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Friday, November 20, 2009 12:57 PM
The many ways to give
It’s that time of year to open our wallets. Not-for-profit organizations are looking for support after seeing the recession take a toll on charitable giving. According to a Statistics Canada report released on Monday, the overall value of charitable donations dropped 5.3 per cent last year.
“Charities definitely need it, and donation receipts have to be issued by December 31 to be used towards your 2009 tax bill,” says Carol Bezaire, vice president tax and estate planning at Mackenzie Financial. “It’s a perfect time to plan and think about it now.”
When you think of donating to your favourite charity, keep in mind that it doesn’t just have to be a gift of cash. There are many options for donations and here are a few of the less common strategies:
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Wednesday, November 18, 2009 01:25 PM
Debating dollar stores and globalization
When I recently wrote in this blog about my love of dollar stores, I did not expect to spark a vitriolic debate. The entry hit a nerve, though, and the comments poured in. Readers were quick to make a connection between dollar stores and low-cost Chinese manufacturing.
“There [are] Canadians who can’t find work because our jobs have gone to those slave-like labour countries,” fumed one irate commenter. “I’m glad your kids like their cheap toys made by a kid [who] doesn’t make enough to even buy one.”
I don’t have any relationship with dollar stores other than as a consumer, but I feel obligated to point out that they sell Canadian-made goods too.
Monday, November 16, 2009 05:49 PM
Giving, even when giving is hard
One of the sharpest memories I have of my grandmother, who passed away when I was a child, is of the clear plastic bag of coins she kept on her dresser. It was for charity, she told me. Whenever she had some spare change, into the bag it would go. It added up. My grandmother was devoted to her chosen charities and gave what she could throughout her life.
I often think about my grandmother’s bag of coins when I’m debating how much of my household budget to set aside for charity. It’s a question that many Canadians on stretched budgets are likely grappling with in the wake of the recession.
Sunday, November 15, 2009 02:01 PM
Five reasons I love dollar stores
In a market that has shown little enthusiasm for initial public offerings, two of the most successful recent market entrants have been dollar store chains. Homegrown company Dollarama DOL-T has seen its stock rise 12 per cent since hitting the Toronto Stock Exchange in October and shares of U.S. retailer Dollar General Corp. DG-N popped in their first day of trading on the New York Stock Exchange on Friday.
It's not hard to see the attraction for investors. Dollar stores have been one of the few retail segments to achieve revenue and earnings growth during the recession.
My love of dollar stores goes beyond their investment potential. I visit my neighbourhood discount store a few times a month to stock up on household supplies that can cost five times the price at a regular retailer. Judging by the number of BMWs and Mercedes I see in the lot outside the store, even those with means to pay more head to the dollar store for deals.
Thursday, November 12, 2009 01:23 PM
Are you putting off retirement?
This RRSP season, you may invest the same amount you always have, or even more, but you’re likely to take less risk with your money.
That’s what Investors Group recently found in its eighth annual poll of Canadians’ investment intentions.
After a year when most of us saw our portfolios shaken by the turbulent economy, many Canadians will be investing more conservatively ahead of the RRSP deadline in March.
“People are being more cautious,” says Jack Courtney, assistant vice president of advanced financial planning at Investors Group.
“In 2007, when people were asked whether they would invest in safe investments, only 15 per cent said yes. In 2008, that number jumped to 40 per cent and now it’s over 44 per cent.”
Friday, November 6, 2009 09:15 AM
Seller beware when cashing out on gold
Earlier this week I wrote about some of the top online destinations for buying gold coins and wafers. But the precious metal’s recent highs may have you thinking more about selling than buying. If you are looking to cash out on some of your gold jewellery, you have a lot of options. You could visit a local pawnshop or go to a gold party and have an appraiser make you an offer.
Or you could respond to one of the many ads promoting quick cash for gold. Companies such as Cash4Gold, GoldKit and GoldPaq will accept your gold jewellery by mail. Send them that hideous brooch you inherited from your great-aunt in a postage-paid envelope and they’ll send you a cheque a few days later. If you don’t like the amount, you can return it and get your gold back at no charge.
But seller beware. Consumer Reports recently investigated the cash-for-gold business and found you’re likely to get a payment absurdly below gold’s spot value.
Thursday, November 5, 2009 12:23 PM
Want to get your hands on some gold?
With gold hitting a record high above $1,095 (U.S.) on Wednesday, I recalled the year my father turned into a gold bug. In 1990, at the start of the recession, he began filling his portfolio with the equities of junior mining companies. He also bought a number of gold coins and wafers and stored them in a safety deposit box.
Commodities guru Eric Sprott has built his fortune on the belief that gold – especially in its physical form – is the ultimate asset to own in any economic environment.
“In my portfolio I have 40 per cent in gold and I think that’s the safest, and probably the most rewarding investment that I could have,” the founder of Sprott Asset Management told investment website Seeking Alpha in an interview earlier this year. “I believe no matter what environment you’re in—deflation or inflation—people will run to gold.”
“For the most part, I always own physical gold. When I say gold, I really mean gold and silver; and I am probably about equal in each. I always take delivery. I want to own the physical—I don’t want an owner’s certificate, I don’t want to own an ETF. I believe that it’s really the only security you have, and you don’t want any counter-party between you and your gold, so I take delivery.”
For my father, gold coins and wafers were appealing because they are easily portable and transferable into cash. Maple Leaf coins are as good as currency and can be quickly exchanged at any bank or commodities trader, while wafers need to be inspected and weighed to be valued.
Tuesday, November 3, 2009 02:11 PM
Gearing up for winter
As winter quickly approaches, our household expenses are mounting. We’re spending on those necessities that will keep us safe and warm during the cold, dark months ahead.
Still, even as we securely batten down the hatches, we’re trying to trim our annual winter readiness costs by sticking to the basics. Here is my family’s winter spending checklist, divvied up into four key categories: the car, the house, the yard and the kids.
The Car
Our most significant purchase this November is a new set of winter tires for my car. In the past, I’ve relied on all-season tires to see me through all weather conditions.
All-season tires work fine in light to moderate snow, but aren’t designed for heavier snowfalls. After skidding a few times on icy roads last winter, even while driving very slowly, I want the extra control and stability of winter tires. It’s not a small investment. I am spending $910 for four tires with steel rims, including installation. But if I treat them well and maintain the right air pressure, they should last me six seasons.
There are many different brands of winter tires - all with different price points. A review of winter tires at Wheels.ca highlights their top picks which range from $111 to $536 each. I’ve also been hearing a Wal-Mart radio commercial advertising winter tires for as low as $36.
Whatever brand you choose, you’ll need to buy four. According to Transport Canada, using only two winter tires, regardless of whether the car is rear-wheel or four-wheel drive, will not give you enough traction.
The House
Two winters ago, my neighbour had to clean up a messy and expensive leak in their bedroom after their eavestroughs became clogged with leaves. Now I always hire a company to come and clean out the gutters and the downspout before it begins to snow. To reduce the ongoing cost of eavestrough maintenance, you can consider installing a filter to keep leaves and debris out. The cost of installation is around $2.25 to $3.00 per linear foot. I had the product installed along a few feet of our home’s eavestrough that tends to get blocked most often.
Now that we are turning our heating on, we’re also taking the opportunity to have our furnace checked out. I want to replace the filter and make sure the humidifier is in good working order.
For more ideas on how to prepare your home for winter, check out this list of 29 tips by blogger Frugal Dad. Among his suggestions are caulking around windows to prevent cold air from seeping in around cracks and having your chimney cleaned.
The Yard
I am feeling guilty for not yet raking the mountain of leaves that have fallen from the trees in my yard. It’s hard to believe the slim branches of our umbrella tree held all the leaves that now blanket our grass. Bagging the leaves will be my priority this week, but there are other gardening duties to tend to before winter.
Before the ground freezes, I’m going to plant flower bulbs so that I can enjoy the splash of colour when spring comes. There are many tips on how to get your garden ready for winter at HGTV Canada’s website.
The Kids
Fortunately, I already have winter coats for my daughters this year. We bought my five-year-old a snowsuit at last year’s sales and my three-year-old is getting a hand-me-down. Still, they both need new boots, hats and mittens. Before I go shopping, I’m scouring our clothing storage bins to see if anything can be reused from last winter. The cost of outfitting your child for winter is not cheap, but it’s best to buy what they need at the start of the season.
A friend with a three-year-old daughter has already bought her a warm coat, boots, a hat and gloves. “I’m not willing to wait for the sales,” she says. “I waited too long last year and could barely find a snowsuit in her size.”
She is saving though by skimping on herself and her husband this winter. “I will probably just wear my old coat, even though it's ripped. Maybe I’ll wait until stuff starts getting marked down to buy something new.”
I plan to do the same.
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Wednesday, November 18, 2009 07:17 AM
Ten ways to dump your financial adviser
After a recent entry in this blog about how many Canadians are unhappy with their financial advisers, a friend confided that he is trying to leave his.
“I am ditching my guy after four years and just signing up a new one that is better suited for my needs,” he told me. But he wasn’t sure how to actually deliver the bad news to his long-time consultant.
Like any relationship, the one between investor and financial adviser requires trust and compatibility to be successful. Breaking up is hard to do. But, like Joe Cocker says, when the magic is gone, there’s no sense in holding on. For my friend, and anyone else trying to dump their adviser, here a couple of ways to deliver the blow.
Monday, November 2, 2009 02:43 PM
Why buy Canada Savings Bonds?
All this month, the federal government has been hawking its 10-year Canada Savings Bonds Series 120 through a constant stream of television commercials. You have only a few days until the November 1 deadline to buy the bonds that pay an annual interest rate of 0.4 per cent. Don’t rush.
The bonds carry the lowest annual return since the government started selling the debt instruments in 1946.
I recall in 1987, my eight-year-old brother took his birthday money and invested $100 in a Canada Savings Bond. It paid over 7 per cent in annual interest. A lot of Canadians invested in them. That year, the best on record for Canada Savings Bond assets, the government raised $17.5-billion through the program. In 2008, gross sales of the savings bonds had dropped to $1.9-billion.
Even though many Canadians are feeling jittery about the equities market and keeping money on the sidelines, they are not stashing their cash in CSBs. The 0.4 per cent coupon doesn’t come close to meeting the core inflation rate, currently around 1.6 per cent according to the Bank of Canada. Factor in tax (unless you hold the bond in a tax-free savings account) and you're really losing money on the deal. You can do far better with a high-interest savings account such as the one available from new retail bank Ally, owned by GMAC Financial Services, which pays 2 per cent.
Yet the federal government is still promoting the investment vehicle to the average Canadian through payroll savings programs across the country. Last week, a friend who works for a financial institution emailed me the pitch she had received from the company’s human resources department.
“Plan for a comfortable retirement with Canada Savings Bonds purchased through the Payroll Savings Program,” it started. “The earlier you start saving, the more secure your future will be. A contribution of just $50 per bi-weekly pay can help you enjoy a worry-free retirement.”
My friend, who is pretty savvy at managing her family’s budget, wondered why anyone would buy into the scheme. “I especially love the line ‘it's easy to save for your dreams’,” she joked. “My dream is a latte in November 2010.”
And even that may be a stretch.
Home Cents Contributors
Chaya Cooperberg
Chaya Cooperberg is living the dream. She’s the mother of two young girls, managing a busy household in the suburbs of Toronto on a tight budget. She’s also managed to build a full-time career in investor relations, running award-winning programs for Canadian public companies. She sits on the Board of the Canadian Investor Relations Institute’s Ontario chapter as well as the National Investor Relations Institute’s virtual chapter.
