Optimizing Wealth Through Asset Re-Allocation
If you are an active investor, your investment holdings probably include many different asset classes. For many investors, diversification is a very important part of the wealth accumulation process to help manage risk and reduce volatility. Your investment portfolio might include stocks, bonds, equity funds, real estate and commodities. All these investment assets share a common characteristic – their yield is exposed to tax. From a taxation standpoint, investment assets fall into the following categories:
Tax Adverse
The income from these investments are taxed at the top rates. They include bonds, certificates of deposits, savings accounts, rents etc. Depending on the province, these investments may be taxed at rates of approximately 50% or more. (For example, Alberta 48.0%, BC 49.8%, Manitoba 50.4%, Ontario 53.53%, Nova Scotia 54.0%). Read more
Cardinal Update – August 2018
STICKING WITH THE TRIED AND TRUE REWARDS INVESTORS OVER THE LONG-RUN – After a correction early in 2018, Canadian and U.S. markets have recovered and moved higher. All is not equal across the indices though. Momentum or growth oriented stocks have been outperforming value stocks. So it is worthwhile to take a closer look at what has been doing well and how it fits with Cardinal’s investment philosophy.
Click here to read more: Cardinal Update – August 2018
Cardinal Quarterly – July 2018
Market Outlook – Global stock markets jumped higher in the second quarter of 2018, moving most markets back into positive territory for the year. The UK FTSE-100 and Australian ASX-100 were the top performing markets, up 8.6% and 7.6% respectively. Other international markets were also positive with the German DAX-30 and French CAC-40 up 2.5% and 3.3% respectively. However, U.S. dollar appreciation in the 5% range offset most of these gains. In North America, the S&P TSX and the S&P 500 gained 7.0% and 5.3% respectively with the US dollar gaining slightly on the Loonie.
Click here to read more: Cardinal Quarterly – July 2018
Canada Pension Plan – Should You Take it Early?
New Rules governing the Canada Pension Plan took full effect in 2016. Under these rules, the earliest you can take your CPP Pension is age 60, the latest is 70. The standard question regarding CPP remains the same – should I take it early or wait?
If you take it at the earliest age possible, age 60, your CPP income will be reduced by 0.6% each month you receive your benefit prior to age 65. In other words, electing to take your CPP at age 60 will provide an income of 36% less than if you waited until age 65.
CPP benefits may also be delayed until age 70 so delaying your CPP benefits after age 65 will result in an increased income of 0.7% for each month of deferral. As a result, at age 70, the retiree would have additional monthly income of 42% over that what he or she would have had at 65 and approximately 120% more than taking the benefit at age 60. The question now becomes, “how long do you think you will live?” Read more