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HookShot posted:Call the dealership you want to buy from and ask if it's possible.
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Dec 2, 2020 13:51
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Sputnik posted:You would not be the first person to do this. Most dealers are well seasoned in this exact thing. They can sometimes even get you the Ontario plates, depending on how close to the ON-QC border they are. Yeah we bought in Quebec with Ontario plates.
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Dec 2, 2020 14:09
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I have some questions related to what to do with savings, as I'm not sure I'm doing this correctly: -10% of my gross pay is invested through my company's match program. MER isn't awful at ~0.5%, it all goes into a fund that's balanced appropriately for my risk profile, I'm set here. I'm contributing appropriately based on my targeted income during retirement. - 6 month emergency fund - this is sitting in a simplii HISA, as we use a simplii checking account for mortgage payments, bills, household purchases, etc. Would it make sense to put this into a TFSA (lots of contribution room available for both my spouse and I) with some kind of GIC product? Value at approx $30K, it's suitable to cover the bills / incidentals should we both loose all income for 6 months. We're not counting any EI or severance in the calculation, so there's a fair bit of cushion here. -Household maintenance savings - $6K a year, growing / reducing as expenses come up. We're residing the house currently, so balance in this bucket is going to be pretty low. Intended to cover items like furnace/ac replacement or repair, hot water tank, eventual replacement of windows, roof, septic, etc. Currently in the same HISA as the emergency fund. -I currently have >20K in my checking account. This is where my pay is deposited, monthly transfers to the simplii checking account for bills/incidentals. About $10K is earmarked for specific / unexpected upcoming expense items (think car repairs/maintenance, upcoming fun events, etc.), the rest is just fun money that I've been accumulating without doing anything with. I'm assuming at the very least I should move the non-earmarked into a HISA, but does it make sense to do anything more than that with it? Fun money is for vacations, sports, hobbies, interests, etc. Tracked in an excel spreadsheet with targets for big ticket items, that I'll reduce if I want to say spend a few hundred on tools or clothing or whatever. Only debt is the mortgage and a financed vehicle (at 0% with no discount for cash, otherwise I'd have just bought outright). Between my wife and I we're just kind of sitting on $90K between HISA and chequing accounts, with all retirement savings goals met separately from that.
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Dec 2, 2020 18:04
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Is there a particular reason that your long-term savings vehicle isn't a TFSA with a passive ETF? I mean, obviously these things do golden on the 50-year horizon, but there's no reason they can't be used on the five, ten, or fifteen year horizon (car, house, college fund respectively).
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Dec 3, 2020 01:22
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Definitely use your TFSA room for something. If you need it short term then a HISA or GIC (whatever pays better) makes sense. Otherwise you could save more for retirement and invest it similar to how your other savings are invested (though you can do cheaper than 0.5% MER without much effort). It is certainly possible to save too much money for retirement though, so you're sure you're all set then don't feel like you have to keep piling more on. If an anecdote helps, I don't have my emergency fund or anything like that in a TFSA, I use all that room for invested long-term savings.
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Dec 3, 2020 01:31
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TrueChaos posted:I have some questions related to what to do with savings, as I'm not sure I'm doing this correctly: This might be a controversial view, but if you have large enough lines of credit with low rates, the opportunity cost of sitting on 30k in an emergency fund doesn't make a lot of sense. Even if you ignore that completely, having to withdraw $5000 a month from your investments at some loss is likely still worth it vs. the opportunity cost of not investing your emergency fund. Looking at 2% HISA vs a conservative 6% return on an ETF, over 10 years, you're looking at a difference of $17,000. If the market tanks at the same time you both lose all sources of income, you'll only be taking a loss on what you have to withdraw. Over 20 years the difference is over $50,000, not accounting for inflation. Looking at the Dow, the week after 9/11 it was down ~14%. The week after the housing market crash it was down ~18%. Anyway, if it were me I'd invest a large chunk of that in a market ETF. Max out your TFSA.
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Dec 3, 2020 01:37
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i've got a rather large equity award (RSUs) vesting in 2021 that'll almost entirely be in the top bracket. other than forgoing RRSP contributions for 2020 (where i have very little income in the top bracket) and saving the room for 2021 do i have any reasonable options for reducing my tax obligations?
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Dec 3, 2020 03:49
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I don't think so, unless there are things you're eligible for that the average person isn't
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Dec 3, 2020 03:54
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the talent deficit posted:i've got a rather large equity award (RSUs) vesting in 2021 that'll almost entirely be in the top bracket. other than forgoing RRSP contributions for 2020 (where i have very little income in the top bracket) and saving the room for 2021 do i have any reasonable options for reducing my tax obligations? (Edited out the zero reading comprehension paragraph suggesting what you already know about) Otherwise, nope you're screwed unless you can get strategically divorced and owe your spouse considerable spousal support, then remarry later. Note that this is considered collusion and illegal at least under the BC Marriage Act or whatever. My wife certainly wouldn't go for it. Sassafras fucked around with this message at 05:07 on Dec 3, 2020 |
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Dec 3, 2020 04:55
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Thanks for the comments everyone, really helpful perspectives.Sputnik posted:Is there a particular reason that your long-term savings vehicle isn't a TFSA with a passive ETF? I mean, obviously these things do golden on the 50-year horizon, but there's no reason they can't be used on the five, ten, or fifteen year horizon (car, house, college fund respectively). Long term retirement savings are where they are because it's required for the employer match, which more than trumps the 0.5% MER. With regards to further long term savings, we've bought our 'forever' home, don't have kids, and am 'saving' for the next car by not using the cash I had saved up for this one and instead paying for it monthly given the 0% financing offer. I could always pay it off tomorrow and start saving for the next one, but I'd rather keep the cash and get the returns. I could put more towards the mortgage on the house, but with interest rates where they are I'd get a better return from investments. pokeyman posted:Definitely use your TFSA room for something. If you need it short term then a HISA or GIC (whatever pays better) makes sense. Otherwise you could save more for retirement and invest it similar to how your other savings are invested (though you can do cheaper than 0.5% MER without much effort). It is certainly possible to save too much money for retirement though, so you're sure you're all set then don't feel like you have to keep piling more on. Yeah, this makes sense. Honestly the emergency fun is going to slowly be converted to shares at the company I'm at (privately owned, consulting firm in the water/wastewater/municipal infrastructure sector), as if I were to leave the job for any reason the shares would be paid out at the current value, and my income can cover all expenses including savings just with a reduction in discretionary spending. My wife works in a unionized heathcare position with a fantastic pension and job security as well. I'm set to be able to buy in at the end of 2021 (not 100% guaranteed, but it's the path I'm on), and the lowest dividend they've paid out in the last 30 years is 18%, with the highest at 50%. I'm currently saving enough for retirement without accounting for what the shares would contribute, so adding more to the retirement savings feels a bit futile. You're not allowed to keep the shares past retirement though, so it'd essentially be a large payout at retirement but no more dividends. Tsyni posted:This might be a controversial view, but if you have large enough lines of credit with low rates, the opportunity cost of sitting on 30k in an emergency fund doesn't make a lot of sense. I had forgotten about that, we have access to a sizeable HELOC at similar interest rates to our mortgage. I'm leaning towards just dumping everything into a TFSA in an appropriate ETF. This would realistically just wind up being the house savings (i.e new furnace, roof, renos, etc.), and my own longer term 'fun' spending, as the emergency fund money in there would be pulled out over the next ~3 years for shares purchases. With these, would it make the most sense to do say two contributions yearly? Withdrawals wouldn't be frequent, but I've heard that it's typically better fees wise to not be making lots of small transactions. TrueChaos fucked around with this message at 05:05 on Dec 3, 2020 |
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Dec 3, 2020 05:02
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Sassafras posted:(Edited out the zero reading comprehension paragraph suggesting what you already know about) this is probably more work than i'm willing to do to save a few thousand but thanks for the option
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Dec 3, 2020 05:24
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TrueChaos posted:I had forgotten about that, we have access to a sizeable HELOC at similar interest rates to our mortgage. I'm leaning towards just dumping everything into a TFSA in an appropriate ETF. This would realistically just wind up being the house savings (i.e new furnace, roof, renos, etc.), and my own longer term 'fun' spending, as the emergency fund money in there would be pulled out over the next ~3 years for shares purchases. With these, would it make the most sense to do say two contributions yearly? Withdrawals wouldn't be frequent, but I've heard that it's typically better fees wise to not be making lots of small transactions. ETF purchases inside a TFSA can vary depending on the broker. As three examples, I know of three of the online Canadian brokers offering three different vehicles - $0.01 per share (bought or sold) ; Free ETF purchases (but $10 per sell order, regardless of volume) ; $0.003 per share (bought or sold) with that liquidity fee kicker which is always so trivial I don't bother to remember it. I guess what I'm saying is that if you're counting in four to six digits, ETF purchase and sell fees are trivial. Go with the old' Warren Buffet and maximize Time in the Market, not Timing the Market. I've bought ETFs three times a month when the windfalls hit. There's no maximizing the fees to really stress about.
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Dec 3, 2020 05:54
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TrueChaos posted:I had forgotten about that, we have access to a sizeable HELOC at similar interest rates to our mortgage. I'm leaning towards just dumping everything into a TFSA in an appropriate ETF. This would realistically just wind up being the house savings (i.e new furnace, roof, renos, etc.), and my own longer term 'fun' spending, as the emergency fund money in there would be pulled out over the next ~3 years for shares purchases. With these, would it make the most sense to do say two contributions yearly? Withdrawals wouldn't be frequent, but I've heard that it's typically better fees wise to not be making lots of small transactions. The fun thing with a HELOC (as I understand it, I don't have one) is the lender can call the loan or change the terms at any time, which would make me reluctant to rely on it in an emergency situation. For money I'm probably going to spend within the next ~5 years, I'm not looking at getting any kind of real return. I just want to avoid inflation eating away at it, which a HISA can mostly do. So if you need a new roof in the next few years, and you would be sad if it starts leaking just as markets take a big dump causing you to sell at a loss, it might not be worth investing that money. And markets can tank just as banks call their loans, which could mean poo poo getting real in a hurry. (I'm admittedly more conservative than some people when it comes to an emergency fund.) Definitely check what commissions are involved on any transactions you're planning, because you heard correct: it's very easy to wipe out gains by trading too often. It can often make sense to pool cash for a few months or a year before moving it over and investing the lot (or in reverse, withdrawing a year's worth at once and spooling it out). If you're paying $40/month in commissions you're probably doing it wrong.
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Dec 3, 2020 06:06
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Dual citizen tax question time again: Does anyone have any experience/recommendations for US/Canada tax preparation services? I've done my own for a number of years and I believe that I'm *mostly* correct on them, and also fall into an income range where the IRS isn't really concerned about me to begin with. With that said I'm thinking it might be worth paying to have a professional do it one year so I have have a template to work off of for subsequent years if/when I do move towards thresholds that would cause me issues. My understanding is that these services are potentially very expensive but I want to at least explore the idea to see if it's worthwhile. I also have a number of questions on potential future events that I'd like to get advice which I'm assuming I could have answered during that time. Secondly, and somewhat related, I have a small TFSA that I've reported both to the provider and on my FBAR reports. It's a very minimal amount (around 7k right now) and I believe it falls below and thresholds that would cause the need for any action on my part. There was some discussion about passive income limits for US taxation a while back, does anyone know off hand what those were and what numbers I should generally be looking out for in terms of my TFSA, if I continue to use it? I do like to keep a significant emergency fund (in a high interest bank account), but for short/medium term funds I'm not really sure what to do with it? I'd like to take advantage of a TFSA and my rationale is so long as I'm below income thresholds a TFSA is still a viable option, unless I'm missing something? Obviously it creates risk in terms of triggering an audit but I am mostly concerned about gotcha tax triggers. Thanks!
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Dec 7, 2020 01:06
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pokeyman posted:The fun thing with a HELOC (as I understand it, I don't have one) is the lender can call the loan or change the terms at any time, which would make me reluctant to rely on it in an emergency situation. I'm glad someone mentioned this. Maybe I'm just paranoid, but the situation where a bank is calling the loan is probably very similar to the economic downturn that has you relying on it.
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Dec 7, 2020 04:19
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Jenkl posted:I'm glad someone mentioned this. Maybe I'm just paranoid, but the situation where a bank is calling the loan is probably very similar to the economic downturn that has you relying on it. Then you sell some of your investments at a loss. I feel like people are imagining a 50% market downturn or something that has never happened and if ever did happen paying your mortgate would be the least of your worries.
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Dec 7, 2020 04:38
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Jenkl posted:I'm glad someone mentioned this. Maybe I'm just paranoid, but the situation where a bank is calling the loan is probably very similar to the economic downturn that has you relying on it. Except that we just had this huge economic and social issue that we are still in the middle in and the exact opposite happened. Instead of calling loans, they were deferring payments. The government has handed out billions under CERB, CEWS, CEBA, etc. Does anyone know of a time in history where banks in Canada started calling HELOCs? I don't think it's happened. I get the risk. I just think it's super low.
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Dec 7, 2020 16:36
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I'm in a similar position, I'm building my emergency fund up to $24,000, but I don't want to keep it in a HISA because of inflation. I was thinking in putting it into a 100%-bond ETF, but I do have a $64,000 HELOC that I can use at any time. So I want to know if people think I should keep with the 100% bond ETF, or go with a riskier one like VGRO or VBAL. I'm 51, already have a sizeable pension fund waiting for me when I retire, a maximized RRSP, and a soon-to-be-maximized TFSA. So I'm not really bothered when markets take a dip for a while.
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Dec 9, 2020 16:57
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Kal Torak posted:Except that we just had this huge economic and social issue that we are still in the middle in and the exact opposite happened. Instead of calling loans, they were deferring payments. The government has handed out billions under CERB, CEWS, CEBA, etc. The fact it hasn't happened before is something to be more wary about, not less. At the very least the bank can start demanding that you amortize the outstanding debt and then you have to start liquidating your holdings which, if the market has also tanked (likely if the bank is actually doing this) could leave you with outstanding debt after your investments are fully liquidated. The main reason people use their HELOCs to invest is to convert the interest on their mortgage from non-deductable to deductable (lookup the Smith maneuvre), and to then use the tax refunds to either pay down the mortgage faster or re-invest. It's generally not recommended for the average person though since it requires a lot of financial discipline and carries its own risk if both the value of your home and the stock market tanks and you are unable to repay the mortgage and the HELOC with your existing assets. You also have to actually pay the interest on the HELOC out of your own pocket each year, which might be difficult if your investments have not been positive that year. qhat fucked around with this message at 23:22 on Dec 12, 2020 |
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Dec 12, 2020 23:11
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Holidays can be a stressful time, especially in the burning tire fire of a year that is 2020, but if anyone is looking for a glimmer of positivity, here it is: at least you're not this guy. -Overcontributed 26k into TFSA -Let friend day trade options because it was a sure thing -The inevitable happened -Kept overcontributing to a total of 73k, because "I thought I could over-contribute a bit more, with the goal of getting back to the over-contributed amount, withdraw it and just move on" quote:I find it hard to believe that one would be paying this penalty for the rest of their life in such a scenario, and trust there must be a one time exemption that can be made. My napkin math says that, by the time he's allowed to start contributing to his TFSA again in 2032, he'll have accrued $49690 is penalties.
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Dec 13, 2020 16:31
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That person must be getting so many PMs from bankruptcy lawyers
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Dec 13, 2020 16:34
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Guest2553 posted:My napkin math says that, by the time he's allowed to start contributing to his TFSA again in 2032, he'll have accrued $49690 is penalties. He can just withdraw to get back down to his allowed amount, no?
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Dec 13, 2020 16:57
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Subjunctive posted:He can just withdraw to get back down to his allowed amount, no? No, because he lost all the money in his TFSA.
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Dec 13, 2020 17:13
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I'm having trouble finding a single TFSA rule that he has NOT broken in that story.
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Dec 13, 2020 19:03
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Guest2553 posted:Holidays can be a stressful time, especially in the burning tire fire of a year that is 2020, but if anyone is looking for a glimmer of positivity, here it is: at least you're not this guy. This is amazing. And I hadn't even thought about quote:Because you lost it in the TFSA, you get a nice extra kick in the balls by not being able to claim it as a capital loss against other future gains.
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Dec 13, 2020 20:28
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edit: whoops wrong thread please ignore
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Dec 13, 2020 21:51
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McGavin posted:No, because he lost all the money in his TFSA. Holy poo poo, that’s brutal.
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Dec 14, 2020 04:47
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qhat posted:The fact it hasn't happened before is something to be more wary about, not less. At the very least the bank can start demanding that you amortize the outstanding debt and then you have to start liquidating your holdings which, if the market has also tanked (likely if the bank is actually doing this) could leave you with outstanding debt after your investments are fully liquidated. Yeah, I don't agree. This literally just happened. We had a global pandemic and the market tanked. Instead of calling loans, the banks were deferring payments. I can't see the future. I'm not saying it's impossible. I just think the risk is extremely low as I already said. qhat posted:The main reason people use their HELOCs to invest is to convert the interest on their mortgage from non-deductable to deductable (lookup the Smith maneuvre), and to then use the tax refunds to either pay down the mortgage faster or re-invest. It's generally not recommended for the average person though since it requires a lot of financial discipline and carries its own risk if both the value of your home and the stock market tanks and you are unable to repay the mortgage and the HELOC with your existing assets. You also have to actually pay the interest on the HELOC out of your own pocket each year, which might be difficult if your investments have not been positive that year. A HELOC doesn't turn your mortage interest from non-deductible to deductible. A readvanceable mortgage does that. If you use a HELOC to invest, that's all it is. Borrowing to invest.
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Dec 14, 2020 06:53
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Kal Torak posted:Yeah, I don't agree. This literally just happened. We had a global pandemic and the market tanked. Instead of calling loans, the banks were deferring payments. Reminder: this pandemic has not ended yet, nobody knows what direction the banks are going to take if defaults start increasing in 2021. Kal Torak posted:A HELOC doesn't turn your mortage interest from non-deductible to deductible. A readvanceable mortgage does that. If you use a HELOC to invest, that's all it is. Borrowing to invest. A readvanceable mortgage is just a mortgage bundled with a HELOC that increases proportionally with your equity. Borrowing on that HELOC to invest after every mortgage payment is what effectively converts the interest to tax deductible. qhat fucked around with this message at 09:38 on Dec 14, 2020 |
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Dec 14, 2020 09:28
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qhat posted:Reminder: this pandemic has not ended yet, nobody knows what direction the banks are going to take if defaults start increasing in 2021. Sure. But very few people use the SM. What percent of HELOCs out there are readvanceable? I bet it's under 5%.
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Dec 14, 2020 16:47
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Guest2553 posted:Holidays can be a stressful time, especially in the burning tire fire of a year that is 2020, but if anyone is looking for a glimmer of positivity, here it is: at least you're not this guy. These CAN'T be real... Some Dumbass posted:Good Afternoon,
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Dec 14, 2020 21:12
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Your guy has a few dozen posts that include an awful lot of weird contradictory nonsense, possibly just financial-topic trolling, some chance of being a way-into-crypto 'free man', otherwise just someone who sees the world through quite an amazing muddle, and not just because he's quebecois. For example, he allegedly divorced in 2016, bought a house in 2019, but is both seeking a mortgage now with 200k in "never reported income in five years" cash and separately inquring about whether he can withdraw from the HBP. He also has a number of "I'm a tenant" / lease questions that are mostly nonsense, but also includes questions about fighting an eviction. Further, claims to have a GST/HST account opened circa Dec 2019 and asks about filing dates, has numerous posts with subjects along the lines of "can't afford necessary repair on car" / "mechanic is extorting/blackmailing me", and for good measure asks a bunch of questions about whether americans can hire canadians (ie, him) while other post titles mention that a parent, at least, is a US citizen [which would potentially have both tax and employment consequences...]. Also complains about having owed taxes to the CRA this year, asks questions about accounting designation reciprocity across countries, and did I mention this is all in the past 6-7 months?
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Dec 14, 2020 21:45
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Sassafras posted:and did I mention this is all in the past 6-7 months? He is leading a very rich life.
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Dec 14, 2020 22:19
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Either way I think we should be happy to be not him.
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Dec 15, 2020 00:47
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Sassafras posted:Your guy has a few dozen posts that include an awful lot of weird contradictory nonsense, possibly just financial-topic trolling, some chance of being a way-into-crypto 'free man', otherwise just someone who sees the world through quite an amazing muddle, and not just because he's quebecois. I feel like if the guy had 200k accumulating in his bank account over the past 5 years yet has never filed a return in that time, the CRA would be flagging him up for an audit pretty quick.
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Dec 15, 2020 02:22
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Sassafras posted:Your guy has a few dozen posts that include an awful lot of weird contradictory nonsense, possibly just financial-topic trolling, some chance of being a way-into-crypto 'free man', otherwise just someone who sees the world through quite an amazing muddle, and not just because he's quebecois. Definitely sticking to getting my financial advice from Goons in any case. So far the biggest thing I've "screwed up" in my personal finance journey is probably contributing to an RRSP after maxing out my TFSA this year, despite not really being able to use the deferral till next year due to happy largely-working-tax-free-for-2020 reasons, and thus not being as efficient as possible (And is very much a first world problem, I do realize) loving tax deferred accounts man, how do they work.
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Dec 15, 2020 19:39
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I'm pretty sure you can defer the tax deduction received through your RRSP contributions and carry them forward. Here's an old article that discusses it https://www.cbc.ca/news/business/taxes/put-it-off-when-it-pays-to-defer-tax-claims-and-deductions-1.955473
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Dec 15, 2020 22:01
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Yep how much room you've gained and used are two separate boxes to fill out - you can earn and defer.
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Dec 16, 2020 00:32
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More than just earn, you can contribute to your RRSP and just choose not to apply it to your income that year.
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Dec 16, 2020 01:09
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Yep, that's the plan! Though on second thought, maybe index investing isn't for me, the folks over at reddit have some GREAT IDEAS about Investing in Bitcoin through tfsa and rrsp that are certain to be far more profitable. At least the top comment is telling the fellow to not... it's not even the only question of the sort on the first page either. I'm going to have to stop reading through these things it's a total rabbit hole
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Dec 16, 2020 06:52
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