If you actually clicked on this title, you should be ashamed. You have a problem, and you need help. Don’t click this kind of crap (or worse the actual title which was 3 Ways To Pull Off This Season’s Coolest Beauty Trend ).

Coolest Financial Trend

You want to know what the coolest financial trend is this season? Pay off debt.

If you are carrying a large debt, and you want a guaranteed investment pay back? Pay off debt.

If you can’t sleep and you are having problems with anxiety due to how much money you owe? Pay off debt.

The best way for me to create a list of a whole bunch of articles about one of my cornerstones? Pay off debt.

If you simply follow these simple tips, you can be part of the financial trend setters this season.

What a Load of Tripe

No kidding? I read so many magazines that have less content than this post talking about fashion, beauty tips and yes even some financial advice columns, who buys into this bilge? Yes I have read articles that talked about the coolest financial trend, I threw up in my mouth a little.

You know what you need to do, you don’t need click-bait titled clap-trap to tell you what to do, just go do it.

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Today is Ash Wednesday and that means in the Christian world that Lent Begins. For many folks this is a time of reflection, and a time of sacrifice. I don’t really buy into that, I view this more as a time of reflection and growth.

Lent
Lent

This Lent try to add things to your 40 day journey to help you grow as a person. Some great financial ideas might be:

  • Read. Read financial books, read philosophical books or just read something. Reading expands your mind.
  • De-Clutter: I really like this idea. Many Churches are jumping onto the Marie Kondo de-cluttering bandwagon. Try to get rid of 40 bags of things that you can donate to charity. Don’t use it as an excuse to buy other crap though.
  • Get out of Debt. If you want to celebrate at Easter, start getting rid of debt now.

Did you realize that the 40 days of Lent means you can take every Sunday off? Do the arithmetic, from today until Good Friday, that is more than 40 days.

Recent Articles

I haven’t written one of these in a while, so I do have a bit of a backlog on things I have written. Stock Picks for the end of the year, was me simply checking what my picks did over the year. I think it is not too bad, given the whacky year 2018 was.

Tangible Financial New Years Resolutions was pointing out the importance of doing measurable resolutions for the New Year. Yes, it has been a while, since I wrote one of these. CPP and EI for 2019 gives us the rundown on how much we’ll have to pay for CPP and EI this year. Remember to be careful telling folks when you have finished paying CPP.

Are we Exposed on Banks in Canada? Currently most Indexes do seem to include a lot of financial stocks. How important is your Credit Score? More important than your blood pressure levels? No! How about When to Use a Pay Day Loan Service? Never! See a trend?

Pay Taxes or Your RRSP ? Too late to decide now, but still an interesting question. I grow weary from the The Anti-Virus Shell Game, sometimes cheap, most times too damn expensive.

RDSP Statement of Grant Entitlement 2019 is our yearly report on what we can put in my son’s RDSP.

Money Deep Thought

The Daily Stoic an email list I subscribe to had some very good advice about debt.

Be wary of debt. Because it is not simply a financial matter. It can be a spiritual matter as well. For to owe can mean to be owned. It can mean that you’ve given up the little bit of control you have in the world and handed it over to a capricious or an insensitive person—or just somebody who values their money more than they value you.

— The Daily Stoic
EQ Bank Savings Plus Account

🎱 For more personal finance stories click here 🎱

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Each year we receive an RDSP Statement of Grant Entitlement from the government. This statement tells us how much my son will receive in grants on his RDSP (for this year). There is also a statement about how much money that can be deposited in the account to receive these grants.

I have scanned the main information box that explains this.

RDSP Statement of Grant Entitlement 2019
My Son’s 2019 Grant Story

As you can see this is an important piece of information. I now know I can deposit $1020 in my son’s RDSP (this year) and it will be matched with $1020 in grants.

The reason these amounts are so low, is currently my son is under 18 years old. Due to his age, his “net income” calculation is based on my family income. Once my son reaches age 18 the income calculation that the statement of grant entitlements is based on, will be his income only. At that time, his grants should be much higher, due to his estimated income at that age.

When he turns 18, he will also have to re-qualify for his Disability Tax Credit as well. This is what we learned from the last time he had to re-qualify.

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The Anti-Virus Shell Game

I continue to be tormented by the Anti-Virus shell game.

Anti-virus software in stores (or on Amazon for that matter) is always on sale. Norton continues to do this, and when you “register” you are asked for a Credit Card. You can’t get updates without giving them a credit card, and that means they have got you. You must keep getting updates to keep the software working to specification.

In a year when your “subscription” is to be renewed, the renewal price is at least twice as much as you paid the previous year.

You do have a way out, you can go on line, and turn off Auto-Renew on your subscription. This is where it gets interesting.

  1. You click the Auto-Renew to “No
  2. Suddenly it asks for a reason why? I answered, “Too expensive
  3. Next the web site says, “What if we give you an Amazon $30 Gift Card?”
    • Where was this perk? This kind of bate and switch silliness I expect from Rogers or Bell. with this “perk” suddenly the cost of renewing isn’t as bad.
  4. If you just don’t like this, keep saying No, maybe you’ll get other “perks”? A set of Ginsu Knives?

I really despise this kind of product silliness, but it looks like the Anti-Virus world is becoming like other Tech Firms (e.g. Internet Provider, Cell Phone Provider, etc.,).

Conclusions

Is the Anti-Virus worth having? Maybe, I am sure folks will argue you don’t need it, or worse, they don’t work, but I will continue to play along (for now).

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Pay Taxes or Your RRSP ?

Given my love for the RRSP (or the Tax Deferral Savings Plan), I was wondering whether folks use it to defer owed taxes? The simple question is Pay Taxes or Your RRSP ?

If you received my T4 early enough that you could estimate my taxes, what would you do if you estimated you owed $500 taxes?

You have two options:

  1. Give the CRA their $500 and forget about it
  2. Put enough money into your RRSP (before March 1st) to counteract the owed taxes. This means you would then owe $0 in taxes.

The argument I keep hearing is that if I put money away in an RRSP now, I’ll just end up paying a higher tax rate on it when I take the money out. There is a school of thought that you might be in a higher tax bracket when you retire. To me, it seems an odd statement given the money will grow (hopefully) in your RRSP. This mean you’ll have more money to be taxed, albeit at a higher rate ?

I tried very hard to find what your nominal tax rate might be in Ontario, but let’s just assume it’s 50% for you.

This means you need to put about $750 into your RRSP to not pay $500 in taxes to the CRA. To do this exercise, if you have Quicktax or something similar, you can simply plug numbers into their RRSP estimator. This might be a better way to estimate, how much to pay.

Now you have $750 in your RRSP, and say you are 32. You have about 30 years until you want to take your $750 out. Assuming a simple growth 4.5% year over year, it will be about $3100.

Why not Put It in an RRSP ?

You now take $3100 out at a higher tax rate (say 60% again hopefully taxes in 32 years are not that brutally high), but it is still about $1300 dollars net. The bonus is you didn’t have to pay the CRA $500 32 years ago (an added bonus).

A net investment of $250 (you were going to have to spend $500 no matter what) you end up with $800 ? Seems like a winner to me.

Why wouldn’t you do this? If you didn’t have $750 dollars I suppose that might stop you, but are there other reasons?

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