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DariusLikewise posted:Is there any easy resources that explain how RESPs work? Is it even worth contributing if I still have TFSA room? It depends on a lot of stuff like whether you have a pension through work, your age, etc. Generally the answer will be yes though. E: Christ I thought you wrote RRSP I'm so sorry need my coffee VelociBacon fucked around with this message at 19:36 on Feb 4, 2020 |
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Feb 4, 2020 18:51
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RESPs are a good middle class intergenerational wealth transfer scheme, but it depends on what your priorities are - your own goals (retirement, emergency fund, sicknasty vaycay) or giving your kids a leg up? I'll look for some resources, but some high points are: -lifetime max contributions of 50k per kid -20% match on first $2500/yr* to lifetime max of $7200 per kid -post-tax dollars go in -income comes out, but it's taxed in your kid's hand -very broad definitions allow for money to be spent on prettymuch anything as long as your kid is in school -upon withdrawal, you can specify that grant money and gains is spent first, which is handy because -your own contributions can be returned to you directly without tax implication. -money must be spent before kids hit thirty-something or else it will be closed. Grants (and gains on grants) are returned to gov't, pure gains are taxed at your rates, no tax for ROC -there's a 99.9% chance that group RESPs will never be worth it by a long shot - do it youself There's more to it than that, but the fact that you're asking which to prioritize makes me think you're not at the level where you need to minmax finances because every 0.1% efficiency buys its own yacht. *higher match available for lower income peeps, but lifetime max is unchanged
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Feb 4, 2020 19:29
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DariusLikewise posted:Is there any easy resources that explain how RESPs work? Is it even worth contributing if I still have TFSA room? RESPs are another tax free shelter for relatively rich Canadians. If you factor in the grant and expect your children to go to a post secondary school of some kind, I would argue the first 2500 should go to the RESP over a TFSA. You get $500 in free contributions per year until you max out. Instant 20% return before factoring in the market compounding.
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Feb 5, 2020 05:08
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It looks like I’m going to be relocating from California to Vancouver in a few months. I’ve read over the info in the OP but does anyone have any advice on a few places to find idiot level explanations or recommendations on finance and banking stuff I should know as a new resident? Like how TSFAs work (are they similar to a 401k or an IRA)? What banks are recommended, what sort of fees/savings I should expect. Good CA credit cards for points (I currently use Chase Sapphire card). Basically I’m not trying to learn how to be responsible, but rather learn how that responsibility looks once we are across the border.
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Feb 6, 2020 16:37
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TFSA is like a Roth. RRSPs are like 401k.
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Feb 6, 2020 16:49
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Mantle posted:TFSA is like a Roth. RRSPs are like 401k. Actually, RRSP is like IRA and 401K is like a company pension (RPP).
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Feb 6, 2020 17:02
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Holy poo poo your big banks suck
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Feb 6, 2020 17:10
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Voodoofly posted:Holy poo poo your big banks suck Please refer to thread title, it's both accurate and humorous. Our CC options are pretty meh as well, MBNA used to offer their card with 2% cash back on everything and a sub $100/yr fee but that's been cut back to 1.6% and $120/yr, otherwise big bank cards are around the 1-1.5% rewards back range for the paid cards and 0.5-1% on the free cards. Some have higher cash back for categories like fuel, grocery, or restaurants but their base rate can be low. I think the cheapest way to bank is to go online bank route or keep a min. balance in your amount to get the monthly fee rebate at the big banks.
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Feb 6, 2020 17:36
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There's some stuff over on reddit here: https://old.reddit.com/r/PersonalFinanceCanada/, but it can be hit or miss. For CCs I am using the PC Financial World Elite MasterCard. Not as convenient as my bank's CC, but the % back is better and there's no annual fee. Usually there's some sort of 100,000 points (~$100) signup bonus. A bunch of us cheapskates are on Public Mobile for byod phone plans with almost literally no support. If you do go with them get a friend to give you a referral code to save a little money.
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Feb 6, 2020 17:46
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I use my TD Aeroplan card because that way I get a business class return flight to/from Europe for basically free every year or two. But I'm pretty sure Aeroplan is completely changing in the summer and probably going to get worse so I would hold off on that until they announce the details of the changes because spoiler alert they never improve the program, only make it worse.
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Feb 6, 2020 18:31
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Voodoofly posted:Holy poo poo your big banks suck Oh you sweet summer child, wait until you meet our telecoms
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Feb 6, 2020 23:13
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Voodoofly posted:It looks like I’m going to be relocating from California to Vancouver in a few months. I’ve read over the info in the OP but does anyone have any advice on a few places to find idiot level explanations or recommendations on finance and banking stuff I should know as a new resident? Like how TSFAs work (are they similar to a 401k or an IRA)? What banks are recommended, what sort of fees/savings I should expect. Good CA credit cards for points (I currently use Chase Sapphire card). Basically I’m not trying to learn how to be responsible, but rather learn how that responsibility looks once we are across the border. If you’re an American tax resident do NOT touch a TFSA. The US tax system doesn’t recognize them as Roth’s in kind but as a taxable account. Do not start a problem with the IRS.
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Feb 7, 2020 03:13
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Voodoofly posted:Holy poo poo your big banks suck Vancity, Coast Capital, Westminster Savings anything but the big four. In addition to not being garbage they're part of The Exchange which is free ATM transactions between everyone in the network.
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Feb 7, 2020 04:17
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Risky Bisquick posted:If you’re an American tax resident do NOT touch a TFSA. The US tax system doesn’t recognize them as Roth’s in kind but as a taxable account. Do not start a problem with the IRS. This. Also, no Canadian mutual funds or ETFs.
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Feb 7, 2020 05:31
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Voodoofly posted:Holy poo poo your big banks suck Don't worry, the small ones suck too! Have fun by placing bets on whether they will suck before or only after getting bought by a big bank. In general you can avoid paying fees for things. Rewards, cash back, and the like seem to be worse across the board. Interac is surprisingly non-poo poo. Keep posting your discoveries. There's a strange kind of catharsis in it, except I'm still sad afterwards. Call it Canadian catharsis.
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Feb 7, 2020 05:54
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Guest2553 posted:RESPs are a good middle class intergenerational wealth transfer scheme, but it depends on what your priorities are - your own goals (retirement, emergency fund, sicknasty vaycay) or giving your kids a leg up? I'll look for some resources, but some high points are: Risky Bisquick posted:RESPs are another tax free shelter for relatively rich Canadians. If you factor in the grant and expect your children to go to a post secondary school of some kind, I would argue the first 2500 should go to the RESP over a TFSA. You get $500 in free contributions per year until you max out. Instant 20% return before factoring in the market compounding. So it is slightly advantageous tax-wise because the gains are getting taxed at your kids rates when it comes out? That's the part that was confusing, it's obviously not completely sheltered like a TFSA. The match looked really good so I was thinking of throwing my soon-to-be-kids CCB cheques in a RESP just to get the matches at the very least
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Feb 7, 2020 17:14
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DariusLikewise posted:So it is slightly advantageous tax-wise because the gains are getting taxed at your kids rates when it comes out? That's the part that was confusing, it's obviously not completely sheltered like a TFSA. The match looked really good so I was thinking of throwing my soon-to-be-kids CCB cheques in a RESP just to get the matches at the very least Yeah, any appreciation and matching contributions by the government are taxed by the beneficiary, with the assumption that a kid entering post-secondary education will have little -- if at all -- of a tax burden. It's the same idea as when all of those local car dealership owners cast their spouse and kids in commercials. I keep telling every single one of my friends who just had a kid to set one up ASAP.
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Feb 7, 2020 17:58
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mojo1701a posted:Yeah, any appreciation and matching contributions by the government are taxed by the beneficiary, with the assumption that a kid entering post-secondary education will have little -- if at all -- of a tax burden. It's the same idea as when all of those local car dealership owners cast their spouse and kids in commercials. The big benefit of the RESP is the government matching. Similarly, if any of you are/know someone who has a disability, they should apply for the disability tax credit and then get a Registered Disability Savings Plan, because the government will match deposits up to $3 to every $1, and up to $3500 per year in bonus money (depending on income) through the Canada Disability Savings Grant It's pretty perverse that the only way to get the grant is to be rich enough to sock that money away each year, but I guess that's a different argument.
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Feb 7, 2020 18:16
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The grant works for 300% matching on the first $500 you contribute then 100% matching for the next $1000. As long as your family income is below 90 something thousand, follow the link above for more details, otherwise you only get the 100% matching on the first $1,000. So your first $500 you get $1500. The next $1000 you get $1000. It takes 1-3 months for the matching to be deposited to your account after your contribution. There's also the bond where you get a few thousand without any contribution and it's dependant on family income tapering off to zero at 40 some thousand family income. It's retroactive too, so you can claim the years back from when the disability was first diagnosed for both the grant and the bond. Your contributions are not taxed when withdrawed but the grant and bond are as well as any capitalgain/interest/dividends. There's a ten 10 year thing where during that rolling window the government's contributions can be clawed back under certain circumstances (no longer disabled, early withdrawals), it's best to read it directly from canada.ca rather than rely on my mostly remembered blurb.
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Feb 7, 2020 20:09
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mojo1701a posted:Yeah, any appreciation and matching contributions by the government are taxed by the beneficiary, with the assumption that a kid entering post-secondary education will have little -- if at all -- of a tax burden. It's the same idea as when all of those local car dealership owners cast their spouse and kids in commercials. Literally FREE money (if you can afford to wait the ~20 years) DariusLikewise posted:So it is slightly advantageous tax-wise because the gains are getting taxed at your kids rates when it comes out? That's the part that was confusing, it's obviously not completely sheltered like a TFSA. The match looked really good so I was thinking of throwing my soon-to-be-kids CCB cheques in a RESP just to get the matches at the very least Students have essentially no income unless they are in a tech co-op program. Their marginal rates basically make this free cash in most circumstances. CCB into the RESP for the match is a pro move. Government cash begets more government cash, socialism inception
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Feb 9, 2020 03:24
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Is there any kind of tax loophole that lets me do this without the child?
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Feb 9, 2020 19:41
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xtal posted:Is there any kind of tax loophole that lets me do this without the child? You can open an resp for yourself (always) and hypothetically get grants on your own money if you're under 17. Might need a cosigner...
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Feb 9, 2020 19:45
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You can open an resp for kids other than your own. For example, if you had neices or nephews, but no kids of your own, and wanted to help them out. You need their SIN to do it though.
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Feb 9, 2020 21:45
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Does it make any sense to keep some of my portfolio in USD if that's how I got them originally? Is this just betting on the exchange rate and the time I do the conversion ultimately doesn't matter, or is it a good/bad idea for other tax/investment purposes?
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Feb 17, 2020 21:03
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Working under the assumption that you're a Canadian living in Canada, the only reasonable reasons I know of for wanting to keep USD funds in USD: 1) You have a USD bank account and like to travel a lot, needing the literal cash without fees. 2) You don't want to bring the money into Canada. If you're suggesting buying USD investments with USD cash from a Questrade/etc account, you may end up paying double tax (US taxes get deducted, then you get to claim the gains as taxes in Canada too!), depending on what you invest in. If you have a bunch of USD/CAD and you want to convert it into CAD/USD in order to invest in your normal stuff, you can either just pay the exchange rate (ie: suck it up and give up on timing the market) or try the classic Norbert's Gambit.
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Feb 18, 2020 06:08
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Norbert's Gambit gets cheaper the more you exchange (it's a flat rate whereas most other exchanges will cost a percentage), so one reason to accumulate some US$ is to save on exchange fees. Some US-listed funds are cheaper than their Canadian counterparts, both in terms of expense ratio and in foreign withholding taxes. If you already have US$ then it's that much easier to invest in e.g. VTI instead of VUN. This nerd's in the middle of a series of posts about foreign withholding taxes and does some calculations to figure out when and where US-listed funds are worth it. If you have US$ income then you can ignore the cost of exchanging dollars when figuring out what you would save. And as mentioned, if you plan on spending US$ sometime soon then you can skip the cost of a couple rounds of exchange. Other than the above, I haven't come up with a good reason to hoard US$ or investments therein. I tend to keep money in the most useful form for me, which is usually CA$.
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Feb 18, 2020 06:35
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For whoever asked, I still intend to keep you all updated about my wide eyed gasps as I discover how amazing your Great White North banks actually are - expect more once I finish getting immigration all sorted out. However, having zero knowledge of this Norbert Gambit, has anyone in this thread ever actually used this to transfer money from USA to CA? I'm going to wait until we get settled before really figuring everything out, but I assume I'd like to transfer my rainy day savings and other short term savings to $CAD once I'm up there, and wouldn't mind saving a couple hundred bucks in transfer fees if I can.
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Feb 19, 2020 20:55
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I've used Norbert's Gambit on Questrade for the opposite CAD -> USD transfer, there's no reason it shouldn't work as simply the other way. Just double check beforehand that your broker has DLR/DLR.TO (or any other cross-listed stock, really) and that there's a simple way to have them journal the stock over. Note that I still had to pay wire transfer fees to get the converted amount out of Questrade and into my US bank account. Likely there'll be a similar cost if you wire transfer US funds into a Canadian broker or whatever.
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Feb 19, 2020 21:11
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I have an etrade account for my work, in USD. It’s annoying because my main bank (tangerine) doesn’t do wire transfers. So my method is they mail me a cheque in USD then I send that to Tangerine in toronto and they deposit in my USD account. Takes about 2-3 weeks and then they put a 3 week hold on it. It rules, great system.
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Feb 19, 2020 21:14
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That's the most Tangerine thing I have ever read.
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Feb 19, 2020 23:38
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I was a pc financial person before and still have a simplii account so I will probably use their wire transfer in the future, less pain in the butt.
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Feb 19, 2020 23:58
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I use Norbert's Gambit on the reg to turn USD into CAD. Works great. The process is a bit different at each brokerage, with varying levels of manual intervention and/or delays. RBC DI is one of the easiest: you enter simultaneous buy and sell orders, then two days later you have your money. If you're unsure, have a look at something like Knightsbridge or TransferWise. Just don't run any sizeable amount through your bank as they will rob you.
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Feb 20, 2020 01:59
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So new tax bracket changes in my home province are going to rob me of so much of my income, what's the best tax haven or are there any good ways to shelter my earnings from auditing? It's only $12k/year in new deductions, but at $470k that's a significant chunk of my earnings and I'm worried it might prevent me from achieving home ownership. 
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Feb 20, 2020 02:03
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Sorry, just checking, are you saying at $470k a year you might not be able to afford to buy a house?
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Feb 20, 2020 02:13
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Pretty sure he's parodying forums poster James Bad. If not, well, Poe's law strikes again. e: vvvvvv Are you sure you don't mean you drank tap water from the Neskatanga First Nation, on year 26 of their boil water advisory? (I don't want to leak canpol into here any further so I'll keep this last joke contained as an edit.) Jan fucked around with this message at 02:21 on Feb 20, 2020 |
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Feb 20, 2020 02:16
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poo poo, sorry guys, drank too much tap water in Texas and hallucinated I was James Baud for a minute. My bad. E: No seriously I'm working in Texoma and the tap water here has about the same chlorine content as a canadian swimming pool. Rime fucked around with this message at 02:26 on Feb 20, 2020 |
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Feb 20, 2020 02:17
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I guess I'm the guy who falls for trolls. You're welcome for coming along so quickly.
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Feb 20, 2020 02:23
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Don't use DLR for USD to CAD. Use RY or TD or something. The advantage of DLR is that it locks in the rate at the time of your purchase (in CAD) on a southbound transaction, for dealing with brokers who suck at journalling the shares to the US side in a reasonable period of time. When going north, using DLR gets you a worse rate (larger spread between buy/sell sides) without that lock-in benefit so you don't know your rate until you do finally journal and sell. (I'm pretty sure this advice is relatively pointless microoptimization unless we're talking about a lot of money.)
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Feb 20, 2020 03:32
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odiv posted:Sorry, just checking, are you saying at $470k a year you might not be able to afford to buy a house? Our household gross is around that and we live in a condo because after selling our Ontario house we couldn’t afford a BC house 
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Feb 20, 2020 04:12
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James Baud posted:Don't use DLR for USD to CAD. Use RY or TD or something. The advantage of DLR is that it locks in the rate at the time of your purchase (in CAD) on a southbound transaction, for dealing with brokers who suck at journalling the shares to the US side in a reasonable period of time. Can you talk more if it is a lot of money?
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Feb 20, 2020 04:42
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