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.

Game-winning shopping hacks for Black Friday & Cyber Monday

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Credit cards in shopping cart and laptop, Black Friday Sale conceptBy Sari Friedman, Ebates Canada

Special to the Financial Independence Hub

Get the coffee brewing and put your game face on! Thanks to our American neighbours, Black Friday and Cyber Monday sales are about to kick off the busiest shopping season of the year, with deep discounts and exclusive online offers.

Canadians are feeling pretty generous this holiday season, with 84 per cent saying they plan on spending almost $200 more than last year, according to our recent Ebates.ca poll.  Whether looking for deals in Canada or across the border, more Canadians are turning to online shopping to avoid the chaos, with 82 per cent saying they will make at least some holiday purchases online.

While you won’t need a helmet and elbow pads to score a deal for these two big shopping days, a little preparation and some savvy strategies will help make sure you stay ahead of the competition – and within your budget.

Don’t believe the hype

The best way to know whether a deal is really a deal is to do your research beforehand. Make a list of items that you’re interested in, then do some recon to compare prices, features, quality and special offers across various retailers. You may find a similar item to what you’re looking for that is a better deal, or at the very least, you’ll have a solid back-up choice that you can still be confident buying.

Limit your spend

the sentence cyber monday and a computer mouse on a background full of dollar banknotes

It’s easy to get carried away in the chase for a deal, but it’s important to set yourself limits or you risk blowing your budget:  game over! Stick to the items on your budgeted list and avoid impulse purchases.  That ‘blowout’ price may seem cheap in the moment, but is it really worth it if your purchase sits in your closet or on a shelf, unused?

Sign up ahead of time

Continue Reading…

The US Forex trading market after the Election

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3d render of forex trading conceptBy Justin Duke

Special to the Financial Independence Hub

All over the world, trading markets are rapidly evolving. There are a lot of factors influencing the difference in the high and low of global currencies. In America, the influencing factors only get bigger: talk of oil prices, the outcome of the election, and many more factors. Currency pairs are moving with the market trends. What exactly does this mean for forex traders? The market can be lucrative, and it can be resilient.

In the past few weeks, a lot has happened in forex trading that the investors of this market should be aware of. Risky trends in the market have been amplified lately, but with the American Thanksgiving holiday coming up soon, forex traders in the U.S. are looking at some sort of break, but this time off from the market trends also means a period away from the optimism that some currencies were showing in the past week.

How commodities impact Forex

The market is still recovering from the somewhat aggressive election run by Trump and Clinton. Other trading commodities that influence the Forex Trading market, like oil and gold, also experience major changes. Thanksgiving, in the past, has rigged the market of its liquidity. The S&P 500, for instance, hits some of its highs during such holidays, leading many investors to believe that holiday cheer is an influential factor that can move the market from a low to a high.

Oil rigs moved from 452 to 471 in just a week, while gold is making a move towards $1,200. Last week, US stocks were trading at a low thanks to the loss of the bias previously owned by the GBP/USD currency trading pair. The Fed is looking to diversify some of its policies so as to help strengthen the current position of the dollar in the market. The position of the Euro, on the other hand, might just be about to get very interesting given the current market flux in Europe. Forex traders should consider the word of trading experts before placing their investments on any currency combinations in the current risky markets. Continue Reading…

Should I start CPP early? Real-Life Examples

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Piggy bank with national flag of CanadaBy Ed Rempel, CPA, CMA, CFP 

Special to the Financial Independence Hub

The most common Canada Pension Plan question I am asked is: “Is it smart to take my CPP early?”

A quick review of the facts:

  • The maximum CPP benefit in 2017 at age 65 is $1,092.50 per month, or $13,110 per year.
  • You can start as early as age 60, but you get 7.2% less for every year before age 65. If you start at age 60, you get 36% less, so the maximum is $8,390 per year.
  • New rules in 2012 increased the penalty for starting early, but you can start CPP even if you are still working.

The simple breakeven calculation misses many important factors. For example, if John starts receiving $8,390 per year at age 60 and Jane starts receiving $13,110 at age 65, it will take her nine years to catch up. The simple breakeven is age 74. John gets more before age 74 and Jane gets more after.

This implies that if you expect to live past 74 (and most people will), you should delay your CPP. But this is not the full answer.

The answer depends on five main factors:

Continue Reading…

Residential Buy- and Sell-back Agreements: a new option for Boomers?

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sell-and-lease-back-boomers-resizedBy Penelope Graham, Zoocasa

Special to the Financial Independence Hub

In today’s real estate market, buying a house is less a traditional rite of passage and more a Herculean feat, especially for Millennials scraping together a down payment in Toronto or Vancouver. To them, the concept of owning a detached dwelling, complete with yard and picket fence, is a faded – and financially unfeasible – memory.

But it was a reality for Canada’s 9.6 million Baby Boomers, many of whom bought in their early 20s, and are still living in the family home. And, given the explosive surge of housing prices over the decades, a fair share of those Boomers have seen their investment grow by hundreds of thousands of dollars. Consider this – according to the Toronto Real Estate Board, the average Toronto home sale price was $75,694 in 1980, compared to September 2016’s average of $755,755 – an 898% increase!

These homeowners face a choice: sell while the market is hot (especially as new mortgage rules designed to cool demand go into effect), or stay put. For many, it’s not an easy decision.  They may feel cashing out isn’t worth parting with the beloved family abode. Others may wish to sell, but dread navigating bidding wars and other competitive tactics when buying their next home. For some, “downsizing” may just be a dirty word. So, what options do these Boomers have?

Sell and Lease-back agreements offer an option

To address this conundrum, some seniors have turned to what is traditionally a commercial real estate practice: buy- and sell-back agreements. In these transactions, a home is sold to an investor buyer while the previous owner continues to live in it as a leased tenant. It’s a method growing in popularity, and can seem the best of both worlds, but it certainly comes with its pros and cons. Here’s what Boomers should keep in mind if considering a sell and lease-back agreement:

Pro: It’s attractive for Investors

Continue Reading…

My recent blogs: KIPPERS, insecure retirement, annuities, post-Trump investing

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depositphotos_30337045_s-2015
KIPPERS. Should parents dip into retirement savings to help their kids?

As regular Hub readers may know, I often write financial articles for other (mostly) digital media, usually the Financial Post, MoneySense.ca and Motley Fool Canada. Here’s some of the most recent blogs or columns, with links via the headlines.

Nearing Retirement and still insecure about your finances? Sadly, you’re not alone. (FP, Nov. 17)). This came out of a survey released this week by Mackenzie Investments that suggested many of us actually feel less secure financially about retirement the closer the actual date arrives. One reason is grey divorce and another perhaps related one is dipping into retirement savings to help adult children.

The latter idea was explored In an earlier FP blog I wrote this week: When Boomers should turn the taps off (or on) when it comes to financial assistance for their kids. (FP, Nov 15). There I pass along a term I learned from occasional Hub guest blogger Doug Dahmer of Emeritus Retirement Solutions: KIPPERS, also mentioned in the photo caption above.

KIPPERS stands for Kids in Parents’ Pockets Eroding Retirement Savings.  I also mentioned this in a short segment on this topic on Tuesday with Peter Armstrong on CBC’s On the Money show.

A few weeks earlier, the CBC aired another segment between me and Armstrong titled You’ve never going to retire, and Here’s Why.

Canadian Personal Finance Conference this weekend

That of course touched on the new book I’ve coauthored with Mike Drak, Victory Lap Retirement. The FP has also been running excerpts of the book the last several Mondays. You can find the first four here. Number 5 is slated for next Monday. By the way, co-author and fellow blogger Mike Drak and I both plan to attend the Canadian Personal Finance Conference 2016 this weekend in Toronto. Hope to see other financial bloggers there!

Last weekend, the FP ran a my column on Locked-in Retirement Accounts (LIRAs): The RRSP’s less flexible cousin: Everything you need to know about the LIRA.  Watch for a followup column that addresses reader queries on this topic.

Earlier this week, Motley Fool Canada ran my take on investing in the post-Trump-victory world: Don’t dump your long-term investment plan over Trump’s victory. And it’s just published my latest quarterly report for Stock Advisor Canada, this one on CRM2 and Best Interest (only subscribers with a user name/password combo can access this).

Over at MoneySense.ca on November 11th was the online version of my most recent column from the November issue of the magazine, which is on annuities: How to win using annuities in retirement.

Hey, no one promised my Victory Lap Retirement would be easy!