Who Needs an RRSP?

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Spoiler alert: you probably do. Most Canadians aren’t big savers to begin with, so when you start throwing financial acronyms at them like RRSP, TFSA, ETF, HESG (that last one is made up), it’s no wonder they get confused. Even those with good intentions might partake of the investment vehicles these acronyms represent but lack an understanding of their potential leads to them being underutilized. The RRSP might be one of the least understood and most underutilized of all. Because contribution room is different for everyone, taxes matter, and it has more flexibility than most people think, it’s easy to get confused about how to make the most of it. What is the RRSP? RRSP stands for Registered Retirement Savings Plan and refers to a tax-advantaged account for Canadians to save for three big things: Retirement (obvs!) A down-payment on their first home (yay!) Post-secondary education (surprise!) Your individual contribution room […]

How to Fund Your Own Maternity Leave

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Maternity leaves in the developed world vary in length and pay from nothing to 14 months at no pay to 100% covered. Canada offers one of the most generous government-sponsored leaves available: a full 12 months off at 55% of your salary. This consists of 15 weeks maternity leave to be taken by the mother, plus 35 weeks of paid parental leave that can be taken by either parent. Sad news surprise: as a self-employed person, I didn’t qualify. Whomp, whomp. In Canada, maternity and parental benefits come out of Employment Insurance (EI). However, in order to qualify for EI, you have to pay in to it. Most self-employed freelancers and entrepreneurs, including myself, opt not to because the costs far outweigh any of the benefits over your working lifetime. The upside of staying out of EI is self-employed Canadians get to keep an extra $2,000 in your business, and […]

How to Access Your Online Bank Offline

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Online banking is more convenient and affordable than most brick and mortar institutions. However, many people hesitate to give up traditional banks for their digital counterparts. Consumers are often wary that an online bank will not be able to provide the services and products they need, but online banking can offer better and faster service than an offline branch, and at a lower cost! Why digital banking is better for your money If you’ve been to your local bank branch lately, you probably already know the downsides to trying to manage everything offline. From restrictive hours to long line ups, brick and mortar banking is hardly as convenient as you might think. For most banking errands, like depositing a cheque, paying bills, or setting up a savings account, you don’t need to speak to a bank teller. With online banking, there’s no waiting in line or rushing to get to […]

Building Consistent Wealth on an Inconsistent Income

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If you’re a contractor, freelancer, entrepreneur, or seasonal worker, one of your biggest challenges is likely consistently growing your net worth on an inconsistent income. The first challenge of living on an inconsistent income is making it last through the lean months. But once you’ve gotten a handle on paying your bills each month even when you don’t necessarily have money coming in, how do you take it a step further and start actually making progress on your financial goals? Many self-employed or seasonal workers pride themselves on having hacked a system that lets them get by without too much financial inconvenience in the months they earn less or don’t earn at all. However, very few actually make progress on their long-term financial goals. The goal is not survival If you work for 4 months and earn $10,000, then don’t work for the following 3 months and spend it all, […]

Debt is an Income Depressant

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Do you make good money but feel broke? Chances are your debt obligations are what’s cramping your style. We tend to think of debt as it’s own entity and not something that affects other aspects of our finances. Or at least, that’s how we think of it when we’re first borrowing the money. Most university students don’t think twice about accumulating debt, student loans and otherwise. After all, they’re earning a degree that will skyrocket their income and let them earn more than enough to pay it back after graduation. But do they know that earning a high income with hefty debt payments feels exactly the same as earning a low income? This is how much debt really costs A good general rule of thumb is that for every $10,000 you owe in student loans, you will have to pay at least $100 per month in payments. This means if […]