By 2 Cents on February 21st, 2011 | Category: Saving |  The test of a first-rate intelligence is the ability to hold two opposed ideas in the mind at the same time, and still retain the ability to function.
~F. Scott Fitzgerald
Update: Thanks to Arjun at Investing Thesis for including this article in the Canadian Personal Finance and Investing Carnival #16.
Very few topics elicit the kind of virulent debate that the TFSA vs. RRSP argument has generated in Canada this RRSP season. To be honest, those of us who cover finance are probably a little tired of writing about the TFSA vs. RRSP war. I’m sure a lot of readers don’t care to read about it anymore. And yet we (including me, apparently) just can’t seem to let it go. (The RRSP deadline for the 2010 tax year is March 1, 2011, so it should be over soon. )
For years, [...]
Read on and enjoy … RRSP vs. TFSA: One Last Dip into the Debate
By 2 Cents on January 24th, 2011 | Category: Retirement |  The conventional view serves to protect us from the painful job of thinking.
~J.K. Galbraith
Update: This article was included in the Canadian Personal Finance and Investing Carnival #14. Thanks!
January is already coming to a close and February will soon be upon us. In the Canadian financial realm, that usually means a mad dash by financial advisors and journalists to remind us that we only have a few weeks left to make the obligatory contribution to our RRSP, or face the reality of dining on Tender Vittles in our golden years. This year, however, there seems to be a bit of an RRSP backlash, with more than one article taking a not-so-fast tone to contrast the steady “RRSP now” drumbeat pounded out by some members of the financial services industry and media.
Recently, Jon Chevreau of the Financial Post reviewed [...]
Read on and enjoy … 5 Reasons to Skip the RRSP Contribution this Year
By 2 Cents on October 13th, 2010 | Category: Saving |  To decide is to walk facing forward with nary a crick in your neck from looking back at the crossroads.
~ Betsy Cañas Garmon
Update: This article was included in the 279th Carnival of Personal Finance – 80s Music Edition posted at Dough Roller. Thanks!
I’ve received a couple of questions from readers on how exactly I have allocated our GIC portfolio. Previously, I’ve written about how set up a GIC ladder, but in reality the numbers don’t always work out as neatly as they do in the examples. The idea behind a GIC ladder is to diversify your interest rate exposure. You can do this by owning GICs with durations of 1-5 years or simply buying a new 5-year GIC each year and rolling money back into 5-year GICs as they mature.
The hope is that you can take the confusion [...]
Read on and enjoy … GIC Strategy: Two Important Questions
By 2 Cents on October 7th, 2010 | Category: Investing |  This is just a short post to let you know that discount brokerage Questrade is now offering commission-free GIC and bond trades. This issue came up during a discussion in the comments section of my 2010 Financial Plan Update for the third quarter. I’ve updated the comments with some of this information, but I just thought I would pass it along in case anyone else is interested.
Holding our sons’ RESP money in cash has been an issue for us for a while. It’s earning zero in a brokerage account, but I hesitated to buy a GIC because my brokerage (Questrade) charged about $30 for each purchase. It hardly seemed worth it with interest rates so low. Further, we may need some of that money within 3 years, and those rates are even lower than the 5-year rates. Unlike the GICs we have in our [...]
Read on and enjoy … Questrade Offering Bonds and GICs with No Commission
By 2 Cents on October 4th, 2010 | Category: Planning | Success is getting what you want; happiness is wanting what you get.
~Author Unknown
If you’re new to Balance Junkie, I outlined our annual financial plan for 2010 back in January. I update the plan each quarter so that readers can have an idea of how one family handles their finances. I don’t claim that the way we do it is the right way, but offer it as a sample for beginners who may not know where to start. I also use it as a way to make sure I actually review our finances every quarter!
Budgets and financial plans should be as unique as the lives that define them. Our life has included some very fortunate years followed by a recent period of tumult. Things have settled down and Mr. Cents likes his new job. Still, as I mentioned last quarter, we continue to worry [...]
Read on and enjoy … 2010 Financial Plan: Q3 Update
By 2 Cents on March 16th, 2010 | Category: Money Psychology | I try to take one day at a time, but sometimes several days attack me at once.
~ Jennifer Yane
Update: This article is featured in the Money Hackers Blog Carnival #109 posted at Maximizing Money. Thank you!
I’ve written a lot of “vs.” posts comparing various financial priorities like RRSPs vs. TFSAs and RRSPs vs. Paying Down Debt. I still understandably get a lot of questions about which of these to do first and how to put financial priorities in order. Should you take them on one at a time or try to tackle them all at once? As usual, a lot of that will depend on your unique situation.
We are constantly bombarded by advice that tells us that we need to be maxing out our RRSP contribution room, our TFSA contributions, and saving [...]
Read on and enjoy … Financial Priorities: Focus vs. Diffusion
By 2 Cents on March 11th, 2010 | Category: Investing | Know safety, no injury. No safety, know injury.
~ Author Unknown
This is another question that’s come up quite a bit lately and it’s pretty easy to answer. The safest place for your money is in a government guaranteed account. If you are Canadian, this means an insured account at a CDIC member institution.
OK, so it’s not quite that simple. There’s quite a bit that you should know about where and how the Canada Deposit Insurance Corporation protects your deposits. I’ll try to cover most of it here.
What’s Covered?
Note that the following list refers only to Canadian dollar accounts. If you have a U.S. dollar denominated account, it is not covered by the CDIC.
Deposit Types
Savings and chequing accounts GICs or other term deposits, as long as the original term is 5 years or less Money orders, certified [...]
Read on and enjoy … What Is the Safest Investment?
By 2 Cents on March 1st, 2010 | Category: 20 Cents | This is a list I compile each month of 10 articles that caught my eye (2 cents each). As always, this is only a sampling of some of the great information out there and there are a lot more I could have included. I encourage you to take a look at these and browse other articles on these sites as I know you’ll find lots of good stuff. Enjoy!
1. Nut at The Writer’s Coin asks Is It Immoral or Just Stupid to Live Beyond Your Means? I think this is a really important debate for the times we’re living in right now.
2. Adam at Magical Penny wrote about Lifestyle Inflation – The Silent Killer of Dreams. Magical Penny has become a favourite read for me, and I think it’s great to see someone so young interested in and promoting personal financial responsibility. Keep [...]
Read on and enjoy … 20 Cents from February 2010
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