Wednesday, 30 December 2015

Best of 2015: TV Edition

Part 2 of my Best of 2015 series and today I'm talking about TV and what I was hooked on this past year. If you want to check out my last post on movies you can get it here. TV shows are a little less specific since they usually go across more than one year so my criteria for this list is that it aired at least some episodes at some point in 2015 (super strict I know)! What have you guys enjoyed watching this year? 

#1. The Jinx: This was the year of true crime for me and The Jinx was the absolute best of anything I watched, listened to or read...and there's a crazy ending! 

#2. Master of None: Oh Aziz, how I love you and your witty sense of humour! This Netflix series is so good and he is just so darn likable. It's so smart and charming and perfect to binge on. 

#3. Dreamland (Utopia): I've raved on here about Dreamland before and it would be impossible to leave it off my list of faves so here it is. Go watch it, it's on Netflix. 

#4. Broad City: I always feel a little weird recommending Broad City to anyone because Abbi and Ilana (the two main characters) are crude, rude, a little gross but so hysterical. If you don't take offense too easily it's worth a watch...YASSS! 

#5. Luther: I'm actually surprised that so many of my picks this year are comedies and I usually like things a little darker...that's where Luther comes in. A dark, heavy cop drama with Idris Elba, what more could you ask for? 

#6. You're the Worst: Funny in a cynical and sarcastic sort of way, the blossoming relationship between Jimmy and Gretchen is the focus of You're the Worst. It's kind of a romantic comedy between two of the most unromantic people on TV. 

#7. The Good Wife: What is there to really say about The Good Wife? If you haven't jumped on the bandwagon yet you probably aren't going to, no matter how many people tell you to. It's probably the best written show on cable and the characters seem to just keep getting better. I actually wish I could go back and watch season 5 for the first time again! 

#8. Life in Pieces: Ok, I might be totally offside on this one because the reviews really aren't that great but I find it so funny and I actually like how they split up the episodes into short stories (short attention span much?). 

#9. Hawaii Five-0: My guilty pleasure show for the past five years. It's now kind of tradition to watch this over breakfast on Saturday mornings. Sure it's fluff, but it's delicious, action packed, funny fluff. Plus, Alex O'Loughlin has his shirt off at least once an episode and that's definitely not a bad thing.

#10. Code Black: I haven't liked a lot of the new cable shows this year but I find myself enjoying Code Black more and more every week. I think the cast is great and I've been needing a new medical drama (I still watch Grey's but it's sure gone downhill the last few years). 

I've also got a few fails; shows that I just could not get into for whatever reason. 

Supergirl: Apparently people love this show but I just didn't, I found it was to teeny-bopper for me. 

Bloodline: The casting for this is amazing but holy man was it a slog to get through. I was waiting for some big twist but it felt like I watched the whole thing and nothing happened. 

Making a Murderer: Another true crime drama and this time one that I didn't really enjoy. I think I'm in the minority here but I had a hard time with this one. I'll admit that I'm kind of a terrible person in that I just could not jump on board with these characters, they were all just kind of awful! The bf liked it though, so if you're a better person than me give it a shot ;) 

True Detective: What a letdown! I thought Season 1 was so good and when I heard who they cast for the 2nd season I thought it would be equally as wasn't, not even close. I'm still angry about it. 

Tuesday, 29 December 2015

Best of 2015: Movie Edition

With 2015 coming to a close I've put together a few recaps of things I really enjoyed over the past year. To kick things off I'm looking at movies that came out over the past year (with one exception) and which ones I thought were great and a few duds. One caveat here is that I can be pretty fussy when it comes to movie watching (ok, and other things...) so I really only watch movies that get at least decent reviews (hooray for Rotten Tomatoes). This means that the duds are really just ones that disappointed me, and in no way the worst movies of the year because let's be honest...who even wastes time on crap movies. 

So here we go, my favourite movies of 2015, in a very particular order. 

#1. The Martian: This ended up being my favourite movie of the year and favourite book of the year. I did like the book a little better than the movie (always the way) but the movie is still fantastic. It was also awesome because I knew Matt Damon was in the movie before I started the book so I read the whole thing as him. 

#2. Kingsman: Secret Service: I was surprised how much I liked Kingsman as I had pretty low expectations going in but it is so fun and entertaining. I know it was pretty popular but if you somehow missed it you should go and watch it, I do believe it's also on Netflix now. 

#3. True Story: This is a newbie for me as I actually just watched it this past weekend. The reviews are a little mixed for it which makes zero sense to me (and obviously I'm a professional critic) but Jonah Hill and James Franco are great as it's right in the true crime wheelhouse that I'm kind of obsessed with lately. 

#4. Sicario: Dark, gritty, violent....all the things I love about a good Denis Villeneuve film and Sicario covers all those bases. 

#5. Trainwreck: Amy Schumer had a heck of a year and this movie really proves that she can carry a movie. Sure it's a romantic comedy but I watched it with the bf and we both loved it. Even LeBron James is funny it, and I kind of can't stand him. 

#6. Room: Another great movie that came from a great book. It must have been a couple of years ago that I read Room and I think it's worthwhile reading it before you see the movie. The little boy in the movie is so good and how can you not love Brie Larson. It's sure not an uplifting movie but everyone needs a good cry every now and again. 

#7. Spotlight: The second journalism movie on my list this year and this one centers on a group of journalists investigating cases of priest abuse in Boston. Rachel McAdams and Mark Ruffalo are in it which is good enough reason to check it out but it's also very well written. Don't go in expecting an edge of your seat thriller because it is not but it's intense enough to keep you involved. 

#8. Furious 7: Ok, ok, I'm a sucker for pretty much all of these movies, even the really bad ones, which this one is not. I still think Fast 5 is the best of the franchise but 7 is good enough to make my list and the extra storyline of Paul Walker's death makes it just a little sweeter. 

#9. Spy: This wont make everyone's top 10 list and you definitely need to be a Melissa McCarthy fan to enjoy it but apparently I am and found this hilarious! One of the best, straight up funny movies I've ever seen. Her and Jason Statham are hysterical together and there is just enough real spy stuff to make it exciting. 

#10. Short Term 12: This one is a little different because it's not from 2015 but I just discovered in on Netflix earlier this year and fell in love with the movie. It's a story about a group home for minors and follows the stories of the children and the counselors. Brie Larson stars in it and it is so good (as I said above, I'm a fan). It covers some pretty heavy topics but still ends up being sweet and inspiring. 

And now for the duds....this time in no particular order, they all sucked. 

Magic Mike XXL kicks things off for being so incredibly ridiculous. I liked the first one, it had a cute story line and was just stripper-y enough but this one had zero plot and ended up just being gross. I don't know about the rest of you ladies but a sweaty stripper grinding his junk in my face would never be my idea of a good time (even if it was Channing Tatum). 

Black Mass was just a disappointment because really, Johnny Depp playing an infamous gangster should just work but this movie was so painfully boring. I don't even mind a slow-burn of a movie but this was just awful. 

Our Brand is Crisis wasn't a horrible movie but I had high hopes for it. I'm a big fan of Sandra Bullock and it looked a little like The Ides of March which I really enjoyed but ended up being boring and just blah. 

Sunday, 20 December 2015

Mutual Funds: What Are You Actually Paying?

Mutual Fund Fees

Mutual funds are incredibly popular in the investment world and I'm in no way against their use in a portfolio but it is important that you have an understanding of the various fees involved. The biggies that you need to know about are going to be the sales charges and the management expenses as these will impact what you pay out of pocket and what your return is after the fees are deducted. 

Sales Charges
There are a few different ways you can pay to buy a mutual fund and this will be determined by your plan for the fund and what type of account you'll be holding it in. 

For a front end (FE) or initial sales charge (ISC) fund you will pay your investment advisor commission to purchase the fund for you, usually this will be in the 1% to 5% range. FE funds would be used in accounts where you don't pay your advisor an additional management fee, so really, this is how they get paid. Feel free to negotiate this fee with your advisor but do keep in mind what sort of other work they do for you. If you are getting retirement or tax planning advice at no extra charge then FE funds could very well be where you are paying your advisor. 

Next up are back end or deferred sales charges (DSC) funds and for these you wont pay anything up front for the fund but you will have to pay if you pull your money out of the fund too soon (in the 5-7% range). Usually you have to keep your money in the fund for 5-7 years to avoid the penalty but a lot of companies let you take out 10% of your holding free of charge each year and switch between funds in the same company over that same period. DSC funds tend to get a bad wrap because people don't understand the long term commitment (or haven't been told) and get caught if they need their money. Obviously there are perks for the mutual fund having at least some sort of control over your money for this length of time, so they actually pay your advisor a sort of bonus when you buy these funds. This is where that bad wrap can come into play if your advisor doesn't fully disclose the penalties for early withdrawal to you. 

There are also low load (LL) funds that are right smack in the middle on the first two in that they will charge you to buy them, but usually less than FE (1% to 3%) but will also charge you if you redeem them early but less than DSC (about 3% and they fully mature after only 3 years normally). LL funds have the good and bad of both FE and DSC funds.

Finally there are no load (NL) funds that wont charge you any sales charges to buy or sell...sounds great right? The only hitch is that these are typically used only in fee-based accounts where you would be paying your advisor a commission to manage your accounts (tends to be by entire account or even household and not by each fund individually). 

For most mutual funds you will be able to buy the same fund by any of the above means. For example, you could buy Cdn Bond Fund-DSC, Cdn Bond Fund-FE, Cdn Bond Fund - LL, or Cdn Bond Fund - NL and they will all be the same except for the sales charge you pay (hold the same investments and be managed by the same person). 

Management and/or Operating Expenses
The mutual fund also has certain expenses that they have to pay (salaries, bookkeeping, reporting, etc.) so they pull the cost of these expenses straight out of the funds earnings. This means that you may not have to pay these directly but it still impacts you as it lowers the rate of the return on the fund. 

Most MER's are between 1% and 3% so if your fund has earned a rate of return of 9% for the year you may only see a 7% increase if you're paying an MER of 2%. Included if the MER will also be what is called a trailer fee to your advisor. This tends to be between 0.25% and 1.25% and is kind of like a finders fee for bringing you in as a client for the mutual fund company. 

The MER's aren't transparent to investors and to get that information you need to contact the mutual fund company and even then you'll likely only get a percentage instead of an exact dollar value. It's worth knowing though, especially if you're choosing between two funds that have similar investment profiles; the cheaper one will likely be your best bet. Keep in mind though, portfolio managers with a good track record will cost more but may also make up for it with better returns. As the disclaimer goes though, prior success does not guarantee future returns. 

Another thing to keep in mind when looking at MER's is the type of fund you are buying. More aggressive, actively managed funds will cost you more than a passive fund simply because there will be more trading in riskier markets which means it needs to be more closely managed and is just more work in general. 

That's the gist of the basic fees you will be charged if you're investing in mutual funds. As always, if you have questions or want any additional details feel free to let me know. 

Mutual Fund Fees

Wednesday, 16 December 2015

Binge Worthy TV Shows

Christmas is always such a busy time for everyone but it's also really nice to curl up, relax and get sucked in to a new TV show. I'm lucky enough to have some time off over Christmas and am hoping to spend at least some of that time vegging out on the couch. Maybe you're planning on doing the same thing and are in need of a new show to dive into, if so, I've got your back! Here are some of my favourites that are all available on Netflix for your viewing pleasure. 

Craving something a little girlie and full of drama? Nashville just might be your answer. One of my best friends recommended it to me a couple of years back and it took me awhile to jump on board, I was pretty skeptical because I'm really not a country fan. If you're in the same boat, don't even worry about it...there's so much good and really not that much country music. There's three seasons available on Netflix now and it's a cable show which means lots of episodes to fill your time ;) 

I've mentioned this show on the blog before and it's a bit of an obscure pick because it's from Australia, but it is seriously so, so funny! It's a little bit like The Office, in that it's set in a workplace and might not be everyone's cup of tea but the bf and I both love it and flew through the two seasons that are up on Netflix. 

In the mood for something a little dark and twisty, Luther might be just the answer. Idris Elba is fantastic (obviously) as detective John Luther. There's four seasons on Netflix but it's actually only 14 episodes in total (those British shows and their weird super short seasons) so you could even finish over the break. Not exactly a festive show but sometimes you need a little crime drama. 

X Company
Sometimes Canadian content can be pretty awful but I thought this show was really enjoyable and am looking forward to the second season. It's about a group of young Canadian spies in WWII and their efforts to thwart the Germans. If you like historical dramas you should give the X Company a shot, I don't think you'll be disappointed. 

I've got a cop drama already so why not a lawyer drama? Suits kind of has it all, it's definitely dramatic but it can also be funny, sweet and a whole lot of charming. The characters are so great and you really root for them but they all have a little bit of a bad streak. It's such a good show and I feel like it doesn't get the hype it deserves. 

Ok, so I'm a pretty big Friends fan and am therefore a Matt LeBlanc fan so my opinion on this one might be slightly biased. With that said, I do think Episodes is funny and enjoyable, even if it's a little fluffy (sometimes that's just what you need though). Matt LeBlanc stars as himself and the show basically parodies his ridiculous Hollywood lifestyle but you don't end up hating him (at least I didn't...)

Tuesday, 15 December 2015

Government Pensions (CPP, OAS & GIS)

Canadian Government Pensions

Last week we talked about the basics of pensions that are provided by your employer so now we are going to focus on the government pensions that are available to you (us Canadians anyways). The most significant is usually the Canada Pension Plan but there is also Old Age Security and the Guaranteed Income Supplement that can help out retirees. 

Canada Pension Plan (CPP)
If you work in Canada you most likely contribute to CPP (one of those pesky deductions off your pay cheque) and will therefore be eligible to receive a CPP payment in retirement. The norm is to start receiving CPP at age 65 but you can also take a decreased pension as early as age 60 or an increased pension if you delay past age 65. In most circumstances it makes sense to start collecting CPP at whatever age you retire; the extra tax you would pay if you are still working (increased income) often cancels out any benefit taking it early. The penalty for taking your CPP early is increasing, so that's something to keep in mind; for 2015 it is (was) 0.58% per month prior to age 65 and for 2016 it will be 0.60%. 

The amount of CPP you will receive is dependent on how much you have contributed and how many years you have worked in Canada. Makes sense right? The longer you've worked and the more you've contributed the higher your CPP will be. Just to give you an idea, the maximum CPP payment for 2015 is $1,065/month and this does increase each year. There are however a couple of  factors the CPP includes that may increase your CPP. The first is the 'General Drop-Out Provision'. What happens here is that some low (or no) earning years can be ignored to help boost your CPP amount. If you were a student, unemployed, etc. you can drop some or maybe all of those years so they wont have an impact. Probably the most common situation that would keep you out of the workforce for an extended period is having children, so CPP has a specific provision to deal with this. The 'Child-Rearing Provision' can be used if you stopped (or worked less) because you were the primary caregiver for your kid(s). The one big difference between the two provisions is that the drop-out happens automatically whereas the child-rearing has to be requested, so if it applies to you make sure you do that. 

Now that just focuses on the retirement pension but CPP also includes disability benefits and a survivor benefit. These will help to cover you if you have a disability that keeps you out of the workforce long-term or if your spouse passes away. For more information on CPP you can check out this site

Old Age Security (OAS)
Next up is OAS which can also play a pretty important role in the income of retirees. Unlike CPP, OAS is available to all legal Canadian residents and is dependent on how many years you have lived in Canada. Right now you can apply to receive OAS starting at age 65 but this is being pushed back to age 67 starting in 2023. This means that if you were born in 1957 or earlier you will be able to start collecting OAS at age 65 and if you were born in 1963 or later you're going to have to wait until age 67. If you're somewhere in the middle you will be able to start sometime between 65 and 67...check here for the details. 

To receive the maximum OAS amount you need to have lived in Canada for at least 40 years (after you turned 18) and have resided in Canada for the 10 years prior to applying. The current maximum OAS benefit is $569.95 and this amount is reviewed quarterly and is indexed to rise with inflation. 

One thing to remember is that if you have a high income in retirement you may have your OAS clawed back (or as the government likes to call it, OAS recovery/repayment). For 2015 the income threshold is $72,809 and this also increases with inflation and the clawback rate is 15%. This means that for every dollar over $72,809 you will have to pay back $0.15 so if you have an income over $118,055 your OAS will be fully clawed back. This is important to keep in mind if you'll have a big pension in retirement, you will want to look at maybe pulling money out your RRSP's prior to age 65 and making use of income splitting. 

Guaranteed Income Supplement (GIS)
The final government pension that is available is the GIS but it is only for those with low income in retirement. The GIS is based on your annual income (if you are single) and on a combined income if you are married. For a single person your income has to be below $17,280 to be eligible. For more information on the income levels and payment amounts you can check the tables at the bottom of this page

Side-note: The Service Canada website has been pretty awful lately, so if you are having trouble opening the links provided above you may have to try back a little later; I promise the links are correct (at least as of the date this was posted). 

Canadian Government Pensions

Friday, 11 December 2015

Christmas Baking

'Tis the weekend to drag out the cookie sheets and mixing bowls and whip up some Christmas baking. This year I'm going with a couple of old favourites and a couple of new additions that hopefully turn out ok! 

I like to pack everything up in Christmas gift boxes from the dollar store with some wax paper and hand them out to friends, colleagues, neighbours...who doesn't love Christmas baking! I'm open to exchanges too ;)

Here's what's going in those boxes this year: 

Easy Homemade Toffee
I've done this chocolate covered toffee for the last 4 (I think) years and it is always a hit, so much so that I'm pretty much required to make it every year now. I always make a couple of batches and top one with some sort of nut (this year it's slivered almonds) and another with crushed candy canes as we've got some nut allergy sufferers. Side note: bulk barn actually sells crushed candy canes so you don't need to peel off those stupid plastic wrappers yourself...I was a little too excited to find those this year! Last year was actually a bit of a disaster for this toffee, the only tricky part is the carmelization process and I think it's actually better to use salted butter and then omit the salt from the recipe. Round two worked perfectly though and that was the only mishap with this recipe (and I never use a candy thermometer). Lesson learned though, unsalted only! 

Classic Shortbread Cookies 
Shortbread is my absolute favourite and there's always some variety on the baking list. This recipe is great, rich and know, everything you want in a shortbread cookie. I like to dip them in a little dark chocolate but they are also great as is. Pro tip, make lots as they may or may not all make it to the packaging step. 

Coconut Macaroons
These are a new addition but they look so yummy and I figured coconut would be kind of a nice change from the classic Christmas cookies. I haven't decided if I'm going to drizzle a little chocolate on these or just leave them plain, it'll be a game time decision once I see how they turn out. I can't make any guarantees on this recipe as it's new to me but I've made other recipes from Sally's Baking Addiction that have turned out really well so I have high hopes. 

Easy Oreo Truffles
These are another new to me recipe but it was recommended to me by a very trustworthy source so I'm giving it a shot. Plus, I've been on a big Oreo kick for the last while (kind of weird since they never used to be my thing...and no, I'm not preggers!) and add in some cream cheese and it pretty much sounds like heaven. Oh, and only three ingredients, doesn't get much more basic than that. 

Do you have any Christmas baking in the works for this year? If so, what are you cooking (baking) up?

PS. We are doing Christmas with my family on the 19th so this is officially our last pre-Christmas weekend to get things done...YIKES!

Wednesday, 9 December 2015

The Basics on Workplace Pension Plans

Workplace pension plans

Pensions are kind of the golden ticket in retirement planning as they have such a huge impact on how much money will be coming in the door after you retire but not all types of pensions are created equal. Today I'm going to break down the two basic kinds of pensions that you would get through working, so this doesn't included government style pensions like CPP and OAS; we'll tackle those another day. 

Defined Benefit Pension Plans
DB plans are the real winners in the pension world and when most people think of a pension this is what their thinking of. A DB pension will pay you a guaranteed monthly pension after you retire that will be based on your years of service, salary and a bunch of far more complicated things. This means that you will get a pension cheque every month after you retire until you die (depending on the option you choose your spouse may even still receive your pension payment even after you die). This is the ultimate in safety and you would need to have a whole lot of money invested to come close to what your pension will likely pay out. 

Let's look at a quick example. Say you will receive a monthly pension of $2500/month, you retire and 60 and live to age 90. In this scenario you would get: $2500 x 12 months per year x 30 years = $900,000. 

Some defined benefit pensions also have indexing built into them. This means that they will increase over your retirement to either completely or partially keep up with inflation. As we're all aware, prices tend to go up over time (that's inflation) so $2500 today will not have the same buying power as $2500 in 20 years, that's what indexing tries to solve. A fully indexed, defined benefit pension plan is about the best and safest option you can have in retirement, problem is, not many jobs come with that benefit anymore because it's incredibly expensive for the employer. Keep in mind though, if you do get a DB pension with your job, make sure you weigh that if you're considering a job switch. You may get a higher salary somewhere else but that payment in retirement is significant. 

Defined Contribution Pension Plan
The other big option (and much more common these days) in pensions are DCPP's. These plans have both you and your employer contributing a portion of your salary into a retirement account that is similar to an RRSP, but with some extra restrictions. The big difference in the two plans is that where as the DB pension will pay you out a guaranteed amount until you die, the DCPP will provide you with money only until you run out. If you end up with $500,000 in your DCPP at retirement and you spend it all in the first 10 years of retirement, that money is goners so you need to make sure you plan your withdrawals accordingly. 

There are a couple other factors of DCPP's that many people do like. You can usually move your funds out of the plan at retirement (and sometimes before) so you can invest however you want (just as you would a personal RRSP). Another thing is that if you die that account will remain with your estate and pass on to whoever you have listed as beneficiary. With the exception of your spouse (if you chose that pension option), your DB pension will stop paying if you die, so if you don't live that long after you start your pension you wont receive that much money...of course, this is impossible to know. 

Now, when I say DCPP's go into an account similar to an RRSP this is true, but you do need to be aware of certain limitations. The accounts are usually called Locked-In RRSP's and they are exactly as they sound. Except for some exceptional situations, you cannot pull any money out of the account until you are retired and even then there are yearly minimums and maximums. The government does this so you don't do what I said in the example above and go out and spend the whole $500,000 (or whatever) in the first chunk of retirement...they force you to be at least somewhat responsible. 

Ok guys, those are the basics. Any type of pension is a great added benefit but you should be aware of what type of pension you have and what that means in retirement. Feel free to post any questions below. 

Workplace pension plans

Tuesday, 8 December 2015

Spoiled Rotten

Spoiling children

With Christmas on the horizon and all the gifting it brings I want to chat for a minute about the matter of spoiling your kids. This is a subject that kind of hits home with me because I'm an only child, and therefore, was (and still sometimes am) accused of being "spoiled rotten". Sure, I had a comfortable childhood with two parents who both worked good jobs and I am completely aware that I had certain privileges that not everyone had but I do not considered myself spoiled, and certainly not rotten!

I think it's a-ok for parents to spoil their kids on Christmas, take them on nice vacations and whatever else they want to do (and can reasonably afford)'s really none of anyone else's business. I do however also think it is so important to teach kids the value of a dollar and that not everything in life comes easy. My parents were (and still are) there to help me if I need but I also was encouraged to get a job at age 14 and have worked ever since. This included part-time jobs all through high school and university and then getting a full-time job right after graduation. I like to think that I have ended up with a great job in a field I enjoy because my parents instilled in me a good work ethic and desire to succeed instead of a sense of entitlement and that means more to me than any of the gifts they bought me or places we traveled. 

Not much makes me crazier than people who have no drive and seem to float through life taking handouts from others...seriously, makes me CRAZY! If you have kids please do yourself and your kids (and me!) a favour and teach them the value of putting in a little extra effort; teach them the basics of money and the role it plays in getting what they want. 

It feels a little weird going on what is basically a parenting rant, you know, since I'm not a parent but I'm always happy to share some opinions ;) 

Now go on out and buy presents with no guilt, and maybe, just maybe, add in a little tidbit about how hard you work to buy all those pretty gifts. Rant over! 

Spoiling children

Thursday, 3 December 2015

Estate Planning Basics

Creating an estate plan

No one ever likes to talk about death, but today we're doing it. It's not exactly a subject that comes up at the family dinner table every often, but it is a conversation that you need to have with your loved ones, just in case a tragic event strikes. It is always better to be overly prepared than be forced into a situation where you have to make life or death decisions with no background information. 

When you're young (and you know, invincible) the last thing on your mind is what would happen to your assets if you passed away. This is especially true when you may not have much in the way of assets, but that doesn't mean it's not important to plan for the future. You don't necessarily have to get your full estate plan in place if you don't have much in the way of assets and no children to make decisions for but there are some advantages of getting a head start. The one biggie is life insurance. The younger you are the cheaper your life insurance premiums will be. Learning about estate planning can also help you if you have ageing parents who might need a little nudge to get their affairs in order. If you already have your own children, you definitely need to start the process and get an estate plan in place. 

So what exactly is an estate plan and what do you need to get done to ensure you have a functioning one in place?  

The Will 
This is the big one, and you want (need) to make sure it is done properly. Sure you can buy a 'Write your own Will' kit off the internet but just don't ok? I really recommend having a lawyer take care of this for you, no matter how simple you think it might be. The last thing you want is for your family to be arguing over non-specific language in your will after you're gone, and this happens more often than you would think. No matter how close you think your children may be, conflicts over an estate happen, and the one way you can control things from the grave (ok, that's a little creepy) is by having a clear and concise Will. Yes, it's going to cost you to have a lawyer prepare your Will, but I promise you it is worth it in the long run. Your Will is where you are going to indicate who gets what of your assets (investments, property, and possessions) and also where you will appoint a guardian to any underage children. Have these conversations before you meet with a lawyer and make sure that people who are getting assigned a job are informed. Sure, that scene it 'Manchester by the Sea' where Casey Affleck finds out his brother chose him to take care of his son might have been funny in a dark and painful sort of way but that's a movie...not real life. Most estate lawyers will provide you with a questionnaire or worksheet to help you plan all things out before you actually meet. 

Enduring Power of Attorney 
It makes sense to get a Power of Attorney done while you are getting your Will done. An enduring POA will allow you to choose someone to make decisions about your finances and your property when you are no longer able to make such decisions yourself. Don't worry about hurting anyone's feelings here; you don't have to choose someone just because they are family. This is not an easy job for anyone (and it could potentially be long-term), so you are looking for someone who can function under stress and make the decisions you would make if you were able. 

Personal Directive (Living Will)
A personal directive is similar to a POA in that it gives someone the decision making power when you are no longer able, but the PD covers decisions regarding your health and personal well-being. This includes such things as medical treatment, where and how you will live, and what happens to your children. Often it makes sense to choose the same person for your POA and PD, but it doesn't have to be. You know your people so do what makes then most sense for your situation, and remember, you can always change your mind in the future. 

Life Insurance 
You will want to ensure your debts are covered and your loved ones can continue to live comfortably if you die suddenly and life insurance can be an important factor in accomplishing that. If you all your debts are paid up, and you already have enough assets saved up to ensure any potential beneficiaries are taken care of then insurance isn't as necessary. However, if that's not the case, then it becomes almost an essential. I would look at getting a term insurance policy for an amount that will cover the cost of any outstanding debts (mortgage, loans, credit cards, etc.), the cost of your funeral, and enough additional money for your spouse to live on and raise any children you may have. Slight side note here...when you are getting a mortgage your bank will try to sell you mortgage insurance; don't do it. It's actually kind of a scam, and I've talked about it more here. Term life insurance is the way to go. 

Ok, those are the big important documents that you want to make sure you have in place. Now I'm going to include a few extra tips that aren't exactly estate planning per se but will make things easier for your loved ones. 
  • Make sure your spouse is listed as an account holder on any accounts/policies you have, or is at least given permission to make decisions; for example, your spouse should be listed on your utility, phone, and cable bills to make any necessary changes if you're not around. If you don't have authorization on an account and your spouse has passed away you may have to jump through some ridiculous hoops to get answers and make any changes to the account. 
  • Keep a file with copies of your relevant documents (all of those we talked about above as well as bank and investment statements) and tell your loved ones where that is so it's easy for them to find. If you are the executor of an estate, it can be a real task trying to hunt down where the deceased had money. I like to keep things simple myself but that's not always the case, some people are all about not keeping all their eggs in one basket and have bank accounts and/or investment accounts at numerous different institutions. 
  • Make sure the beneficiaries listed in your will match up with the beneficiaries you have listed on your insurance and investment accounts to avoid any confusion and keep those beneficiaries updated! There are rules in place for this (life insurance trumps Will but Will trumps investment accounts), but it's an easy change to make and helps avoid any conflict. Imagine how you might feel if you think you're the listed beneficiary on a large RRSP account only to find out the Will specifies otherwise...
  • If you are lucky enough to have a pension, make sure you (and your spouse) know your pension options. When you are retiring, you will be most likely be given different options on how and when your pension is paid out which can include how much your spouse would receive in the event of your death and potential guarantees for set terms. You might get a higher monthly amount if you choose an option where your spouse gets a reduced pension with no guarantee after your death but that might not make sense in the long run. Taking the slightly smaller pension now could save your spouse from suffering money troubles in the future.
  • So much of our lives are online now that it can be helpful to have a record of usernames/passwords that can be accessed to shut down online services. I'm sure if you take a look through your credit card statement you likely have a few online services that you are paying for (Netflix, Spotify, etc.) and those would all need to be cancelled. There are also things like email accounts, online banking, and social media accounts that may need to be accessed for monitoring or to shut them down. 
  • If you have pets, you'll want to make sure you have someone who is willing to take care of them. You can even include set aside a portion of your assets to whoever gets the job to make sure your furry friends are given all the spoiling they deserve. 
  • Do you want to be an organ donor? If so you'll want to make sure you've discussed this with your family, so they have a heads up. Then you can sign the back of your Alberta Health Care Card (if you live here), register online, or register the next time you get your driver's license renewed at a registry. 
There you have it. Hopefully, you're now ready to get your estate plan in place and make sure your loved ones do the same thing. As always, feel free to post any questions down below. 

Creating an estate plan

Wednesday, 18 November 2015

Why NOT to Get Mortgage Insurance

Negatives of Mortgage Insurance

If you've ever applied for a mortgage you'll know that they always offer you mortgage insurance and I'm hear to tell you (or remind you) not to get it. If you're on the other side and are a first time home buyer then even better, as you'll be armed with the info before dealing with the bank.

Now don't get me wrong, insurance is important, especially when it comes to covering your debt but there is a better way of doing it.

Your bank will have you pay a monthly premium to cover whatever is outstanding on your mortgage (hence 'mortgage insurance'). Sounds great right, but let's just think about that for a minute. You are going to be paying the same premium every month for the life of your mortgage but your mortgage is going to keep shrinking, so you are basically paying the same amount for less and less of a payout. Plus, the payout goes straight to the bank so you have no control over it. Not so great now huh?

Instead you're going to want to look at getting some term insurance for an amount that will cover your debt. A term life insurance policy will more than likely be cheaper than mortgage insurance, the payout will not decrease and that payout will come directly to the beneficiary who can use it for whatever they want. The term insurance will also stick with you for as long as the term whereas you will need to reapply for mortgage insurance anytime you move your mortgage. Cheaper, guaranteed payout amount and no need to renew if you change mortgage holders...lots of positives!

If you already have mortgage insurance you should be able to cancel it at anytime with no penalties. Definitely get some term insurance quotes, get that in place and then cancel your mortgage insurance to ensure there's no gaps in your coverage.

Negatives of Mortgage Insurance

Friday, 13 November 2015

Credit Cards: Best Bang for Your Buck

In the market for a new credit card and want to make sure you get the best possible deal? Here's a look at some of the best cards in the Canadian market and what makes them so great. You'll first want to decide which category will work best for you. If you carry a balance you'll want to go with a low rate card but if you're pretty good at paying them off every month you'll want to start reaping those rewards. If you travel a lot you should look at a card that pays out in travel rewards, otherwise a cash back card is likely the best option. 

Best Low Rate You should try as hard as you can to not carry a balance on your credit card but if you absolutely must (I get it, things happen) you should look into a low rate card. Even paying a small annual fee can be worth it if you carry a balance. The TD Emerald Visa will cost you $25/year but you'll get an interest rate as low as 4.2% depending on your credit rating. Just remember, if you're paying off your card every month don't even consider a low rate option, move right on down to something rewarding.

Best Cash Back If you spend a lot on your credit card but are on top of paying off your balance it can be worth it to fork over some money for a fee card because you'll likely make it all back and then some. The MBNA World Elite Card will cost you $89/year but can get you 2% cash back. The interest rate is 19.99% though so pay off those balances (yup, I'm a broken record). Another good option if you spend a bit less is the SimplyCash Card from Amex with 1.25% cash back and no annual fee.

Best Travel Rewards The best option for travel really depends on what airline you prefer to travel with as the cards for specific airline rewards tend to be a better value than others (like Airmiles). If you like Westjet you'll want to look at the Westjet RBC World Elite Mastercard for $99/year. If your in the Air Canada/Aeroplan club you should look at either the Amex Gold Rewards card.

Best Retail Rewards If you're not much of a traveller you can instead earn rewards to use at places you spend money. The PC Financial World Mastercard will earn you PC points to save money on your grocery bill. If you shop at Superstore (or other Loblaws stores) and already collect PC points this no fee option might be a good choice for you. Another good option, if you're a Rogers customer, is the Rogers First Rewards Mastercard. This is another no fee option that can earn you money off your phone bill. The Scotiabank Scene Visa is also a good option if your a frequent movie goer but they did just increase the number of points you need to get into imax or other premium movies so keep that in mind.

If you want more details on these or some other good options check out this article from Moneysense.

Tuesday, 10 November 2015

Your Investment Options

Types of Investments

If you're just getting into investing one of the first things you need to understand are what options are available to you. It's important to have an emergency fund setup and easily accessible (I suggest a high interest savings account) but when you start an investment account it should be for longer term goals like buying a house, your kids education or retirement and you want that money to work for you. I'll breakdown some of the most popular investment options to help give you a better idea on what will work for you right now.

GICs are the ultimate in safety when it comes in investments because they guarantee your return. Now this sounds great but the return you get (especially right now) is going to be low; think 1.50% on a 5 year GIC. The concern with such a low return is that your money may not beat inflation, which means your're actually losing money in the long term. The other concern is that most GICs are locked in so you can't get access to your money if you need it before the term is up.

Now onto more complicated matters...bonds. There are many types of bonds but they are all basically debt investments where you loan the issuer money and in return they pay you back your principal with interest. Bonds are usually a low risk investment but it really depends on the type of bond you buy and the trustworthiness of the issuer. You can get government bonds (think Canada Savings Bonds) or corporate bonds that could be backed by very solid companies or those in financial trouble. Wit
h that said, even if a company goes under, bond holders get paid out before stock holders which makes them inherently less risky.

Stocks are a riskier option but they are also where you can earn the highest returns. High risk, high reward right? When you buy stock in a company you essentially buy yourself a little (or big I suppose) piece of the company. Now stocks don't always have to be high risk but there is, of course, always some amount of risk. Even the biggest and most successful companies can loose you money and they often aren't the ones that will have big increases in returns. It can be fun to get into trading some stocks but it is always important to have a lower risk portion of your portfolio to pull you through rough market conditions. 

Mutual Funds You can buy a mutual fund that covers just about any part of the market, whether it be a specific risk level, geographical region or corporate sector. Now, mutual funds will cost you and you need to make sure you understand all the costs involved, but I think they are a good option to help you maintain a diversified portfolio. The guys and gals that run mutual funds are good at their jobs and have all possible research, analytics and models available to them to help them succeed. Stock picking can be fun as I said, but you just aren't going to have the time or resources to do the job they do so I'm OK paying them to do that for me. If you're just starting out funds can also be a way to get into a few sectors of the market with smaller amounts of money.

Index Funds and Exchange Traded Funds (ETFs) Index funds and ETFs are created to mirror an index (such as the S & P 500) which basically means they hold the stock positions used in that specific index. Like mutual funds, they are a good way to diversify your account but they won't cost you as much because they simply buy what's in the index and so aren't actively managed. Just remember that while you won't do any worse than the index, this doesn't mean you are always going to have positive returns. The markets aren't always up and can sometimes be a lot.

Hopefully this helps you understand some of the different components you can use when you start investing. Let me know if you have any questions.

Types of Investments

Wednesday, 4 November 2015

Saving Series: Handmade Gifts

Christmas is always such an expensive time for us. I love buying, wrapping and giving gifts, and even though we don't have a huge family to buy for it still adds up so fast. We also don't have many kids to buy for so it's mostly parents, siblings and friends who can be hard to buy for since they always seem to have everything. This is when I turn to some easy (but still awesome) handmade gifts that people really seem to like.

Here's some things that have made my DIY list for the season.

1. Tile Coasters - I haven't tried this out yet but I will be (I'll let you know how it goes). I looked through a bunch of tutorials and this one sounds the best and makes the coasters water and heat resistant. You can use patterned scrapbook paper or even your own pictures for these coasters (Instagram pics would work great since they're already square). 

2. Crochet Slouchy Beanies - I am addicted to making these right now and will be giving them to everyone this year. I only learnt how to crochet last year and taught myself from you tube videos so don't feel intimidated, it's easy! These beanies are cute and really comfy, I pretty much live in one of mine every weekend. My favourite yarn for these is Caron Simply Soft which can be found at Michael's (make sure you grab a coupon).

3. Color Blocked Wood Vases - These vases are so cute and simple to make. I think they would make fantastic hostess gives with some fresh flowers in them. You can go with festive colours or keep it a little more neutral to match anyone's decor. Or change up the pattern and go with thinner stripes or even a chevron pattern instead of the colour blocking. 

4. Twenty Minute Totes - Have a sewing machine at home? These totes would work up super fast and would work great as reusable gift bags that can be used over and over. The gift bag that keeps on giving ;)

5. Marbled Clay Ring Dishes - How pretty are these little jewelry dishes? I think these would be perfect for any ladies in your life and they look unique and pricey! The tutorial sounds easy enough but I have zero experience dealing with clay and I have some doubts mine would be so nice and bowl-shaped. But hey, if it does work out...awesome, and if not I guess I'll have a misshapen jewelry dish for personal use. 

6. Boozy Hot Chocolate Mix - Here's a super easy (aka last minute) gift that would be great for neighbours, co-workers or teachers (or maybe not it acceptable to give booze to teachers? Probably not...). Anyways, you could make a bunch of these really fast if you need something quick. 

7. String Art Map Panel - This one isn't so much a tutorial as just picture inspiration but it's easy enough to follow. You could do a province (or state as shown) or do a country or pretty much anything else you can come up with. I also think it would be cute to do a star (instead of a heart) in the middle and mark off the location of a meaningful city. A piece of wood, some stain or paint, nails and some string...can't get much easier than that and you didn't even need to be an artist. 

8. Infused Olive Oils - Flavoured olive oil is so popular right now and its really simple to mix some up for yourself or as gifts. Get some cute little bottles, good quality olive oil (try Costco) and some herbs and you can whip up some little gift sets in no time. 

Let me know how it goes if you try any of these or if you've got other great DIY gift ideas. 

Tuesday, 3 November 2015

Tipping Etiquette

To Tip or Not to Tip?

What do you guys think about tipping? When do you do it and how much do you give and what makes you tip a lot or a little?

I feel like I'm a pretty generous tipper in most situations but sometimes i kind of hate how so many places now prompt for tips....I'm looking at you Starbucks and your annoying phone pop-ups.

I've been a server/bartender in the past so I know that it's a tough job and you definitely depend on tips, so because of that I almost always tip about 20% (unless the server is straight up rude). Lots of things can happen that are completely out of your servers hands, so as long as they're polite and try to make up for it I think they've done their job.

What about food delivery? We actually hardly ever order food, pizza once in awhile but we live central and are so close to so many great restaurants that usually we'll est out or go pick something up. From what I do know, lots of places now charge a delivery fee so I definitely take that into account when tipping the driver. I'll still usually give them something, $5 maybe.

I also tip for spa type services like haircuts, massages or when I get my nails done but less, usually around 10%. If I'm paying $50 for a haircut and it takes about an hour I figure that's pretty expensive, but I get that there are overhead costs and that's not all profit.

Now, what about all those places (like Starbucks, Booster Juice, etc.) who all hassle us for tips now. For places like that I very rarely tip, and if I do its usually a $1 or less. I figure that tipping is for really great service, and how exemplary can your service be in the 30 seconds of contact we have when I'm pulling through the drive thru. Sorry but no.

Am I totally offside on any of this? Let me know your thoughts and if it also annoys you with all the tip requests.

To Tip or Not to Tip?

Wednesday, 28 October 2015

Highlights of the Alberta Budget

The Alberta Budget (2015)

Feels a little like Alberta right now hey? We voted in the NDP's with an overwhelming majority and now that they're taking action we're all freaking out a little. 

As I'm sure you all know the government put forward their budget for Alberta yesterday and there has been some serious debate. They are basically looking at running pretty massive deficits over the next couple of years with the first surplus not coming until 2020. That's scary, I get it. However, I also get that the economy in Alberta sucks right now because of the decline in oil prices but at the same time we have social programs that are struggling and need money. I for one am not ok with the government further sacrificing our education and healthcare needs to keep the province out of debt. 

Let's take a quick look at some of the main points of the plan: 

1. Individual and corporate taxation: farewell to the flat 10% tax rate for all Albertans. Those earning over $125,000 will now see their taxes increase for this year and again for next year (see rates listed below) and the corporate tax rate was increased from 10% to 12% (as of July 1, 2015). 

2. Sin Taxes: the markup on liquor will increase by 5% and a carton of tobacco will go up by $5. I have no problem with this (probably because I don't smoke and am not a big drinker) and still wont cover the huge cost to the healthcare system that heavy users bring about. 

3. Healthcare: increase spending by 4% in 2016 with additional money going to support long term care facilities, home care and mental health services. I'm good with this one. With our aging population there is really no way out of spending more money on healthcare and I like their goal of expanding home care. 

4. Education: reverse the 3% decrease of funding that was put in by the PC party. I don't have kids yet but I'm sure I will one day and it's so important to ensure they have access to good education and safe schools. This will allow the province to hire almost 400 new teachers to help prevent class sizes from getting even larger.

5. New job creation program: they will give an incentive of $5,000 to employers for each new employee they hire. This one I'm not sold on, sure it's a perk if you have to hire someone but I don't see a company going out of it's way to add staff that they'll have to pay (let's say $50,000/yr) just to get $5,000.

6. Infrastructure: increase infrastructure spending by 15% to improve roads, schools and hospitals. This plan is similar to Trudeau's federal plan, and is based on advice from Dave Hodge (former Bank of Canada governor) that you should spend during bad times and save during good. I ultimately do agree with this but worry we might be spending TOO much. 

Those are the key points I took out of the budget and my opinions on it, what are you guys thinking? 

The Alberta Budget (2015)

Tuesday, 27 October 2015

Cash vs. Credit

Should you use cash or credit?

Let's take a look at the endless debate of whether it is better to use cash or credit. First off, my opinion...I think both have a place and definitely believe that cash is better for some people but I'm a credit card user and I think the advantages of using them can outweigh the downfalls but only IF YOU'RE CAREFUL! 

Let's take a quick look at some of the pros and cons of each. 

Cash - Pros 
-accepted pretty much everywhere
-no additional fees attached 
-makes you consider large purchases (usually there would be a time lag between wanting something and having to go to the bank to pull out enough cash)

Cash - Cons
-if it's stolen it's as good as gone
-doesn't help build your credit 
-easier to waste cash on small purchases (I'm more likely to stop and grab a coffee if I've got $5 in my purse than if I'd have to put it on a card) 
-can't shop online 

Credit Cards - Pros
-many come with cash back or travel reward programs 
-helps build up your credit 
-can cancel if stolen and a lot of cards have programs in place to rebate purchases if stolen  
-online shopping, which can also get you better deals

Credit Cards - Cons
-high interest rates and often have fees
-easy access to a high limit you may not be able to afford 
-encourage impulse buying 
-can damage your credit

If you've had problems with credit card debt in the past then you may want to stick with using cash or ensure your card has a LOW credit limit to keep you out of trouble. 

Some personal finance gurus (Dave Ramsey and Gail Vaz-Oxlade) are strong proponents of an all cash budget and I think for people trying to pull themselves out of debt that's a solid plan. For those who have control of their spending I think the benefits of credit cards can be really great. The most important thing with credit cards is to make sure you can pay off your balance EVERY month. Even just one month of carrying a balance can outweigh the reward benefits you are earning and so often one month turns to two, turns to three...

The takeaway is that credit cards can be a great weigh to get added benefits from your purchases but you must know your limitations and use them properly.

Should you use cash or credit?