Random Thoughts

Estimated reading time: 4 minutes

RRSP season is slowly coming to a close, if we are to believe the advertising campaigns from the banks and mutual funds. RRSP season is actually all year round, however March 1, 2017 is the deadline for contributing to an RRSP for the 2016 tax year.

It is bad planning (in my opinion) to buy RRSPs at this stage of the game, but if you find money (and don’t have debt to pay off), it is an OK place to put found money. I have over the years written plenty of articles on RRSPs, and here are a few for you to read:

• The Spousal RRSP the Forgotten Savings Tool, is a useful tool.
• Are you getting tired of listening to all the financial jargon?RRSP Bingo is for those lucky folks who might be visiting their investment folks.
• RRSP Rebalance Season, if you are going to be looking at your retirement investments, maybe it is time to rebalance them too?
• Which do you do? RRSP then TFSA ?  Of course I am assuming you have paid off your debt.
• In a more snarky line, TFSA Retirement Welfare Bums, is a discussion about all those rich folks who can put money in their TFSA for their retirement.

If this is RRSP season, remember that it is tax season as well. For folks in Ottawa who work for the Federal Government, there are tax problems. Over 50,000 have had issues with their T4 slips from the new Phoenix pay system. Ironically the CRA (who are also part of the Phoenix Pay system) say that there will be no dispensations for them. The CRA was kind enough to put up an FAQ Page for Tax Questions.

The ultimate concept in the #Fakenews? The status bar and how long it says it will take to install your software (several minutes, my arse!)

My Writings for Week Ending February 24th

Given we are in the RRSP Season, I had my own poke at the topic, which I borrowed from a discussion I had with Preet B. and Michael James about how so many folks seem to forget that an RRSP is a Tax Deferral Savings Plan. How many times have you heard someone tell you how much money they have in their RRSP and never mention the taxes they might have to pay on that sum?

Yesterday, a rodent may or may not have seen his or her shadow and winter may or may not be ending sooner or later. What would financial ground-hog day be like ? This happens pretty much every month, when the Bank of Canada sets key interest rates, maybe they decide on the basis of the Governor seeing his own shadow? No, but that is a worthwhile indicator I suppose.

It is the year of the Fire Rooster, to our friends who observe the Chinese Lunar Calendar. If you are a Rooster, this may not be a good year for you, but I still enjoy the Festive Celebrations for this new year. We shall see how fortunate a year it ends up being, but it will be a long year, with 13 months .

In Ottawa we begin Winterlude , the festival celebrating the winter here. The weather rarely co-operates, it is either too warm and the canal melts or so cold no one wishes to be outside. The forecasts suggest  this might be a good year to enjoy the festival.

My Writings for Week Ending February 3rd

I have been meaning to publish this week’s article for a while, but wasn’t sure whether I got it right. I have been approached by a few “Promoters” of companies that charge a fee (or percentage) to help folks get their Disability Tax Credit, and I have ignored their offers, as I feel they are taking advantage with their fees. When I came upon Bill C-462 I thought that finally the government was agreeing with my opinion, however, as I wrote in Bill C-462 : Protecting Disabled Canadians or a Paper Tiger ? it seems this act is dead on arrival.

If anyone has any more insight on this, please contact me as I am very interested to find out whether this Act will ever be put into practice.

Editor’s Note: I have now included the last update date on all my articles, so you can see that those that I may “reprint” in social media, has usually been updated (or edit’ed to make it more readable).

It seems some money lenders are not happy with the new Mortgage rules, so they are attempting to bamboozle the system by marketing something called a Bundled Loan (or as I call it bungled mortgages ). The CBC’s explanation of this new poly-morphed debt vehicle is:

Canada’s subprime mortgage providers are increasingly teaming up with unregulated rivals to sidestep rules designed to clamp down on risky lending. … The result of these partnerships are so-called bundled loans, which pair a primary mortgage with a second loan from unregulated groups called Mortgage Investment Corporations (MICs).

This loan offer appears to be nothing more than the old trickery of offering 1st, 2nd, and perhaps even 3rd mortgages, except that the 2nd and 3rd mortgages are being provided by different lenders. Despite the fact that this practice is not illegal, the primary lender is obligated to consider all of the borrower’s outstanding debts when offering the main mortgage. It is unclear whether they are taking into account the other parts of the loan bundle. Nevertheless, this situation is a clear example of mishandling mortgages and should be addressed as such.

It is Friday the 13th today. Is it a bad day to invest? I don’t know call me in a year and I will tell you. Should you sell on Friday the 13th? Depends on what you are selling, and whether what you sell goes up in value after you sell it. I never get tired of giving these kind of testicle busting comments. Did you realize that Friday the 13th, always occurs after a Thursday the 12th ?

My Writings for Week Ending January 13th

Last week the year end employment numbers were published by our friends at Stats Canada, and it showed that 2016 Was the Year of the Part-time job, since that is where most of the job growth in Canada took place. It is good there are more jobs, but it is disturbing to see that many folks careers now consist of a few part-time jobs, quilted together to create enough income to live on. Let us hope they are not also looking for bungled mortgages.

A Money Thought

Well, it costs you money, because in Ottawa it is Pothole season!

2016 has been a real pain in the arse, especially in terms of news and music. It is safe to say that most people are looking forward to seeing the back of it. However, I have a thought-provoking question for you. Do you think the famous individuals who passed away in 2016 anticipated what 2017 has in store and decided to leave early? This is a deep thought from BCM for 2016, and I firmly believe that this year cannot end soon enough.

Have you done any of the things you should be doing for the end of year?

• Top up your Charitable donations ? Those are counted on the calendar year, you have today to try to get it done (or go to Church on Sunday and they might count it as this year too).
• TFSA juggling, if you were planning on taking money out of your TFSA, you should have done it by now, that way you can easily have the deposit space for next year, and you can start paying it back.
• It is never too early to put money into your RRSP (if you have room, and don’t have a lot of debts).
• Make sure you have paid all of your bills for 2016 as well (quarterly CRA, property tax, etc.,).
• Evidently January 2nd is known as Divorce Day, so maybe you should start that early ?

You could always create a financial plan for 2016 as well (never a bad idea either).

My Writings for Week Ending December 30th

I did manage to get a thematic post out this week, discussing the important celebration of Festivus, with Festivus Financial Airing of Grievances, and I have a lot to complain about this year, that is for sure! Next the feats of strength, get ready to rumble, baby!