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Carrick on Money

Rob Carrick pulls together the best personal finance ideas of the week

Entry archive:

Downsizing? Use these rules to help decide what to throw out

My family most recently moved 17 years ago. Last Friday, I found a box of junk in the basement that we never unpacked. As my wife and I start the decluttering process for our next move, the unopened box will be used as inspiration to get rid of all non-essentials.

Here’s some help I found in deciding what to get rid of: a U.S. couple’s account of how they recently decluttered for a move to a smaller home. They used three sensible ground rules: 1) If they hadn’t used something in over a year, it got tossed; 2) If it hadn’t been opened since the previous move, they got rid of it; 3) Reason over nostalgia, which meant getting rid of many books and CDs.

This couple ended up with two lists after their decluttering efforts, stuff they definitely wanted and an “if it fits” list. My sense is that most of the stuff on any “if it fits” list won’t fit, but the people doing the decluttering haven’t quite yet got to a point where they can get rid of it. But the more diligent you are about decluttering, the more time and money you’ll save in moving.

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Rob’s personal finance reading list…
Married, with separate finances
I’m a big believer in combining your finances when you partner up in life. A millennial money blogger disagrees for some interesting reasons, one of them being that she and her spouse don’t want to be responsible for each other’s individual debts. An example of how different generations can take a different view on personal finance.

True confessions about wasting money
Ten people come clean about the ways they spend excessively. Interesting in that none seem particularly inclined to do anything about it. Inertia is a huge challenge in improving our finances.

How to help ward off dementia
Three easy-to-follow tips offered on the basis that dementia can blow up your retirement plans like nothing else.

Best baby shower gifts
Hmm, not a subject I know a tonne about. But if I did have to go to one, I know I’d appreciate a list of suggested gifts to help me spend wisely.

Today’s featured financial tool
How can you tell if you’re getting a serious, professional-grade financial plan from an investment adviser or financial planner? Check out this briefing on what to expect from the financial planning process. It comes from the Financial Planning Standards Council, which oversees the Certified Financial Planner (CFP) designation.

Ask Rob
The question: “We are considering putting $25,000 into our two granddaughters’ registered education savings plan (RESP) for their future education. Is this a good idea? Are there positive and negative tax implications for us?”

The answer: “If you want to ensure the money you’re providing goes toward your grandchildren’s post-secondary education, an RESP contribution is a good idea. Money in the RESP is sheltered from tax until withdraw, and then it’s taxed in the hands of the beneficiary student. That’s your granddaughters, who presumably will have a modest total income and not owe any income tax. There are no real tax implications either way for you, the contributor to the plan. For example, you don’t get the same kind of tax deduction as when contributing to an RRSP.

What I’ve been writing about
- How to get ahead when your income is hardly growing
- How to boost your returns when buying bond ETFs (for Globe Unlimited subscribers)

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

Send us an e-mail to let us know what you think of my newsletter.

Want to subscribe? Click here to sign up.

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These are the favourite travel websites of Canadians

Budget travel expert Barry Choi offers his thoughts here on a list of Top 10 travel websites that was compiled by a digital marketing firm. Sitting at Number One is Tripadvisor.ca, which Mr. Choi says he uses every time he plans a trip.

My wife and I use it, too. The reviews of hotels, restaurants and attractions can be useful, but the real attraction is the availability of forums where travellers ask questions and get answers from people who have been there and done that.

Also, if you’re considering a particular destination, check out what other travellers are saying about it. For fun, I always click to the worst reviews first. Somebody describes the ancient temples of Angkor Wat in Cambodia, named the No. 1 landmark for 2017 by Tripadvisor readers, as “dusty, hot and a waste of time.”

Here are some other travel-related resources I’ve found lately:
- Credit cards with no foreign transaction fees: The latest list of the few credit cards that don’t charge the typical 2.5 per cent fee on transactions in currencies other than Canadian dollars. If you travel a lot, take a look.
- What to do with those dreaded flight layovers: The cheapest flight options are often ones with layovers. Here are eight airports where you can duck out quickly and easily to visit the nearby city.
- What she learned from being robbed at gunpoint on vacation: Tips on protecting your money – cash, credit cards, bank cards – in case you’re robbed while on vacation in another country. The first person aspect elevates this article beyond the usual list of tips.

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Rob’s personal finance reading list…

Hey, where’s my interest?

An account from the Ombudsman for Banking Services and Investments about a woman who was erroneously told by her bank that she would receive interest of 1.25 per cent per month on her savings. There’s a lesson here about double or even triple checking what frontline bank staff tell you. They get stuff wrong sometimes. As for 1.25 per cent per month, that works out to be more than 16 per cent annually. The complainant should have known better.

Leave these reno jobs for the pros
Gas lines, electrical work, structural changes and more. Pay a professional to get these key jobs done properly.

Navigating the dental aisle of confusion
How to get value when spending money on products to whiten your teeth

Today’s featured financial tool

Unable to get a complaint against a bank or investment firm resolved? See if the company involved participates in the Ombudsman for Banking Services and Investments, an independent office that investigates situations involving amounts of up to $350,000.

Ask Rob
The question: “My 17-year-old son has saved $7,000 from his part-time job and would like to invest it. What would you recommend?”

The answer: "Awesome job by your son. Just excellent. My question back to you relates to your son’s cash needs in the years ahead. If the $7,000 will be needed for college or university, there’s a good argument for keeping it safe and sound in a high-interest savings account. If your son is able to let that money sit for the long term, then some low-cost exchange-traded funds would work well. Once he reaches the age of majority (18 or 19, depending on the province), he can open his own account at an online brokerage and hold the ETFs directly. Or, he can have a robo-adviser handle things for a modest cost. Eighteen is also the age where your son starts to be eligible to use a TFSA. Contribution room for TFSAs is currently set at $5,500 per year. RRSPs are also an option if your son has earned income (sounds like he does)."

In case you missed these Globe and Mail personal finance stories
-
Is now a good time to buy a house or should we keep saving?
- Well-to-do investors plow cash into Canadian farmland
- For investors, there’s a hurricane coming. What you should do now (for Globe Unlimited subscribers)

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

Send us an e-mail to let us know what you think of my newsletter.

Want to subscribe? Click here to sign up.

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Let’s bury the ‘women are spendthrifts’ narrative in personal finance

A recent study suggests that money is the top reason for strains in a relationship, ahead of differing goals for the future, career decisions, politics and kids. What’s the top predictor of a disagreement about money? A husband thinking his wife spends too much.

Meanwhile, the biggest contribution to stress for wives was having a husband who sees them as a spendthrift. The idea that women are avid, free-spending shoppers seems to be ingrained in our thinking about money. Based on a recent experience at a drugstore, I would like to suggest that there’s no difference between men and women as spenders and consumers.

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Carrick on money newsletter: Tips and tools for university students

Today’s newsletter was compiled by personal finance editor Roma Luciw.

In the last five years, Globe and Mail personal finance columnist Rob Carrick and I have visited college and university campuses across the country, talking with students about money. We start our financial literacy sessions by going over what we think are some of the most pressing money-related topics young adults will face during their school years: managing student loans, learning to budget, how to handle debt, and what awaits them in the job market.

When we open it up to questions, we are asked about housing, credit scores, bank products and how to get started investing. We’re happy to talk about anything financial; the important thing is getting these conversations going. Here’s a list of Globe and Mail content on topics students often want to discuss. If you are a student, read it. If you know a student, pass it along to them.

1) How to navigate a relationship with your bank.
In Millennials, banks are not your friends, Rob shows students how to evaluate the value of a student bank account. The overall message here is that banks are not your friends – or your enemies. They are companies you do business with, so do your research, defend your interests and don’t forget to shop around.

2) What is a credit score and why should I care about it?
With many students borrowing money for the first time, interest in credit scores – and how to maintain a good one – is high. This story looks at what goes into determining your credit score and how to check it. The basic message here is not to panic. Pay what you owe on time and limit your overall borrowing, and your credit score will be just fine. Here’s a video I did on this topic.

3) Ultimate investing guide for Gen Y, part one and two
Although they don’t have any money coming in (yet), students are always curious about investing. Rob’s ultimate investing guides – here’s part one and here’s part two – are designed to help young adults find their footing without getting clobbered by fees and commissions.

4) Housing – when will I be able to afford to buy?
Real estate is another hot topic among Canadian students. To help you start thinking about your future and current housing decisions (which by no means need to involve buying; check out this video about how renting is not a waste a money), I will steer you to some excellent online tools we at the Globe have built. Check out our Can I afford to move out calculator, our Where in Canada can you afford to rent tool, and lastly, our When will I be able to afford a downpayment tool.

For more student-related stories and videos, visit our Gen Y money page. If you’d like us to come to your campus, send me an email. If you are a student with a money-related question, tweet it to us using the hashtag #genYmoney.

Subscribe to Carrick on Money
Are you reading this newsletter on the web or did someone forward the e-mail version to you? If so, you can sign up for Carrick on Money here.

Today’s featured financial tool
With the Bank of Canada raising interest rates this week, here’s a Globe and Mail tool to show those of you with a fixed-rate mortgage how much your monthly payments could change when it comes time to renew.

Ask Rob
Do you have a question for Rob Carrick? He is away on holiday this week but send it our way. Sorry he can’t answer every one personally. Questions and answers are edited for length.

In case you missed these Globe and Mail personal finance stories
– About half of Canadian workers living paycheque to paycheque: survey
– The BoC has put every mortgage holder on alert. Ten things to ponder now (for Globe Unlimited subscribers)
– Tax matters: Mistakes to avoid when transferring assets to other names
– She’s 32 and saved $100,000​ for a condo, here’s how

Featured Video
Gen Y money: What to do with your money if you’ll never buy a home

More Carrick and money coverage
For more money stories, follow Rob on Twitter and join the discussion on his Facebook page. Millennial readers, join our Gen Y Money Facebook group.

Send us an e-mail to let us know what you think of my newsletter.

Want to subscribe? Click here to sign up.

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How much does it cost to raise kids?

Today’s newsletter was compiled by personal finance editor Roma Luciw.

As children across the country flock back to school and my own household settles back into our routine of preparing lunches, scrambling to finish homework and rushing between soccer games and piano lessons, I’m reminded of just how expensive kids are.

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It’s not just tuition. Why the cost of education is higher than many students expect

Rob Carrick

Next week is the first week back to school for most postsecondary students in Canada and along with living on your own for the first time, meeting new people and, of course, studying, one thing not far from top of their minds will be how to pay for it all. Tuition has climbed as much as 40 per cent in the past decade and Canadians’ participation in registered education savings plans (RESPs) remains stubbornly low.

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Small business owner? How you could be impacted by new tax laws

Rob Carrick

The federal government announced proposed tax changes in July but now small business owners are starting to push back. The proposals seek to eliminate or restrict tax-saving measures such as sharing income with family members, saving passive investment income in a corporation and converting a corporation’s income into capital gains. Small business owners are gearing up to fight the changes across the country, saying they will have a devastating impact on their businesses. Here’s a list of ways the tax laws could be changing and strategies to deal with them if you are a small business owner.

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Gloating about a high credit score? You could still be a bad borrower

Rob Carrick

Credit scores are the latest fad in the financial world. One recent survey found that if you’re dating, a high credit score is considered one of the most desirable attributes in a potential mate.

Credit scores used to be obscure – lenders could consult when sizing up a client for a loan, but borrowers themselves had to go through credit reporting agencies such as Equifax and TransUnion. Now, in an effort to attract clients and keep them loyal, financial firms are starting to make credit scores available at no cost to clients. Royal Bank of Canada is doing it, the Capital One credit card people are doing it, and so are the alternative lenders Borrowell and Mogo.

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The good news, bad news story of living to 100

Rob Carrick

The World Economic Forum issued a discussion paper recently titled, “We’ll Live to 100 – How Can We Afford It?” The math behind this question is simple. “On average, [lifespans have] been increasing by one year, every five years,” the paper says. “Babies born today in 2017 can expect to live to over 101, or in other words, they will live to see the year 2117.”

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Why it’s good to splurge on travel

Rob Carrick

A blog called Proud Money recently did something cool – it asked a mix of people what kinds of spending always feels worth it to them.

One person said giving to charity, one said books, and a couple said investing in themselves and their careers. But the most popular answer was travel. “When I spend money on travel, it always feels worth it to me,” one woman wrote. “I feel like I am part of something greater than myself. I am experiencing things that some people will never see in their lifetime. It is inspiring and humbling.” Great summary, that.

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Here’s a way renting beats owning a home by miles

Rob Carrick

For wealth-building, owning a home and renting are pretty much a wash. If you rent and invest the money saved over owning, you can build comparable wealth to the owner. Where renting beats ownership clean is in providing financial flexibility.

Consider the story of personal finance blogger John Robertson. Because of an illness, his household had to go down to one income. An emergency fund helped sustain them, and so did helpful family members. But the fact that his family rents was also a big factor. They rent in Toronto, by the way.

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The best place to live if you commute to downtown Toronto

Today’s newsletter was compiled by Iain Boekhoff.

Toronto’s soaring real estate prices have tapered a bit in recent months, but living downtown might be just as affordable as commuting when you factor in all the costs. That’s according to an analysis of thousands of homes for sale in the GTA by TheRedPin that balances affordability with proximity to downtown Toronto. Ajax, Pickering and Whitby top the list of affordable commuter cities, while Burlington, Keswick and Oakville are at the bottom. On top of affordability of housing and commute times, factoring in your health – those with longer commutes are more likely to not get enough sleep, be obese, suffer from depression and have money worries – might make downtown Toronto a more attractive choice.

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Don’t let back-to-school shopping break the bank

Today’s newsletter was compiled by Iain Boekhoff.

Summer is halfway over, which means it’s almost time for some back-to-school shopping. Buying new supplies, electronics and clothes for your kids can quickly deplete a family’s budget. Here are some tips on how to get the most out of your back-to-school budget, including holding off on buying non-essential supplies to catch sales after school starts. You can also check out this roundup of past Globe stories that includes a section on keeping your spending in check for all your back-to-school needs.

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Six happy thoughts on retirement from an actual retiree

Rob Carrick

If you want to know what retirement will be like, ask a retiree. There are plenty of financial planners and other experts who have views on this topic, but there’s no substitute for the voice of experience.

I asked retirees on my Facebook personal finance page about their biggest surprises – both good and bad – after leaving the work force. One of the replies I received was this excellent note from David Davidson of Oakville, Ont. Here’s a lightly edited version of his post:

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These are the reasons you’re financially stuck in a rut

Rob Carrick

The Canadian economy is finally starting to build some momentum – that’s why interest rates are starting to move higher. Do you feel like you’re getting ahead financially? If not, here are some fresh insights about personal finance habits that may help. They come in the form of five misconceptions about money that touch on some important themes, notably that being in debt is the new normal.

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Why you should use your Aeroplan points ASAP

Rob Carrick

The breakup of the partnership between Air Canada and the Aeroplan customer loyalty program was announced in May, but it won’t actually happen until 2020. I have no doubt that a lot of Aeroplan members will forget about this development until the media starts reminding them just ahead of the deadline.

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The new Canada Child Benefit: Difference-maker or dud?

Rob Carrick

The first Canada Child Benefit payments were sent out just about a year ago. Have families noticed any difference in their finances as a result of this signature promise from the Liberal platform in the last federal election campaign?

To find out, I asked members of my Facebook personal finance community (scroll down to July 19). Some people said the non-taxable payments are helpful, including an accountant who said she notices the payments making a huge difference for low and middle-income families. But there was also some push-back and anger.

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How much should you spend on wine when you’re invited to dinner?

Rob Carrick

A reader of this newsletter recently sent me a rant a bit about stingy houseguests. “When I visit people I always bring a good bottle (or bottles) of wine,” this person wrote. “[But] I have friends who will come for an evening (or even days) and they invariably bring the cheapest plonk they can find.”

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What one executive learned from her ‘faux-tirement’

Rob Carrick

Ever thought about test-driving your retirement? Christine Benz, the director of personal finance at the independent analysis firm Morningstar, did that recently when she took a six-week sabbatical. She says her “faux-tirement” taught her a few things.

Give this article a read if you’re looking ahead to retirement and wondering how to structure your life. Ms. Benz said her list of tasks that needed doing didn’t take as long as she thought to complete, that home projects were a nuisance and that her spending was a mixed bag. With less stress in her life, she found she wasn’t treating herself to “little goodies” as often. But at the same time, she had more shopping opportunities.

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A rising rate survival guide for home owners and buyers

Rob Carrick

Homeowners, prepare for higher interest rates when you renew your mortgage. Fixed rate mortgage costs started to rise last week, and variable rate mortgages will be affected by the rise this week in the Bank of Canada benchmark lending rate by 0.25 of a point. The increase is widely expected to be followed by another one later this year. If the economy keeps improving, expect more rate increases in 2018 or later.

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Let’s talk about our tendency to ‘awfulize’ retirement

Rob Carrick

Are you looking forward to retirement, but also dreading it? It’s normal. Even while eagerly anticipating the day when we don’t have to punch the clock any longer, we worry about all kinds of retirement unknowns. Will we be bored? Run out of money? Keep our health?

Our conflicted thoughts about retirement are nicely captured in an article by a guy who had big plans for life after leaving his job as an air traffic controller. But as he got closer to the end of his working days, he began to “awfulize” retirement by worrying about things such as whether he had saved enough. How did he break the cycle? By realizing that there will inevitably be uncertainties when you retire, but you’ll be rich in both time and opportunity to try new things.

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The verdict’s in. Here’s how to tell if you’re cheap

I asked readers for their views on cheapness in a recent edition of this newsletter featuring a guy who asked a friend to split a $3 fee for an advance golfing reservation. After reading the 46 replies that came in, I can report that you may well be seen as a cheapo if you don’t offer to split a bill of $20 or more with a friend.

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Millennials lo-o-o-ve their credit cards. Is that a problem?

In a recent survey, 27 per cent of millennials said they spent more than half of their disposable income using credit cards, compared to 16 per cent of boomers.

Ninety-five per cent of millennials reported having at least one credit card, compared to 80 per cent of boomers. While boomers were pretty much evenly split between cash back, travel reward and low-interest cards, millennials strongly preferred cash back and travel cards.

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Carrick's newsletter: Bitcoin is smoking hot – should you invest?

Bitcoin is a digital currency that has been around since 2009. Transactions involving Bitcoin are made with no bank middleman, and you don’t have to use your name. But the really intriguing thing about Bitcoin is the investingaspect. Prices were in the $2,750 (U.S.) range in late June, compared to about $630 a year ago.

Should you jump in? A European investment firm makes a good argument for taking a pass. Basically, this cryptocurrency is too speculative and unstable. Bitcoin is running into resistance as a challenger to traditional money because of slow transaction times and the appeal of current payment options. Why use Bitcoin when you have a credit card that is convenient and offers reward points?

A recent study took a look at who is using Bitcoin. It’s mostly computer programmers and people involved in illegal activities. By the way, Bitcoin has a hot new rival caller Ether.

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NEW: Get the Real Estate newsletter, covering the housing market, mortgages, deal closing, design and more. Sign up here.

How to get started with retirement saving
A thorough look at what millennials need to know about getting started saving for retirement. Given how many young adults work contract jobs and thus have no pensions, this is crucial information.

How old is “old?”
The answer depends on who you ask. Ask a millennial and old age starts at 59. Ask a baby boomer and it starts at 73.

The world’s most tourist-friendly countries
A fun list if you’re planning a trip.

Ingenious ways to organize your fridge
The bottom line here is to arrange things so you use up more of what you buy and throw out less. Some cool ideas here. By one estimate, households waste $28 worth of food each week.

Today’s featured financial tool
The Ontario Securities Commission has re-launched its GetSmarterAboutMoney website. Check it out for unbiased information on investing, working advisers and more. There are also some good calculators that I have featured in this spot.

Ask Rob
The question: “I’m 38 years old with no debt, no mortgage, a solid government job and a great pension plan. I have $52,000 to invest in my TFSA. I’m going sell-directed route. How should I invest this money? Please help!”

The answer: You don’t say how long you want to keep the money invested, so I’ll assume it’s for the long term (10-plus years). Your pension plan allows you take an aggressive approach in your own investments, provided you’re comfortable with stock market risk. If so, consider putting most of the money in exchange-traded funds tracking the Canadian, U.S. and international stock markets, and a small percentage in a broad-based bond ETF. Exchange-traded funds are very cheap to own and offer diversification across the entire stock market. If you’re a Globe Unlimited subscriber, check out my 2017 ETF Buyer’s Guide.

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

What I’ve been writing about
– How high debt loads are hurting our children
– Wavering on Home Capital high-interest GICs? Buffett’s got your back (for Globe Unlimited subscribers)

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

Send us an e-mail to let us know what you think of my newsletter.

Want to subscribe? Click here to sign up.

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Do any of your friends suffer from cheapskate-itis?

A classic example of this affliction: A guy asks his friend to cover half of the $3 fee for an advance reservation at a golf course.

Can technology be exacerbating this kind of cheapness? With banks starting to ease off their fees for Interac money e-transfers, these replacements for cheques and cash make it super easy to split the bill at dinner, pay your friend for the cost of tickets to an event and so on. When you’re using an app like e-transfer on a mobile phone, tablet or computer, it’s as easy to send a small amount as it is a large one.

The Moneyologist, a columnist for the MarketWatch website who looks at money and ethics, says apps like e-transfer actually make us more accountable for our portion of shared expenses. No longer can you say you forgot your wallet, or you’ll pay up later. But friends don’t ask friends to split $3 charges. This much is clear.

At what cost does it become OK to ask your friend to split the cost with you? Is it $10…$20…$30…$50? Send me your thoughts at rcarrick@globeandmail.com – if I get enough responses I will report back in a future edition of this newsletter.

Subscribe to Carrick on Money
Are you reading this newsletter on the web or did someone forward the e-mail version to you? If so, you can sign up for Carrick on Money here.

How to beat soaring meat prices
With meat expected to be a hotspot for food inflation this year, it makes sense to think about eating more vegetables. That won’t fly with your family? Here’s some advice on how to sell people on veggie options.

Ingenious ways to organize your fridge
The bottom line here is to arrange things so you use up more of what you buy and throw out less. Some cool ideas here.

If money doesn’t add happiness, what does it do?
According to one study, having money reduces sadness. As for happiness, its three components are genetics, our life circumstances and our intentional activities.

Shared home ownership for seniors
A profile of four women between the ages of 65 and 71 who bought a house together after deciding they didn’t like other housing options available to them.

Today’s featured financial tool
The accounting firm employing the Blunt Bean Counter blogger is looking for people to participate in an online survey about the financial position of people approaching or in retirement.

Ask Rob
The question: “The lowest management expense ratios on the mutual funds in my employer’s pension plan are 1.25 per cent, and that’s for index funds. That’s at least fifteen times higher than some exchange-traded funds. Are you aware of any mainstream financial institutions that offer more competitive fees on their pension plan investments?

The answer: “That sounds quite expensive for a pension plan. Go to your HR department and suggest they ask the investment company supplying funds for your pension plan for lower-cost options.”

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

In case you missed these Globe and Mail personal finance stories
- How to pay for a million-dollar home reno
- Is the CPP plan fair? Hardly
- A big fear for wealthy families: spoiled kids

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

Send us an e-mail to let us know what you think of my newsletter.

Want to subscribe? Click here to sign up.

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Carrick's newsletter: They’re praying for a real estate crash

Young adults in Toronto, Vancouver and other communities with hot housing markets are getting desperate. They worry that unless housing prices fall, they’ll never get into the market. “I know it’s mean to say and I know it would hurt those of our friends who completely over-extended themselves,” says a Vancouver resident interviewed by Maclean’s. “But honestly, we’re praying for a crash.”

I’ve been saying for ages that if you can’t afford to buy, renting is a perfectly sound option. Lower expenses as a renter leave you room to invest and build wealth comparable to the homeowner with rising equity. But there’s a problem with renting – a shortage of affordable properties.

A pullback in housing prices would open the door to home ownership for some renters. If prices only stagnate or keep rising, we run the risk of leaving both renters and aspiring owners priced out of our biggest cities. Housing have-nots are already resentful. It could get worse.

Subscribe to Carrick on Money
Are you reading this newsletter on the web or did someone forward the e-mail version to you? If so, you can sign up for Carrick on Money here.

Women are better investors
A U.S. investment company says women save more, trade less and assume less risk. These are foundational attributes of the successful investor.

Weddings of the 0.01 per cent
How billionaires get married. Whatever you imagine, the reality is more lavish and excessive.

How to save when visiting tourist attractions
Solid tips here for saving money when visiting tourist spots with your family.

Etiquette for bringing your lunch to work
A recent edition of this newsletter looked at the financial benefits of bringing your lunch to work instead of buying it. Now for some much-needed pointers on how to share the company fridge without grossing out or irritating your colleagues. This item caught my eye because of recent odour issues in the fridge at the office here.

Today’s featured financial tool
What’s your investor profile? This calculator helps you find out and then suggests an appropriate mix of stocks and bonds.

Ask Rob
The question: “I’m 31 and about 8.5 per cent of my entire portfolio is in a single bond fund with the remainder in equities. My adviser tells me that I should retain the bonds for the inevitable event of a recession so that I have something available to sell in order to buy more equities, which will be relatively undervalued at that time. Generally speaking, do you agree with this approach?”

The answer: “Having less than 10 per cent of your portfolio in bonds is bold, but at your age it can make sense if you’re confident you won’t be tempted to sell in a stock market downturn. I gather that your adviser is suggesting you rebalance if stocks tank. Bonds would likely account for a higher percentage of your portfolio in that situation (they’d rise in price while stocks fell). Rebalancing would mean selling some of your bond fund to buy stocks and get them back up to 90 per cent or so of your portfolio. If so, then I agree.”

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

What I’ve been writing about
- Canada’s food prices offer a taste of inflation to come
- How borrowers, savers and investors can prepare for higher interest rates
- Are these preferred shares a 5-per-cent solution? (for Globe Unlimited subscribers)

Featured Video
Are Canadians too hot for dividend stocks?

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

Send us an e-mail to let us know what you think of my newsletter.

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Why these parents are giving their adult kids an early inheritance

One of the effects of expensive housing seems to be a change in the psychology of parents about inheritances. A substantial number of parents are helping their adult children buy houses, whether through gifts or loans. Call it an early inheritance.

A recent Manulife Bank survey suggested that 45 per cent of millennial buyers had family financial help. Early inheritances are obviously gaining traction, but we haven’t heard much from the parents who are handing over this money. That’s why a recent New York Times story is so interesting. It’s a first-hand account from a man who, with his wife, has been giving cash gifts to their four adult kids.

This husband and wife are comfortable, not wealthy. But they find themselves with more money than they need on a day-to-day basis and want to share with their adult children. The kids are using the money to buy houses, to save for their own children’s education and to help start a restaurant. “I will not waste a minute worrying about how they are going to spend the money,” their father writes. “And I am glad we gave it to them.”

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Get used to lower returns Investment advisers talk here about how they are being conservative in estimating client returns. Forget any notions of double-digit returns for a diversified portfolio. One adviser quoted here estimated 3 per cent after fees and inflation.

The case for cash-back travel rewards cards
A head-to-head comparison between a cash-back travel card and a competitor that offers a fixed deal on flights. A big win for cash back overall.

A present you can give your adult kids
De-clutter your home. Save your kids from having to get rid of stuff that, sorry to say, no one really wants.

Old is a loaded word
A lot of questions emerge from the aging demographic trend in Canada and other countries. For example, when do you qualify as being “old?” A gerontologist argues here that the term should only be applied to people who are frail.

Today’s featured financial tool
Find out how much the electricity to run various household appliances costs.

Ask Rob
The question: “What’s the easiest way to see how well the returns on your actively managed mutual funds measure up against a similarly structured index portfolio, perhaps one that’s 75 per cent equity, 25 per cent income?”

The answer: “Start with individual benchmarks – say a mix of Canadian, U.S. and international stock indexes, plus a Canadian bond index. You’ll find performance data on those indexes here. Next, subtract roughly 0.25 to 0.35 of a percentage point from the benchmark returns to cover the cost of owning index-tracking exchange-traded funds.”

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

In case you missed these Globe and Mail personal finance stories
- Financial lessons learned from family cottage owners
- Canada household debt-to-income ratio hovers near record highs 
- Couple set their sights on buying a house, starting a family

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

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Carrick's newsletter: There's more than just old dudes writing about finances

A young female blogger says a common complaint about the world of finance is that it’s dominated by older men, particularly in the banking and brokerage worlds. “This lack of perspective can make us younger, female investors feel left out and awkward about getting serious about our money,” she writes.

I like her solution. In a recent post on her blog, she lists a few of her favourite female finance bloggers. Here are some of the topics these bloggers have written about lately: How to live in an unaffordable city, how to budget for a new home, your brunch habit, how much people spend on wedding presents and the benefits of job hopping versus being loyal to an employer. These are all fresh, relevant topics that you don’t see the old dudes talking much about.

Here are a few more female personal finance voices you should check out:
- Cait Flanders
- Give me back my five bucks
- Golden Girl Finance
- Squawkfox

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Kids of the ultra-rich go to summer camp
Parents are hiring professional packers to get their kids ready for sleepover camp, and then giving extravagant gifts on visitor’s day. Some bring household staff to clean the children’s cabins.

The worries about index investing are overblown
The rise of low-cost index investing has been one of the most powerful financial trends of recent years. This has led to increased scrutiny of indexing and, inevitably, criticisms that say it might be dangerous. Here’s some commentary that should put your mind at ease if you’re an indexer.

Can riding your bike affect your car insurance costs?
No – you can be ticketed as a bicycle rider for a variety of things, but bikes are not motor vehicles.

Trendspotting – millennial moves in with grandparents
We’ve been talking for years about how many young adults are moving back into the family home. Here’s the story of a young woman who moved in with her grandmother to save money and stayed because the two are best friends.

Today’s featured financial tool
This ETF screener is offered by an investment research outfit called Morningstar, which is known for its star ratings on mutual funds and ETFs. You can look up ETFs by star ranking.

Ask Rob The question: “Is it true that online brokers take a trailer fee for mutual funds purchased via their investing sites where no advice is provided?”

The answer: “In many cases, yes. The background here is that the fee investors pay to own many mutual funds include trailing commissions that go to advisers and their firms to pay for advice and services. So if you own these funds in a DIY account at an online broker, you may still be paying for advice. Solution: Look for the Series D funds that online brokers are increasingly making available. They’re low-fee funds for DIY investors that have most of the trailing commission taken out.”

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

What I’ve been writing about
- How aspiring buyers should play Toronto’s real estate market
- Beware the bait of the increasingly common readvanceable mortgage
- Your adviser could be making wealth-destroying fund decisions (for Globe Unlimited subscribers)

Featured Video
Not having a will is an unforgivable money mistake that a surprising number of people are making.

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

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Carrick's newsletter: This awesome sandwich can help get your finances in shape

The most pinned sandwich on the social network Pinterest has no bread – it’s made of cheese and roast beef between cucumber slices. This sandwich is supposed to be for picky kids, but cost-conscious adults should give it a try, too.

Bringing your lunch to work is one the most basic ways to save money on a weekly basis. Ramit Sethi, author of I Will Teach Your To Be Rich, is a believer. So am I. After overdosing on food court lunches many years back, I started bringing my own lunch most days. But here’s the thing about packing your own lunch. Unless you’re creative, your meals can quickly become monotonous. That’s where the radical sandwiches on Pinterest come into play.

Aside from the ingredients, there’s a cost to bringing your own lunch in the form of time spent getting things ready. Here’s some advice on prepping a week’s worth of lunches in under an hour. Total estimated cost savings by not buying lunch out: $3,380 per year.

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Buy a home – it’s good for you
As a personal finance guy, my take on home ownership is driven mainly by affordability. There’s also the case to buy a home because of the social benefits. Academic research shows that owning a home is associated with better educational and health outcomes, stronger families and more.

Question: What’s another name for a long-term investment?
Answer: A failed short-term investment. More jokes about the financial advice biz here.

The story of Toronto’s classiest con man
That’s how The Walrus describes a man you’ll read about in this page-turner of a story. Make time for this one.

Advisers vs. advisors
There’s been some talk recently about how investment advice people calling themselves advisors are just sales people, while those listed as advisers – note the e – are bound to put client interests first. Here’s a thorough look at how these two titles play out in the real world.

Today’s featured financial tool
The federal Financial Consumer Agency of Canada offers these resources for teaching children about money. There’s advice on allowances, teaching teens about credit and more.

Ask Rob
The question: “I notice that most conservative investment portfolios are 60 per cent stocks and 40 per cent bonds. Why are GICs seldom mentioned for fixed income?”

The answer: The big reason is that investment firms make more money from selling bonds and bond funds than they do from GICs. Practically speaking, GICs are not easily sold before maturity. Someone who might need to dip into his or her investments at some point should not be in a GIC. Bonds and bond funds are much more liquid.

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

In case you missed these Globe and Mail personal finance stories
– Newlyweds need a clear financial plan for their future home
– Renting out space in your home: Is the stress worth it?
– The 2017 ETF Buyer’s Guide: The complete series (for Globe Unlimited subscribers)

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

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You have money questions, we have tools and calculators with answers

One of the things that sets the Globe and Mail’s personal finance coverage apart is that we don’t just tell you how to manage your money. With our online calculators and tools, we also show you. Over the past couple of years, we have introduced tools for home buyers, downsizing baby boomers, people building up their tax-free savings accounts and more. We don’t buy these tools off-the-rack from developers – we build them ourselves based on our understanding of what people want to know.

Here’s a list of highlights:

TFSA Calculators: Find out how much your TFSA could be worth based on your expected contributions. Is a million-dollar TFSA possible? Yes, and this calculator shows you how.

Buying a house, Part One: The Real Life Ratio Calculator is the real-world version of the home buying calculators offered by banks and other mortgage lenders. The question answered here is whether you can afford not just your mortgage, but also home maintenance, day care, car-related costs and, of course, saving for the future.

Buying a house, Part Two: Here’s help in figuring out how long it will take to afford a down payment in cities across the country.

Downsizing your home: Find out whether it makes sense to sell the family home now or wait, and how much money you stand to save if you move to a condo or smaller house.

– Are you getting value from your adviser? This downloadable checklist will help you find out.

– Am I getting good value for the advisory fees I pay? Find out how your fees compare to other investors with similar-size portfolios. For Globe Unlimited subscribers.

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Are flights in Canada expensive by world standards?
Does it snow in winter? Eighty countries are ranked in this flight price index, and Canada is among the highest cost

These retirees live on a cruise ship
Take note if you reside in Vancouver or Toronto. It’s so costly to live in New York now that some residents are finding a break from expenses by living and working remotely for part of the year on cruise ships.

Help for small business owners on buying vs. leasing a car
A look at the tax implications of both options.

This crack house just needed a bit of love
Here’s the story of a couple that bought a former crack house in Toronto and dropped $1.1-millon on a five-year reno job. A satirical fundraising drive has been set up on their behalf.

Today’s featured financial tool
If you’re unconcerned about investment fees, you need to try this calculator offered by the B.C. Securities Commission.

Ask Rob
The question: “There have been many articles on the cost of adviser fees lately. I have about $550,000 invested with a brokerage firm, and my annual cost is about $5,040, or about 1 per cent. I have been with them for about 5.5 years and am satisfied. How normal is a 1 per cent fee?”

The answer: One per cent sounds quite reasonable. Globe Unlimited subscribers can check their advisory costs using this fee comparison tool.

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

What I’ve been writing about
– Bailing on Aeroplan? Here’s how to find a rewarding replacement
–Where is the ethical leadership in the investment industry?
– Where a risk-averse boomer couple who just sold their home can safely invest $300,000 (for Globe Unlimited subscribers)

Featured Video
Why we should worry about millennials buying houses.

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

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Carrick newsletter: We need to fight the tyranny of big, fat weddings

Estimates of how much the average wedding in Canada costs range as high as $42,000, which is enough for a house down payment in many cities across the country. But we’re underselling the cost of weddings if we just focus on the bills paid by the bride, groom and possibly their parents.

Bridesmaids and groomsmen often pay heavily to participate in a wedding, plus there’s the gift costs for guests. Americans spend an average $160 (U.S.) on wedding presents. In a heated discussion on my Facebook personal finance page recently, the recommended amount for presents ranged from $150 to $500. The more elaborate the wedding, the more people feel pressured to give a big gift. It’s no wonder that so many people say they have declined to attend a wedding because of the cost.

The wedding industry is the big winner here. When it comes to their “special day,” people seem willing to put up with the kind of pricing tricks the car industry abandoned long ago.

One of the most popular editions of this newsletter ever looked at discount funeral options. I’d like to see a similar level of interest in frugal weddings. Here’s a Q&A with someone who had a wedding for under $1,000. If that’s too extreme, try this guide for a $5,000 wedding. For wedding guests, here are some suggestions on how to cheap out gracefully on a gift.

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The best temperature to set your air conditioner
Consumer Reports lists the ideal temperature for when you’re at home, when you’re at work or away and when you’re sleeping. Use this website to convert the Fahrenheit temperatures to Celsius.

How to juice your home’s curb appeal with just paint
Nine simple but pretty cool suggestions for sprucing up the exterior of your home.

Working until 70 should be the new norm by 2050
Canada is listed among eight industrialized countries that face a large shortfall in the amount of money that people have available for retirement. The solution is for people to work longer, which is less onerous that it seems. Working longer is a big help in making your retirement savings last longer, and many people enjoy staying engaged in the workforce.

Why women should create a “what if” budget
Most married women will outlive their husbands. Here are some thoughts on how to prepare financially for this possibility, including the creation of a budget that accounts for any drop in income after a spouse dies.

Today’s featured financial tool
A tutorial on how to use online tools to track the book value of exchange-traded funds you hold in taxable accounts.

Ask Rob
The question: “I own a Home Capital GIC. Should I cash it in? The amount would be covered under Canada Deposit Insurance Corp. as it is $50,000.”

The answer: Not sure why you’d cash in a CDIC-protected GIC. If you did, you should expect to pay a penalty. CDIC says it aims to repay deposits in non-registered accounts within three business days, while registered accounts take a little longer.

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

In case you missed these Globe and Mail personal finance stories
– The surprising truth about how much you need to save for a happy retirement
– Figure out what you’ll need to save for retirement in five simple steps
– How would you invest a $10,000 windfall?

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

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Shrewd real estate moves: They won lottery dream homes and sold them

Nine straight winners of the Hospital Home Lottery in New Brunswick have sold their prize home, some for hundreds of thousands of dollars under value. I’m giving them an A grade in personal finance.

The reason why people keep selling their dream homes is that they can’t afford to run them. A winner from a few years ago reported that total insurance, property tax and heating costs came to about $2,625 per month. “It would be considered a dream to have a home like that, but it’s not necessarily realistic in terms of cost to maintain it,” she said.

There’s a lesson here for both young people buying a first house and people moving up to a bigger home: Consider the cost of ownership. List the fixed costs you’ll face in the new home and see how much of your household cash flow you’ll have left to live on. If they’re honest, some people will find they can afford to buy a home, but they can’t properly afford to own it.

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Carrick newsletter: Half of Canadians are making this unforgivable money mistake

One of the great mysteries of personal finance is why so many people fail to have a will drawn up. Fail is exactly the right word here. Epic fail.

The latest evidence of this behaviour comes in a poll from Toronto-Dominion Bank that suggests half of Canadians don’t have a will. Almost 30 per cent of those who lack a will are between the ages of 53 and 71, an age range when people may have accumulated significant assets. Without a will, your assets are distributed according to a formula that varies by province. You would have no say in how much your spouse or children get.

If you don’t have a will, make getting one your No. 1 personal finance project for the remainder of 2017. A 2015 fee survey from Canadian Lawyer Magazine says simple wills cost $441 on average, while complex wills for a couple averaged $1,357. For most people, the time of life to start thinking about a will is when they have kids. Update the will as you get older to reflect the changing needs of your children and the assets you’ve accumulated.

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Why it feels like getting ahead is dead
Here’s a problem affecting both Americans and Canadians – weak wage gains at a time of reasonably strong job growth. The old relationship between falling unemployment and rising wages seems to be broken.

Avoid these rookie barbecuing mistakes
Meat’s bloody expensive. Get your money’s worth by avoiding these blunders.

How to spot a housing bubble
Look for a lot of talk about flipping properties for a profit, says the widely respected Yale economics professor Robert Shiller. Sounds like Toronto and surrounding areas.

Backtracking on the “dementia tax”
A proposal to have seniors pay more of their care costs was introduced during the British election campaign recently by Prime Minister Theresa May. Now, she’s backtracking after a big drop in the polls. Keep your eye on this storyline. In countries with aging populations, like Canada, governments are going to be under pressure to contain spending on health care.

Today’s featured financial tool
InterestPiggy.com bills is a free online marketplace where people can have banks, credit unions and other financial players bid for their GIC, savings and loan business. You say what you want, then see what rates you’re offered. If you try InterestPiggy, let me know what you think.

Ask Rob
The question: “When I make a TFSA withdrawal, I have to wait until next year before putting it back in. Does that mean I have to wait a full 12 months from the data of the withdrawal?”

The answer: “You can put the money back starting at the beginning of the year after you made the withdrawal. Here are the Canada Revenue Agency’s rules for making or replacing withdrawals from a TFSA.”

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

In case you missed these Globe and Mail personal finance stories
- Why it’s now a scarier environment for investors than ever before
- What happens when the kids don’t want the family cottage?
- Is dollar-cost averaging a smart way for millennials to invest?

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

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Carrick newsletter: You’re angry – that’s why you can’t stop spending

The challenge in covering the ongoing story of high household debt levels in Canada is finding something fresh to say. A story that appears in June issue of The Walrus magazine manages to pull this off. The headline says “Canada’s Middle Class is on the Brink of Ruin,” which is hardly a new message. We’ve been hearing similar warnings for years now.

The original part of this article is a comment from Laurentian University economist Louis-Philippe Rochon on why we’re borrowing so much. He puts it down to economic anger – we’re working harder and not getting ahead. So we resort to retail therapy, funded through borrowing.

This observation will resonate if you caught the details of the latest jobs and wages report. “Across the spectrum of white-collar jobs in Ontario, there was a decline in earnings among managers and professionals in health, law and natural and applied sciences,” my colleague Rachelle Younglai reported. “Senior managers for example, were paid, on average, $53.54 an hour in April compared with $58.29 a year ago.”

The most basic message of personal finance is to live within your means. It’s much easier to follow this advice when your means is increasing every year through rising pay.

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When to sell your old furniture
Thoughts on the best time of year to sell things like furniture, baby gear and cars. A master strategy for monetizing the junk in your basement using Kijiji, Craiglist and such.

How to save money while travelling
A blogger gathers up some of the best posts from other blogs on budget travelling. Among the topics covered here are doing Disney on a tight budget, finding flight deals and visiting one of my favourite cities, New Orleans, on the cheap.

Just try and find a roommate in Toronto if you’re older than 35
Elle Gallagher, 59, is having a hard time finding a roommate. A story of agism and expensive housing markets. Apparently, no one wants to share a place with people older than 35.

Looking for a house in a neighborhood with top schools?
Prepare to pay a whopping price premium. In Toronto, the gap could be as much as $800,000.

CPP and OAS versus U.S. social security
An accountant’s detailed comparison of how these programs compare in terms of both benefits and the money you contribute while working.

Today’s featured financial tool
Ratehub.ca claims its online mortgage comparison tool is the first to reflect mortgage policy changes that have affected the cost of borrowing. Rates will now vary according to factors like size of down payment and mortgage amount.

Ask Rob The question: “Could you discuss holding a portfolio with large unrealized capital gains? Is this a serious investing flaw? Starting in 1983, I invested in Canadian bank shares.”

The answer: “You may find this blog post of interest – a financial adviser pushes back against the reluctance many people have to sell an asset – stock, mutual fund or rental property – because they’ll have to pay capital gains tax.”

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

What I’ve been writing about
- How dividends came to dominate our investment portfolios
- The 2017 ETF Buyers’ Guide: U.S. and international dividend funds

Featured Video
An argument for millennials to think twice about home ownership.

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

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Carrick newsletter: Stud, dud, thud – the three stages of a man’s life

This is no country for old men. Census data from 2016 shows us that among seniors aged 85 to 99, there were 54 men for every 100 women. Among people aged 100 and up, there were 19 men for every 100 women.

The reasons why males die younger may have something to do with testosterone and the way it makes men stronger in the near term, but weakens them in the long run. There’s hope that medical advances will enable male lifespans to catch up to women. But as I mentioned in a recent column, the most overlooked aspect of retirement planning might just be that women live longer than men.
There’s research that shows women are less prepared for retirement than men.

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Carrick on money newsletter: So, what’s your plan for Aeroplan?

We are about to enter a period of intense competition for customer loyalty. Aeroplan is losing Air Canada as its key partner – what will it do to keep its members from fleeing to other customer loyalty programs? And what will those other programs do to pry people away from Aeroplan?

As I said in this column last week, Canadians should prepare for all-out war between loyalty programs for their business. Keep your eye on what Aeroplan rivals like Air Miles and SCENE come up with. Remember, Air Miles is still smarting from the bad publicity it received last year over an ultimately abortive plan to have points older than five years start expiring. For now, consider whether it makes sense to start using your existing Aeroplan points instead of saving them for a future trip.

The Rewards Canada website says Air Canada’s decision to leave Aeroplan wasn’t a surprise because Aeroplan has evolved away from its original role as a frequent flyer plan. When Air Canada introduces its new offering, expect rewards based on travel (flights, hotels) and spending on credit cards, but not spending in retail stores.

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Don’t get a divorce – get a bigger house
This slogan is brought to you by a realtor whose marketing is included in this collection of the funniest real estate ads in the never dull Toronto-area market.

Rent or own in retirement?
A useful summary of the pros and cons for both owning a home and renting in retirement. A financial planner told me the other day that one of the top questions clients are asking is whether it makes sense to rent in retirement.

Affordable international vacation spots
Seven cities in Mexico, Europe, Asia and the Middle East. Maybe this can help you zero in on a destination – a list of how much it costs to grab a beer in cities around the world.

Thoughts on moving in together
Expensive rents are a big reason why more couples are living together. Here’s a look at some of the financial questions they should be discussing, including who gets the home if the couple breaks up.

The Netflix economy – renting over owning
All about the implications of the pay as you go economy – basically, renting goods and services instead of buying them. From a personal finance point of view, pay as you go can be very liberating. Instead of owning a car, for example, you just buy the rides you need via a car-sharing service or the likes of Uber.

Today’s featured financial tool
The Financial Consumer Agency of Canada offers this credit card selector tool. Pick a card by features like rewards, fees, insurance and benefits.

Ask Rob
The question: “If a financial institution collapses and a person’s term deposits are covered by CDIC, what is the process for obtaining the funds?”

The answer: “Canada Deposit Insurance Corp. will find you if the financial institution that sold you a term deposit collapses. You don’t have to apply for coverage. CDIC targets three business days for paying deposits to investors. You would receive principal and interest to a combined $100,000 per eligible account. More details are available in a column I wrote for Globe Unlimited subscribers.

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

What I’ve been writing about
- Prepare for all-out war among loyalty programs for your business
- This is how millennials could end up paying the bills for baby boomers

Featured Video
Canadians are good borrowers, but it may come at a cost.

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

Send us an e-mail to let us know what you think of my newsletter.

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The time to check your home insurance policy is before the flood

Expect to see more of the kind of rainy weather and flooding we’ve seen recently in Quebec, Ontario and British Columbia. Insurance companies certainly see more volatile weather ahead, and that’s why they’ve been making changes to the coverage they offer for flooding of various types.

Are you protected against flooding? An increasing number of insurers are offering coverage against what they call overland flooding (from a river or lake). But some people may not be aware this coverage is available and thus haven’t added it to their policies. Read this rundown on flood insurance and then read your policy or contact your insurer to see what coverage you have.

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Why you should try to step up your TFSA contributions

ROB CARRICK

Making the maximum contribution to tax-free savings accounts is an achievable financial goal we should all strive for. The 2017 annual limit is $5,500 for people 18 and older, and you can catch up on unused room in later years. Once money goes into a TFSA, it’s free from tax. Gains in the account are tax-free, and so are withdrawals. TFSAs are without question the most versatile savings tool available to Canadians.

To demonstrate the power of the tax-free savings account, a team at the Globe and Mail created an online TFSA calculator. It shows how much your TFSA would be worth if you kept your current pace of investing and, if you’re not maxing your contributions, how much more you’d have if you went up to the limit each year.

Some people use their TFSAs to hold their savings, others to invest. We show you how both approaches will play out over the years. We conservatively estimated returns of 1 per cent for savings and 5 per cent for investments on an after-fee basis. But you’re free to change those returns to suit your own experience.

Between mortgages, daycare, retirement saving and all our other financial obligations, it can be hard to find money for TFSAs. Our calculator offers encouragement to give TFSAs their due.

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Your spring 2017 guide to sensible home buying
A package of our best online tools and guidance for buying a home. Can you afford to buy? Find answers here.

Investing lessons from a lawyer
A lawyer who represents investors harmed by the misconduct of advisers and brokers offers some of the investing lessons he’s learned through his work.

Enough with the retirement pessimism
Canadians anticipate a long retirement, but they’re pessimistic that they’ll be financially comfortable. I’m including this item as a prompt to take action if you’re worried about your retirement. Review your investments, try to save more and get some financial planning help. I’m seeing a planner myself to get some questions answered.

In defence of index funds
Index investing, whether through index mutual funds or exchange-traded funds, has really taken off over the last few years. Recently, critics of indexing have said that indexing’s popularity creates the risk of a stock market bubble. Here’s a defence of indexing by longtime investment writer and investor advocate Jason Zweig. Now for a rebuttal to recent criticisms of exchange-traded funds, which are an ideal tool for index investing.

The investing world has a KIC Rule – keep it complex
The best investment planners and advisers are great simplifiers – they talk your language and stick to basic principles. But the investment industry knows well that complexity is a big selling point with investors. Don’t buy in.

Today’s featured financial tool
With houses as expensive as they are these days, a low mortgage rate is essential for keeping your household budget on track. A new app called Monitor My Mortgage lets you track your mortgage on a daily basis, including penalties for breaking it. You can also get bulletins on interest rate changes. Monitor My Mortgage makes money by connecting interested users to mortgage brokers.

Ask Rob
The question: “To ensure that your interest is covered by Canada Deposit Insurance Corp. for Oaken Financial guaranteed investment certificates, what do you think about splitting the maximum amount [it’s $100,000] between Home Trust and Home Bank as opposed to keeping it all at Home Trust and possibly forfeiting interest?”

My reply: This makes sense. The backstory here is that Oaken, Home Trust and Home Bank are subsidiaries of Home Capital, which has seen an exodus of depositor money because of recent events that have been widely covered. Oaken deposits are covered through the CDIC membership of Home Trust and Home Bank. If you have money deposited at a financial institution that collapses, CDIC covers principal and interest to $100,000. So if you invested $100,000 in one GIC, you might not be covered for the interest you’ve earned. You could address that in the Home Capital situation by splitting the $100,000 between Home Trust and Home Bank, which are separate CDIC members.

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

In case you missed these Globe and Mail personal finance stories
-How to know when it’s time to divorce your adviser.
-How to prepare for retirement during every decade of your life

More Carrick and money coverage

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Hey, aren’t GICs supposed to be stress-free investments?

These are worrying times for people who put money into savings accounts and guaranteed investment certificates sold by subsidiaries of troubled Home Capital. Clients have pulled millions of dollars out of savings accounts from Oaken Financial and Home Trust, but GIC assets remained largely untouched as of early this week.

Both savings and GIC deposits at Oaken and Home Trust are protected for up to $100,000 by the Canada Deposit Insurance Corp., a federal crown corporation. But while savings are easily transferrable to another financial institution, non-cashable GICs cannot easily be redeemed. Expect penalties and to forfeit at least some interest if you’re able to break a GIC.

Here are two suggestions to ensure your GICs are as worry-free as possible. They come from Brandon Brot, a principal at GIC Wealth Management, a deposit broker offering GICs from a variety of issuers.

Mind the limits
For banks and trust companies that are members of CDIC, the limits are five years in term and $100,000 in combined principal and interest. “If you’re worried about an institution, don’t invest $100,000 and think you’re going to get your interest back,” Mr. Brot said. “If you’re doing a compound interest GIC, you should do significantly less than $100,000 to ensure you’re covered.”

Credit unions have their own provincial deposit insurance plans, some with higher limits than CDIC. However, not all provincial plans have government backing like CDIC. The Deposit Insurance Corp. of Ontario is a provincial agency. The Deposit Guarantee Corp. of Manitoba says on its website that there is no legislated requirement for it to be backstopped by the provincial government.

Organize your accounts
You can have multiple GICs at the same CDIC-insured institution, each covered to $100,000, if you set up your accounts properly. “We have a lot of clients who have $300,000 in coverage – they have accounts for themselves, for their spouse and a joint account,” Mr. Brot said. Registered accounts are also covered separately.

Mr. Brot said that even with CDIC coverage, people worry about their money being tied up and unavailable if their GIC issuer collapses. He’s attended conferences where CDIC officials have offered assurances on this matter. “They made us feel comfortable with how quickly they would handle things if, God forbid, something were to go wrong.”

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Home Capital and its mortgage customers
Mortgage lending is what Home Capital does with the money it takes in from GICs and savings accounts. Do mortgage clients have any worries if the company were to collapse? An experienced mortgage expert offers a definitive no.

Should you renovate your house to get a better price?
A blogger goes over the pros and cons of putting a shine on a home before selling. Real estate agents I’ve spoken to say you only recover a fraction of the cost of these upgrades in the selling price.

How online shopping makes you a sucker…
An eye-opening read for those who think online shopping gets you the best deal. In fact, retailers are looking at your buying habits and tailoring prices to maximize profits.

…And the same may apply to bargain travel websites
Travel aggregators are convenient for comparing airfares and hotel rates, but they may not offer the best deals. So try contacting airlines and hotels directly.

Today’s featured financial tool
Deposit brokers are an option for GIC buyers looking for help finding good rates and ensuring they are fully covered by deposit insurance. Start with the website of the Registered Deposit Brokers Association if you want more information about deposit brokers.

Ask Rob
The question: “A lot has been written about investment fees and disclosure recently, so I’m wondering what we’re paying in fees on the Canada Pension Plan? What’s the management expense ratio on Canada’s largest fund?”

My reply: The Fraser Institute quoted a fee of 1.07 per cent for the CPP in a report from 2016, the highest of the six pensions considered. The most popular Canadian, U.S. and international equity mutual funds would be in the area of 2 per cent or more, bonds funds somewhat less. Exchange-traded fund MERs can be as low as 0.06 per cent.

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

What I’ve been writing about
– Despite heavy borrowing in recent years, our credit scores are in very good shape overall.

– Home Capital is a reminder of the risks of reaching for higher interest rates (for Globe Unlimited subscribers)

Featured Video
Good news in the housing market: the upward pressure on mortgage rates has evaporated.

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

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Owning in a hot real estate market is an overrated form of wealth

The problem with being a real estate millionaire in places like Toronto or Vancouver is that so many other people are as well. If you sell your house, pretty much anything you aim to buy in a good location will be comparably expensive. A solution to this problem of trapped wealth: Sell and buy somewhere where the market is calmer.

One young couple sold a Toronto home recently so they could move to Ottawa, where the market is comfortably warm at best. They bought for over $300,000 in Toronto and sold for more than $1-million. Another Toronto couple sold a house in the city for $1.7-million (more than twice what they paid 10 years ago) and are moving two hours north to Collingwood. I visited Owen Sound, about a 2.5-hour drive from Toronto, a few years ago and wrote a column about relocating there in retirement.

One of the interesting things about the Toronto real estate market is that there has been a shortage of houses listed for sale. The most frequent explanation is that gridlock has set in – people don’t want to sell because of the cost buying another home. However, an increase in the number of new listings in March suggests more people are looking to cash out.

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When a woman earns more than her husband
More and more women are the high earner in their household, but a U.S. study found that an increased divorce rate is associated with women earning even $5,000 (U.S.) more than their husband.

This is the cost of getting pregnant
A personal finance blogger reports that he and his wife are expecting a child. Here’s his rundown on the (considerable) costs of trying to get pregnant through in vitro fertilization.

How to make mermaid and unicorn toast
A hot new food trend is to use the likes of beet juice to add colour to plain stuff like cream cheese. Seems harmless and easy on your budget, unlike so many other foodie fads.

Retiring overseas? These countries have great healthcare
A frequent question people have when considering the idea of retiring abroad: What’s the health care like? Here are four countries that score well in this area.

Spending habits of the one per cent
A glimpse into a photographer’s 25-year study of wealth, class and status symbols. Overwhelming proof here that money “makes you unhappy in a better part of town.”

Today’s featured financial tool
Here’s a useful index for the federal government’s financial literacy database. Find info specific to Indigenous people, entrepreneurs, parents, people with disabilities and more.

Ask Rob
The question: “I own dividend-paying U.S. stocks in a non-registered account. Is there any way for me to reclaim the 15 per cent withholding tax?”

My reply: Yes. Here’s how.

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

What I’ve been writing about
-Why first-timers should rethink buying in a hot housing market.
-The 2017 ETF Buyer’s Guide: Best global and international funds (for Globe Unlimited subscribers)

Featured Video
A modest proposal for people who want financial planning and investment help, but not the sales pitch to buy products.

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

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How to make filing your taxes (slightly) less odious

Filing your income taxes has to be one of the most dreaded rituals of the year. Gather your tax slips and receipts, complete the tax form and hope you’ve reported everything properly and not overlooked tax credits or deductions you’re entitled to. Americans lack the super-simple tax-filing system they have in countries like Japan and the Netherlands, but there’s hope for we Canadians.

The Canada Revenue Agency has introduced a new service called Auto-fill my return and it can greatly expedite the process of completing a tax return. If you use tax software to complete your return and send it to CRA via Netfile, Auto-fill automatically fills in a lot of the boxes for you using information that employers and financial firms have supplied to CRA via T4s, T5s and more. Yes, CRA gets a copy of the same tax slips as you.

CRA says Auto-fill was used for more than 981,000 returns sent via Netfile as of April 10, well more than double the 425,000 at the same time last year. Click here for a list of free tax software products that are good to go with Auto-fill.

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Canada’s most affordable cities for housing
A list of 35 cities where houses are affordable according to a traditional measure – the ratio of house prices to income.

Millennials sure like their parents
A look at why so many millennials are living at home with their parents. Financial reasons play a role, but there’s also a comfort factor.

Air travel secrets
A flight attendant tells you how to win the “most annoying passenger” award and more. Presented on the basis that all the attention paid lately to airlines bumping passengers will make you a more discerning consumer of air travel.

Tips from the “wellderly”
That’s one researcher’s term for people in their 80s who have no cognitive decline or dementia. Exercise is a huge factor in reducing the risk of cognitive impairment.

Meet the new head of Tangerine
Brenda Rideout is the first female CEO of a major Canadian financial institution. Tangerine is the online bank owned by Bank of Nova Scotia.

Today’s featured financial tool
Use the website aretheyregistered.ca to make sure an investment adviser or advisory firm is registered to sell securities.

Ask Rob The question: “Do brokers in Canada have a fiduciary duty to manage their clients’ RRSPs in the best interests of those clients?”

My reply: No. Most investment advisers are bound by suitability standards, which mean recommended financial products have to be suitable for a client’s needs and situation. But there is no broad standard to put client interests first. An exception is a type of adviser for high net worth clients called a portfolio manager.

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

In case you missed these Globe and Mail personal finance stories
- Could the CPP Post Retirement Benefit work for you?
- Five tips for graduating students trying to crack a tough job market
- Why Globe and Mail dividend guy John Heinzl is buying more shares of one particular dividend growth stock (for Globe Unlimited subscribers)

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

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Six things to keep in mind when talking to your kids about money

A goal for Canada's financial literacy initiatives is to have today’s generation of young people be better with money than their parents. Two areas to target for improvement are high debt levels and the tendency to place an excessive importance on home ownership. Too many Canadians are financing their lifestyles with debt and hurting their overall financial wealth by owning homes they can barely afford.

I raise these points to help get you thinking about Talk to Your Kids About Money Day, which is today (Wednesday, April 19). In this guide to having conversations with kids about money, an expert suggests parents discuss mistakes they’ve made or those that a lot of Canadians are making, like borrowing too much.

The U.S. personal finance writer Dave Ramsey has some tips on talking to kids about money; one I particularly like is setting family finance goals. In a column a few years back, I suggested making the cost of university or college a part of money talks with kids. Here’s some advice for affluent families on discussing money with kids.

Here’s a recent Globe story about a new program that is making financial literacy education a reality for Ontario high-school students. I started a discussion about who has responsibility to teach kids about financial literacy on my Facebook personal finance page recently and was surprised by the quantity and thoughtfulness of the posts. Parents are obviously engaged with this topic, which is encouraging.

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Gordon Ramsey on kids and money
The celebrity chef says his kids don’t deserve to inherit his fortune – the tough-guy perspective on parents helping kids with money.

A manual for decluttering
A blogger writes about de-cluttering from through the experience of having just three weeks to downsize the family home to a small apartment. Check out the list of tips for letting go of stuff. Now for an extreme form of de-cluttering – from a 2,000-square-foot house to an RV.

His surprise $1,300 furnace repair bill
Life as a homeowner: you wake up one morning and the house feels kind of cold. A quick $1,300 later, you’re good to go. It’s a lesson in why you need an emergency fund from Sean Cooper, author of a new book called Burn Your Mortgage.

Five ways to use your daily commute time productively
Time is money, right? So instead of sitting in traffic getting torqued by talk radio, try one of these ideas for using your time well. I like this one: Practice your public speaking. I’ve done it myself.

Survive and thrive after losing your job
That’s the title of a free e-book published by Chartered Professional Accountants of Canada. The book won an Excellence in Financial Literacy Award from the U.S.-based Institute for Financial Literacy. Cairine Wilson, who oversees CPA Canada’s financial literacy initiative and retires in May, received a legacy award from the institute.

Today’s featured financial tool
Make sure you’re getting all the tax breaks you’re entitled to by using a website called Sherpa.Tax. I profiled the young entrepreneur who developed this site in a recent column.

Ask Rob
The question: “I finally gave my adviser his termination notice today. None of his counterpoints hit the mark until he said that moving my accounts would trigger $225,000 in capital gains. How would you mitigate that?”

My reply: I asked accountant and blogger Mark Goodfield for this thoughts on this one. Here’s what he came up with : “We have this issue all the time. The new adviser will often take all the legacy holdings and sit down with the client and review whether they fit their current investment philosophy and risk profile. Where the holdings do fit the profile, they are often kept and/or slowly traded over time. Where they don’t, the client needs to determine if the tax hit is really all that bad. Locking in a profit never hurts. This is obviously a huge issue, as I noted my blog.”

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

What I’ve been writing about
–Tangerine downsizes perks on reward cards; two lessons for bank customers

–Six reasons to be grateful you don’t live in a hot housing market

–Dividend-hungry investors could be partly at fault for banks’ aggressive sales tactics (for Globe Unlimited subscribers)

Featured Video
Why do people hate bonds right now?

More Carrick and money coverage For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

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Canada’s top cash-back reward credit cards

The popularity of credit cards offering cash back rather than travel rewards is definitely on the upswing. Travel cards appear to be a mature category with little innovation these days, But there’s a lot of action in the cash-back category – new products and new twists on earning rewards. While some cards offer a set reward rate, others return more cash in particular spending categories. This allows you to pick a card suited to your spending habits.

If you prefer tangible cash rewards as opposed to travel points you might never use, now’s a great time to pick a cash back card. Here are some rankings of top cash-back cards. Always consult a few different listings to get a variety of perspectives.

Rewards Canada just issued its list of top cash back cards this week.

GreedyRates.ca looks at a variety of cards, including those with and without annual fees.

RateHub.ca offers a search engine to help you find cards suited to your situation

HowToSaveMoney.ca: A total of 76 cards were considered, so this is an exhaustive comparison.

RateSupermarket.ca ranks the best cash-back cards with and without annual fees.

A card that comes up in a few of these rankings is the Tangerine Money-Back Credit Card. In this column, I explain how Tangerine is changing this card for the worse barely more than a year after it was introduced.

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The lighter side of tax time
Late night TV host Stephen Colbert does a hilarious interview with a guy who works for tax preparers H&R Block, then goes undercover as a tax guy. Best laugh of the week.

What if the CRA wants to audit you?
All about what happens when the Canada Revenue Agency wants to dig deeper into your tax situation.

Saving for other people’s weddings
The cost of attending a wedding is so expensive these days that one blogger talks here about having a savings account just to cover the cost of attending friends’ weddings. Advice to young couples: A frugal wedding benefits you, and your family and friends.

Avoid these four popular dividend stocks
Well-argued contrarian thinking on four widely owned U.S. dividend stocks.

Tales from the dark side of human nature
A woman who looks into suspicions of fraud abuse against seniors talks about some of the nasty things she’s seen scammers do. Check out the story of the guy in his early 70s and his 23-year-old girlfriend.

Today’s featured financial tool
Figure you’ll put off investing for the future and catch up later? Here’s a calculator that shows the cost of delaying.

Ask Rob
The question: “Why are the corporate bonds being offered for resale by my discount broker so limited in choice and nearly completely different from the equally sparse choices from my spouse’s discount broker, which are, again, quite different from the limited offerings at a third discount broker that my mother uses?”

My reply: The Canadian corporate bond market is fairly thin – not a ton of selection for investors and not a lot of trading of the bonds that are in the market. Thus, brokers all have different inventories. If you want a specific issue, try calling your broker to see if they can get it for you. Mind the yields you’ll get. Brokers mark up bond prices a fair bit, and that squeezes the yields that retail investors get.

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

In case you missed these Globe and Mail personal finance stories
– Want to save thousands? Forget car ownership and rent instead
– How to break up with your bank.
– The best investment for retirement? Try marital counseling and a home miles away from your kids

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

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How to arrange the no-aggravation renovation

We hear a lot about how tight housing markets are driving up prices in some cities and how rents are rising as well. Now for the latest trickle-down effect of hot housing – surging demand for renovations.

If you read down in this story on people striking out when trying to buy a house in Toronto, you’ll find stats showing how many more people in the city are planning to spend big bucks – $50,000 – on renovations. The goal of a renovation is to get the best value for your money. For help with that, check out this briefing on planning a reno from Consumer Reports, a trusted source of unbiased information.

Got an investment property? This list of renovating tips suggests you take care of cleaning and repairs first. Here are some tips for a bathroom reno that won’t break the bank, and some insider’s tips for saving money on all types of renovations.

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How to convince your boss to let you retire gradually
Want to keep working part-time after you retire? Here are the objections your boss is likely to raise, and some counter arguments.

13 ways to waste your money
A thorough list of mostly avoidable fees and costs. I bet you’ll find at least one idea here to save money.

The illusion of wealth
Would you rather have $1-million or $5,000 a month when you’re retired? If you picked $1-million, you should read this article about the false sense of security people get from what they consider to be large sums of money. Now for another tricky question: What’s more important, the amount you save or the rate of return on your investments?

If you bank by smartphone or tablet…
This ranking shows you which banks are leaders in mobile banking services.

Their condo had hidden costs
All about a class-action lawsuit some Ottawa condo owners have launched against a developer over whether heating systems were included in their purchase price. A lesson on stuff you have to watch out for when buying a condo before it’s built.

Today’s featured financial tool
For those with investment income, here’s a primer on taxation of real estate investment trusts, or REITs, that are held in non-registered accounts. REITs are a popular investment for investors seeking income.

Ask Rob
The question: “Why not go back to basics and recommend that all 20– or 30-somethings read The Wealthy Barber, shun debt, ignore the hype, have patience, stay the course, and retire wealthy. It’s what I did. I only ever had a wage-paying job, but I saved, maxed out RRSPs, didn’t go to clubs, didn’t buy designer-branded crap, didn’t buy luxury cars, and didn’t live beyond my means and didn’t take out loans to buy stuff (other than a mortgage which I aggressively paid off). Live within your means. Don’t live for consumption. Retire wealthy and early.”

My reply: Great advice, thanks. The problem here is that we live in a society that promotes the idea of happiness through consumption. It’s hard to control spending when you see all the cool things your friends and family on doing on social media. I will continue to fight the good fight about living within your means, but I also recognize that how strong the pressure to spend is. The key is balance. Save, and then spend what’s left over.

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

In case you missed these Globe and Mail personal finance stories

How to claim home office expenses on your taxes
–Six ways to benefit your heirs, not the taxman
–Should I get a line of credit to repay my student loan?

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They’re scraping by on $500,000 a year

Large incomes do not solve money problems. As you make more, you spend more. The same budgeting challenges exist, but with bigger numbers. This was one of the points raised in a column I wrote recently about a financial adviser who warns that high earning baby boomers aren’t saving enough for retirement.

Now for an illustration of where the money goes in a household with a big income. It’s an article called Scraping By On $500,000 A Year, and it shows how easy it is to soak up a big income with fancy cars and multiple vacations every year. This is a U.S. example, but it serves quite well to demonstrate how people with huge incomes spend.

Do high earners need a financial literacy lesson? Here’s a start: Pare back your spending to consume fewer luxuries. One vacation instead of three. One luxury car instead of two. If you need help, people who don’t earn big bucks can advise you on living with less.

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Is it OK to skip a mortgage payment?
I say no, but lenders do allow you to do this. Here’s a summary of how skipping a payment increases your overall mortgage borrowing costs.

Start your spring decluttering right here
This video presents five things you really need to throw out.

Making your splurge on steak worthwhile
Seven tips for cooking steak, which seems more expensive at every trip to the grocery store.

How’s your French?
A list of the most and least expensive cities to rent an apartment. Quebec and New Brunswick cities dominate.

The challenge of parenting an adult
Large numbers of young adults live at home because they work temporary jobs or can’t afford high rents and house prices. But what if your adult kids are difficult to live with?

Today’s featured financial tool
Here’s a useful checklist of tax credits and deductions for 2016. Make sure you’re using every tax break possible.

Ask Rob The question: “I read everywhere that a prudent investing strategy is to buy an index rather than hiring someone to actively invest your money. Is this a good strategy no matter what the size of the money that is being invested? I am thinking of something in the $2-million range.”

My reply: “Index investing can make sense for portfolios of any size. But I get the sense you’re one of the many investors who sees indexing as a DIY strategy. Not necessarily. There are advisers who actively manage money, and those who use low-cost exchange-traded funds to track indexes. With a sizeable portfolio, you may have complex financial planning needs. Whether you go with indexing or active management, make sure you get good advice to guide your investing.”

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

What I’ve been writing about
- Water damage is probably the biggest threat to your home. Are you protected?
-Just bought a house? Pass on TFSAs and RRSPs to pay down your mortgage
- Feeling pressure to buy investments? Try this. (Globe subscribers only)

Featured Video
How to handle three difficult money conversations – negotiating your salary, loaning money to children and couples combining their finances. The videos are from the Financial Planning Standards Council, which oversees the Certified Financial Planner (CFP) designation.

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

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Get rich in real estate, Toronto-style

There was a Real Estate Wealth Expo in Toronto earlier this month. According to Toronto Life’s account, people who paid between $50 and $2,500 packed the city’s convention centre to hear from motivational speaker Tony Robbins, the rapper Pitbull and others.

Seminars on getting rich are nothing new or remarkable. People are always looking for short cuts on wealth building. Making money the old fashioned way – by saving and investing diligently over time – is too slow for some. This brings us to Toronto’s incredibly hot real estate. Increasingly, we’re hearing about the sort of speculative buying of homes that suggests a bubble.

Outsiders looking at the Toronto market certainly have that impression. One investor newsletter recently followed some guidance on investing in the Trump era with a quick take on what the Wealth Expo in Toronto says about a bubble in the city: “Suffice it to say, you can’t really ring a bell any louder than this.”

Another cutting take on the event comes from an investing blogger with experience as a securities trader in Toronto and New York. “Bubbles are largely psychological,” he writes. “This crowd was tangible proof of that.” (Note: There’s a bit of profanity in this post.)

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Planning to vacation in Canada this year?
A travel booking website tells you the best time to book tickets for travel to Canadian cities.

The problem with precarious work
“…No job security, poor pay and no hope for advancement” – that’s how a part-time instructor at a university describes her job (which she loves, anyway). People working contract or temporary jobs also face stress-related mental health issues. Another view of the gig economy is that it facilitates the exploitation of people trying to make a living.

Buffy the Vampire Slayer is an investing guru
Some sensible investing lessons were taught by this cult favourite TV show, which my wife loves.

A dollar back for every nine cents you put in
A young personal finance blogger interviews the head of the Healthcare of Ontario Pension Plan and learns a thing or two about the value of defined benefit pensions.

The cars of personal finance bloggers
Yes, there are many frugal vehicles here, but some bloggers do enjoy a nice ride.

Today’s featured financial tool
This infographic summarizes the personal finance measures contained in the recent federal budget. Here’s my own list of budget highlights (for Globe Unlimited subscribers).

Ask Rob
The question: “I’ve read a few times that bond prices are at risk due to higher interest rates, but that it’s still worth keeping them as a hedge against market shocks. Given that bond values would decline as interest rates rise, what do you think about just holding cash in a high-interest savings account?”

My reply: “Good thought. For now, you can get comparable returns from some high interest accounts, with zero chance of losing money to market fluctuations. Bonds are better in an environment of falling rates, though.”

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

What I’ve been writing about
– How baby boomers living the high life are at risk in retirement
– The 2017 ETF Buyer’s Guide: Best bond funds (for Globe Unlimited subscribers)

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Don’t get buried by funeral costs: This alternative cost just $1,573.35

Rob Carrick

A recent newsletter about high-pressure sales and high prices in the funeral industry in Canada prompted an e-mail from a reader that I want to share with you because it was so refreshingly forthright and helpful.

“It was distressing this morning reading about the experiences of people and funeral homes,” this reader said. “We have just been through a very different experience which I would like to share with you.”

Here’s an edited summary of this reader’s experience:

“My mother-in-law died in December. She was 83 and had metastatic cancer. We knew that she did not have long to live when she was admitted to hospital.

“We knew that she did not want a funeral or the involvement of a funeral home. She wanted a simple cremation and, ultimately, that her ashes would be scattered with the family gathered at our cottage in the summer. I contacted a simple cremation and burial service found through a web search. I completed forms and other paperwork in advance of my mother-in-law’s death.

“When she died, the cremation and burial service took care of everything. My only contacts with them were by phone and e-mail and we were all extremely pleased with the services rendered. Our total bill was $1,573.35. That amount covered documentation, including 10 copies of the death certificate, collection of the body from the hospital, transfer to and from the crematorium, a cardboard container (which was my mother-in-law’s wish), an urn, the crematorium fee and all taxes.

“We collected the urn and paperwork at a crematorium in Toronto a few days after the cremation. Again, we were treated with respect and dignity.”

Thanks to this newsletter reader for sharing.

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Want to be a millionaire? Make your bed
In this video, a socio-economist talks about his survey of millionaires regarding their everyday habits. Big surprise – they’re extremely disciplined people.

Top cash-back credit cards
This listing was built by evaluating more than 40 features of 76 different cards. Here’s a list of the best no-fee cashback cards.

You should sniff these products before buying – seriously
Fresh produce, coffee, fish and other stuff you should smell before buying to make sure you’re getting good value for your money. Sniffing etiquette is covered here as well. Don’t touch your nose to stuff.

Ignore these five investing myths
An in-your-face trashing of some widely held ideas about investing. Fun read.

Today’s featured financial tool
This calculator is designed to help you pick the right age to start your Canada Pension Plan and Old Age Security benefits.

Ask Rob
The question: “How difficult is it to choose a financial adviser, and how does one know if you need one? How do you start to find one?”

My reply: It’s not hard to find an adviser, but it’s time-consuming. You need one if you’re unsure whether you’re on track to meet your financial goals in life – being able to retire comfortably at a certain age, being debt-free by a certain age, helping your kids pay for university or buy a house. Start looking for one by asking friends, family and associates if they have an adviser they recommend. Also do some googling for advisers near you and look at their websites. Interview a few advisers before signing on with anyone. Ask about their accreditation, their process for working with clients, their services provided and their fees. Make sure you’re dealing some someone who advises rather than simply tries to sell investments.

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

In case you missed these Globe and Mail personal finance stories
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I’m getting a big inheritance – how should I invest it?
- Four dead simple solutions for DIY investors

Featured Video
Four things millennials need to know about getting started as an investor.

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

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Repair costs wear him down: 'I am tired of being a home owner'

A home owner vents here about all the repair and maintenance costs he’s paying. “Owning, managing and taking care of a home are just too much for me,” he writes. “There are a lot of repairs and maintenance that are required, more than I initially expected. And I’m tired of it!”

Amen, brother. The grind of keeping a home operating smoothly is an overlooked aspect of owning a property. Home upkeep costs are sometimes estimated as 1 per cent of the value of the property, or $1 per square foot. This is the annualized average amount – some years will cost you nothing, while others will bombard you with one thing after another. Here’s a housing expense calculator that suggests you should expect home maintenance costs to average 3 to 5 per cent annually.

Try not to resort to your line of credit or credit card to finance house upkeep. Instead, look at the major components of your home – roof, furnace, driveway – and estimate when they will need to be replaced. Then, start a reserve fund to cover these costs.

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Are you reading this newsletter on the web or did someone forward the e-mail version to you? If so, you can sign up for Carrick on Money here.

Applying the 40-70 rule to your parents
If you’re 40 or your parents are 70, it’s time to start talking about awkward age-related issues like finances, driving and independence. Here’s a booklet on how to start the conversation from a company that provides services to help keep seniors in their homes.

How a bull market warps your brain
A timely reminder of how rising stock markets can lull investors into thinking they’re smarter than they actually are. Don’t get cocky.

Mortgage insurance premiums on the rise
A look at how the recent increases in mortgage default insurance premiums will affect buyers across the country. Buyers must pay for this insurance if they have a down payment of less than 20 per cent.

Who’s in the middle class?
Interviews with people shopping at a U.S. shopping mall suggest pretty much everyone thinks they’re middle class.

This is what happens in a hot condo market
In Toronto, the condo market is so hot now that buyers are coming in with unconditional offers. This means buyers are foregoing a chance to make an offer conditional upon a lawyer’s review of a condo’s status certificate, which offers details on maintenance fees, special assessments and ongoing issues in the building. Another example of how buyers have no power in a hot housing market

Today’s featured financial tool
Here’s the Canada Revenue Agency’s list of free software products you can used to complete your income tax return. Before you buy any tax software, see if these freebies will do the job for you.

Ask Rob
The question: “We are sick of MERs eating into our portfolio. We are thinking of dumping everything to just go with ETFs. What do you think?”

My reply: “I get this question fairly often these days. I think ETFs are an outstanding portfolio-building tool, in part because the cost of owning them is far less than mutual funds. The cost of owning any type of fund is measured through the management expense ratio, or MER. Returns are reported to investors on an after-fee basis. The reason ETFs are cheaper is that there are no costs embedded in their fees to pay for investment advice, as there is with mutual funds. If you’re getting financial advice with your funds, that’s a value that may justify the higher cost. If you’re not getting any advice, then ETFs will cost you less to own and might just perform better.

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

What I’ve been writing about
- Rumours of a capital gains tax hike caused this investor to cash out.
- Is your bank trying to upsell you? Buy this, don’t buy that.
- Have a complaint about your bank? Here’s where to go.

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

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What, you’d like pay and benefits with that job?

Rob Carrick

We’ve had strong employment growth in Canada in recent months, but questions are being raised about the quality of the jobs people are getting. Wage growth is weak, the number of hours people are working has declined and there’s a growing preference among employers for offering temporary or contract jobs instead of full-time positions.

Now for a new wrinkle in finding a decent-paying job. A Winnipeg woman named Taylor Byrnes was rejected for a job interview at a company called SkipTheDishes.com after asking about pay and benefits. The company later apologized, but the implication was clear. In today’s job market, employers have all the leverage.

We need to recognize this more in personal finance. For example, workers in today’s “gig economy” (you go from job to job) face challenges in saving for retirement. Temporary workers also tend to be paid less and receive fewer benefits. If you feel like you’re not getting ahead financially, the job market may be the reason.

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So much for the empty nesters
The social side of an expensive housing market is just as interesting as the money aspect. Here’s a story about a family where parents are staying in their home so their 29-year-old daughter can live with them while she saves for a house down payment.

Adviser 1, Client 0
This is a disgrace. A woman has been with her investment adviser for 10 years and has a net return of only $1,500 after paying fees of $25,000. A great argument made here for monitoring your portfolio regularly and not letting long periods of underperformance go by unchallenged.

10 ideas for a cheap first date
The coffee date seems a sensible idea for getting to know someone without spending big bucks.

What if you can’t afford your medications?
Toronto’s Sunnybrook Hospital suggests you start by talking to your doctor – there may be ways to reduce costs.

Save money, make money in the second-hand economy
I’m including this item as a reminder to me as much as you to think about the second-hand market as a place to either sell unwanted items or buy them on the cheap. The online market place Kijiji says the average person selling second-hand stuff online made $1,037 last year, while buyers of second-hand items saved $843. Clothing, shoes, entertainment products and games and toys are the most exchanged goods.

My kid, the accident fraudster
How kids can inadvertently order stuff on line and run up their parents’ credit cards.

Attention, Toronto renters
To help us better understand what's happening in the city's tight rental market, please take this short survey.

Today’s featured financial tool
 Need a new car, truck or SUV? This calculator can help you compare the costs of buying and leasing.

Ask Rob
The question: “My husband and I are nearing retirement and have an online brokerage account worth $800,000, invested in Canadian dividend stocks. We own shares in banks, utilities, and communications and have been following a DRIP (dividend reinvestment plan) approach which has been very successful to date. Fearing an upcoming market correction I recently put stop loss sell orders in at 7 to 8 per cent below current valuations. Is this a sound strategy? We intend to continue to hold dividend stock in our retirement so would have to buy back at some point.”

My reply: “My question to you is how you’ll know when to buy your dividend stocks back if the stop-loss order goes through and they’re sold. If stocks are falling, you might be too nervous to buy. Next thing you know, stocks are rebounding and you’ve missed a chance to get in a good price. If your long-term plan is to hold dividend stocks, it’s hard to see any upside to trying to time the market by selling and then rebuying.”

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

Featured video
The overlooked way to prepare for retirement – lay the groundwork for working past age 65.

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Death is a booming $1.6-billion industry in Canada

The funeral services industry comes off looking just awful in an investigation done by the Toronto Star and CBC Marketplace. Exorbitant charges and high pressure sales were common, but what really stands out are the stories of people who pre-paid their funerals. Years later, their families were told they’d have to pay substantial extra charges for burial or cremation

Here are some basics on funeral planning, including tips on pre-arranging a funeral service. Some important questions to ask are what happens if you move, and does the contract include all fees? To organize a cost-conscious funeral without looking cheap, consider these tips.

There are a growing number of low-cost alternatives for funerals, so don’t feel boxed into the traditional funeral home experience. And remember the Canada Pension Plan death benefit, which is a modest lump-sum payment to the estate of a deceased CPP contributor. The maximum payout for 2017 is $2,500.

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Let British-born financier Jonathan Fisher help you profit like the experts
That’s the devious hook securities regulators in Alberta used to lure people to a fake investment seminar staged to highlight how cunning scammers are. A total of 22 people showed up for the session, and most seemed to appreciate the wake-up call.

Breakfast cereal confidential
Ten facts about popular breakfast cereals. Presented in case your family is like mine in consuming a lot of cereal. Now for some info on how to pick a healthy cereal.

Toronto housing humour
The Beaverton, a satirical magazine, mocks the high price of condos.

A new kind of ETF
BMO’s family of exchange-traded funds now includes four bond funds with an “accumulating units” version. That means the cash distributions are reinvested into the fund automatically and not paid out in cash. An interesting option for investors looking for growth rather than income.

NHL player gets scammed
A video about Brian Berard, a onetime NHL defenceman who nearly lost everything through a fraudulent financial adviser. Mr. Berard started out with a conservative approach to building a retirement fund, but then his adviser decided to get more ambitious.

What millennials want from the financial industry
They want their financial products, cheap, fast and with no chit-chat. Works for me.

Today’s featured financial tool
Spring is high season for home buying, and that means many people buy and renew their home insurance at this time of year. If you’re comparing insurers, check out these consumer reviews. You’ll also find reviews of credit cards and mortgages.

Ask Rob
The question:
“I have about $80,000 in my RRSP that I recently pulled out of an underperforming mutual fund. I am ready to start managing my own portfolio and have a shortlist of investments I am considering, mostly using a passive index tracking strategy. However, given the increasing talk about a market correction (timing and extent unknown, of course), would it be worth waiting for this to occur before getting back into the market given current valuations? I accept the principle that I won’t be able to time the market, but am still worried about current valuations and getting in at or near the top.”

My reply: “I have no idea about the timing, but the markets have had a great run and will at some point fall hard. If you’re worried about this, consider this approach: Divide your $80,000 into four chunks and invest one of them quarterly over the next year. Academic research shows that a lump-sum investment beats the gradual approach in most cases. But the correction risk today is real and I think investors need to protect themselves psychologically as much as anything else. Moving into the market gradually will ease your worries about buying and then having your investments fall off a cliff.”

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

What I’ve been writing about
- Sad but true: Prudent savers are getting hit with the highest mortgage rates

- A foreign-buyers housing tax in Toronto? Bring it on – and fast

- The 2017 ETF Buyer’s Guide: Best Canadian Equity Funds (for Globe Unlimited subscribers)

More Carrick and money coverage
For more money stories, follow me on Twitter and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.

Send us an e-mail to let us know what you think of my newsletter.

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About the writer