Weekend Reading – Debt clocks, tax tips and more
Welcome to a new Weekend Reading edition: about debt clocks, tax tips and more.
Before we get into some of my favourite finds from the personal finance and investing blogosphere this week, you can check out other popular recent reads below:
Should you consider an All-Weather Portfolio?
I shared how and when to withdraw from your TFSA or RRSP.
(For the most part, drawing down your RRSP first is better in semi-retirement or retirement. That means keeping your TFSA “until the end” as an investment account is usually tax-smart.)
In this recent case study below, I share the impact of 3.5% inflation sustained over the next 40 years and taking your CPP and OAS as early as possible in retirement. Not exactly wise for fighting longevity risk but you can retire at age 55 with higher inflation.
Weekend Reading – Debt clocks, tax tips and more
As you know, inflation continues to run wild.
A reminder not to count on our Bank of Canada to help you and I out in fighting inflation – it’s not going to happen!!
If you live in Quebec however, depending on how you look at this, you are getting some help soon…
“Quebec’s spring budget includes a one-time payment of $500 to every adult earning $100,000 or less to help offset the impact of inflation, and the cash is scheduled to arrive a few months ahead of the provincial election.”
You can check out more details in this media announcement here.
We’ll see what Ontario might do for their gimmicky election ploy as well. I call this government move a ploy since current inflation is largely stemmed from a supply issue: lack of supply; in pretty much everything. I’m not understanding how more money given out really fixes the products and services supply issue. If you can help explain that to me, that would be great. 😊
In reading that article, I checked out that province’s gross debt: which includes debt on financial markets and money owed for civil servants’ retirement plans. That debt was estimated at $215.3 billion, or 43.1 per cent of GDP.
That’s wild.
That further triggered me to think about how much debt Ontario has, along with our federal government.
It’s staggering people…
My share of Ontario debt was about $30,000 or so some time ago – but that’s accelerating higher at a dizzying rate.
You can play with the debt clocks below for your awareness. Cool site.
Source: https://www.debtclock.ca/ @DebtClockCan
On the subject of huge debt and other general evils of personal finance when not used wisely, some reminders with tax season now here.
Reminder #1 – TurboTax Canada promo codes!
I know my TurboTax Canada Giveaway for 2022 is over, (congrats to all winners by the way once again!!) but I encourage you to read on for tips and tricks thanks to my partnership with TurboTax Canada this tax filing season.
You can still take advantage of my juicy 15% discount on TurboTax Canada tax preparation software only until May 2, 2022 below.
Reminder #2 – Get some free AND low-cost help to fight the taxman!
Over at Cashflows & Portfolios, we wrote about some top tax tips for retirees based on our work with clients. A reminder you can hire me or my partner on that site for a low-cost retirement projection report.
Also, need a good tax book? We all do to navigate tax-season!
Thanks to my friend The Grumpy Accountant all My Own Advisor readers receive a massive discount with no expiration off his book.
Read that post above for the whopping 30% discount code!
Other Weekend Reading…
Another Loonie shared some of his favourite dividend paying stocks.
My friends at FIRE We Go! recently released their February dividend income update. They have asked if I should go on their YouTube channel soon. Should I do it??? 🙂
The MoneySense team with Dale Roberts just released the latest making sense of the markets post – always a fine read.
I’ve been a big fan of one Millionaire Teacher for many years now. Andrew Hallam suggested the following when it comes to bonds:
“Don’t abandon a diversified portfolio of stock and bond market indexes because of forecasts, current interest yields, or a price drop. Don’t abandon bonds for cash. You don’t know what bond prices or yields will be next year or five years from now. Nobody does. And with bond market indexes, you won’t be stuck with current prices or current yields.”
Finally, also from the dividend income file…
Read on how Anne Scheiber, who worked as an auditor for the IRS, retired at the age of 51 in 1944, and made a whopping $22 million investing in U.S. dividend stocks.
- Invest in companies with growing earnings
- Invest regularly
- Reinvest your dividends
- Invest in a tax efficient manner
- Be frugal where it makes sense
- Give back…
Helping Ukraine
I’ve already made my donation (and will continue to do so….) to help millions displaced from Ukraine. If you have the means, I encourage any financial contribution to the Canadian Red Cross, Canada-Ukraine Foundation, Global Medic or another responsibile charitable organization of your choice that can help make an impact.
Take care, be safe.
Mark
Mark
My name is Mark Seed - the founder, editor and owner of My Own Advisor. As my own DIY financial advisor, I'm looking to start semi-retirement soon, sooner than most. Find out how, what I did, and what you can learn to tailor your own financial independence path. Join the newsletter read by thousands each day, always FREE.
“I’m not understanding how more money given out really fixes the products and services supply issue. If you can help explain that to me, that would be great. ”
Quite simple really. It’s not meant to “fix” the supply problem. It is just to make people “feel” good with the current administration and vote them back in.
Same in Quebec. And by the way, we are not getting $500. We are getting a tax credit which, in some cases, may mean you get the cash back. Some situations are such as if you have already paid your taxes. However if you have not filed and end up owing money to the RRQ then you just pay $500 less. Or maybe they will send you $500 after taking a few thousand out of your pocket beforehand. At any rate it is just a politicians back slap to tell you how lucky you are that they are in power. Oh! And vote for them again in October.. By the way, guess where they got the money from. LOL Why from us!
RICARDO
Ha, well, definitely a feel good election ploy getting your money back!
Stay well Ricardo and thanks for your comment!
Thanks for the share, Mark!
I’m elated to get your approval on my list of dividend stocks. As a dyed in the wool ETF investor, that list was quite difficult for me to come up with. I got a lot of inspiration from yourself and others who make becoming a hybrid (dividend and ETF) investor so appealing. I may eventually go down that path as I learn more.
Cheers,
Al
Great stuff. I find dividends work for me on many levels AL but I also believe in low-cost ETFs since I can’t ignore the lazy investing benefits they provide as well 🙂
Have a great weekend,
Mark
I think it’s better to give the real story about Anne Scheiber from the rebuttal in Forbes and let others decide for themselves.
One thing I will say in retirement is we’re not big spenders but then again, we don’t live in austerity either. So yes, we save what we can, and invest when we have the cash and re-invest that along with dividends/distributions.
Taken from the archives of the Financial Wisdom Forum site:
https://www.financialwisdomforum.org/gummy-stuff/Scheiber.htm
Thanks for sharing that and I would agree, if index funds were available back then. I totally agree with this:
“The facts support a much more limited lesson: Live on next to no money, survive in good health to past 100 and let your savings compound for 60 years. With that going for her, Scheiber would have gotten as rich had she invested in a diversified basket of stocks, today’s index funds, and never attended a single shareholders meeting or read a financial statement.”
I think our basic spending needs for my wife and I will be in the range of $4,500-$5k per month. Another $2k per month in spending on some “extras” (i.e., travel) and that’s our desired lifestyle in the coming years. Our hope is that dividends/dividends pay for most of that and some part-time work for extras.
Mark
Hey Mark, good post. Thanks for talking about Ukraine.. important to continue nudging people to send support.
On the same note, how fortunate are we to discuss how to increase our value while less fortunate are struggling to survive due to high inflation. A couple years of higher inflation for us more fortunate is a simple blimp in our overall worth. Dividends and compounding tackle inflation with ease.
Take care.
Absolutely and thanks Paul. I’m likely to make another donation after my next paycheque.
Dividend increases should also help us tackle inflation – that’s my expectation! 🙂
Mark
Excellent post Mark thank you ! Thanks for sharing Anne’s investing journey it’s really amazing and Yes that power of compound is so powerful I personally starting to feeling it now that my portfolio is at a good size.
As for the interview of course we would like to see you on youtube I’m sure it will be educational for a lot of readers.
Helping Ukraine should be a moral obligation for all of us , for me personally living through 18 years of civil war before coming to Canada and watching this tragedy unfolding brings back some scary and sad memories and I hope no one will ever see it but sadly I guess people on earth can’t live in piece and enjoy their lifes.
Good stuff on the YouTube. I will likely do it 🙂
Very good message on your part here related to the moral obligation. I will do my small part!
Mark
Great content – as always – Mark. Sam is doing an amazing job and it is nice to see big numbers every month. Another interesting link, the 22 million with dividends? Wow. I will definitely check it out.
Good call on helping Ukraine. We are very fortunate to live in Canada, and this is a good opportunity to support the initiative of great organizations.
And we would love to have you with us. Fingers crossed. 🙂
Tlstay safe!
Most welcome Gean. You’re now investing with a high rate and those investments are making money and that money is making more money!! 🙂
Yes, we are very forutnate and blessed in Canada. We have our problems, but sometimes often very small really…
Best wishes, chat again soon!
Mark
I first read the story of Anne Scheiber back in 1996 in Money magazine, still available on the internet. Shortly after, Forbes magazine debunked the whole story. After Forbes own investigation, they found that Anne’s portfolio hadn’t performed any better than an equity index fund.
Very fair. An index fund re: S&P500 might have done just as well. My point in including this post is more about the power of compounding.
Certainly nobody with an index fund could amass $22M if they didn’t have Anne’s savings rate – that is also key.
Thoughts?
Mark
Indexing investing was not available during most of her investing years (retired at age 51 in 1944 – living to 1994). It proved dividend investing works. Nowadays, combine these two investing strategies, may yield good returns with less volatile risk. We were less worried and holding our portfolio well when market was dropping 30%+ in March 2020. Dividend for income and downside protection, indexing for diversifying into more industries and countries, esp. US SP500, etc.
Thanks Bruce and yes, indexed funds or ETFs were not really popularized until about 20 years ago.