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My top project for December 2018 was to write a guide to the changes coming to the Canada Pension Plan in January. The process is widely known as CPP enhancement, and it balances higher contributions for workers and their employers with rising retirement benefits over the decades ahead.

The point of these changes is to make the CPP a bigger factor for the steadily growing majority of the population that does not have a company pension plan and may not have enough saved to maintain their standard of living in retirement. The full impact of the CPP enhancement will be seen in 2065. Today’s current maximum annual retirement pension of $13,610 would be worth approximately $20,750 in 2018 dollars by then – an extra $7,140 a year.

There’s a view held by some people that Canadians are already saving enough and thus don’t need an improved CPP. A longtime personal-finance blogger dispenses with that argument here. Some other useful resources for understanding what’s ahead for the CPP:

  • An actuary’s take on how much of a difference CPP enhancement will mean for the income of retirees.
  • An opinion piece on how the expanded CPP will not narrow the gap between public- and private-sector pensions
  • The federal government’s official description of CPP enhancement.

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Rob’s personal finance reading list…

Gift cards are a bad present

The problem with gift cards is that a lot of them end up lost or forgotten. Here’s an argument for giving cash instead. Why do so many companies offer gift cards? Here’s a list of seven reasons – Number Three is “generate revenue in advance of sales.”

Stop wasting money on expensive skin care products

Dermatologists discuss affordable skin-care products they use. The names mentioned here can be found in any drugstore, including Vaseline Petroleum Jelly (for dry lips, cracked hands and feet). At the gym I go to, I notice more men are using skin-care products these days.

The road to early retirement

Veteran personal-finance blogger Mark Seed looks at how he’s doing in meeting 10 goals that can help you retire early. The list is mostly financial, but a stable family life is also on the list. Smart.

Why she’s in no hurry to pay offer her car loan

A personal-finance blogger figures she could pay off her car loan in less than a year. Here, she explains why she’s not going to do that. A lesson here: You don’t have to be perfect in every aspect of your finances.

Today’s financial tool/app

This calculator will estimate how much more you’ll receive in retirement benefits as a result of CPP enhancement, and how much more you’ll pay in contributions.

Ask Rob

Q: In the article How taxes can provide relief from a failed investment, it’s mentioned that interest and carrying changes on investment for income can be claimed as a tax deduction. Does this deduction apply to money borrowed to invest in a TFSA?

A: No. Details here.

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 and clarity.

What I’ve been writing about

  • Pre-retirees, here’s what people already retired can tell you about your future standard of living
  • This key interest rate is flashing a warning sign about buying a house (for Globe Unlimited subscribers)
  • How aggravated clients can reconnect with their advisers (for Globe Unlimited subscribers)

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