Monday, 8 August 2016

Financial Basics 13 - Tracking your Financial Performance

When you decide that you want to track how something is performing, usually this is done by measuring something actual and comparing against a target. An Athlete's performance is measured by such things as time, distance, height or score. But what do they measure against? In their competitions they are trying to get the fastest time, longest distance, lowest or highest score depending on the sport. In training and warm-up competitions they may be measuring their performance against something else. They may have a target time they want to achieve, or maybe they just want to continually improve over their personal best time.

So when you want to measure your performance your need to:
  • Decide on what you are measuring.
  • Decide on what targets or progression are considered success.
The simplest form in term of finances is to measure your Net Worth and compare it to a target amount that you want to achieve. 

Net Worth Tracking Spreadsheet

This spreadsheet is designed to help you keep track of your Net Worth, those you designate as Retirement Assets and compare your assets to forecasts created from the Retirement Forecast spreadsheet.

You can download the blank spreadsheet here. If you want one with some example data already filled in, download that here

Tuesday, 7 June 2016

Experimental Design for Reservoir Simulation


ED4Sim is a spreadsheet tool designed to assess uncertainty in petroleum reservoirs using reservoir simulation.  It is a very powerful spreadsheet, that has state of the art capabilities in an easy to use flexible package.

This spreadsheet was developed mainly while working at Nexen, and along with the RSMPlots spreadsheet, the company has allowed it to be released publicly. 

Update June 7th, 2016

The link to the Essential regression add-in is broken and I am unable to find this tool elsewhere. This is surprising as I consider it the best free regression tool and as good or better than commercial (not free) tools. I have provided links below to my copies of this tool.

Tuesday, 5 April 2016

Retirement Planning and Forecasting 2.0

Retirement Planning and Forecast Spreadsheet (for Canada)

Updated to version 2.4 on April 5th, 2016. 

In this version I have updated all the tax rates for federal and all provinces (the previous version had just the major changes to federal and Alberta rates). I have also added the feature to fund TFSA contributions from RRSP withdrawals in retirement (previous version did this from savings).

Download new version here.  

Updated to version 2.3 on February 8th, 2016. 

In this version I have updated the TFSA limits for 2016, added a message if either person has an income shortfall in retirement, added a report of total tax lifetime income tax paid on the Inputs_Summary sheet, included the federal tax abatement for Quebec and changed how the tax rate iteration works to remove a bug.

Updated to version 2.0 on May 21st, 2015. 

In this version the inputs during employment phase have changed. Instead of specifying a percentage of income saved, you now specify an income and expenses. After deducting taxes and expenses from income the difference is the amount saved. This version allows the potential withdrawal of savings during employment if expenses and taxes are higher than income. This version handles the tax payable on investment income more accurately than the previous one. 

This spreadsheet allows you to make an accurate financial plan for your retirement, starting at any time in your life.  Unlike many retirement tools, this spreadsheet shows a cash flow forecast vs time and identifies which account money is saved into (during employment) and which account or source the retirement income is withdrawn from.  It handles the different account types (RRSP, LIRA, TFSA and a taxable investment account), the limits imposed on them and does income tax calculations for any of the provinces.  

The picture below shows the main page of the spreadsheet which contains all the inputs you need (in yellow) and provides a cash flow forecast and how the savings accounts increase and decline.  

I hope you find the tool useful and I am always willing to hear of suggestions to improve it. 

Thursday, 15 October 2015

Portfolio Live - Investment Portfolio Rebalancing

The objective of this spreadsheet is to allow you to re-balance your investment portfolio while reducing purchasing costs and maximize tax efficiency. It does not spread the funds (or stocks) across all accounts, but tries to keep all of each fund in just 1 or 2 accounts. 

Updated to version 1.3 on October 15th, 2015 to fix a minor bug. Updated to version 1.2 on August 28th, 2015 to add new functionality to allow you to balance the portfolio based on Asset Classes instead of just by each Asset (Fund or Stock). In the spreadsheet there are two separate sheets, one to do the calculation by Asset and the other by Asset Class. 

Version 1.1 added new functionality to allow you to force funds not to be sold from any of the accounts. This feature can be used to allow you to balance the portfolio as best as possible while not selling funds with unrealized capital gains in the Taxable account. 

Here's a link to the spreadsheet on Google Sheets. After you open this please make a copy to your own Google Drive.  

Here's a link to an Excel version. Note that in this version you need to enter stock, ETF and mutual fund prices by hand, or use this Google Sheet - Portfolio Prices - to pull prices from Google Finance and then paste them into the Excel spreadsheet. 

Tuesday, 11 August 2015

Financial Studies 1 - RRSP Withdrawal Strategies?

What is the question?

I have three questions I want to answer with this blog post. 
  1. Should you begin withdrawing RRSP when you retire, or wait until some later time such as at 71 when you are forced to begin withdrawals?
  2. What is the amount of withdrawal from RRSP, relative to withdrawals from other investment accounts, that will maximize value?
  3. Will you maximize value by setting income from RRSP to make your taxable income the top of a specific tax bracket?

Wednesday, 5 August 2015

Financial Basics Update #1

I have made the following changes, updates and improvements to the Financial Basics series.

August 5, 2015

Financial Basics 2 - Income Tax

I removed the comment that the tax rate in Alberta is a flat 10%, since this will be changing in 2016.

Financial Basics 3 - How Different Savings Accounts Work

I added the following bullet to the description of an RRSP account
  • Contributions do not have to be deducted from taxes in the current year and can be carried over and deducted in subsequent years.

I modified the following under TFSA for the change in TFSA limits in 2015.
  • Contribution limit for 2009 to 2012 was $5000, for 2013 to 2014 it was $5500 and is now $10,000 from 2015 onward.  The contribution limit used to be indexed to CPI (consumer price index, or inflation) and rounded to the nearest $500, but with the increase in the limit in 2015, the indexing now no longer applies. 

Financial Basics 4 - Self-directed Accounts

I added the following paragraph to clarify why you would need a US $ account.

If you will be trading in securities in US dollars, or need a US $ account and credit card for purchases in the US, the following features are required. They come free with an Investorline account.
  • US dollar conversion and US dollar cash account within Taxable account.
  • Ability to pay your US$ credit card from the US dollar account.