Do You Know Your Tax Bracket? Saw that question (What is my tax bracket?) in Money Magazine as a frequently asked question, so let me help you out (for those in Canada), with a few helpful links and a few more helpful tables and such helping you figure out What is Your Tax Bracket. As a precursor to these hints, you should always check with the CRA or a licensed Tax Accountant if you have questions about your Tax Bracket and such.

Where do you find out about the current Federal Income Tax Brackets (for you as an Individual, not you as a corporation) ? Go to this page for individuals. That page will tell you the following (for 2015):

Federal tax rates for 20158

• 15% on the first $46,605 of taxable income, +
• 20.5% on the next $46,603 of taxable income (on the portion of taxable income over 46,605 up to $93,208), +
• 26% on the next $51,281 of taxable income (on the portion of taxable income over $93,208 up to $144,489), +
• 29% on the next $61,353 of taxable income (on the portion of taxable income over 144,489 up to $205,842), +
• 33% of taxable income over $205,842.

Remember that is Taxable Income, so this is what is left after you have taken your deductions, and credits and such. Remember also that if you earn less than the Basic Personal Amount (line 300) you don’t have to pay taxes (for kids with summer jobs and such).

However, that is not all, remember that you have Provincial Income Tax as well, and here are the 2018 numbers to keep in mind too:

Addendum

A commenter has pointed out another excellent resource in this area TaxTips.ca , check them out too!

After a long discussion with my publisher (BCM Publishing) about my upcoming book, we got stuck on financial book titles , so here are some of the best possible titles that we can think of for this soon to be best-seller.  Remember the financial book title is what sucks folks into reading it, and we aren’t completely sure what the Main Thematic Premise of the book should be either, so I have included a quick explanation with each title:

Starting Investing Late; Stock Tips for the Dead Investor

Figure it is a dead sure best seller? Too much? You can really take a lot of risks with your investments if you have nothing to lose.

Stock Prices Always Go Up

Don’t they? Certainly that is what all investment folks tell me.

How to Make a Million in Financial Blogging

Look how rich I am. I know of many rich financial bloggers, but then again they use this simple plan on How to Be a 6 Figure Blogger.

The Best Financial Arguments to have with your Spouse

You know that it is always good to argue with your spouse especially about money, and you want to win that argument too.  While you are arguing with her about money, throw in some comments about how she has been “letting herself go” for a while.

Sure You Can See My Last Natural Gas Bill

What could go wrong with that? I trust most strangers that come to my door at 8:00 PM at night, don’t you?

Hedge Funds are For Everyone

You can trust Hedge Fund managers, they have your best interests at heart. Look how much money is spent here? Everyone talks about it, it must be a very good thing.

Stop Worrying and Get In Debt Already

Everyone is doing it, aren’t they? Remember worrying is what is going to kill you, not the debt.

It is NEVER too Good to Be True (or the Pyramid Scheme Story)

I keep getting these e-mails about how I could make a fortune, they must be telling the truth.

The Lottery Ticket Retirement Plan

Certainly more than 1 of my acquaintances, is using this retirement plan.

Any other titles I missed? This seems to be similar to my infamous post There Are No Dumb Financial Questions.

No I am not going to be publishing a book, I can barely slap two sentient sentences together, but that hasn’t stopped other folks.

A few years back I wrote about financial literacy. You may not know, that November is Financial Literacy month in Canada. Financial literacy should be an all year round kind of thing. Just like Movember it’s nice for folks to think about a topic. Like any health issue you should not only be worrying about money and Financial Literacy in November. You should be worrying all year round about your finances.

Why do you need financial literacy, or an understanding of your financial situation? To paraphrase John Lydon “Ever get the feeling you’ve been cheated ?“. That phrase, is why you need financially literacy. You worked hard for that money, but you need to understand the rules of  the money game, or you might just lose it.

How do you stop being cheated?

• Don’t pay for a year, scams for high end electronics and their warranties are a perfect example of needing to know the rules. Seems easy enough, you need to pay off the debt before a year transpires and you will not be charged any interest on the Electronic Thingy you purchased. Some more of these rules are:
  • Many plans now are not “don’t pay for a year” they are in fact “make equal payments for a year and no interest”. Be sure you understand this, or if you under pay a single payment you may owe a whack of cash at the end of the term.
  • The “no interest” sounds like a great deal. The cost of the no interest loan is built into the cost. Any interest you might end up paying is pure profit for the vendor.
  • What does your warranty really get you? Replacement? Repair? If you answer, “The guy told me it was replacement”, did you read that in the agreement? Sales folk makes a very nice commission on that warranty (in fact I think he pockets most of it). Be sure what the salesman said is what is written in the contract.
• Seems easy isn’t it? How many folks do you know that end up paying the interest on these “don’t pay for a year” deals? You don’t know of any? No one will admit they screwed up. Learn the rules.
• Investing rules? Libraries have been written about all the “rules of investing”. Folks are still buying Mutual Funds that claim they “Beat the Market”, or have “Guaranteed Growth”, but can they say that without it being true?Depends on the context they made the statement, isn’t it?
  • If I create a mutual fund and for the first 4 years, it “beats the S&P 500 for growth”, I can make that claim in any advertisement I want, and it is truthful, can’t I? Research of this fund would uncover this truth, so always check these types of claims. What if I created 500 funds 5 years ago, but only allowed “internal trading” of it, and only made the 1 that did beat the S&P 500 for 5 years available to the public? I can make the claim still, I don’t need to mention the 499 failures.
  • If I say that in 5 years your money will Growth by 3% a year guaranteed, you might want that, but if you didn’t look closely to see, that if you tried to take your money out before 5 years, you’d have extensive penalties, would that change your point of view? You have your guaranteed growth, however, you also have a locked in investment.

There are so many more of these kinds of truthful statements, that still are not really what you think the truth is.

Conclusion ?

Learn the rules of the financial game, that is what financial literacy means to me. What does it mean to you?

“Borrow for growth, not Consumption” –Rule quoted by Financial Planner

“Blow it out your ear” –Big Cajun Man

No, I am not saying you should borrow for consumption either, you should not borrow. Buying a house is the only thing I can see as a good reason to borrow money, borrowing money to invest just strikes me as asking for a swift kick in the lower abdomen.

It’s interesting that I tripped across this in my archive of articles that I started and then stopped, as Robb E. over at Boomer and Echo went and asked a whole bunch of folks about this, and got some interesting answers to the Question, Should You Borrow to Invest. Lots of interesting ideas in that article (no I am not condoning the advice, simply saying that it is an interesting read).

Borrowing money to buy a single stock can be viewed as buying on margin (in a simple understanding), the advantage is that you can buy lots more of the stock with your borrowed funds, and enjoy the huge profits, however, the best way to do this is to find a sure thing that will deliver profits that out-strip your borrowing rate, and that stock is? Anyone?  In the 90’s it was Nortel, Enron or WorldCom, not sure what they are now. The con of this are you could have borrowed money and end up with a less valuable (or worse worthless) asset at the end of things.

Selling Short is another way to borrow, where you find someone who is willing to sell their stock and you guarantee that you will buy it back for them in a prescribed time period (or when the person who loaned you the shares says they want their shares back). The exciting part on this one is you can lose infinite money with this one (if you believe infinite growth is possible in the market), let me explain:

• I convince Michael James to sell his International Buggy Whip at $10 a share
• The world decides that buggy whips are making a big comeback and the share price sky rockets to $100 a share
• I decide not to buy back yet, because the market will drop out, but it keeps going up, and up….

This will never happen! Don’t know, but I bet there are folks that Short Sold Apple in the 90’s that might disagree with that statement.

I am not sure who devised this heuristic but this is one I subscribe to:

Put no money into the Stock Market that you are not willing to lose

Surprisingly when I started looking at the markets in 1981 that was one of the rules, wonder what happened to it? Anyone hear anyone espouses this “Debbie Downer” point of view of the markets (aside from the sky is falling bloggers like me)?