Sunday 22 February 2015

Financial Basics 3 - How Different Savings Accounts Work



This post is about the different types of savings accounts you can use in Canada.  

Article was edited March 2017, to update TFSA and RRSP limit amounts.

There are 3 levels of hierarchy to savings accounts and investments.  The three levels are:
  • Bank or Investment company
  • Type of account (TFSA, RRSP, RESP, Taxable)
  • Type of investment

Friday 13 February 2015

Financial Basics 2 - Income Tax

This post is about understanding income taxes enough to know how they impact saving, investment and retirement income.  Income tax is a very complex subject and this post will NOT be a complete summary of all the income tax laws and rules (in Canada).  This post will attempt to summarize just what you need to know for saving and investing, provide links to additional references (if you wish to read more) and also links to tools to help understand the quantitative impact of income taxes. 



If you are not familiar with the origins and purpose of income tax you should read the Wikipedia entry on the subject Wikipedia: Income Tax. Pay attention to the sections "Defining Income" and "Deductions Allowed" as these are important concepts when considering saving and investing as not all types of income are taxed in the same manner, some contributions to savings (ie RRSP) are deductions and some investment income (ie dividends) are allowed tax credits against taxes. 

Sunday 1 February 2015

Financial Basics 1 - Stuff I wished I knew when I was 22

I've had this blog up for a couple of years now.  All I have posted so far are some spreadsheets that I wish to share with others.  Two are related to my profession and two related to retirement planning. Spreadsheets eh?  Yes, I am an Engineer.


I'm thinking that it is time to broaden my horizons and actually write posts about subjects other than spreadsheets?  Will anyone care?  Maybe not, but I'll let the readers decide that. 


This post is about summarizing in a simple way the basic information one needs in order to save and invest for retirement or financial independence.  I now wish that I would have both received and heeded this advice when I was starting out in the working world, mainly because I would have worried less about investing and would not have made some mistakes that cost me a bit of money along the way.  Not losses per se, but more like gains that were missed.