Search found 49 matches

by Thorn
08 Jan 2015 20:09
Forum: Financial Planning and Building Portfolios
Topic: Differentiating between Accumulation and Withdrawal phases
Replies: 22
Views: 961

Re: Differentiating between Accumulation and Withdrawal phas

I am often confused by descriptions of "withdrawal" scenarios (e.g. 4% a year is OK) that seem to assume the individual needs to consume savings capital to survive. In a number of posts above this does not appear to be the case. We may have someone who: (1) Does not require any income or capital fro...
by Thorn
11 Jan 2014 23:44
Forum: Retirement, Pensions and Peace of Mind
Topic: Estate planning – gifting money
Replies: 12
Views: 2277

Re: Estate planning – gifting money

Intergenerational joint accounts (e.g. parent and child) Please don't forget that there have been two Supreme Court decisions in the past five years instructing that balances in the accounts must be included in the estate accounting unless the parent has specified in writing (prior to death of cours...
by Thorn
08 Oct 2013 14:17
Forum: Financial Planning and Building Portfolios
Topic: Wills, Estate Planning, Life Insurance
Replies: 404
Views: 52040

Re: Wills, Estate Planning, Life Insurance

Another wrinkle to consider - when the deceased has inter-generational joint accounts with the executor or a child. Two Supreme Court decisions in recent years have ruled that joint account contents be reported in the will execution as estate assets, specifically if most or all of the account funds ...
by Thorn
06 Oct 2013 17:32
Forum: Financial Planning and Building Portfolios
Topic: Advice for beginners - in as few words as possible
Replies: 104
Views: 5103

Re: Advice for beginners - in as few words as possible

My family's finances were a mess for 30+ years until I got fed up and started to track income, expenses, assets and liabilities, then periodically produce an income statement and balance sheet to see if we were winning or losing. In some cases we would look at an expense category total like Dining a...
by Thorn
05 Oct 2013 22:41
Forum: Financial Planning and Building Portfolios
Topic: Leveraged investing
Replies: 51
Views: 3727

Re: Leveraged investing

Two observations on borrowing to invest: (1) In many cases the funds come as a demand loan, with the potential for an unwelcome phone call in a down market, possible wiping out the loan capital and some of your savings. (2) For the new investor this is sold as a "way to make more money", i.e. a spec...
by Thorn
09 Jun 2013 23:27
Forum: Financial Planning and Building Portfolios
Topic: Re: My Portfolio Seeking advice, please help 2013-14
Replies: 165
Views: 6056

Re: Portfolio Help

Hi folks, sorry I am so late in joining this discussion. Two points, based on my experience since retiring: (1) I believe it is very important for you to be debt-free when you retire. I know you have a long way to go, but it is easy to go way off track over the years. (2) My wife and I downsized in ...
by Thorn
19 Mar 2013 10:51
Forum: Retirement, Pensions and Peace of Mind
Topic: RRSP withdraw strategy for early retirees
Replies: 208
Views: 13736

Re: RRSP withdraw strategy for early retirees

brucecohen mentioned the book "Your Retirement Income Blueprint". I have read it and encountered many good ideas, from an author who has been in the fee-only financial planning business for years. For example: 1. Where future income in retirement may increase (inheritance, etc.), top up your early m...
by Thorn
02 Mar 2013 00:00
Forum: Taxing Situations
Topic: Keeping track of ACB for mutual funds in taxable accounts
Replies: 24
Views: 1857

Re: Keeping track of ACB for mutual funds in taxable account

I don't wish to derail this discussion, but may I ask a related question? In case of the death of the owner of mutual funds or segregated funds, how does the executor determine the ACB and possible capital gains/losses for the final return? What differences if the fund is not in a jointly held accou...
by Thorn
28 Feb 2013 00:01
Forum: Retirement, Pensions and Peace of Mind
Topic: Bequest for nieces and nephews
Replies: 42
Views: 2472

Re: Bequest for nieces and nephews

Given sufficient funds and time, I favor the experimental approach. Starting soon, give them each (say) $10K a year and see what they do with it, perhaps for 2 or 3 years. If they seem to be clueless, a little discussion about future gifts might be in order. If you have an excess of income each year...
by Thorn
04 Jan 2013 15:43
Forum: Financial Planning and Building Portfolios
Topic: Does a young investor need bonds?
Replies: 56
Views: 2711

Re: Does a young investor need bonds?

For any investor, the following might apply, remembering that no investment decision is risk-free: (1) Cash - has appeared in your investment accounts through a sale, maturity, dividend or interest payment, etc. Let it sit for a while if you don't like anything you are hearing or seeing at present. ...
by Thorn
23 Nov 2012 01:10
Forum: Financial Planning and Building Portfolios
Topic: Investing in a Taxable Account is a Gift to the CRA
Replies: 87
Views: 2460

Re: Investing in a Taxable Account is a Gift to the CRA

There are annual limits on amounts that can be contributed to RRSPs and TFSAs, so you need an unsheltered account unless you wish to leave any remaining cash on the sidelines. Also, for folks in lower tax brackets coming into retirement, it is good to consider unwinding RRIF withdrawals faster than ...
by Thorn
23 Oct 2012 13:34
Forum: Retirement, Pensions and Peace of Mind
Topic: Division of assets on separation - Contingency tax rates
Replies: 16
Views: 3586

Re: Division of assets on separation - Contingency tax rates

I just read the Nov 2012 issue of MoneySense "What's His, What's Hers". After seeing the comment above, I Googled "pension splitting after divorce canada" and got a lot of hits. One I looked at was http://www.pension.ca/Dividing%20a%20pension.htm . In brief this seems to be a complex, murky topic wi...
by Thorn
18 Oct 2012 18:11
Forum: Retirement, Pensions and Peace of Mind
Topic: Division of assets on separation - Contingency tax rates
Replies: 16
Views: 3586

Re: Division of assets on separation - Contingency tax rates

In a slightly different vein, it is important to get a financial planner involved, as many lawyers only consider the immediate division and not the long-term implications of that division. There are CDFAs in Canada (Certified Divorce Financial Analysts) essentially CFP or equivalent with additional ...
by Thorn
19 Sep 2012 19:44
Forum: Retirement, Pensions and Peace of Mind
Topic: Determining Minimum Withdrawals from a RRIF....
Replies: 7
Views: 1223

Re: Determining Minimum Withdrawals from a RRIF....

On a slightly different tack, RRIF withdrawals are taxed at your marginal rate. If you have significant capital in the RRIF and you have room in your current tax bracket, you could consider taking more than the minimum. If you withdraw an amount to "top up to bracket" you will pay a lower marginal r...
by Thorn
30 Aug 2012 00:52
Forum: Financial Planning and Building Portfolios
Topic: Fixed Income - Bonds, Real Return Bonds, Laddered?
Replies: 99
Views: 6738

Re: Fixed Income - Bonds, Real Return Bonds, Laddered?

My apologies if I have offended some participants by not responding to criticisms of my comments. I seem to see a wide variety of opinions here. I try to consider each and work it into my overall view of the subject. Since I am very new to forums, perhaps I should read more and write less in the fut...
by Thorn
28 Aug 2012 23:26
Forum: Financial Planning and Building Portfolios
Topic: Fixed Income - Bonds, Real Return Bonds, Laddered?
Replies: 99
Views: 6738

Re: Fixed Income - Bonds, Real Return Bonds, Laddered?

I am retired, married, 68. A few observations on the discussion so far: (1) Fixed income (bonds, which are liquid, as opposed to GICs which are not) are intended to preserve capital and deliver some interest income. Bond funds are equities, not fixed income: they do not provide any level of guarante...
by Thorn
28 Aug 2012 13:46
Forum: Retirement, Pensions and Peace of Mind
Topic: So you are going to buy an annuity. With what?
Replies: 145
Views: 11008

Re: So you are going to buy an annuity. With what?

Great comments from all the folks above. I am 68 with sufficient pension income, so I will be handling my own investment capital for the foreseeable future. Before getting lost in the annuity yes/no details, the starting point should be a set of retirement goals, hopefully more than one (e.g. "leave...
by Thorn
26 Aug 2012 23:06
Forum: Taxing Situations
Topic: 2012 and on dividend tax credit changes
Replies: 40
Views: 3346

Re: 2012 and on dividend tax credit changes

I second "like-to-retire" - once retired, we need some portion of our portfolio in fixed income, to provide both income and capital preservation. If you are 100% equities, sooner or later you will make a poor decision and place both capital and possibly dividends at risk. Once retired, we generally ...
by Thorn
29 Jul 2012 23:26
Forum: Taxing Situations
Topic: Itchy to Collapse RRSPs
Replies: 27
Views: 2724

Re: Itchy to Collapse RRSPs

joeclarke, for those preparing to retire or already retired, Daryl Diamond's (Canadian) book "Your Retirement Income Blueprint" helps you plan your future income streams, and as well as bringing up a zillion other issues, explains why moving money from registered to non-registered holdings may make ...
by Thorn
27 Jul 2012 18:15
Forum: Retirement, Pensions and Peace of Mind
Topic: Retirement Debt
Replies: 24
Views: 1460

Re: Retirement Debt

Inquisitive's reply concening deferral of property taxes reminds us once again that some of us are fortunate enough to be able to meet all our bills each month/year, while others need to be more creative in order to have sufficient income to live for the foreseeable future. Some of us are able to me...
by Thorn
26 Jul 2012 00:43
Forum: Retirement, Pensions and Peace of Mind
Topic: Retirement Debt
Replies: 24
Views: 1460

Re: Retirement Debt

I voted "No Debt" as well, with some clarification needed. We retired 10 years ago with no long-term debt - mortgage- and loan- free. Now, for short-term debt: We do use an LOC cheque occasionally but only if we can clear the balance when the cheque clears - sometimes that requires a little planning...
by Thorn
29 Jun 2012 23:21
Forum: Financial Planning and Building Portfolios
Topic: TFSA: What Asset Allocation?
Replies: 59
Views: 4407

Re: TFSA: What Asset Allocation?

I, like many of your here, have three accounts - unsheltered, RRSP/RRIF and TFSA. Three comments: 1. I think your asset allocation needs to first be worked out for your entire portfolio (cash, fixed income, equities), then decisions made about allocating funds to each account. Certainly tax-ineffici...
by Thorn
24 Jun 2012 20:43
Forum: Financial Planning and Building Portfolios
Topic: Thou shalt not split 60/40
Replies: 31
Views: 2319

Re: Thou shalt not split 60/40

As a retired defensive investor, I have found that a careful reading of many structured products places all the advantages in the seller's hands and none in the investor's. For me, anything beyond corporate bonds, common shares and selected ETFs (broad, passive, non-leveraged, low-fee) entails unacc...
by Thorn
19 May 2012 11:17
Forum: Financial Planning and Building Portfolios
Topic: Risk = ??
Replies: 491
Views: 88184

Re: Risk = ??

In most investing topics, it is best not to get too caught up in the extensive math and stats literature. The models fall far short of the real-world complexities in the money, fixed-income and equity markets. For me, "risk" is the probability that I won't achieve the promised or expected returns on...
by Thorn
26 Apr 2012 00:17
Forum: Financial Planning and Building Portfolios
Topic: Portfolio Theory: GICs vs. Bonds
Replies: 10
Views: 1511

Re: Portfolio Theory: GICs vs. Bonds

Great comments, folks! Thanks for straightening me out about some ETF payouts - they sound a lot like income trust payours, which I find a little annoying, since each return of capital means I need to re-calculate my adjusted cost base. A few more observations: (1) The Canadian bond market trading v...