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Investing

Play By The TFSA Rules And You Won’t Get Burnt

Many Canadians have recently received unwelcome letters from the Canada Revenue Agency (CRA) regarding excess contributions to their Tax Free Savings Accounts (TFSAs). Penalties in the form of fees owing to the government were assessed for excess contributions made during 2009.

Most people affected were likely confused by the restrictions placed on the TFSA by the government. The important thing for Canadians to understand is that once you have used your contribution space for the year, even if you withdraw from your TFSA, you cannot put that money back until the following year.

June 17, 2010

Investing

Why Is Your Stockbroker Clueless About investing?

It is truly amazing how many people entrust their entire life savings to stockbrokers who know absolutely nothing or very little about investing. In their defense, many stockbrokers may be honest individuals who truly want to help their clients. However, the problem is that they were never trained to be investors but instead were trained to be salespeople, and they are constantly being pushed by their employers to sell. After being recruited by a brokerage company, they are subjected to intensive sales training where they are taught how to cold-call, prospect for clients, and counter various clients’ objections. The actual education on how to select and analyze particular investments is limited.

June 15, 2010

Investing

Learn to Trade Individual Stocks

While at a concert recently, I met a young woman who told me that she and her husband took a course a few years ago that taught them how to trade individual stocks.

She said, when she first heard about the training she almost didn’t take it, because the course was quite expensive, almost $9000. However, they decided to take it despite the cost, and she said they were able to recoup the cost of the course within one year of trading stocks.

She recommended that married couples should take the course together, so that both partners are on the same page. It is much more difficult if only one spouse understands what is going on.

June 9, 2010

Investing

The Risk Of Investing In GICs

Guaranteed Investment Certificates (GICs), are a common savings vehicle used by Canadians. There are different types. Some are locked in for a specific period of time, while others are cashable at anytime.

GICs provide the following advantages:

-Your principal is guaranteed.

-For most GIC types, you are guaranteed a fixed rate of interest for a specific period of time.

-They help people to save who would otherwise spend their money. If their money is locked away, they have no way of accessing it, making it impossible to spend it on a whim.

June 7, 2010

Investing

Why Inflation Matters

Inflation, the ever -increasing cost of everything over time, makes a significant impact on your savings. In a normal, healthy economy, the inflation rate usually hovers around 3%. Essentially, everything goes up in value except your money. This is an important concept to understand as inflation impacts your purchasing power.

June 5, 2010

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