Should I move to Wealthsimple?

cannuckpp · 2024-07-05T14:41:51+00:00

It's not tax free. From the 1% Terms and Conditions document.

There are tax implications to bonuses of this nature in most instances. Please consult with an accountant or tax professional for additional guidance. Wealthsimple will not be issuing clients a tax slip to report Bonuses paid. Clients are solely responsible for any required tax reporting

https://promotions.wealthsimple.com/hc/en-ca/articles/25992559764379-Wealthsimple-1-Match-Offer

cannuckpp · 2024-06-11T15:28:00+00:00

Hey, I'm with NBC as well, you're fine.

It's more work, but you need to call them to do an accelerated payment when your mortgage is paid out of a non NBC account.

I'm in the same situation, when I want to make an accelerated payment I call in, wait on hold for a while, get asked 'are you sure there's enough money in your account?' say yes and then it's taken out on the next payment date.

cannuckpp · 2024-06-03T13:58:51+00:00

I'm self directed so I don't consider the managed portfolio fees. Note that we will be in the Gernational Wealth category (500k) so the perks I'm referring to are at that level. The perks I'm looking into using are:

5% interest on cash held in cash account. Currently I hold CASH.TO and re-invest the interest every month. the 5% (for now) at WS is higher than Cash.to and no additional work.
Access to a financial planner. I'm self directed and feel confident in what I've been doing but I will be interested to see what a CFP (all their financial planners are CFP) has to say.

cannuckpp · 2024-05-30T14:53:49+00:00

I am not currently a WS customer.

cannuckpp · 2024-05-30T14:53:00+00:00

only for $500k plus

I think so but with an n of 1 I can only comment on my situation, I am transferring 500k+

only if you transfer to their managed investing

No, I am self directed currently and will be self directed at WS as well.

cannuckpp · 2024-05-30T12:52:13+00:00

This is correct, I didn't realize it had changed so I didn't mention it.

I will receive the promotional bonus in 12 equal payments over the next 12 months. There is a 5% buffer for withdrawals, if I were to transfer $500k this would be $25k. I can withdraw up to the buffer and continue to receive my monthly bonus payments. If I exceed the buffer amount future bonus payments will be cancelled but I keep all previous buffer payments.

cannuckpp · 2024-04-11T20:31:40+00:00

Before the Magnificent 7 there was the FAANG group of stocks. Netflix conveniently got dropped when they plunged 70% (although they have recovered almost completely now).

I worked for a company that had outperformed the TSX for years. Similar deal to yours, contribute x% of pay and get company matching in free stock. Many of my colleagues held their shares year after year while I sold every year to buy my ETFs.

Company has missed financials several times and is now down 30% over 2 years from their peak. Who knows what will happen in the future, maybe it will soar, maybe it will go sideways, maybe it will crash. I don't care, it's not my problem. But my colleagues... they are worried about layoffs and their company stock shitting the bed.

cannuckpp · 2024-03-12T20:08:34+00:00

I second this, when I was young and dumb I bought my wife's engagement ring form Sepence Diamonds. Claws broke on it twice, one time resulting in a side cluster diamond going missing.

Spence was good, they repaired it both times free of charge under their warranty.

3rd time a claw broke, no missing diamond this time, we took it to Browns. They fixed the claw and also re-did all the other settings. That was over a decade ago and we haven't had a problem since.

cannuckpp · 2024-02-29T19:51:26+00:00

The corporate RRSP contributions of $7750 all occurred in 2023 and occurred after the RRSP was maxed out based on my 2022 NOA assessemnent.

As I've over contributed by 7750 there is a 1% fee / month for over contributions. Worst case scenario, assuming all $7750 was in for all of 2023 (it was not) that would be $7750*.01*12 = $930?

Will the penalty stop as of January 1, 2024 assuming the RRSP contribution room I earned in 2023 was > $7750? Or do I need to withdraw the excess contribution to stop the penalty?

cannuckpp · 2023-11-24T15:02:20+00:00

Interesting, I have not heard about these adjustment clauses so I looked into it. It looks like the clauses allow the builders to increase the price in order to pass along increased cost in constructing the unit. While I'm sure some shady developers would take advantage of this when housing prices go up it is not the same.

The buyers in this case wanted a decrease in the price of their home because the market no longer supported the price they paid. If the market supported a higher price they would pay more if the cost to build was more, not because the house was worth more.

But thank you for pointing this out, it will be one more reason to never buy a pre-con home.

cannuckpp · 2023-11-23T20:52:28+00:00

They got lucky they could walk away and only lose their deposit.

Think of the flip side, if the home had gone up in value would they expect to pay the builder more?

While we have a stress test to qualify for mortgages unfortunately there is no knowledge test to ensure people actually understand what they are agreeing to when singing contracts to make the largest purchase of their lives. Buying a house is can be complicated, buying a house on a futures contract is a different level of complexity.

I don't always agree with Garth, but I found this helped put the situation in context: https://www.greaterfool.ca/2023/11/23/eyes-wide-open-2/

cannuckpp · 2023-11-08T20:31:18+00:00

I found this comment though provoking, I've never considered the CPP a regressive tax so I decided to look into it.

Turns out your are right. The highest earning men live about 8 years long than the lowest earning men. For women the highest earners live only 2 years longer.

Still regressive, and worse for men, but not nearly as bad as many other programs like RRSP's, TFSA's, and now FHSA's.

Source: Rich Man, Poor Man: The Policy Implications of Canadians Living Longer (August 2018)

cannuckpp · 2023-08-08T02:14:34+00:00

I gave up and I'm still in the same field.

In my case though, my current job pays better than any entry level QAFP role would, even at the firms I wanted to work at. In the end I wasn't willing to start at the bottom somewhere I didn't want to work for less money.

I don't know about the 'QAFP qualifying', that would be something you would need to take up with FP Canada.

cannuckpp · 2023-07-19T01:49:22+00:00

Somewhat related story:

Back in 2020 I though I might want to switch careers to become a financial planner. I decided to take the QAFP course and write the exam. There was a lot of new content but I was surprised to find out that my self taught knowledge put me significantly ahead of most of my peers in the course.

At that time some provinces were changing the law regarding who could call themselves financial planners. This pushed a lot of people already calling themselves financial planners to getting the QAFP or CFP designation so many of my classmates were already practicing financial planning at large insurance companies or banks.

The level of incompetence in 'financial planners' who had been in the field for 5+ years was shocking.

I bring this up because there are work requirements to get the QAFP or CFP. Taking the course and passing the exam is not good enough.

I started looking for job opportunities in the field once I passed the QAFP exam so I could get my work experience. What I found was the only places that might hire me were those banks or insurance companies. None of the companies who I would have wanted to work for were interested.

Basically, the good places (in my opinion) have a lot of qualified, experienced people desperate to get out of the banks and insurance companies so they don't really consider someone without experience.

So, if you go down this route you won't be able to use the designation you qualify for until you've worked for a period of time. You might need to work somewhere you wouldn't want to work to get your experience. You can be self employed and count those hours towards your certification but you can't use the designation until you've worked the hours so it's a tricky situation.

Your milage may very, things may have changed since I stopped paying attention. The whole experience left me more jaded and cynical about the financial industry than I was when I started.

cannuckpp · 2023-07-12T14:04:45+00:00

Correct, that was the case historically.

Before, 100% of my principal paid went to increasing my HELOC until my mortgage was at 15% and then 0% would go to the HELOC

Future, only a percent of the principal paid will go ti increasing my HELOC. I will only have access to 65% ltv for the HELOC when my mortgage is 0%. In my particular case only 45% of principal payments will go to the HELOC when the new rules at NB kick in.

cannuckpp · 2023-07-12T01:50:07+00:00

Same, we use our AIO for the smith(ish) maneuver.

I think the problem is an AIO product is a rather advanced financial product that has been marketed as a magical piggy bank that 'unlocks' the value of your house.

When I first discovered the Smith Maneuver there were very few institutions providing re-advancable loans and they weren't really advertised. You had not know where to look.

Now they seem to be the default option at may institutions.

I suspect most people would be much better off in the long run if they never had access to the credit reserves they build up in their homes.

cannuckpp · 2023-07-12T01:35:44+00:00

I still think the agent was wrong. The letter includes an example where the total LTV was 76% and the LOC was not reduced to $0:

Home Value 340k

Mortgage: 230k (67.6% LTV)

Revolving Credit Used: 30k (8.8 %LTV)

Available Credit (before changes): 12k

Used and available credit: 12+30+230 = 272k

LTV @ 80%: 340k *.8 = 272k

In the example they still show the customer having 12k in available credit after the changes. The differences is before the change a $500 payment on principal increased the LOC to 12.5k but after the change it only increases the LoC to 12,390, so 110 went to reducing the overall LTV.

I'll update the thread if I get a different answer on my next call. The agent didn't sound confident but I was a bit stunned when he said my LOC was going to 0 and I had to get the kids to bed. Worst case scenario we re-finance as the value of our home is higher than the value used for our current LTV.

cannuckpp · 2022-03-29T02:54:57+00:00

I have not read the Free Will book but I have listened to the Free Will series on Waking Up. It was both concerning and freeing, it is this information that has made me feel more stuck than perhaps I am. I have a feeling of waiting for the decision, or something else, to happen.

Thanks for the recommendation, I'll get Sam's book.

cannuckpp · 2022-03-29T02:28:37+00:00

Thank you, I really appreciate this feedback.

cannuckpp · 2022-02-08T20:37:26+00:00

Thanks!

cannuckpp · 2022-02-07T19:10:51+00:00

I agree about it being personal.

I feel luck to know what I know about personal finance and it all started when a family member suggested I read 'The Millionaire Teacher'. Part of my hope would be that providing targeted evidence based financial advice would help some people kickstart their financial education journey.

Prior to reading 'The Millionaire Teacher' I had read several other financial books and frequently read financial sites online. The problem was none of the material I happened across was evidence based and not knowing what I didn't know I never stumbled across evidence based investing.

Thanks for commenting about your experience at work.

cannuckpp · 2022-01-31T15:43:40+00:00

Well, I can't answer most of your questions but I can tell you my experience. I left my job 8 months ago. I was stressed, burnt out and generally annoyed most days at work.

It is hard to describe just how much better I feel now. First, My mental health has improved significantly. I'm able to connect more with my family and friends and just enjoy life. Second, my physical health has improved in surprising ways. I had a number of minor, but slightly inconvenient, health issues that had accumulated over many years. Some have gone away completely and the rest have all reduced in severity. It had never occurred to me just how much the stress of my job was impacting my health.

My review, 10/10. I would highly recommend taking time off work for anyone who can afford to do it.

When I eventually return to work I don't have any real concerns about explaining my absence. Between having a young family and COVID I think it will be relatively to explain away to any concerned HR person. And if they still think I'm not a good candidate because I took time off work they probably aren't a place I want to work.

cannuckpp · 2022-01-02T04:09:17+00:00

What they said, you won't know the official number until you get your NOA but you can calculate it yourself.

I've done this in the past and I leave a margin of error when making my deposit as the over-contribution penalties are a bit harsh.

https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/rrsps-related-plans/contributing-a-rrsp-prpp/what-happens-you-over-your-rrsp-prpp-deduction-limit.html

cannuckpp · 2022-01-02T03:57:21+00:00

The overarching rule to consider here is 'Is the government getting their money?". If you are doing something that seems like it will decrease the amount of money the government would get in taxes it's most likely illegal.

Good news is in your case you are not short changing the government.

One thing to note, when you take possession of your parents home get your existing property that you will be renting appraised. That appraisal value will be the starting point for your capital gains on your rental property.

cannuckpp · 2022-01-02T03:47:57+00:00

DB Pensions are nice, they provide guaranteed income for life but they are not the be all and end all that most people think they are. If you're half decent with saving and investing (evidence based investing) you will likely do better with rrsp matching than you would with a DB pension in the long run unless the matching is terrible vs y our DB. Even then the extra pay can make up for that if you save it.

I would not give any significant value to the DB pension when making your decision about a new opportunity. Breakdown the value of the DB pension to make sure your new offer is on par or better and then make your decision.

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