Canadian Dollars Blog

Well, February was again a very volatile month. So how did we do in February? RRSP: $42200 CASH: $15366 STOCKS: $33400 (outside RRSP) ------------------------------------------- TOTAL: $90966 (-2%) month over month For the month of February my networth decreased by about 2% due to more volatility in the market and a few unforeseen costs that I ran into. Namely, my car was in for repairs that costed me way more than I had originally expected. Also, I liquidated some old poor performing mutual funds that I had purchased about 10 years ago with advice from an advisor. I had neglected those funds for a long time and it wasn't until recently that I discovered that the MERs for those funds were ridiculous that I decided to sell them and purchase some index funds. Overall, I am still keeping a long term focus even though this past month was not as prosperous as I would have liked. Let's hope things improve in March! Thanks again for reading the Canadian Dollars Blog.

I love riding the TTC. It takes me to and from work and occasionally I get to witness the outrageous - whether it's a crazy man that's talking to himself or two friends talking about hot stock picks. I generally prefer the latter type of outrageous because the risk to me is very minimal. It usually starts like this. One guy is a bragger - he'll brag about how he made a killing shorting some stock or being able to time the market. The other guy, on the other hand just sits there an listens. You can immediately tell that the second guy is an investing newbie because he's listening intently to what the first guy has to say. You can see the disappointment in the newbie's face when he exclaims that he only achieved index performance last year. The bragger makes fun of the index performer and claims that the index performer doesn't have any skill at reading the markets. I knew it was going to 13,000 the bragger says in a loud voice. I knew Apple was overpriced ...

Less than 48 hours after the budget was revealed, there are already many criticisms of the proposed Tax-free Savings Account. Some argue that the amount is not enough, while others argue that all it does is make the wealth middle class richer. In today's Toronto Star, there is an article which compares the proposed system with the British Individual Savings Account (ISA) in which the critic writes: "But almost invariably, the only people who participate are the ones with lots of spare cash – the sort of people who already do save and who would have saved anyway. So it ends up being a giveaway to the wealthy middle class." This sort of thinking would also poo poo on the idea of RRSPs as well. What the author is failing to see is that in an age where the average Canadian saves next to little what they earn, there is a merit to programs like this. By sheltering the first $5000 every year, the policy clearly helps and gives Canadians an incentive to save up their money. ...

Twice a month, on a Wednesday, Hart House serves up a delicious multi-course meal for just $5! Note that this is not limited only to students. You should get there early as line ups for this amazing deal become insane very quick! Here is a list of upcoming dates: March 5th March 19th April 2nd All Five Buck Lunches occur on a Wednesday, from 11:45am - 2pm. For more information, contact the Hall Porters' Desk at Hart House. 416.978.2452. http://www.food-beverage.utoronto.ca/food/news/Five_Buck_Lunches.htm

Tax-Free Savings Account (TFSA) * This is the major measure relating to investors * Begins 2009 * Every individual 18 years and older obtains $5,000 per year (indexed) contribution room regardless of income * No upper age limit for earning contribution room or making contributions ( no 71 year rule as for RRSPs) * Contribution room not used may be carried forward indefinitely * Contributions are non-deductible; withdrawals are non-taxable (including investment income withdrawals) * Qualifying investments the same as for RRSPs * Attribution rules do not apply so one spouse may contribute to the other spouse’s TFSA Partial unlocking of Federally Regulated LIF’S * Effective date unknown * Individuals 55 or older with LIF accounts of $22,450 or less may un-lock * Individuals 55 years and older eligible for one time un-locking of half of their LIF holdings Guaranteed Income Supplement (GIS) Earned Income Exemption Increased * Implementation date unknown ...

There seem to be a host of new companies in Canada that have recently started operations in the 'community to community lending' space. For those not familiar with this type of business, it allows individuals to lend other individuals money at favourable interest rates for both the lender and borrower. The lender is able to earn a higher interest rate than they would in a 1 year GIC and the borrower is able to borrow money at a rate lower than what is given to them on their Mastercard and VISA cards. While on the surface this sounds good and all and the fact that many of these companies do offer credit checks (I would hope) and do proper screening, it makes me wonder. Have we not learned from the credit crunch issues in the states? Here's why I think this is troubling. First of all, Canadians have a record amount of debt. Folks! On average, we're saving less than we're spending. That would indicate why these person to person lenders are seeing a market - a m...

How many times have you chewed gum only to be disappointed. Be honest. When you're in your car driving two hours to some destination, don't you just hate it when your gum loses it's flavour after about 20 minutes? If you're on the highway you have to quickly reach over and find somewhere to dispose of the flavourless gum. You could keep chewing it, but by now it's starting to taste like chewing rubber. Which, unfortunately isn't very appealing. What if some competitor came along, and decided to change the rules of gum. To break through and truly think outside of the box. This is gutsy of course and risky. Why mess with something that's established? Is it really wise to take on the Wrigley's of the world? If so, how do you decide how to differentiate yourself from them? To give yourself a true competitive advantage? Sure you could come up with another outrageous flavour that your competitor doesn't sell. But does that really work? Peopl...