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TFSA vs. RRSP Duel: Who Wins?
The inability to make a decision has often been passed off as patience.
~ Author Unknown

At this time of year, many Canadians are trying to figure out where to put their savings in order to reap the greatest tax and long term investment advantage. With the introduction of TFSAs, that decision has been complicated a bit. There has been great debate over which are the best investment vehicles to choose for your TFSA and whether RRSPs are a better retirement savings option.

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RRSPs: Taking Money Out
Life is not long, and too much of it must not pass in idle deliberation how it shall be spent.~ Samuel Johnson

Our series on RRSP Basics continues today with some information on how and when to take money out of your RRSP.
Withdrawing Money Before You Retire
The idea behind RRSPs is that you won't be taking any money out until you retire. But as we all know, life happens. Here's how it works if you encounter an emergency where you absolutely need to take some of your money out:
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TFSA: Investment Gains, Withdrawals and Contribution Room
Money often costs too much.
~Ralph Waldo Emerson
Last year I wrote about TFSA Withdrawals, giving some examples of how they work. In the last couple of weeks, however, I've received a lot of questions from readers on how capital growth affects your TFSA contribution room.
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TFSA Contribution Limit for 2012
Simplicity is the ultimate sophistication.
~Leonardo DaVinci

Most people have calculated that if the CPI (Consumer Price Index) runs around 2%, that would mean we should exceed the threshold as of 2012. While that looks likely to happen, the CRA hasn't officially announced the 2012 TFSA limit yet. I spoke to someone at CRA last week and they said that the official announcement hasn't come yet, but that it will (obviously) be out by the end of 2011. He advised us to keep watching the CRA website for TFSA updates.
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RRSP vs. Paying Down Debt
Today, there are three kinds of people: the haves, the have-nots, and the have-not-paid- for-what-they-haves.
~ Earl Wilson
RRSPs work best for the haves. The have-nots might be better off starting with TFSAs, and the have-not-paid-for-what-they-haves should pay down debt first. That would pretty much sum up my general view of using RRSPs.
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Financial Outlook for 2012
We are rapidly coming to the point where we can no longer stuff the dirty clothes and toys under the bed. There is no more room. We are going to be forced to actually deal with the mess.
~ John Mauldin, 2012: A Year of Choices

Just a few weeks into 2012, markets have been mostly positive - until Friday's rumours of European downgrades and JP Morgan's disappointing earnings results derailed the enthusiasm. The warm holiday glow of optimism seems to be fading and 2012 is already starting to feel a lot like 2011, with all of ...
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Yes, You Can Live Without Bonds
The conventional view serves to protect us from the painful job of thinking.
~J.K. Galbraith

A recent article in the Globe and Mail delivered the following advice to investors: Don’t Let a Fear of Bonds Infect Your Healthy Portfolio. The implications are clear:

Recent concerns about ultra-low interest rates eventually turning higher are overblown.
If you succumb to the paranoid people who think interest rates can actually rise above 0% - 3%, your portfolio will be unhealthy, damaged, infected. (The image with the article showed people in protective masks.)
And my personal favourite: Long term investors ...
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6 Remedies For a Debt Hangover
Cheers to a New Year and another chance for us to get it right.
~ Oprah Winfrey
OK, so you overindulged. You read all of those articles warning about moderation or complete avoidance. You intended to follow that prudent advice. But you didn't. I could easily be talking about alcohol consumption or debt consumption. Either way, over-consumption will put you in a precarious position.

If you're not in that position on either front, congratulations. If you are, you're not alone. Debt has been in the news a lot lately and if you read my post on 2010 ...
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The Gene Mauch Rule for Investing Success
The following is a guest post by Rob Bennett. I'm pleased to announce that Rob will be sharing his thoughts with us here in a monthly column. Thanks Rob! :)

Gene Mauch was the manager of the Phillies baseball team when I was a boy growing up in Philadelphia. He once said something in an interview that has stuck with me ever since.

Mauch said that, when his team was on a winning streak, his job was to pop holes in the inflated egos of his players. When players are winning, they start thinking that they are so ...
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The Real January Effect
We spend January 1 walking through our lives, room by room, drawing up a list of work to be done, cracks to be patched. Maybe this year, to balance the list, we ought to walk through the rooms of our lives... not looking for flaws, but for potential.
~Ellen Goodman
Have you ever heard of The January Effect? It's basically a piece of market folklore that gets mentioned each New Year, with updated performance statistics. It usually comes with an endless debate about whether it's an actionable piece of information or something more ...
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20 Cents from July 2010

By 2 Cents on August 2nd, 2010 | Category: 20 Cents | 8 comments

Today is a Civic Holiday for many people in Canada. If you are one of those, I hope you’re enjoying your long weekend! Once again, I was amazed by the number of really great articles out there in July. Here are just 10 of my many favourites. Enjoy!

1. Brett Arends at The Wall Street Journal gets the top spot this month for pointing out Ten Stock Market Myths That Just Won’t Die. There are some real gems here. How many times have you heard these pearls of wisdom? (Sarcasm intended.)

2. Thicken My Wallet offered some ideas on Avoiding Overexposure to the Equity Market. This is a great look at some of the reasons we may come to have too much equity exposure and a few ways to avoid them.

3. The omnipresent Miranda Marquit wrote [...]

Read on and enjoy … 20 Cents from July 2010

20 Cents from June 2010

By 2 Cents on July 2nd, 2010 | Category: 20 Cents | 4 comments

We’re halfway through 2010 already. The kids are out of school and I hope to spend some quality time with each of them over the next couple of weeks. I hope you get to enjoy some R & R as well. In the meantime, I have 10 great articles for you to ponder as you sip a cold beverage on your patio!

1. Ryan at Lifestyle Shock encourages us to look at the really big picture by linking to a very thought-provoking video of Vaclav Smil in 9 Billion People + 1 Planet = ?. I would encourage you to read the post and watch the video when you’re in a state of mind to really let it sink in. I wonder if we’ll let this problem reach a crisis before we really get organized and do something about it. I hope not, but [...]

Read on and enjoy … 20 Cents from June 2010

20 Cents from March 2010

By 2 Cents on April 1st, 2010 | Category: 20 Cents | One comment

Here’s my monthly gathering of 10 of my favourite articles from around the web. The bad news is: there are usually way more than 10 articles that I could include here, so some great ones inevitably get missed. The good news is: I just joined Twitter, so I’ll be able to share articles with you throughout the month. If you want to follow me on Twitter, I’m @BalanceJunkie. Enjoy!

1. Man vs. Debt had a guest post from Carmen on 8 Effective Ways to Raise Frugal Kids. There are some great ideas here, but I don’t see many of the parents I know implementing them. That makes it a lot harder for others to try them out. I guess #4 (socializing with like-minded families) would help a lot.

2. If you want to elicit angry and sometimes downright nasty comments, mention anything to do with [...]

Read on and enjoy … 20 Cents from March 2010

Should You Take Money Out of RRSPs to Pay Off Debt?

By 2 Cents on March 9th, 2010 | Category: Planning | 5 comments

Retirement: It’s nice to get out of the rat race, but you have to learn to get along with less cheese.

~ Gene Perret

Update: This article was featured in the Money Hackers Carnival #108 – Dare or Truth! at Eliminate the Muda. Thanks. I love that theme! It was also included in the Carnival of Financial Planning Edition #133 by The Skilled Investor. Thank you!

I’ve had a lot of inquiries about this lately, so I thought I would address it today. I’ve written about RRSP Basics and RRSPs vs. Paying Down Debt, but these articles dealt mainly with general issues and new contribution money. I haven’t directly addressed the question of whether or not you should actually withdraw money from existing Resgistered Retirement Savings Plans in order to pay down credit card or mortgage [...]

Read on and enjoy … Should You Take Money Out of RRSPs to Pay Off Debt?

Your Financial Hierarchy of Needs

By 2 Cents on January 14th, 2010 | Category: Money Psychology | 11 comments

The elevator to success is out of order. You’ll have to use the stairs.

~ Joe Girard

Update: This article made it into the editor’s top 5 picks in The Carnival of Personal Finance – Support Haiti Edition @ Million Dollar Journey. Thanks Frugal Trader!

Abraham Maslow is the psychologist best known for his hierarchy of needs. He basically postulated that humans need to have more basic needs fulfilled before we try to satisfy higher level needs. If we try to attain higher self-esteem while more basic needs like steady employment or a stable family life go unmet, we will feel uncomfortable and stressed out. This goes along with the idea that discomfort means change is required.

Now I am certainly not the first to draw a parallel between Maslow’s hierarchy of human needs and our financial needs. In doing the [...]

Read on and enjoy … Your Financial Hierarchy of Needs

TFSA vs. RRSP Duel: Who Wins?

RRSPs: Taking Money Out

TFSA: Investment Gains, Withdrawals and Contribution Room

TFSA Contribution Limit for 2012

RRSP vs. Paying Down Debt

Financial Outlook for 2012

Yes, You Can Live Without Bonds

6 Remedies For a Debt Hangover

The Gene Mauch Rule for Investing Success

The Real January Effect

20 Cents from July 2010

20 Cents from June 2010

20 Cents from March 2010

Should You Take Money Out of RRSPs to Pay Off Debt?

Your Financial Hierarchy of Needs

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