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pokeyman posted:Skepticism is definitely good when it comes to personal finances. Good links thx. edit: New Page. Pls do your patriotic duty and buy Canadian stocks.
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Mar 16, 2024 21:54
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Femtosecond posted:Pls do your patriotic duty and buy Canadian stocks. Don't do this if you like money.
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Mar 16, 2024 22:26
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tragic_ethos posted:Eh, I'm still generally of the mind that worrying about dividend withholding for US stuff is pretty marginal in terms of total gains. The current average yield of S&P 500 tickers is 1.84% per Google, it sucks to be sub-optimal obviously, but likely not worth much mental expense if we're talking a 0.2 to 0.3% loss each year (ie. taking a 30% withholding hit on US dividends rather than 15%). Here's a cost benefit analysis of a hypothetical $200k portfolio fully invested in XAW (https://www.blackrock.com/ca/investors/en/products/272108/ishares-core-sp-us-total-market-index-etf). Say $100k is in the TFSA and $100k is in the RRSP. Only the $100k in the RRSP can be optimized. Of the $100k of XAW in the RRSP, only 64% ($64k) of that is in US domiciled equities, made up of IVV (54%), ITOT, (4%), IJH (4%) , and IJR (2%). The optimization would be to replace those US domiciled equities with their equivalent funds held in USD. Those $64k in equities currently pay 12m trailing yield of: $729 = $54k * 1.35% (IVV) $54 = $4k * 1.38% (ITOT) $280 = $4k * 7.01% (IJH) $26 = $2k * 1.32% (IJR) Total dividends $1089 Withholding 30% on dividends = $326.7 Potential return 15% of dividends = $163.35 Out of the gross return of $163.35, your net return needs to account for losing money on currency exchange to USD each time you accumulate and from USD each time you drawdown. You also lose money on the spread each time you rebalance, which you are now responsible for doing at the correct time and with the correct holdings. At what point does it even net you positive EV financially, let alone become worth your time? Even if the optimization is to shift all of your US exposure into the RRSP ($128k) and have the remainder in your TFSA ($72k) you still only would have a gross savings of $326 on every $200k of AUM. That's still not worth having to manually manage weightings IMO. If you choose to hold bonds or have less than 64% US exposure your numbers get even worse. Please double check my calculations. Mantle fucked around with this message at 02:40 on Mar 17, 2024 |
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Mar 17, 2024 02:37
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Mantle posted:Here's a cost benefit analysis of a hypothetical $200k portfolio fully invested in XAW (https://www.blackrock.com/ca/investors/en/products/272108/ishares-core-sp-us-total-market-index-etf). Thank you for putting in the work  . When I looked through these calculations a decade ago my mental model was it’s marginal gains until you have 7 figures in savings, and I have never had cause to re-evaluate hahaha.
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Mar 17, 2024 15:33
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Can someone with investment and monetary policy knowledge explain to me, in a non pithy or conspiracy theory way, what the GOC purchasing mortgage backed securities is actually supposed to do? I know they're doing it with the BOC as the actual purchaser, and that it's supposed to do something about making investment in MBS less attractive, but after that my eyes cross.
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Mar 19, 2024 00:28
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But I could be wrong. Edit: I'm wrong. unknown fucked around with this message at 01:14 on Mar 19, 2024 |
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Mar 19, 2024 01:10
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redbrouw posted:Can someone with investment and monetary policy knowledge explain to me, in a non pithy or conspiracy theory way, what the GOC purchasing mortgage backed securities is actually supposed to do? I know they're doing it with the BOC as the actual purchaser, and that it's supposed to do something about making investment in MBS less attractive, but after that my eyes cross. the general concept is that of "quantitative easing": https://en.wikipedia.org/wiki/Quantitative_easing the typical story is that additional (central bank driven) demand for bonds will increase liquidity and support asset prices in those markets, leading to increased stability for banks, increased lending activity, and easier financing of government deficits. typically only government-backed bonds are purchased by respective central banks (and this often includes mortgages). the whole concept is not without some controversy and it's a good topic for broad discussion in the no-tweet econ thread: https://forums.somethingawful.com/showthread.php?threadid=4027219
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Mar 20, 2024 14:16
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I have a question regarding "pension adjustments" and "RPP Contributions" on your T4. Is there a rule of thumb for how much those figures on your T4 impacts your RRSP room? Is it a 1:1 ratio in $$? For example, let's say you have an RRSP limit of $15,000 for 2023, but your pension adjustment is $10,000 and your RPP is $2000 on your 2023 T4. Does that leave you $3K of room to contribute? If not, is there an easy-ish way to ballpark it?
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Mar 20, 2024 20:49
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slidebite posted:I have a question regarding "pension adjustments" and "RPP Contributions" on your T4. Someone should comment if I'm off base, but checking my return, the hypothetical $2,000 RPP (that shows up on a 2023 T4) acts as a deduction directly to your net income in 2023. It does not impact your 2023 RRSP deduction limit, nor does it factor into calculation of the 2024 RRSP deduction limit. If you mean that the $15,000 is the 2024 deduction limit before pension adjustment (based on 2023 income), then your max 2024 deduction would be $15,000 - $10,000 pension adjustment = $5,000.
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Mar 21, 2024 00:39
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So as long as you are less than $2k over your RRSP contribution limit you are not penalized right, does it affect your limit for next year? Got a late slip that I had totally forgotten about and looks like I will just be under the 2k 
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Mar 21, 2024 19:40
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priznat posted:So as long as you are less than $2k over your RRSP contribution limit you are not penalized right, does it affect your limit for next year? Yeah, less than $2k is okay, although I believe this is a lifetime limit. If this extra $2k contribution was in the first 60 days of 2024 though, you might not technically be in over contribution territory as you are just using up your 2024 contribution room.
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Mar 21, 2024 20:50
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tragic_ethos posted:Yeah, less than $2k is okay, although I believe this is a lifetime limit. If this extra $2k contribution was in the first 60 days of 2024 though, you might not technically be in over contribution territory as you are just using up your 2024 contribution room. Ohhh yeah it was. Ok that’s good to know! I really gotta get more organized with what is getting contributed but last year was a bit of a weird one with changing jobs etc.
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Mar 21, 2024 21:39
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I was wondering about this... like what happens if you mess up and accidentally over contribute but immediately realize it. Is everything ok if you quickly withdraw? lol You'd think maybe, but then what about if there's a few months between when you over contribute and when you find out. I guess you're penalized by paying interest every month so are you only penalized the months you're over the limit? I guess it's worse to over contribute in January and do nothing all year than it is to almost over contribute in January, do nothing all year, and then over contribute just over the line in Dec ?
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Mar 22, 2024 04:29
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Femtosecond posted:I was wondering about this... like what happens if you mess up and accidentally over contribute but immediately realize it. Is everything ok if you quickly withdraw? lol The wording is generally you are charged 1% interest for every month you have over contributed to rrsp or tfsa. This is calculated at end of month, so if you over contribute but pull it out before end of that initial month of contribution, there is no penalty. I understand there are ways to withdraw mistaken rrsp contributions without additional tax complication at least, but never had cause to look too much into that.
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Mar 22, 2024 13:42
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you can sometimes negotiate the fines down if you tell them you got late paperwork or made an error migrating accounts or similar. the people on the CRA hotlines are incredibly helpful, I’ve found
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Mar 22, 2024 18:55
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tragic_ethos posted:Yeah, less than $2k is okay, although I believe this is a lifetime limit. If this extra $2k contribution was in the first 60 days of 2024 though, you might not technically be in over contribution territory as you are just using up your 2024 contribution room.
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Mar 22, 2024 19:08
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tragic_ethos posted:The wording is generally you are charged 1% interest for every month you have over contributed to rrsp or tfsa. This is calculated at end of month, so if you over contribute but pull it out before end of that initial month of contribution, there is no penalty. I understand there are ways to withdraw mistaken rrsp contributions without additional tax complication at least, but never had cause to look too much into that.
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Mar 22, 2024 19:13
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I called in to register for the Quebec Health plan after putting it off and oh my I felt respected and treated like a person and there was basically no wait times.  Lady laughed at me a little for being confused about weekdays vs workdays, but was fine! I had tried to register online but might've been mixed up about whether I was eligible for a private plan or not, I vaguely recall something about my last job's group insurance plan being something I could continue but I'd have to pay for it or something? So I didn't look into it, the lady informed me that if it was offered that I might HAVE to have taken it which seems weird to me, so I wasn't sure but I also thought that that "offer" might've expired and the lady agreed that was probably possible and registered me for the date I guessed at. I'm not about to dig it up to figure/find it out, I just want my no-hassle public plan until I get enrolled in my next job's group plan, sheesh.
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Mar 27, 2024 20:12
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yeah they want you to take the employer-subsidized group plan whenever possible because it reduces the financial load on the provincial system. I think it makes some sense, and afaik companies don’t really game it?
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Mar 27, 2024 21:01
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