Hub Blogs

Hub Blogs contains fresh contributions written by Financial Independence Hub staff or contributors that have not appeared elsewhere first, or have been modified or customized for the Hub by the original blogger. In contrast, Top Blogs shows links to the best external financial blogs around the world.

Leave an inheritance of cottage relaxation, not taxation

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Cottage On The Carpenter Lake, CanadaBy Tarsem Basraon, TD Wealth 

Special to the Financial Independence Hub

The summer is quickly approaching and for many Canadians that means one thing: cottage season.

While many parents envision leaving the family cottage as part of their inheritance one day, with the value of cottages often appreciating since purchase, there’s also the risk of bestowing the legacy of a large tax bill.

To help make sure you’re leaving an inheritance of cottage relaxation and not taxation, here are three strategies you can discuss with your financial advisor when planning your cottage legacy. These strategies are available to you while you are alive, and there are various other strategies that can be implemented on your death in your will.

• Co-own with your Kids

Adding your children to the deed and making them co-owners of your cottage could help defer capital gains tax and save money. For example, if your cottage value has increased over time, it would trigger a capital gain on the portion of the cottage that your children now own and you would pay the tax on that now. Down the road, your kids would only pay tax on the capital gains owing on the remaining portion of the cottage you own when you die. There is,  however, a risk with this approach. Continue Reading…

Choosing frugality amid social pressures to spend

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Man keeping a woman from entering a store and begging her to stop shoppingBy Helen Chevreau, Hub Staff

As millennials, we often feel pressured by both the media and our peers to look and act a certain way. It’s a general rule of thumb that if you’re in your twenties or thirties, you’ll feel the strain of wanting the newest and best something at least once. Many of us will crack under pressure and eventually purchase that new iPhone (even though our current one works fine), or that new pair of jeans (even though we already have a pair in that colour).

The thing about succumbing to these societal pressures, though, is that for the most part, at the end of the day, we don’t feel better about ourselves after making these big purchases. In fact, a lot of the time, it’s quite the opposite. We see the shiny new product and our first reaction is “I need this now.” We can convince ourselves the price is irrelevant, and that it will pay for itself, or that it’s a necessity. But how frequently is that true? Do we ever really need to bow to those pressures?

Stop, Drop, Don’t Shop

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Mrs. Frugalwoods

It seems there is a trend emerging in the financial millennial blogosphere wherein bloggers enact a “shopping ban.” The terms of the bans vary by site, but the general premise remains the same:  a new consumption philosophy rooted largely in the theory of not purchasing anything.

“Mrs. Frugalwoods” of the blog Frugalwoods, for instance, is well on her way to going three years clothes-purchasing-free. Continue Reading…

How to manage your first Credit Card

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a young business woman holding new credit cardBy Alyssa Furtado, RateHub.ca

Special to the Financial Independence Hub

When you become an adult is a matter of opinion. It could be when you turn 18, move out of your parents’ home, or land your first job. But for some, they joke that you’re not really an adult until you get your first credit card. I don’t know where the joke originated from but from a financial standpoint, getting your first credit card is practically a life event.

Depending on what province or territory you live in, you can legally get a credit card at the age of 18 or 19. Unfortunately, at that age, many of us aren’t making sound financial decisions, which is why you might be tempted to sign up for a new card on your college/university campus or even inside a grocery store or mall.

What credit card you select and the benefits it offers could affect you in the long run. So it’s a good idea to understand how to manage your first credit card before signing up for the first offer available to you.

Picking the right card

Receiving a free t-shirt or a travel mug may be tempting but if that’s the reason you’re signing up for a credit card, you can do a lot better. Continue Reading…

Retired Money: The Joy of Pension Splitting

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Elderly couple in a meeting with an adviser discussing a document as she watches across the desk in her officeThe third instalment of my new bimonthly Retired Money column at MoneySense.ca has just been published online and focuses on the important topic of pension splitting, or pension income splitting.

You can read the whole piece by clicking on this highlighted headline: How to keep more benefits with pension income splitting.

As the piece observes, pension splitting can be manna from heaven for retired or even semi-retired couples where one is collecting a generous Defined Benefit or other employer pension and the other is not.

Nor is it as complicated a process as it may seem at first blush: you don’t have to actually divide such a pension and send some to each spouse: it all happens at tax-time when for tax purposes you choose what percentage of the pension each spouse should receive. Naturally there are multiple things to consider, such as other income sources, relative tax brackets and so on.

But the bottom line is that in many cases, it should result in thousands of extra after-tax dollars a year in the pockets of the couple as a unit. And that’s how couples should behave, isn’t it?

For more information about pension income splitting, a good place to start is the Canada Revenue Agency’s web site, and in particular this explanation. Note too that it includes a short video.

 

FinTech wars heat up as Robo firm NestWealth hires former BlackRock sales director

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Chris Hogg heads up new Nest Wealth Pro unit

The fin-tech wars are heating up on the Sales front: Toronto-based robo adviser NestWealth.com today announced it has hired the former Director of National Accounts for iShares BlackRock to head up its new B2B offering, Next Wealth Pro.

The hiring of sales veteran Chris Hogg is a “huge day for Nest and I think for the industry as a whole,” says NestWealth founder and CEO Randy Cass.

Nest Weath Pro is a new digital wealth management platform: it provides traditional brokerage firms, advisors, and asset managers with a “white label” turn-key solution that includes know-your-client tools and customizable portfolio management.

Disruptive shift

In a press release issued this morning, NestWealth said Hogg has more than 20 years industry experience, including the last three years at BlackRock. The release quotes Hogg as saying that “I’ve seen many changes within the industry, but have never encountered a shift as meaningful and disruptive as what we’re seeing today.”

Case said Nest Wealth Pro demonstrates that “technology and tradition can co-exist in a way that supports advisors and benefits their clients.”

NestWealth describes itself as “Canada’s largest independent Robo-Advisor.”

Speaking of disruption, there’s a good piece on finch’s impact on the banks in Thursday’s Financial Post. See ‘Disruption here and now’: Pressure of Uber moment transforming banks, conference told.