 90 per cent of families,would receive more under Trudeau's plan than they do under Prime Minister Stephen Harper's.


From: http://www.cbc.ca/news/politics/jus...xes-boost-benefits-for-middle-class-1.3060323

I'm not sure if I like the proposed 2% income tax cut or the TFSA limit increase better. For anyone that covers that whole $44,701 to $89,401 tax bracket that proposed 2% tax cut = $894 in taxes saved per year. If you find yourself in the $200k+ tax bracket obviously you loose that $894 pretty quick (there is a proposed 4% increase for incomes over $200k from 29% to 33%). Note that these are only proposed federal numbers, provincial tax brackets get added on top of that.


----------



## peterk

1.5M said:


> Nice, attack the person not the ideas.
> Anyway, too many right wingers on this forum for my taste (probably you chase out people who don't agree with you).
> I'm out, peace.


Try Mr. Money Mustache. Might be more up your alley. Plenty of your socialist friends hang out there


----------



## Moneytoo

@sags, just to make sure - you're saying it seriously, not sarcastically or mockingly or with tongue in cheek? As a borderline sociopath, I can't tell the difference :stupid:


----------



## gibor365

> why someone holds such strong views against anyone with wealth


 The good example of heavy rich taxation was in France 
*France's proposed tax hikes spark 'exodus' of wealthy

Looming tax hikes by France's new socialist government have triggered an exodus of the Gallic super-rich to 'wealth-friendly' nations like Britain and Switzerland*
http://www.telegraph.co.uk/news/wor...oposed-tax-hikes-spark-exodus-of-wealthy.html

If my margin rate will be 80% and I have really big income  , I would just return to Israel where 


> Returning residents and new immigrants will be exempt from taxes for ten years on income generated outside Israel. This covers all income, active or passive, such as interest, dividends, pensions, royalties and rental of assets. All income, whether from the realization of assets and investments abroad or from regular income abroad, is tax exempt.


----------



## gibor365

> The difference is Trudeau's policies were developed by a independent economists, while Harper called a few wealthy friends to see what they wanted.


 Is it a joke?! Who are those independend economists?!



> I'm not sure if I like the proposed 2% income tax cut or the TFSA limit increase better. For anyone that covers that whole $44,701 to $89,401 tax bracket that proposed 2% tax cut = $894 in taxes saved per year. If you find yourself in the $200k+ tax bracket obviously you loose that $894 pretty quick (there is a proposed 4% increase for incomes over $200k from 29% to 33%).


Not only .... we gonna loose $2,000 refund from tax split, will stop getting promissed Universal tax money (looks like we'll get it in July 1st and last time  if Harper loses), no TFSA increase and higher taxes.... 
So, 100% that we are voting for Harper, screw LIBs and "communists" ...
P.S. Who would be Justin if he wasn't son of Pierre?!


----------



## Toronto.gal

sags said:


> The difference is Trudeau's policies were developed by a *independent economists*


1. Here are the 'independent' gurus: 

“...an eclectic group of business executives, university professors and think-tank policy wonks, along with a few of his own MPs.....The discussions are very in-depth and tend to get into the weeds a great deal. It’s not just blue-skying from 40,000 feet..”

http://www.macleans.ca/politics/ottawa/the-inner-circle-inside-trudeaus-economic-advisory-team/



sags said:


> while Harper called a *few wealthy friends* to see what they wanted.


*2.* I'll let you give us the list of such friends. 

*Money2:* I can confirm that sags is dead serious. Have you not noticed he's been campaigning for JT from 2014? :biggrin:


----------



## twowheeled

I'm still very confused. without reading through 58 pages, am I allowed to contribute the extra amount right now or not? The bank says yes.


----------



## none

Well nobody ever lies on the internet so I think you should take the word of these faceless electrons and ignore what your bank says.


----------



## GoldStone

sags said:


> The difference is Trudeau's policies were developed by a independent economists, while Harper called a few wealthy friends to see what they wanted.


----------



## r.a.m.capital

Talk to an account manager at your bank. I believe you can start contributing the additional $4500 now.


----------



## r.a.m.capital

That is to say if you have already contributed the $5500 allowed for the year.


----------



## sags

Well lets just see...............

On Trudeau's economic advisory team, some of the members are.............

Mike Moffatt, a professor at Western University’s Ivey Business School (who also blogs on economic issues for Maclean’s), who is a trade expert.

University of Ottawa economist Miles Corak, an expert on intergenerational mobility.

Kevin Milligan, who teaches at the University of British Columbia’s Vancouver School of Economics (another Maclean's contributor).

George Gosbee, chief executive of *Calgary-based AltaCorp Capital Inc*.—_who, previously served on the economic advisory council of Jim Flaherty_

Frank McKenna, currently *deputy chair of TD Bank Group*, and formerly the Liberal premier of New Brunswick, as well as Canada’s ambassador to the U.S. 

Bill Morneau, who stepped down as chair of the business-oriented *C.D. Howe Institute *last winter, after raising eyebrows by delivering a speech at a Liberal convention in Montreal, in which he_ accused Stephen Harper’s government of “partisan politics of the very worst kind_.”

On Harper's team of economic advisors there is...................maybe Mike Duffy ? oh, I know...........Conrad Black maybe.


----------



## gibor365

> On Trudeau's economic advisory team, some of the members are..


 you forgot to mention economists K.Marx, F. Engels and V.Ulyanov


----------



## sags

Didn't Ulyanov play hockey for the Soviet national team in the 1972 Summit Series ?

I seem to recall something about.............Tinkers to Evers to Ulyanov.

I don't know for sure. I am just throwing it out there and taking a Chance.


----------



## nathan79

OnlyMyOpinion said:


> Still trying to decide whether 1.5m is just a flame-fanning, troll-like individual, or whether someone who makes so many ill-considered comments actually thinks they are contributing? They are certainly not on CMF with any financial knowledge.


Funny, I'm still trying to decide that about gibor. That guy takes the cake for the most hyperbolic and ridiculous comments.


----------



## gibor365

sags said:


> Didn't Ulyanov play hockey for the Soviet national team in the 1972 Summit Series ?


No, He played a different "sport" 



> peterk said:
> 
> 
> 
> Try Mr. Money Mustache. Might be more up your alley. Plenty of your socialist friends hang out there
Click to expand...

 Is it very advanced forum where people planning to retire before start working?! and live on 20K per year?! Obviously they gonna hate "rich" 



> I'm still trying


 Keep trying


----------



## OnlyMyOpinion

twowheeled said:


> I'm still very confused. without reading through 58 pages, am I allowed to contribute the extra amount right now or not? The bank says yes.


The answer is Yes.
Gov't of Canada new release says: _Canadians can immediately take advantage of the proposed $10,000 Tax-Free Savings Account annual contribution limit_ From: http://news.gc.ca/web/article-en.do?mthd=index&crtr.page=1&nid=966849

And the CRA site now says: _Important notice - Under proposed legislation, the annual TFSA dollar limit for 2015 is $10,000. The proposed measure increasing this limit is subject to parliamentary approval. Consistent with its standard practice, the CRA is administering this measure on the basis of the Budget announcement. Financial institutions may immediately allow existing and new account holders to contribute up to the proposed maximum._ From: http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/tfsa-celi/menu-eng.html


----------



## Moneytoo

Toronto.gal said:


> *Money2:* I can confirm that sags is dead serious. Have you not noticed he's been campaigning for JT from 2014? :biggrin:


I usually stay out of politics (and don't even visit those threads on the forum, so don't know other members' political views) In last election, I voted for Freedom Party of Ontario - didn't even know we had one, just saw the name on the ballot and liked it  But even for someone as apolitical as me (oh yeah, I also voted for Rob Ford - 'cause he cracked me up lol), it seems that to think that any politician gives a crap about "90% of the population" (other than getting their votes) is naive


----------



## GoldStone

sags said:


> The difference is Trudeau's policies were developed by a independent economists, while Harper called a few wealthy friends to see what they wanted.





sags said:


> Frank McKenna, currently deputy chair of TD Bank Group, and formerly the Liberal premier of New Brunswick, as well as Canada’s ambassador to the U.S.


Frank McKenna? Independent Economist? WOW


----------



## none

I don't understand the reference.


----------



## GoldStone

none said:


> I don't understand the reference.


According to sags, Frank McKenna is "an independent economist" serving on JT's economic advisory team. McKenna is a prominent Liberal politician, a lawyer by training. He is neither independent nor an economist.


----------



## Moneytoo

@none, yep, you're right - he reminds me of the laughing buddah lol

(I'm very comfortable with my looks btw, and am used to dealing with trolls so vicious - you'd have to try something really unique  and I promise not to cry to mods since I owe you one lol)


----------



## none

GoldStone said:


> According to sags, Frank McKenna is "an independent economist" serving on JT's economic advisory team. McKenna is a prominent Liberal politician, a lawyer by training. He is neither independent nor an economist.


Never heard of the guy. No one is truly independent although i'm usually surprised how blatant people can be about how non-independent that can yet pretend they are.


----------



## sags

McKenna's extensive biography in politics and business is available at the Wikpedia website.

Just to set the record straight............he has a law degree and a degree in political science and economics.

His resume speaks for itself.

http://en.wikipedia.org/wiki/Frank_McKenna


----------



## gibor365

> formerly the Liberal premier of New Brunswick


 by default cannot be "independent economist"


----------



## Toronto.gal

sags said:


> On *Harper's team of economic advisors there is...................maybe Mike Duffy?* oh, I know...........Conrad Black maybe.


Is that the best you could do? 

Another important member of JT's team that you left out from the link I posted, is Toronto MP Ms. Freeland, who believes in 'retooling capitalism for the social good', and who has written below book - anyone read it? I haven't yet, but I might.










A review.
http://www.theglobeandmail.com/arts...super-rich-and-the-rest-of-us/article4623261/


----------



## uptoolate

I haven't read it but from the review it sounds like they thought it was fairly balanced... and without solutions. They mentioned that the idea that significant inequality leads to greater innovation/productivity/overall well-being is likely not true in developed countries and incorrect for developing countries. At the end of the day, poverty leads to desperation and all kinds of adverse actions and outcomes.


----------



## carverman

Toronto.gal said:


> Is that the best you could do?
> 
> Another important member of JT's team that you left out from the link I posted, is Toronto MP Ms. Freeland, who believes in 'retooling capitalism for the social good', and who has written below book - anyone read it? I haven't yet, but I might.


Ms Freeland seems to think in socialist ideals..and we know from history that sometimes socialism has it own unique set of problems.


On income inequality:



> What should we do about it? One argument is we should do nothing. To this way of thinking, differences in income are motivating: *Economies need people to want to keep up with the Joneses (or the Khodorkovskys), and the larger the gap, the higher the motivation.* A second argument is the libertarian one, that what someone earns within the law is what it is, and it’s not your business.



Sure there are countries where socialism seems to work, but this type of government doesn't always work out for every country. In order to create industry and
jobs, capitalists need incentive...profits for themselves and by these profits make their lives more luxurious. 
Taxing income at 55% (such as in Sweden) in most countries would force capitalists to move their holdings offshore and not pay any taxes in the long run.

Governments are there to redistribute income between the haves and the havenots. If the havenot burden on govt's proves to be too much, requiring higher
income and consumption taxes, there will be a backlash in the long run. The havenots (social assistance etc) cannot move and in most cases they are
socially dependent on others..but not so the capitalists.


----------



## sags

It shouldn't come down to taxpayers subsidizing billion dollar corporations.

Why should taxpayers provide low income subsidies for Walmart employees ?

The trend of companies considering their workers as a necessary evil..............to be paid the lowest amount possible, will have to be reversed and return to the time when companies valued their employees and considered them an asset to the company.

Ontario teachers are going on strike all over. The same people who espouse free markets want the government to order them back to work.

Evidently it is their view, that free market works when wages are suppressed, but shouldn't be allowed if workers don't agree with the suppression.

The government interferes with the free market system for labor, when they bring in temporary foreign workers.

Supply and demand is artificially altered and there is no more free market system.


----------



## none

sags said:


> Why should taxpayers provide low income subsidies for Walmart employees ?
> 
> .


Then there's this:

http://www.huffingtonpost.com/2013/11/19/reasons-love-costco_n_4275774.html

Some companies don't go by status quo and do quite well.


----------



## Moneytoo

Makes sense to me:

_If everyone in the industry raised wages, Costco's quality of customer service would probably decline. And it's unlikely that Wal-Mart's would improve. _

Read more: http://www.businessinsider.com/why-wal-marts-pay-is-lower-than-costco-2014-10#ixzz3ZHPPVBG4

(Disclaimer 1: my first job in Canada was as a salesperson below minimal wage at the home electronics chain that's gone bankrupt since then. And since I was poor, middle class, upper middle class and now apparently am married to the 'rich' - who already wants to go back to just being a software developer as running a big part of the company is much harder than those who love counting somebody else's money think - I've seen life from many angles and believe that most of us have a choice.)

(Disclaimer 2: didn't see the previous post while typing mine lol)


----------



## sags

And the busiest store around here by a country mile..................is Costco.


----------



## gibor365

> I've seen life from many angles and believe that most of us have a choice.)


 You're very right!
When I immigrated to Israel I was extremely poor (wasn't allowed to take from USSR more than $160 and my first job was oaying $2.25US/hour, so I worked 29 days in month, 9 hours night shifts and was going to college in the afternoon), than became middle class and "rich" ... after immigration to Canada started like low-middle class (1st job in inventory company $9 per hour), than middle class and now looks like I'm "rich" again


----------



## Toronto.gal

sags said:


> And the busiest store around here by a country mile..................is Costco.


You'll never see me in one [or WMT for that matter]. 

I was not even allowed to view [not shop at first] a COSTCO store without registering as a member first [this was a few years ago], and for that reason, I would never become a member/shopper. I was told I had to register, and that if I didn't like the store, they would cancel my membership.

Fair to compare them?









http://www.thedailybeast.com/articles/2012/11/26/why-can-t-walmart-be-more-like-costco.html


----------



## Moneytoo

gibor said:


> ... after immigration to Canada started like low-middle class (1st job in inventory company $9 per hour), than middle class and now looks like I'm "rich" again


And now that we're finally making more money (who knows for how much longer as we're not getting younger) and our kids are (or will be soon over 18) - JT thinks we'll need to pay even more taxes to help "90% of Canadian families" who can't help themselves 

Speaking of taxes - I did get a raise after all, not just the title  Almost 3K. Or ~150/month or less after all the deductions - for now... lol


----------



## none

Toronto.gal said:


> Fair to compare them?


Sure, why not? You can compare anything. I like oranges better than apples for example.


----------



## mrPPincer

Apples are better.


----------



## sags

To never enjoy a Costco pumpkin pie.................is to never live life to it's fullest.


----------



## none

sags said:


> To never enjoy a Costco pumpkin pie.................is to never live life to it's fullest.


Speaking of pie - ever make a cherpumple? I did a couple weeks back and it was great.

https://www.youtube.com/watch?v=Rp4yWTLIPaE


----------



## Beaver101

mrPPincer said:


> Apples are better.


 ... I agree too ... no peeling required and keeps the docs away (so it's myth). :biggrin:


----------



## Toronto.gal

sags said:


> To never enjoy a Costco pumpkin pie.................is to never live life to it's fullest.


No worries, there are several top/delicious bakeries all around me [where I bought ur honey cake Money2].


----------



## Beaver101

sags said:


> To never enjoy a Costco pumpkin pie.................is to never live life to it's fullest.


 ... are you absolutely sure of that? Pie-pumpkin-from- "Costco"? better than home-made apple or peach pie? never to live life to the fullest? :emptiness:


----------



## Moneytoo

Toronto.gal said:


> No worries, there are several top/delicious bakeries all around me [where I bought ur honey cake Money2].


Please tell me that you also shop at places with commissioned salespeople and buy stuff that is not on sale at least once in a while and tip well when you go out - or I'll feel like the last consumer supporting the Canadian economy... lol


----------



## gibor365

> "90% of Canadian families"


 all those numbers, 90% and so on, is just JT propoganda... Harper TFSA increase, benefits everyone , income tax split benefits everyone except "poor" people who doesn't pay taxes and in both spouse make exactly same money.... 
The major difference that JT also yells "kill the rich" and masses like it .... they just don't understand that Libs "rich" definition constantly changes...and suddenly many of them by themselves will fall inti this hated category


----------



## mrPPincer

Beaver101 said:


> ... I agree too ... no peeling required and keeps the docs away (so it's myth). :biggrin:


Yep, and not just opinion either, I just found documented proof on the interwebs..
http://www.smarter.org/research/apples-to-oranges/


----------



## none

gibor said:


> Harper TFSA increase, benefits everyone , income tax split benefits everyone except "poor" people who doesn't pay taxes and in both spouse make exactly same money....
> .


That's ridiculous. Of all the people who have <$4500 to save it benefits exactly ZERO.


----------



## gibor365

none said:


> That's ridiculous. Of all the people who have <$4500 to save it benefits exactly ZERO.


really?! even with $500 contribution, person will have benefit > than ZERO 
and... if you want to use maximum benefit, spend less ... 
I just see how much "poor" people spend of stuff that is not essential .....in Canada it's just crazy!


----------



## cainvest

gibor said:


> I just see how much "poor" people spend of stuff that is not essential .....in Canada it's just crazy!


I know a number of people that are in the lower income brackets and according to them, the newest smart phone with a $60+/month data plan is a MUST HAVE!
So yes ... the new TFSA limits won't benefit all in the lower income brackets, some definitely by choice though.


----------



## gibor365

cainvest said:


> I know a number of people that are in the lower income brackets and according to them, the newest smart phone with a $60+/month data plan is a MUST HAVE!
> So yes ... the new TFSA limits won't benefit all in the lower income brackets, some definitely by choice though.


Very true! . I'm "rich", but I have my the simpliest LG cellphone with no data plan and I bought it only after I disconnected my land line , becuase it cheaper... At my workplace I know some girls who always complaining that they don't have money, but practically everyday driving to Tim Hortons 2km to buy coffee, even though we have exact same free coffee machine in the office, probably they like THI cups 

In our family, the biggest Harper supporter is my 19 yo son, who studies in University on double degree program, he cannot currently to use all proposed Harper's benefits (even though he temporary maxed up his TFSA with working semester money), but after University he's planning to work and earn money and not to retire after couple of years like many on MMM forum


----------



## Moneytoo

gibor said:


> I just see how much "poor" people spend of stuff that is not essential .....in Canada it's just crazy!


Well some of them are just "poor" by choice:



> Because of my education I can make an additional $100-200 an hour in my spare time whenever I want. For instance in the last couple months I've made an additional $5K per month (sorta) doing work that I could only do b/c of my education. Making $5000 a month risk free is a pretty sweet financial addition which is only possible because of my education. I don't do it that often however because money is cute and fun and all but I have more fun spending $50 drinking beer and eating tacos with my girlfriend rather than sitting in front of a computer. Money is worthless unless you spend it.


I can't wait to see how their opinion about the "rich" will change when they become one...


----------



## none

cainvest said:


> I know a number of people that are in the lower income brackets and according to them, the newest smart phone with a $60+/month data plan is a MUST HAVE!
> So yes ... the new TFSA limits won't benefit all in the lower income brackets, some definitely by choice though.


And I know a number of people who don't own any cell phone because they can't afford it and after they have put money into their kids RESP there's nothing left. MAYBE $1000 a year into a TFSA which was far covered by the previous $5500.

It's a defensible position to say that something is bad policy in general but benefits me to such a disproportionate level that I can't help but support it. I can understand that at least. But to defend something based on math that doesn't work out I can't compute.


----------



## bgc_fan

FWIW, apparently I'm one of the few people on this board that make far less than 200K and wouldn't be able to make use of the extra $4.5k increase in the TFSA (BTW it looks as though the plan isn't to hold TFSA contribution limits to $5.5k, but have it increase as per inflation). However, I can make use of the decrease in income tax rates... also I don't have kids.

So, the Harper option gives me nothing, the Trudeau plan does. If my vote can be bought, guess where it would go?


----------



## Moneytoo

There was an interesting thread here recently - with some honest self-reflections and observations:



Rusty O'Toole said:


> 2 things I have noticed.
> 
> One, I have deep seated psychological issues that hold me back from making money. Crazy but true.





wendi1 said:


> I've noticed that some of my friends and relatives have weird little "scripts" that seem to prevent them from making money. Like, good artists have to be poor. Or, you can't have money in the bank and still be a good person. Or, you deserve the best car, clothes or computer equipment that money can buy.
> 
> Now I am looking for my own little scripts... I wonder if a person can honestly ever know their own assumptions.


I wonder if anybody ever thinks, "I care so much about the poor that I need to be making more money to better help them!" instead of "I would be helping the poor more if I had more money, but I barely have enough for myself, so those who have more should be helping more!"


----------



## gibor365

> And I know a number of people who don't own any cell phone


 Cellphone was just an example.... so they spend too much on other non-essential product.... MMM on his blog tells that in Canada family with kids can live good life with annual income 25K  , so it's everyone's choice what to do with money...



> also I don't have kids.


 I agree that split income tax should be for every family regardless of having kids or their age.... Hopefully (if he gets elected), Harper will introduce this tax break for everyone


----------



## none

gibor said:


> Cellphone was just an example.... so they spend too much on other non-essential product.... MMM on his blog tells that in Canada family with kids can live good life with annual income 25K  , so it's everyone's choice what to do with money...


Sure, lets so some math on that - family with income of 25K with 2 kids:

After tax income about 21K minus $5000 a year in TFSA leaves 16K - then you want them to save 10K in their TFSA which leaves $6000. So you think a family of 4 can live on $500 a month?


----------



## Toronto.gal

^ Seems your math is incomplete.

What benefits does a family of 4 making such low income receive from the gov., just in child benefits for example? Didn't you tell us you receive $400/month for your 'official poverty'? Should you then receive a TFSA allowance on top of that?


----------



## none

Toronto.gal said:


> ^ Seems your math is incomplete.
> 
> What benefits does a family of 4 making such low income receive from the gov., just in child benefits for example? Didn't you tell us you receive $400/month for your 'official poverty'? Should you then receive a TFSA allowance on top of that?


That's a good point actually. You're right, the child benefit would probably more/less cover the RESP contribution.

So the family would then be living on about $1000 a month. Pretty tight for a family of 4 I would think, no?

I don't understand your point about bringing my economic situation up all the time? I have said that I have benefited tremendously from harpers policies and this TFSA is yet another one. I think you take the naive and simple view that if someone is against a government policy then they shouldn't use it? Is that what you're grasping at?


----------



## gibor365

none said:


> Sure, lets so some math on that - family with income of 25K with 2 kids:
> 
> After tax income about 21K minus $5000 a year in TFSA leaves 16K - then you want them to save 10K in their TFSA which leaves $6000. So you think a family of 4 can live on $500 a month?


I menat that 25K MMM is telling about is much less than offcial average salary, so whatever on the top of 25K can be invested into TFSA or spend on other stuff


----------



## Moneytoo

bgc_fan said:


> So, the Harper option gives me nothing, the Trudeau plan does. If my vote can be bought, guess where it would go?


"How self-made millionaires negotiate, for example, is habitually dramatically different than most less affluent people negotiate. Let’s consider one key difference among many. Instead of adopting a “Win, Win” orientation, *self-made millionaires are inclined to go with: “I Win, You Whatever.” This is not to say that the self-made millionaires are aiming to “burn” the people on the other side of the table – far from it. What the self-made millionaires are focused on is their enlightened self-interest.* They’re all in favor that everyone involved in the negotiation comes out a winner, so long as they come out winners. If their opponents don’t achieve their agendas, that’s indeed unfortunate but as self-made millionaires tend to see it, it’s not their responsibility to make sure their opponents negotiate wisely."

http://www.forbes.com/sites/russpri...-intelligence-a-significant-personal-fortune/

I think you're on the right path... lol


----------



## Eclectic12

Moneytoo said:


> ... I wonder if anybody ever thinks, "I care so much about the poor that I need to be making more money to better help them!" instead of "I would be helping the poor more if I had more money, but I barely have enough for myself, so those who have more should be helping more!"


Funny you should ask ... I know a few people who bring coffee/single person coffee brewer into work. Their coffee costs them a fraction of what the cafeteria/Tim's charges and they donate most of what coffee would have cost them. It's not the same as going out to increase one's earnings but it's close.


Time can be another way ... several volunteer at the local furniture bank. Kids (if you can call a 58 year old a kid :biggrin: ) as they are wrapping up the estate call and the volunteers pick up the furniture. Refugees or low income people or students drop by ... pick out what will help them and the volunteers drop it off. 

Everyone wins as good furniture is being used instead of going to the land fill.


Cheers


----------



## none

gibor said:


> I menat that 25K MMM is telling about is much less than offcial average salary, so whatever on the top of 25K can be invested into TFSA or spend on other stuff


I was just showing you how the math doesn't work out. Anyway this thread was getting interesting when it veered off to cake but now we're back in grade school. I'm out.


----------



## gibor365

Average Canadian salary by province 
• Newfoundland and Labrador – $52,572 
• New Brunswick – $44,044
• Nova Scotia – $42,992
• Prince Edward Island – $41,184
• Quebec – $44,621
• Ontario – $49,088
• Manitoba – $45,760
• Saskatchewan -$51,792
• Alberta – $60,476
• British Columbia – $46,900

Even if only one spouse works it would be enough money to max up TFSA


----------



## Toronto.gal

none said:


> I don't understand your point about bringing my economic situation up all the time? *I have said that I have benefited tremendously* from harpers policies and this TFSA is yet another one.


I can refer to former comments you made [I have a good memory, lol] when I see that it relates to the current discussion/when you contradict yourself and/or when you 4get/leave stuff out; the point was to simply remind you of what you left out, i.e. the benefits as well, that's all!


----------



## Moneytoo

Eclectic12 said:


> Time can be another way ... several volunteer at the local furniture bank. Kids (if you can call a 58 year old a kid :biggrin: )


We felt so ashamed when we learned that my 80 year old (it was a few years ago) father-in-law volunteers at the local soup kitchen - and none of us knew because he usually wakes up when we're sleeping, so we wouldn't know what he's doing in those wee hours. Ashamed because we couldn't imagine someone doing it quietly, without telling anyone, "just because"... So I decided to keep setting a good example for our daughter and called a few places that were looking for volunteers. Two wrote down my name, but never called, one told me straight out that they have more volunteers on the waiting list than they'll ever need - and, frankly, I realized that I only truly care about animals, but not people... So we saved a stray cat, she stayed with us for a few weeks, didn't get along with our cat, but my mom took her in and they're very happy together - and I keep promising myself that I'll make a big donation to the animal rescue society, but, alas, never do... sigh


----------



## none

_I can refer to former comments you made [I have a good memory, lol] when I see that it relates to current discussion/when you contradict yourself and/or when you leave stuff out; the point was to simply remind you of what you left out, i.e. the benefits as well, that's all!_

No it's you trying to put the conversation on an irrelevant tangent. I've said repeatedly that I benefit from this policy yet I think the policy on a national scale in a bad idea.

*Edit: Ooops my bad. I'm out for real this time!*


----------



## mrPPincer

gibor said:


> Average Canadian salary by province
> • Newfoundland and Labrador – $52,572
> • New Brunswick – $44,044
> • Nova Scotia – $42,992
> • Prince Edward Island – $41,184
> • Quebec – $44,621
> • Ontario – $49,088
> • Manitoba – $45,760
> • Saskatchewan -$51,792
> • Alberta – $60,476
> • British Columbia – $46,900
> 
> Even if only one spouse works it would be enough money to max up TFSA


They all make more than me and I max TFSA


----------



## Moneytoo

none said:


> I was just showing you how the math doesn't work out. Anyway this thread was getting interesting when it veered off to cake but now we're back in grade school. I'm out.


There, have a piece of one of my favorite cakes: http://cdn.amadeuspatisserie.com/wp-content/uploads/2014/12/Amadeus1.jpg


----------



## gibor365

mrPPincer said:


> They all make more than me and I max TFSA


This is the point! It's everyone's own choice what to do with your income!

Big TFSA room should benefit a lot retired (the real ones, and not who retire at 35 ), as moving emergency cash into TFSA gives them chance to avoid OAS clawback


----------



## cainvest

mrPPincer said:


> They all make more than me and I max TFSA


There we go, mrPPincer gives us the proof that it can be done with a below average income.

Next topic, is RRSP at 18% only for the rich?


----------



## gibor365

cainvest said:


> Next topic, is RRSP at 18% only for the rich?


Yeap, sure  Give idea to JT to decrease it by 5% (hence "poor" have another expenses) and as compencation , to increase tax on "rich" by 5% :biggrin:


----------



## mrPPincer

Yes, incontrovertible proof!
I suspect there are still some misled orange lobbyists will try to deny it (I call them orangees), but orangees are well known to ignore well-documented scientific fact in favour of their wacky apple-denier schemes..


----------



## sags

People will vote for what benefits them the most.

Harper's plan benefits some Canadians.

Trudeau's plan benefits some Canadians.

When it comes to the election............we will see which plan benefits the most voters.


----------



## nathan79

sags said:


> People will vote for what benefits them the most.
> 
> Harper's plan benefits some Canadians.
> 
> Trudeau's plan benefits some Canadians.
> 
> When it comes to the election............we will see which plan benefits the most voters.


Neither one helps me... lol. I am still more likely to vote Liberal, but not just on fiscal issues.


----------



## Moneytoo

Hmm what happened to the beer lovers party or legalize weed party or what-it-was-called the one I voted for last time? lol Doesn't seem to be much choice now with all the fun parties going defunct * sigh *:

Canadian Extreme Wrestling Party (defunct)
Fed-Up Party (also known as FU)
Parti Citron (Lemon Party, defunct)
Rhinoceros Party
Rhinoceros Party of Canada / Parti Rhinoceros (defunct)

http://en.wikipedia.org/wiki/List_of_frivolous_political_parties


----------



## gibor365

sags said:


> People will vote for what benefits them the most.
> 
> Harper's plan benefits some Canadians.
> 
> Trudeau's plan benefits some Canadians.
> 
> When it comes to the election............we will see which plan benefits the most voters.


That's true! However, there are current benefits and there are potential (future) benefits ... as I said earlier, my 19 y.o. won't really benefit from Harper's benefit, but most likely he will , in future...


----------



## gibor365

gibor said:


> That's true! However, there are current benefits and there are potential (future) benefits ... as I said earlier, my 19 y.o. won't really benefit from Harper's benefit, but most likely he will , in future...


I like more "our traditional parties" like: Marxist-Leninist Party of Canada , Revolutionary Communist Party , Communist Party of Canada (The Communist Party of Canada is the second oldest registered party after the Liberal Party of Canada, and the only registered political party to have been declared illegal (in 1921, 1932, and 1940) 

Until 2010 there was "Work Less Party" ...may start popular again


----------



## mrPPincer

ok, all kidding aside, I don't know if it really comes down to voters voting to what benefits them most.

For example, anybody remember the so-called 'green shift' plan or who was trying to sell it?

OFC not, it failed miserably as a platform even though it was an excellent plan, but Stéphane Dion just didn't have the charisma, and the plan wasn't sold well, and that blurb the media put out when he scolded the interviewer for asking an unanswerable/unclear question killed their campaign (if they ever stood a chance), even though that clip was *not* supposed to go on air according to standard procedure/agreement.


----------



## mrPPincer

In hindsight suppose CTV won by airing that clip, if it made any difference, because if the CBC was any competition to them then, (2008), it's a lot less now after 7 more years of cuts by the Harper gov't.


----------



## Moneytoo

mrPPincer (why do I read your username as "Mr. Prince, eh"? ), I don't think I ever voted Green, but I promise I will if they're not promising anybody anything


----------



## mrPPincer

^imho Elizabeth May is absolutely awesome, but I in my area would not vote green because it would be throwing a vote away.
I have to vote strategically which means liberal unless ndp pulls a rabbit out of their ***.

I'm in a rural area that had a very long time liberal but-social-conservative rep who retired and now there's a *C*onservative in there from a big well known and well respected family which ironically is, I think, really not that conservative either socially or fiscally, at least the ones I know.

The liberal candidate here has an almost insurmountable task ahead of him imho if he wants to win.


----------



## Moneytoo

mrPPincer said:


> I'm in a rural area that had a very long time liberal but-social-conservative rep who retired and now there's a *C*onservative in there...


That what happened in my urban area - for years, my vote didn't matter because the liberal was getting re-elected (I even voted for him once, because who cares, the majority would anyway) But in 2011, the Concervative won. Guess who? Joe Oliver, aka the Minister of Finance! So I guess I can vote for whomever I want as he's staying... 

Got an email from Questrade today, informing me that "Good news. Thanks to the new 2015 federal budget, your TFSA annual contribution limit has nearly doubled to $10,000."

This is how I would normally learn about things...


----------



## andrewf

gibor said:


> really?! even with $500 contribution, person will have benefit > than ZERO
> and... if you want to use maximum benefit, spend less ...
> I just see how much "poor" people spend of stuff that is not essential .....in Canada it's just crazy!


Let them eat cake, eh? Min wage worker earning $20k per year is supposed to save $10k per year in their TFSA to prove gibor correct that everyone will benefit by increasing TFSA contribution room?


----------



## andrewf

bgc_fan said:


> FWIW, apparently I'm one of the few people on this board that make far less than 200K and wouldn't be able to make use of the extra $4.5k increase in the TFSA (BTW it looks as though the plan isn't to hold TFSA contribution limits to $5.5k, but have it increase as per inflation). However, I can make use of the decrease in income tax rates... also I don't have kids.
> 
> So, the Harper option gives me nothing, the Trudeau plan does. If my vote can be bought, guess where it would go?


Per gibor, you must be wasting your money on beer and popcorn.


----------



## andrewf

gibor said:


> Average Canadian salary by province
> • Newfoundland and Labrador – $52,572
> • New Brunswick – $44,044
> • Nova Scotia – $42,992
> • Prince Edward Island – $41,184
> • Quebec – $44,621
> • Ontario – $49,088
> • Manitoba – $45,760
> • Saskatchewan -$51,792
> • Alberta – $60,476
> • British Columbia – $46,900
> 
> Even if only one spouse works it would be enough money to max up TFSA


You realize that more than 50% of people are below average, right (median is less than average)?


----------



## bgc_fan

andrewf said:


> Per gibor, you must be wasting your money on beer and popcorn.


Worse. I bought a nice house in a nice neighborhood and have a short amortization period, so a large portion of money is mortgage.


----------



## sags

Anyone can live on $10,000 a year............just don't leave the parents basement, eat their food, drive their car, and bum spending money from them.


----------



## none

andrewf said:


> You realize that more than 50% of people are below average, right (median is less than average)?


Sorry to be that guy but the median is not always less than average. Depends on the degree of kurtosis.


----------



## nathan79

The median individual income is 31,320 (2012).

http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/famil105a-eng.htm


----------



## Moneytoo

So I guess these programs are only helping a few:

Toronto, Ontario — Adrian (not his real name) was a shy, introverted youth who moved to Toronto after experiencing upheaval within his family. He had dropped out of high school and had no real employment prospects. _*Determined to transform his life for the better*_, Adrian applied for and was accepted into the Youth Succeeding in Employment Program (YSEP), _*which is funded through the Government of Canada’s *__*Skills Link*__* program*_. The program was delivered by Eva’s Phoenix, a shelter for homeless youth where Adrian stayed while he participated in the YSEP program.

....

Kingston, Ontario – When Dan Hendry found out about the YMCA and YWCA Grants for Youth Internships program, he _*decided to take fate into his own hands*_ and presented the Youth Eco program to the Kingston Sustainability Centre. As a result, he became their first intern.

More: *Success Stories: Youth and Students
*
And the solution is higher taxes to pay more to their unskilled parents and peers?


----------



## sags

Glad you brought that up Moneytoo..........

It is unfortunate that the next federal election seems be all about the TFSA or Family Income Tax..........so called "help" for the middle class.

Neither the Conservatives or Liberals have mentioned much about investments in skill training and education, among other things.

We have a mismatch of jobs and skills in Canada, and we have jobs available in one part of the country and unemployed young people in another.

Where is the financial aid to help the unemployed move to where the jobs are ? 

It cost money to move and set up for a few months, and unemployed people don't have a lot of money.

The best investment we could make in Canada, is to educate and train young people who are currently unemployable.

I hope we will learn more about the party platforms and they will include something on this topic........as well as addressing the horrendous conditions on native reserves and in Northern Canada, and providing properly for our veterans.

Entire villages and towns without proper drinking water in 2015 ?................I mean, come on already.

Lots could be done, besides thrashing out the benefits of the TFSA and who gives out the best tax breaks.

Maybe instead of raising taxes, the government should reallocate the revenue they already have.

It is their job after all............to prioritize their spending effectively.

I don't believe targeted tax breaks are the best use of that revenue.

Let's see what we can do with the money we already have..........before either giving out tax breaks or raising taxes.


----------



## Guban

none said:


> *Edit: Ooops my bad. I'm out for real this time!*


More inaccuracies. 

You've posted that you were "out" in post 462, 629 and again in post 633.

This didn't stop you from posting #655!


----------



## Toronto.gal

What few mentioned here are the many ways to make/save more money [and not just via increasing one's education which is not always possible]. There are people who work at more than 1 job, and not just to put food on the table.

There is a young member here who doesn't yet earn much, but he increases his income by renting rooms in his house, and in other ways as well.

Life is not easy, often times sacrifices need to be made to reach one's dreams whatever they may be, and not always rely on others to get you there.


----------



## gibor365

bgc_fan said:


> Worse. I bought a nice house in a nice neighborhood and have a short amortization period, so a large portion of money is mortgage.


So it was your choice  you could've buy average house in average neighborhood and max up TFSA


----------



## bgc_fan

gibor said:


> So it was your choice  you could've buy average house in average neighborhood and max up TFSA


Or increase my amortization period, or rent, etc. Point is, TFSA increase doesn't offer me any advantage at this point in time.


----------



## carverman

sags said:


> I hope we will learn more about the party platforms and they will include something on this topic........as well as addressing the horrendous conditions on native reserves and in Northern Canada, and providing properly for our veterans.
> 
> Entire villages and towns without proper drinking water in 2015 ?................I mean, come on already.


What happened to all that federal money given to the Indian bands in Northern Ontario?

Squandered, (Chief Teresa Spence..remember the Idle No More movement and her ahem...."hunger strike in Ottawa' while secretly having pizzas delivered by her friend in her Cadillac Escalade SUV...)...some of that money was earmarked for safer drinking water and sewage treatment..and housing...where did all that money go?..nothing on the books to show where it was spent.

Unfortunately with this kind of "band administration", not much is going to change in these communities, because nobody wants to work together!



> It is their job after all............to prioritize their spending effectively.
> 
> I don't believe targeted tax breaks are the best use of that revenue.
> 
> Let's see what we can do with the money we already have..........before either giving out tax breaks or raising taxes.


Uh huh!


----------



## Moneytoo

sags said:


> It is unfortunate that the next federal election seems be all about the TFSA or Family Income Tax..........so called "help" for the middle class.
> 
> Neither the Conservatives or Liberals have mentioned much about investments in skill training and education, among other things.


Sad, but sounds true: http://www.greaterfool.ca/2015/05/06/true-lies/

_Weeks later the election was called. The prime minister told reporters it would be decades before the bloated deficit fell or unemployment improves (we were in recession then). Shortly afterwards she made it worse. *“An election is no time to discuss serious issues,”* she said. And she was right. In an election, everyone’s supposed to lie.
...
*People vote for headlines, not policies.* For leaders and brands, not local women or men. Mostly, they vote against the current bums, consequences be damned.
...
*The reason: there are no simple solutions to messy, hoary old problems. *That’s why elections are about lies. Leaders who say blunt things, even truthful, get their derrieres chewed off. Just ask Jim Prentice._


----------



## Cal

I thought this was an interesting way to look at taxation and tax breaks:

http://www.theglobeandmail.com/glob...ner-bill-relates-to-tax-cuts/article24441644/


----------



## GoldStone

Cal said:


> I thought this was an interesting way to look at taxation and tax breaks:
> 
> http://www.theglobeandmail.com/glob...ner-bill-relates-to-tax-cuts/article24441644/


I came here to post the same article. Tim Cestnick nailed it. :eagerness:

Someone should read this article to Justin T.


----------



## Synergy

^ great link / article - thanks for posting.


----------



## sags

That's an old story and has an alternative ending as well.

The rich guy doesn't show up, but they weren't short $50 because the rich guy was drinking fine wine and eating steak........that accounted for $60 of the $100 total bill.

So he doesn't show up and the other 4 saved $10 on the bill.

That is how it is. The wealthy claim the greatest bounty from the countries wealth........and they should pay more for the privilege.


----------



## cainvest

sags said:


> That's an old story and has an alternative ending as well.
> 
> The rich guy doesn't show up, but they weren't short $50 because the rich guy was drinking fine wine and eating steak........that accounted for $60 of the $100 total bill.
> 
> So he doesn't show up and the other 4 saved $10 on the bill.
> 
> That is how it is. The wealthy claim the greatest bounty from the countries wealth........and they should pay more for the privilege.


That alternative ending sounds like it was made by someone who doesn't know any rich people.


----------



## Moneytoo

cainvest said:


> That alternative ending sounds like it was made by someone who doesn't know any rich people.


There was an old Russian anecdote which would be hard for me to translate (as it would also require a historical explanation), but the gist of it was that while "revolutionists" wanted to get rid of the rich - their "rich" predecessors wanted to get rid of the poor (by making them richer )


----------



## GoldStone

sags said:


> That's an old story and has an alternative ending as well.
> 
> The rich guy doesn't show up, but they weren't short $50 because the rich guy was drinking fine wine and eating steak........that accounted for $60 of the $100 total bill.


Your alternative ending is a pure fantasy. It implies that 60% of government spending goes to the upper middle class and the wealthy. Really??? :stupid:

On the other hand... the original story is a pretty good analogy of how our society works. Everyone has equal access to the social services: healthcare, education, OAS, etc. The upper middle class and the wealthy foot the bulk of the bill to provide these services to everyone.


----------



## fraser

I am not a big fan of these credits, rebates, what have you.

From my perspective they are political tools to gain votes in certain demographic and socio economic groups.

I would much prefer the Government to focus on simplifying the tax code and reducing the income tax rates. If they want to get more money into the hands of the middle class simply adjust the tax bands. I know this would not be popular with those occupations centered around personal income tax planning/preparation, etc. or with politicians who rely on 'shell games' to get elected and remain elected. I find it a little insulting to be bribed with my own money.

And I get really tired of the Harper Gov't harping on middle class families. They seem to be doing very little for single parent families.....who in fact form a large percentage of what we would refer to as families. But these folks may not go to the polls as often so they are forgotten. 

My guess is that if seniors as a group had a low, instead of a high, voter turnout the most recent budget would have had zero in it for them. This is about getting elected or staying elected. Nothing whatsoever to do with a fair and equitable personal income tax regime.


----------



## andrewf

Analogies are always wrong but sometimes useful. Not sure the restaurant analogy holds. When the alternative to splitting the bill that way is living in a country like south Africa or Somalia, maybe the rich aren't getting a bad deal after all.


----------



## GoldStone

andrewf said:


> Analogies are always wrong but sometimes useful. Not sure the restaurant analogy holds. When the alternative to splitting the bill that way is living in a country like south Africa or Somalia, maybe the rich aren't getting a bad deal after all.


The story is about splitting the savings, not about splitting the original bill.


----------



## andrewf

For instance, in the analogy, perhaps it should be mentioned that the tenth man may have in the past been one of those who ate for free. And the twenty dollar reduction in the bill was not a pure windfall, but rather cutting back on portions and replacing the salad with KFC coleslaw.


----------



## pwm

GoldStone said:


> .. the original story is a pretty good analogy of how our society works. Everyone has equal access to the social services: healthcare, education, OAS, etc. The upper middle class and the wealthy foot the bulk of the bill to provide these services to everyone.


Exactly. Then those same people who pay the bulk of the taxes are vilified and demonized by the ones who receive the benefits, most of whom don't pay any income taxes at all.


----------



## GoldStone

Margaret Thatcher's classic moment where she explains that everyone has benefitted from the economic reforms, even if the gap between rich and poor is wider. She explains that the liberals effectively would rather the poor be poorer, provided the rich were less rich.


----------



## Cal

sags said:


> That is how it is. The wealthy claim the greatest bounty from the countries wealth........and they should pay more for the privilege.


That is why we have the GST. A consumption tax taxes those who spend more.


----------



## sags

Income taxes are a little over 50% of Federal government revenues, and nothing for municipal revenues.

The vast majority of the other 50% of the Federal revenues comes from other sources, such as sales taxes, fees and such places as the 3 Billion dollars in surplus in the EI Fund the government gathers up each year. The middle class provides the majority of those revenues.

In addition, there are Provincial and municipal taxes and fees, that are paid primarily by the middle class.

Revenues are more than income taxes.

The wealthy have access to everything the middle class funds, from roads and highways to hospitals and healthcare.


----------



## andrewf

I don't fit into a neat pigeon hole as a liberal. I support using market mechanisms where they make sense and minimally harmful taxation, but I do think it is important to keep income inequality in check. Highly unequal societies are crime ridden, dangerous, unstable and unhealthy, even for the wealthy. The rich in South Africa need bullet proof cars and razor wire around their homes and are still at much higher risk than the wealthy in less unequal societies. Wealthy people, when given the choice between low taxes and livable societies, tend to choose the latter.


----------



## Eclectic12

sags said:


> ... The vast majority of the other 50% of the Federal revenues comes from other sources, such as sales taxes, fees and such places as the 3 Billion dollars in surplus in the EI Fund the government gathers up each year. The middle class provides the majority of those revenues.
> 
> In addition, there are Provincial and municipal taxes and fees, that are paid primarily by the middle class...


 ... not sure this is true ... are you really saying the rich don't spend or that they aren't paying municipal taxes on their typically large sized home lots, cottage lots, their condo in the city so they can make the most of the work week etc.?

Depending on one's definition of rich ... there's probably far fewer so that the bigger numbers of middle class pay the larger percentage when adding everything up but I suspect on the individual level, more is paid.


Cheers


----------



## 0xCC

Just to actually wrap this up (at least until the election) the 2015 federal budget received Royal Assent on June 23, 2015. It is now law and there isn't any reason to not use all of the new contribution room if you have the ability to.

Release from the Department of Finance: http://www.fin.gc.ca/n15/15-062-eng.asp


----------



## avrex

I agree. That wraps up 2015. $10,000 is a sealed deal for 2015.

....

Now let's look forward to 2016.
Let's assume that the NDP or Liberals form a minority government.

*Will they reduce the TFSA back to $5,500?*


----------



## cainvest

avrex said:


> Now let's look forward to 2016.
> Let's assume that the NDP or Liberals form a minority government.
> 
> *Will they reduce the TFSA back to $5,500?*


If they released a budget in early 2016 (say march or so) chances are it would be a reduced limit for 2017.


----------



## Davis

They could make an announcement and/or introduce legislation in the fall to change it for 2016. If they wait for the 2016 budget, I agree with cainvest that they would most likely make the change for 2017 so that people don't have to withdraw contributions they've already made.


----------



## Synergy

avrex said:


> *Will they reduce the TFSA back to $5,500?*


That's like taking candy away from a child! :frown:


----------



## Userkare

avrex said:


> Now let's look forward to 2016.
> Let's assume that the NDP or Liberals form a minority government.
> 
> *Will they reduce the TFSA back to $5,500?*


No, they will eliminate TFSA altogether. People who have money to save are evil!


----------



## besmartrich

Synergy said:


> That's like taking candy away from a child! :frown:


I completely agree and if Liberal or NDP try to take away 10K TFSA limit, that may become a political suicide for the party.


----------



## AltaRed

besmartrich said:


> I completely agree and if Liberal or NDP try to take away 10K TFSA limit, that may become a political suicide for the party.


Not if the majority of Canadians are not willing/able to use that much room. After all, it is the NDP and Libs who say the increased limit is 'for the rich' and it is the 'not rich' folk who will vote for the NDP and Libs to 'teach us rich types a lesson'.


----------



## none

If they removed that TFSA altogether maybe (and that would result in me not casting a vote) but if they wanted to put it back to $5500 indexed I'd be OK with that. Not a big deal from my perspective.


----------



## sags

An in-depth recent study showed that of all the people who had a TFSA only 17% maxed out the old $5500 limit, and they were predominantly in the higher income groups.

In 2013 only 6% of eligible Canadians maxed out their TFSA contributions. It is probable that even fewer people will have the means to max out the $10,000 limit.

The TFSA increase is of little benefit to most voters, (62% of eligible Canadians don't have one) and hence isn't an election concern for any of the parties.

Given that Canada is heading into a recession, especially if lower oil prices remain at current levels, and with rising budget deficits likely in the future, I would guess the following scenario.

1) The NDP and Liberals reduce the limit back to $5500 for 2016 and forward but cap the total contribution level.

2) The Conservatives leave the $10,000 limit for 2016 and forward but cap the total contribution level.

The TFSA isn't a major revenue problem today, but over time the loss of government revenue would increase rapidly to the benefit of a small number of Canadians.

Putting a lifetime cap on TFSA contributions serve all the political parties agenda. 

They don't have to officially "eliminate" the TFSA, and few people would find a cap objectionable.

The downside is that in the future, the TFSA's ability to fund retirements would be less effective.

The Liberals and NDP will claim to offset this by expanding the CPP. The Conservatives will be forced to follow their lead in some fashion.

We will see how it all plays out over the next few months, but I doubt any of the political parties would even consider rolling back any contributions to date.

http://www.cbc.ca/news/business/exp...-benefit-wealthy-new-study-suggests-1.3131574


----------



## fraser

We made the extra contributions quite some time ago. As soon as they were announced. No issue with the institution.

It is never about what the population in general thinks about a program. It is always about what the Conservative base of voters thinks and cares about, and of course new target groups of the Conservative Party.

There is a very good reason why retirees were big winners in the last budget and why the TFSA was increased. Same for family payments that recently got mailed out. These groups vote in high proportions and/or are part of that base the gets Harper re-elected.

October is election time. Job 1 is to get elected. All other priorities are well down the list.


----------



## none

One of the issues is that the TFSA program is being abused by the weathly using their children's room as cover.

Rich dude with 4 kids that just turn 18 - Gets 60K additional room per year (including spouse)


----------



## RBull

^ Gets $40k "additional room" -(4 *adult* kids x $10K), not $60K

20K for 2 spouses isn't "additional". All adults have this availability. 

Doubtful this happens much and even if/when it does government has far bigger issues than this. Gifts aren't against the law and the accounts have to set up in the adult owners name. 

I think Sags is right that a cap is coming regardless. In the likely event there is a change in govt it's likely the TFSA will be reduced. I hope not.


----------



## Synergy

none said:


> One of the issues is that the TFSA program is being abused by the wealthy using their children's room as cover.
> 
> Rich dude with 4 kids that just turn 18 - Gets 60K additional room per year (including spouse)


I don't see a problem with that. Great way to help children through school, build up a down payment for their first home, cash to start a business, etc. Kids are expensive. Do you not think the wealthy pay their fair share? Look at all the property taxes they pay, cars they buy, vacations they go on, stuff they buy to fill their mansions, etc. Would you not help contribute to your child's TFSA if you had the extra money?


----------



## none

I meant 60K additional room each year. I thought that was clear.

I'm just pointing out the tax implications.

A rich person can use the TFSA room of those that s/he trusts without penalty. In the example above a wealthy person with wife and 4 kids who happen to turn 18 this year - can potentially have 60K of tax free investments each year until his/her kids decide they want to use their own room. Is that fair? Does the extra money that person receives by tax avoidance have a net positive benefit on our society? I doubt it personally.

As for the questions, Do I think rick people pay enough taxes? I'm not sure - I'm sure some do and others don't. In'm just pointing out how some wealthy people are abusing and taking advantage of the system to avoid paying taxes. Reducing tax revenue has consequences. This needs to be considered under the new / old program and the potential impacts on government programs such as health care, education, military etc and we need to decide whether it's justified or not.

Personally, the additional TFSA doesn't really help me THAT much, even though my RSP and TFSA are already maxed. I just keep my canadian equities in non-registered accounts and the tax implications are relatively minor.

interesting read: http://www.cbc.ca/news/business/exp...-benefit-wealthy-new-study-suggests-1.3131574


----------



## OnlyMyOpinion

none said:


> ... interesting read: http://www.cbc.ca/news/business/exp...-benefit-wealthy-new-study-suggests-1.3131574


At least they note "the study, released Monday by the left-leaning Broadbent Institute..." 
The other consideration is whether the tax revenue lost on TSFA income justifies the government providing an incentive for Canadians to save more. 
I recall years ago when our first $1000 of interest income was tax free. That deduction is long gone (not sure but may have been part of slaying the deficit in the 1990's). It provided some incentive to save in low volatility GIC's, CSB's, etc. 
Now, with TSFA's, the Dept of Finance reports that "many account holders principally hold risk-free assets such as savings deposits or GICs".
I've no doubt that future governments will continue to bastardize our income tax credits/deductions/exemptions for their political purposes.


----------



## uptoolate

Thanks none. The most striking statement in the article to me was, "By comparison, the maximization rate was 31 per cent for those with incomes higher than $250,000." So they are saying that less than one third of people with a taxable income of over $250,000 have maximized their TFSA. Holy crap Batman! What are the implications of this? It would be nice to see the entire break down by income group, as it would for RRSPs, across all incomes and also by age. It doesn't really look like many people are taking advantage in any income group. By age, I would guess that affluent retired folks are using it the most, pushing excess RRIF withdrawal money over to their TFSA.


----------



## OnlyMyOpinion

Yes, something like Charts 5 and 6 here. Interesting. Unfortunately this is dated 2011, haven't located anything more current so far:
http://www.fin.gc.ca/taxexp-depfisc/2012/taxexp1202-eng.asp


----------



## uptoolate

Yes thanks. It looks to me from Chart 6 that those with incomes over 200k are contributing quite aggressively.


----------



## techcrium

Question:

IF you earn $50,000 per year but you have TFSA and RRSP completely maxed and are able to max it for later years as well, which political party benefits you the most?


----------



## supperfly17

techcrium said:


> Question:
> 
> IF you earn $50,000 per year but you have TFSA and RRSP completely maxed and are able to max it for later years as well, which political party benefits you the most?


I would assume the conservatives.


----------



## none

It would depend your time scale. as for putting more money in your pocket tomorrow... MAYBE the conservatives - I'm not convinced of that though because conservatives tend to be inept at financial management but somehow manage to convince people that it's the other way. Look at the data - conservatives are bad for the economy - especially in the long term.


----------



## GPM

Pity the NDP and Liberals will decrease the limit. It seems to be out of ignorance or grandstanding as the TFSA can be a far better tool for saving than the RRSP for middle class/lower income where the tax savings of an RRSP are negligible. I'd prefer to see the RRSP capped again like in the nineties. And the tax savings are significant at $22,000(?). Sorry I don't use them anymore. However, If the NDP and Liberals really want to even the tax base than they should make personal corps pay full personal level tax instead of corporate tax levels. That's the real secret of the rich, including their business buddies (so no worries of it ever happening). Take out what you need and pay ludicrously low tax on what's left inside. Oops, probably shouldn't have said that!


----------



## uptoolate

Agree that corps really can skew things quite a bit. Not sure how valuable the data on earned income is when professionals and people with businesses can shelter 500k a year at only 10% federal tax rate. Although my understanding is that this is for active income and not investment income. Still it seems like quite the tax break.


----------



## uptoolate

none said:


> It would depend your time scale. as for putting more money in your pocket tomorrow... MAYBE the conservatives - I'm not convinced of that though because conservatives tend to be inept at financial management but somehow manage to convince people that it's the other way. Look at the data - conservatives are bad for the economy - especially in the long term.


Yes it seems ironic that little 'c' conservatives seem to be much worse fiscally than their more liberal brethren. At least in Canada and the US.


----------



## andrewf

GPM said:


> Pity the NDP and Liberals will decrease the limit. It seems to be out of ignorance or grandstanding as the TFSA can be a far better tool for saving than the RRSP for middle class/lower income where the tax savings of an RRSP are negligible. I'd prefer to see the RRSP capped again like in the nineties. And the tax savings are significant at $22,000(?). Sorry I don't use them anymore. However, If the NDP and Liberals really want to even the tax base than they should make personal corps pay full personal level tax instead of corporate tax levels. That's the real secret of the rich, including their business buddies (so no worries of it ever happening). Take out what you need and pay ludicrously low tax on what's left inside. Oops, probably shouldn't have said that!


TFSA and RRSP are equivalent if you face the same marginal tax rate in retirement as during your working years. You need to think harder about the difference between RRSP and TFSA if you think TFSAs are substantially better.


----------



## Eclectic12

GPM said:


> ... It seems to be out of ignorance or grandstanding as the TFSA can be a far better tool for saving than the RRSP for middle class/lower income where the tax savings of an RRSP are negligible.


I guess it depends on one's definition of middle class as most that I would call middle class who are willing to talk about RRSPs are expecting at least a two tax level drop in their retirement income.




GPM said:


> ... I'd prefer to see the RRSP capped again like in the nineties...


What cap are you referring to?

The only one I recall that has been removed is the foreign content.


Cheers


----------



## none

dotnet_nerd said:


> Mathematically, TFSA is better. _Significantly better_. All the growth that occurred during its lifetime is completely tax free. On RRSPs the entire portfolio gets taxed.
> 
> Which would you rather have $1M dollars in at retirement???


This isn't true - TFSA and RSP are mathematically equivalent if your tax bracket doesn't change. If you go down a few steps RSP are much better.

http://www.theglobeandmail.com/glob...xplains-tfsa-or-rrsp/article1356709/?page=all


----------



## 0xCC

dotnet_nerd said:


> Mathematically, TFSA is better. _Significantly better_. All the growth that occurred during its lifetime is completely tax free. On RRSPs the entire portfolio gets taxed.
> 
> Which would you rather have $1M dollars in at retirement???


As none points out this is not true. It can appear to be true if you only consider the after-tax RSP contributions being the same as the after-tax TFSA contributions. In other words, if you make the RSP contributions with after-tax money and then spend the tax refund that the RSP contribution generates.

This is the sort of tricky part to really understand about RSPs - you have to make sure you contribute before tax dollars to take full advantage of an RSP, that means either having tax withheld at source lowered or contributing the tax refund generated by the RSP contribution.


----------



## GPM

Eclectic12 said:


> I guess it depends on one's definition of middle class as most that I would call middle class who are willing to talk about RRSPs are expecting at least a two tax level drop in their retirement income.
> 
> 
> 
> 
> What cap are you referring to?
> 
> The only one I recall that has been removed is the foreign content.
> Cheers


The $13,500 maximum, no yearly increases. 18% maxed out at about $75,000 I think, but don't have a calculator handy. I Loved when they removed the foreign content limit. That was plenty to try and fill for all but very high wage earners. $22,500 is a gift to the wealthy, and the really wealthy can still stuff money into corporations. Many avoid RRSP's altogether, pay dividends, avoiding a double hit on CPP, but forgo the CPP. Very tax advantaged money in a personal corp and more flexible (buy anything, pay other family members over 18, hold life insurance that comes out tax free, but bought at low tax rate, etc). Investment income being taxed at full rate is the only draw back.

I'd still go with the tfsa s a good saver if I was young to avoid claw backs. I always maximized savings no matter the product. Therefore, risk for me with RRSP


----------



## Eclectic12

GPM said:


> The $13,500 maximum, no yearly increases.


Are you confusing what a pension does to the RRSP maximum? 
Or maybe what you are earning based on your income with pension adjustments reducing it?

CRA says the maximum RRSP contribution room one can earn is $24,930. That's up from 2014's $24,270 and 2013's $23,820 ... so I am not following why you are saying "$13,500 maximum, no yearly increases.".


Now one's earned income x 18% may be lower than this and having a work pension that results in a PA which reduces what one has earned can also affect the number (just like a Pension Adjustment Reversal will add more RRSP contribution room) ... but this is different than what you are describing.




GPM said:


> ... 18% maxed out at about $75,000 I think, but don't have a calculator handy.


The math is fine ... what's throwing it off is that the limit is much higher (i.e. almost double) your number, where $132K x 18% is $23,760. There appears to be a $57K gap between your thinking and CRA's published maximum for 2015.

Of course, this assumes the $132K is all "earned income" and there is no reductions or additions based on pensions. (Sorry if I'm sounding like a broken record but a fair number of people miss that the 18% is earned income ... not all types of income.)




GPM said:


> ... $22,500 is a gift to the wealthy, and the really wealthy can still stuff money into corporations. Many avoid RRSP's altogether, pay dividends, avoiding a double hit on CPP, but forgo the CPP. Very tax advantaged money in a personal corp and more flexible (buy anything, pay other family members over 18, hold life insurance that comes out tax free, but bought at low tax rate, etc). Investment income being taxed at full rate is the only draw back.


???

I've having trouble following the claim that "the tax savings are significant at $22,000(?)", " Many avoid RRSP's altogether ..." and "I'd prefer to see the RRSP capped again like in the nineties."

Lots of snippets of info but nothing I can follow as to what the rationale is. Then too, there's what is at best, a misunderstanding of what it what or an incomplete description of what the RRSP maximum limit is.




GPM said:


> I'd still go with the tfsa s a good saver if I was young to avoid claw backs.


As I understand it - OAS clawbacks don't start until $67,668 or so (the old 2011 number where I believe it is higher today) ... so I'm not sure why someone in a lower income level needs to worry about it. 




GPM said:


> ... Therefore, risk for me with RRSP


 ... not sure what your situation is but at the same time - I know people who have avoided the RRSP in pre-TFSA days because they were worried the RRSPs would be cancelled. 

Question is ... what is the rationale, what is the situation and how likely is what one expects? 


Cheers


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## GPM

Sorry, not too eloquent this morning!

What I meant was contribution room for the RRSP. In the nineties it was capped at 18% or $13,500, whichever was less and didn't change for many years. This allowed someone making $75,000 to maximize their RRSP. A pretty good salary in those days.

So, what I was getting at is now that the RRSP limit is approaching $24,000, the income to maximize it is over $132,000. That really only benefits the rich, as this is a boat load of income and most dual income earners don't approach that. I think capping the level now or around $25,000 contribution room is a good idea. The contribution room at almost $24,000 is the gift to the wealthy (I read my last post and didn't understand it myself!)
Someone making $32,000/year gets very little tax refund in our tiered tax system. Someone making
$132,000 gets a very significant tax refund. This of course is for employees.

Now, I was in the situation where I was self employed. The RRSP limit at $13,500 was inadequate for me to maximize my 18%. From a selfish point of view this was unfair, but being realistic, it was more room than most people needed. Therefore, I turned to a corporation. I used it for the bit of excess I had but preferred RRSP's. 

The people I knew who were really loaded skipped the RRSP's altogether and preferred personal corporations-lower taxes, more flexible, and no double hit on the CPP (paying your own portion and the company portion. This is where the personal corporations of the rich are very unfair to the average citizen. You pay corporate tax instead of the top tier. That means someone making approximately $500,000 a year is still paying a tax rate of around 17%. Not very fair of the 1 percenters, paying the same % as much lower income earners. 

The confusion with RRRSP's and corporations-some dividend out their income and avoid the government programs altogether. Others payout salary from their corporations to maximize the RRRSP's and hide the rest in the corporations. Just tax planning to fit each individual's situation.

I am odd, I guess, because I grew up very poor, catapulted into a highish income, and met some very rich people, seeing how they operated. I am caught between being a capitalist, but being very socialist!

The danger for me is exceeding the clawback amounts. In retrospect, not a bad problem to have. However, as an ardent saver, I would have prefered a TFSA with a high limit, and an RRSP with a lower limit.

In short (well the opposite) I prefer to see the TFSA not tinkered with and prefer it to the RRSP. Not the first time I've been wrong though.

Interesting point about how neither vehicle matters for low income earners as they won't reach the clawback amount. With all the talk of TFSA's, I've never seen this come up, just TFSA's withdrawals are not income so there is no taxable income and definitely no claw backs.


Thanks!


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## none

From a pragmatic point of view a good thing about TFSAs is that it's worth what it's worth without the hazy tax implications associated with an RRSP. People still think that putting $10K into an RRSP is actually saving 10K.


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## Eclectic12

I agree that people are not doing their homework and making mistakes.

At the same time, when I think of my dad contributing to a spousal RRSP where my mom's retirement income was OAS/GIS plus a $10 a month pension - it does not seem hazy at all that the withdrawal tax rate is multiple tax levels lower than the contribution tax rate.


But as you point out ... where people don't learn the mechanics, there's no hope to move on to identifying where they are likely to be.



Cheers


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## GPM

You obviously had a smart dad. Unfortunately most people are very uneducated. My folks were saved by the new income splitting program. However, as with the older generation, my dad did everything himself. They never found out about the sharing program until they saw my accountant regarding selling their cabin with huge capital gains. This was well into retirement.

As with both above, I love the transparency. 

I just like TFSA's much better than RRSP's. I would have preferred a large one to to the RRSP's. I don't think they help the rich only, as claimed by opposition parties, as I very poorly tried to explain. Unfortunately, their reduction or eventual cancellation will be the loss of a great savings/retirement tool.

However, RRSP's are still great, if used, even if people don't understand them!


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## My Own Advisor

Remember TFSA "income" is not income-tested. Another bonus.

TFSA contribution limits have nothing to do with your annual income as well.


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## Eclectic12

GPM said:


> You obviously had a smart dad. Unfortunately most people are very uneducated.


Not really ... considering he complained about the credit union "only offering GICs" where in hindsight he decided he should have put a % into something more equity based (I was standing beside him when the rep offered to outline what was available and he insisted on GICs/savings accounts).




GPM said:


> I just like TFSA's much better than RRSP's. I would have preferred a large one to to the RRSP's. I don't think they help the rich only, as claimed by opposition parties, as I very poorly tried to explain ...


Trouble is most articles talk about one situation to help explain their point, those who aren't thorough latch onto the one point and can make disastrous decisions. 

One poster on here about two years ago latched onto the TFSA being Canadian tax free and read an article that those with rich pensions can run into clawback territory. His proposed solution was to liquidate the RRSP now to take the tax hit and avoid the RRSP going forward. When asked, he had no idea what his retirement income might be so that he had no idea how likely a clawback was. That did not deter him from insisting taking the tax hit now was his best move.

Decisions based on incomplete understanding with no due diligence to see what applied or does not are more likely to be a problem in the future.


Somehow they understand that one should know the tool, know it's use and apply it appropriately but ignore this in the financial arena.

Cheers


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## GPM

Yikes!!! I wasn't reading 2 years ago. If you guys couldn't stop him, who could? I guess some people REALLY do need advisors! I'm well above average in financial knowledge among my PEER group, but well below people on this forum. I have learned a lot on this thread and the forum in general. You make very good points in particular. I shudder to think what my friends are doing-well in some cases I know. This forum should be required reading.

I'm sure you will give me another lesson soon!
Seeya.


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## cashinstinct

> The NDP promises to:
> 
> – Reverse changes to TFSA contribution limits; says higher amount helps the wealthy and does little for middle-class Canadians.





> The Liberals promise to:
> 
> – Cancel TFSA increase to $10,000, saying it helps well-off Canadians who need it the least.


http://news.nationalpost.com/news/c...-you-need-to-know-about-the-parties-platforms

I assume it's prospectively as discussed in the thread. They can't make these changes retrospectively without some major headaches...


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## Guban

I'm not sure what major headaches would happen if the $10k increase is reversed.

There is no chance (hopefully) that the reduced limits will result in penalties for those people that added the extra $4.5k, so the NDP or Liberal government would just have to pass a law saying that we would have to use up the amount contributed with the new year's $5.5k added room. Under this law, those that contributed $10k into their TFSA under Harper would only be allowed to add $1k in 2016 if the limit drops back down to $5.5k under Trudeau or Mulcair. 

What do you think? Fair? No major headaches?


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## cashinstinct

That would be a way to make it less complicated, to have an impact on the following year for people who are maxed out on TFSA in 2015 under the $10,000.

I was not thinking about penalties, but more in terms of having to withdraw $4,500, which seemed like a bad implementation method.


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## larry81

they wont touch the TFSA dont worry, its just politicians being politicians


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## gibor365

> There is no chance (hopefully) that the reduced limits will result in penalties for those people that added the extra $4.5k, so the NDP or Liberal government


 those communists can do whatever they want.... they want to steal people`s money to subsidize themselves, unions and government workers!...
Harper is not perfect, but other 2 are disaster.... and Green is a joke



> they wont touch the TFSA dont worry, its just politicians being politicians


 most likely they will and those bastards also gonna cancel tax income split and UCBB... if they win, I will encourage my kids to leave this country after University


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## GPM

gibor said:


> those communists can do whatever they want.... they want to steal people`s money to subsidize themselves, unions and government workers!...
> Harper is not perfect, but other 2 are disaster.... and Green is a joke
> 
> most likely they will and those bastards also gonna cancel tax income split and UCBB... if they win, I will encourage my kids to leave this country after University


Forgive me for back talking to a senior member. I don't give a rats a$$ about politics, but you are either very melodramatic or don't have a clue what real communism is. Maybe your kids should go to one of these great countries before university, so I don't have to subsidize their education.


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## gibor365

> don't have a clue what real communism is. Maybe your kids should go to one of these great countries before university, so I don't have to subsidize their education.


 I know what is `communism`very well as i lived there for 23 years  
You don`t subsidize my kids, our household pays in taxes more than several ``poor`families have total income....
Harper finally gave some some cash back from our taxes, and those neo-communists want to take it back right away!
btw, about universities, practically all European countries have free high-education, Germany has free universities for EVERYONE , even for you if you decide to study there.... so don`t tell me stories that 8K per semester we`re paying is coming from your pocket...


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## sags

Political systems and politicians don't matter..........there is no free lunch.

People either pay taxes that pay for their services or they pay lower taxes and pay for some services separately.

The only question is who pays the taxes, and collecting from those who can afford to pay seems a logical and likely solution.


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## GPM

gibor said:


> I know what is `communism`very well as i lived there for 23 years
> You don`t subsidize my kids, our household pays in taxes more than several ``poor`families have total income....
> Harper finally gave some some cash back from our taxes, and those neo-communists want to take it back right away!
> btw, about universities, practically all European countries have free high-education, Germany has free universities for EVERYONE , even for you if you decide to study there.... so don`t tell me stories that 8K per semester we`re paying is coming from your pocket...


Well said sags. Gibor, admittedly many countries in Europe have done things better. Norway is free too. Been to Germany and Norway. Nothing compares to Canada. Only South Africa but it's too dangerous.
Sorry duuude, but I graduated in the early 90's (hence inability to insert happy face!!!), paid more taxes than many families incomes put together, made more than my whole family put together at times. Counted my blessings instead of complaining. Still paying and yes I'm still subsidizing kids university through taxes (although obviously less with tuition hikes). Happy to do it. Especially since university is 3x as much inflation included as in the nineties. Happy to pay for Medicare too. If they are going to Norway (be ready for 60% taxes but everything is free!) or Germany great. Good luck in the evil empire of America. Just saying not all taxes go to corrupt politicians. The great thing about a semi socialist country is it spreads the wealth around, so a 17 y/o kid (with a single mom making minimum wage) can go to university. If that's real communism I'm in. I love the TFSA but it's a drop in the bucket for anyone who can afford it. It's for the rich not the middle class. I'm not concerned if they lower it. Also, never minded moving into higher tax brackets. I always had enough and knew to many with too little.


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## BoringInvestor

gibor said:


> those communists can do whatever they want.... they want to steal people`s money to subsidize themselves, unions and government workers!...
> Harper is not perfect, but other 2 are disaster.... and Green is a joke
> 
> most likely they will and those bastards also gonna cancel tax income split and UCBB... if they win, I will encourage my kids to leave this country after University


As Harper has not cut my taxes to 0%, and continues to subsidize themselves, union and government workers, I declare them communists too.


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## GPM

Hey Gibor, sorry if you lived in the old Soviet Union. Went after the collapse. Life looked pretty rough. Likely seemed like a good idea to its founders though. Had a friend from Romania's hey day. Yikes. Congrats on your success in Canada.


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## gibor365

Point of communism, "From each according to his ability, to each according to his need" , and the "leader" will decide everyone's needs  This is what I see in NDP/Lib propoganda... also they always talk about "CLASS STRUGGLE" , kinda "take from "rich", give to "poor""



> I love the TFSA but it's a drop in the bucket for anyone who can afford it. It's for the rich not the middle class


 just neo-communists cliche ... the real rich that maybe 1.5-2% in Canada don't care about TFSA increase or split income, as couple of thousands per year for then is nothing... Are you really thinking that family of 4 with gross income 200K is rich?! TFSA and Split income helping mostly middle class ...



> Just saying not all taxes go to corrupt politicians.


 but big part of it... did you all forget Liberals "sponsorship scandal"?!
... and except it, they are going to increase Foreign Aid, subsidies for "refugee" and so on ... First make order in your own home, than give money to neighbours... You wish to help refugees, make donations....don't force me ....Why not to introduce free dental for seniors and kids for example?!


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## gardner

gibor said:


> but big part of it... did you all forget Liberals "sponsorship scandal"?!


Well you do have to have a sense of proportion. The Gomery commission cost $14M to run and managed to track down something like $4M in improperly directed funds. So the whole mess cost ~$18M. That's about 13% of a single F-35.


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## gibor365

gardner said:


> Well you do have to have a sense of proportion. The Gomery commission cost $14M to run and managed to track down something like $4M in improperly directed funds. So the whole mess cost ~$18M. That's about 13% of a single F-35.


And if we won't have such commissions....can you imagine what will be amount of " improperly directed funds"?! Do you know how much cost to have police, but we cannot to live without it....
And we don't need F-35 or any other F's ....who is threatening us?! USA?!
btw, T-50 is cheaper and better


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## Moneytoo

gibor said:


> I know what is `communism`very well as i lived there for 23 years
> You don`t subsidize my kids, our household pays in taxes more than several ``poor`families have total income....


Same here - well, almost, came to Canada at 26, 21 years ago  Up for another promotion (and a raise) - second this year, fourth since I started working at this company less than 4 years ago. Hopefully will finally cross 100K. Smiling when typical 9-to-5-ers born in Canada, still developers and testers in their 50's and even 60's, ***** about Harper and talk about '(un)fairness'. And they're not poor by any standards as no one in IT will get out of bed in the morning for less than 60-80K! (No wonder jobs are getting outsourced...) Loved this comment to Garth' recent entry:



> “Dis Immigrants’? How about dissing everyone who’s 50 and above, been in this country for twenty years or more… who hasn’t become a self made cash multi-millionaire with a paid off house in this great country of ours. People ..if you are 55-70 and still working you have made some really dumb decisions in life. If you’ve ‘made your money’ through inheritance or being a teat sucking civil servant parasite it doesn’t count.


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## gardner

gibor said:


> And if we won't have such commissions....can you imagine


Oh, of course, of course. I'm not saying that we should ignore the problem, only that there is a sense of proportion. If you are worried about where Her Majesty pisses away your hard-earned tax dollars, it is worth your time to look where it actually goes is all I'm saying. You may be rightfully annoyed at the useless waste that went into the sponsorship scandal, but put it in the perspective of where the government says it will be spending money and you see that it's small potatoes.

I am favouring buying the newer F-18s. The American's are using them, so they obviously meet all the bullshit "interoperability" requirements. They're like what we have already and they cost less than half of F-35s on a per unit basis. The difference in cost for one plane would pay all of the expenses of all of the senate for years.


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## sags

Canadians aren't perfect...........just the closest thing to perfection there is.


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## gibor365

> Same here


 We just have different life experience than Canadians 
By no means we are extremely smart...we live in Canada 16 years, I was 34 and worked 10 years prior in police, my wife was recent grad, both of us practically didn't know English ... so, how come we almost 10 years don't have any debt and travelling 3 times per year abroad ?! And NDP/Libs are telling that we are in 15% richest Canadian population?!
Or majority Canadian-born people are too lazy or they spend all their cash on BS 




> developers and testers in their 50's and even 60's, ***** about Harper and talk about '(un)fairness'


 they just don't understand that if their dalaries in 60's-80's , they will be much better with Conservatives government... if one spouse in 80'sK and another in 40'sK, their family gonna loose 2K/year right away because NDP/Libs going to cancel split income... and with this $$$ increase foreign aid and refugees benefits


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## sags

Most Canadians don't earn anywhere near your salary levels.

How much do you think the person who paves the roads earns in a year ? The person who assists you in Home Depot ? The receptionist in your lawyer's office or the bank teller ?

Drive around and look at everyone working away, and you soon realize that most of the world is just "average Joes" struggling to make a living.

The current economic system rewards non work income and punishes work related income.

Look no further than the tax code to see examples of that...........like the TFSA.


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## gibor365

> The receptionist in your lawyer's office or the bank teller ?


 Have no idea about receptionist , but talked to guy (indian immigrant) that works kinda teller in PCF and he told me that earns close to 60K .... and if you don't want to study, to invest into yourself and want whole life to be teller, it's not my problem, why i need to subsidize you?! You have to understand that money don't grow on the trees,



> The current economic system rewards non work income and punishes work related income.


 Oh, really?! All our income is a pure work related income ... and in TFSA it's mine , already taxable money


----------



## GPM

Hi Gibor. We had free dental for kids in the Saskatchewan primary schools in the seventies and eighties. Then free at a dentist until 18. There were not enough dentists then. Great program and would still be useful, especially for inner city kids. No time off work or school, good treatment. Really nailed the under priveledged. This was discontinued and I don't know why. I was that age to be in the program. 
Well, I hate to say it and I'm ready for the pummelling, but starting with Generation X, and Generation Y "would you hire them?" A LOT (not all) have a very poor work ethic and even worse spending habits. I am generation x (start?). The baby boomers spent everything they made (not ALL but my brother who is a boomer is shocked by his colleagues) and are in surprisingly poor financial condition. They are the biggest voting class. Income splitting will stop when they are gone. We (multigenerational Canadians) all grew up in a life of relative wealth and strong social safety net compared to most of the world. The immigrants are the people who push hard and make it (like my grandparents and great grand parents). I saw it all the time in University. Hard working parents. Kids going to be professionals. Parents grew up without all the free things. However, I am still a strong believer in our flawed but excellent social safety net. For the military, we should be special forces only. 16 f18's are a little embarrassing. No offence to the pilots. They are top notch and I know one. But we aren't the force we were in the 40's. Peacekeeping and assisting in battle only is for Canada. Our forces still get the hardest assignments though. Have to keep them up to date.
The fellow is right working income and savings are taxed heavier than investment income. Very unfair, but life. I love the TFSA, but you likely need over $100,000/year income as a family to try and use. At $200,000 you are likely the 1% or close. I haven't followed for a while. Great accomplishments for you and Money Too in a short time. However, you are right, except for those who have fallen on up tough times, where is everyone else's money. I like foreign aid not foreign wars. In case of war, it's all strategic to the U.S. Better to keep the money at home. The U.S. are our biggest ally and threat. Financially and militarily


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## gibor365

> The U.S. are our biggest ally and threat. Financially and militarily


 I agree and many times was telling about it.



> I love the TFSA, but you likely need over $100,000/year income as a family to try and use.


 Not true! My mom who is senior and has income 10K had it fully taxable (untill 2 months ago she moved all in Tangerine HISA to get 3%), my son who is on co-op program in umiversity has it also fully maxed (untill 2 months ago he also moved all in Tangerine HISA to get 3%).
It's more than enough to use TFSA with income 100K, i did calclulations and 60K/year will be more than enough for us when we retire (include overseas travel)... If people didn't learn how to spend money, it's their problem... Sure , if somebody buys 1 mil house with 100K income , they can forget about TFSA!



> We had free dental for kids in the Saskatchewan primary schools


 Now everyone portrets CCCP as an evil, but when I was in school, every year , in every school, dentists were coming and taking care about 100% of the children! Obviously for free, as medicine was free


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## GPM

Gibor, you are right that we should have our house in order before we give foreign aid. However, it's a disgrace that a nation so first world can't afford it. All the politicians are the same. Spend. They have to spend or they will lose. Look at Joe Clark. He tried to make a change and ended his priministership and career immediately. We are still the best country in the world though. But our reputation is slipping. This isn't my Grandmas' country anymore.


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## gibor365

> However, it's a disgrace that a nation so first world can't afford it.


I can give you an example.... my mom (senior) needed implant, she got guote several thousand $$$ here... so she wanted to fly to Israel and one of the reasons was this implant, as in Israel dental care even better than here and several times cheaper (it's also private), I hardly discouraged here.... I know some immigrants who were flying to Ukraine, Russia, Israel for dental work ... So why my taxes should go to some Foreign Aid or to "so-called" refugees who has everything for free?! Nonsense!


> But our reputation is slipping


 Is Switzerland has bad reputation?! Do they care about it?! QJust a question ...


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## GPM

Interesting about the medical and dental. Always pulled for CCCP in the Olympics. Your family have good spending habits for sure. I like TFSA better than RRSP as I stated before. I was speaking more of maxing both. If you and your family are, that is fantastic and likely unusual. Canadians are drinking wine on beer budgets I'm afraid


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## Moneytoo

sags said:


> Most Canadians don't earn anywhere near your salary levels.
> 
> How much do you think the person who paves the roads earns in a year ? The person who assists you in Home Depot ? The receptionist in your lawyer's office or the bank teller ?


Sorry, sags, don't have a lawyer, but had an uncle (well, still have, just stopped talking to him after grandma died a few years ago) with a "loser mentality". He always believed that he doesn't need to try hard because everybody owes him something just because he was born. The government, his parents, his neighbours, his sister, his niece (me), her husband. Even when I was a student living on a stipend, he was asking for handouts. Last I heard, both him and his son (who became software developer, like me) were out of work (again), collecting EIs and renting out the apartment that I bought (with my first big bonus money) for grandparents. Both of their wives surprisingly are always able to find work, in good times and bad times. So forgive me for not liking much somebody else's grown up and healthy "uncles" who expect the handouts.

I didn't max out my TFSA yet btw, still have 15K to go. Putting more in my RRSP first, so I'll have 10K returned next spring for next year TFSA. And voting for conservatives - please forgive me for wanting to keep more of my money for myself so I won't have to depend on handouts when I'm old


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## GPM

There is truth in what you say. Maybe aid should be voluntary. I'm not a fan as no one would give. I've done the third world. Saddest thing I've seen. Mostly countries owned by first world nations for resources. No chance for them. 

Anyhow, everyone to their own opinion. Yours is particularly interesting due to your background. Money Too as well.


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## GPM

Lived in a small prairie town for a while, Money Too. Housing is cheap so that is where the government hides all the 2nd and 3rd generation welfare families. Sad to see. Using the system. However, have seen people fall and bounce off of welfare as it's meant to be. Also saw the non functional that need it. Pity such a great program is abused. 
Anyhow, nothing the matter with trying to get ahead. Sounds like your career and saving is going well.

Gibor, I always had trouble with CCCP portrayed as the evil empire. Obviously no utopia though.


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## gibor365

> Canadians are drinking wine on beer budgets I'm afraid


 Probably Canadians are drinking Canadian beer  I dink European that is much much better quality and also much .... cheaper! Just last months thaere was a discount on Harp (perfect beer), this month on Kozel (perfect beer) 
Probaly Canadians are drinking Grey Goose, but I drink Russian Standard  and so on



> Maybe aid should be voluntary.


 it would be more fair to give foreign aid portion of my taxes to Russia where I got my degree, and my wife's to Israel where she got hers 

...and yeap, maybe I'm a bad person, but I don't give sh... about third world countries and can find much more useful implementation of my taxes than support their corrupted governments... and btw, we constantly donate a big bags of my kids old (and frequently new) clothes....


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## gibor365

> Gibor, I always had trouble with CCCP portrayed as the evil empire. Obviously no utopia though.


Actually now Canada with theit "buddy" US doing exactly the same!
Obviously no utopia  , but after I lived for many years in 3 different countries, I can compare..... and I can say that many things in CCCP were good (obviously many were bad )... only free education and health care were a huge things. Cultuaral life were great, from school we had constantly trips to theatre, ballet, concerts etc... here my kids graduated from scholl and except some rare (and expensive) trips to maple syrop places they had nothing! Not even 1 trip to concert! All organized sport activities were 100% free. As a child I had a lot of sport from chess to boxing


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## Moneytoo

GPM said:


> Lived in a small prairie town for a while, Money Too. Housing is cheap so that is where the government hides all the 2nd and 3rd generation welfare families. Sad to see. Using the system. However, have seen people fall and bounce off of welfare as it's meant to be. Also saw the non functional that need it. Pity such a great program is abused.
> Anyhow, nothing the matter with trying to get ahead. Sounds like your career and saving is going well.


Well maybe if I didn't grew up in a small village-like town (suburb of Donetsk, the current Ukrainian war epicentre), raised by grandparents while my mom tried to make it in the city (parents divorced when I was little), on the verge of poverty by Canadian standards, and didn't work minimal wage job when we came to Canada - I'd have a middle-class guilt. But as I "bragged" in this thread 100 pages back, I just can't feel sorry for "poor" Canadians since the distance between my tiny town in Ukrane and Toronto was much larger than theirs 

(I'm sure our daughter will be different when it comes to compassion. But she worked her *** off to make it to the medical school from the first try. We just attended their first ceremony. The majority of future doctors are visible minorities. I bet most of their parents are first generation immigrants who came here with next to nothing, like us, and want their children to have everything. Most of her Canadian-born friends are taking it easy, taking a year off, dropping out, choosing "artsy" programs without a chance of making money, ever. And 20 years later they'll be bitching that the immigrants stole their jobs and need to pay higher taxes so they can keep playing video games...)

Rant off. And I actually love Canada


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## GPM

Moneytoo said:


> Well maybe if I didn't grew up in a small village-like town (suburb of Donetsk, the current Ukrainian war epicentre), raised by grandparents while my mom tried to make it in the city (parents divorced when I was little), on the verge of poverty by Canadian standards, and didn't work minimal wage job when we came to Canada - I'd have a middle-class guilt. But as I "bragged" in this thread 100 pages back, I just can't feel sorry for "poor" Canadians since the distance between my tiny town in Ukrane and Toronto was much larger than theirs
> 
> (I'm sure our daughter will be different when it comes to compassion. But she worked her *** off to make it to the medical school from the first try. We just attended their first ceremony. The majority of future doctors are visible minorities. I bet most of their parents are first generation immigrants who came here with next to nothing, like us, and want their children to have everything. Most of her Canadian-born friends are taking it easy, taking a year off, dropping out, choosing "artsy" programs without a chance of making money, ever. And 20 years later they'll be bitching that the immigrants stole their jobs and need to pay higher taxes so they can keep playing video games...)
> 
> Rant off. And I actually love Canada


Whoops! Taken wrong way. I was getting at the abuse and laziness you are speaking of because a lot is hidden - not unemployment but not LOOKING for employment. This isn't in the statistics. Also, from Romanian friends I assumed your early life was no picnic. You are correct minorities are taking over the professions. They are the only ones with focus and fortitude. I've seen restaurant owners kids studying while waiting tables in slow times. And your right. 2nd generation.
It was already the case in '88 when I was training at university. Arts and science was fun but useless (maybe in retirement). 
To the point and I'll catch it for this: THERE ARE NO POOR CANADIANS. We are a welfare state. Anyone on the street has psycological problems. Look at your upbringing. I've been to Africa too many times. That's poor. Nobody starves here and I've actually been turned down by the Salvation Army. I may have some middle class guilt, but it came from growing up poor by Canadian standards (a laugh) making it and then seeing Africa. What an eye opener. Just after university too. Quite my job to go. Canadians are way to entitled, but I still like the safety net. Came from the depression.

Congratulations on your daughter. In '88 a few got in on first tries. But now, degree needed. Outstanding.

By the way I love reading the rants on the forum! Can't ...do..smiley...faces.


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## Moneytoo

GPM said:


> Whoops! Taken wrong way.


No-no, sorry, it was just me - had a few drinks tonight, learned some bad news (about upcoming layoffs - I "saved" two people on my team, but few of the others with whom I worked on other projects are in danger, one just had a third child...) and didn't really reply to your comment, but rather continued an old argument on this thread...



> Canadians are way to entitled, but I still like the safety net. Came from the depression.


Sorry if I'm taking it the wrong way again, but just reminded me how amazed I was to learn that one of my first managers had clinical depression. He was in his early thirties, single, good job, good income, seemed to have everything a normal person needs - I remember wanting to smack him on his head, "Snap out of it! People in my former country don't have time for depressions - they're too busy surviving! What if you were a single mother with a child to feed - would you have time to lie in bed all day, feeling sorry for yourself?!" etc. It was a long time ago... 

I guess we were raised to believe in "what doesn't kill us - makes us stronger". 8 years ago my faith was tested - I had a dangerous thingy that would make me officially disabled for the rest of my life if I wasn't careful. Instead of doing what the doctor ordered - I changed doctors (needed a note that I recovered) and went back to work. My daughter witnessed her mother coming back from "brain dead" (my mind was literally shutting down after few minutes of reading, watching TV or even conversation) and later told me that it was the main reason she became interested in neuroscience (her major). Nobody at work knows (or would believe if I told them) I forgot about it myself - until I read recently that people who suffered a similar condition live in fear of relapses. I read some stories - and came to conclusion that people take themselves way too seriously 



> Congratulations on your daughter. In '88 a few got in on first tries. But now, degree needed. Outstanding.
> 
> By the way I love reading the rants on the forum! Can't ...do..smiley...faces.


Thank you  And I usually exceed the limit of smiles, so have to delete some... lol


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## GPM

What a crappy night! Good to vent. And No, I seriously can't do smiley faces. Makes all my responses and texts serious looking!


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## gibor365

> The majority of future doctors are visible minorities.


 Moneytoo, in GTA we're "visible minorities" 

My son graduated from IBT program (best secondary school in Peel - you need to pass exams to get there), they had less than 10% whites, practically 0% - Canada-born kids....
Now my son in University of Waterloo/Laurier - very similar picture....



> THERE ARE NO POOR CANADIANS


 was telling it many times on this forum , but always was told that I'm wrong  . From what i see, we can afford trip to Europe, and so-called poor can only afford trip to Cuba 



> but I still like the safety net


depends with what countries you compare..... 100% agree if you compare to US and A, but my brother lived in Finland, from what he described, their safety net is much much safer than here


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