Can You Withdraw From Your RRSPs Before You Retire?

If you have a traditional RRSP, you might be wondering if it is possible to take money out of it for an emergency before you reach retirement age. The answer is “yes” – you can withdraw from your RRSP before you retire, but you will have to pay tax on it immediately. And the sad reality is the taxes might be much more than you would pay if you waited until you were retirement age. Also, if you withdraw money from your RRSP early, then you take the chance of permanently altering the original contribution room you had to save according to government guidelines.

What are the tax consequences of withdrawing from your RRSP ahead of time?

When you withdraw from your RRSPs before you actually retire, then the financial institution holding the funds is required to take an immediate tax and pay it to the government in your name. Depending on what the specific tax rate is, the amount you will pay will probably be somewhere between 10-30% and is determined by how much you withdraw. If you live in Quebec, you might get a slight break with the taxes only being between 5-15%, but there will also be a provincial tax amount held back.

Also, if you withdraw money from your retirement account early, then the amount that you take out is subject to being taxed. The money from your RRSP becomes “taxable income” – so in reality, you are taxed on the same money twice. Whether or not that will affect how much you owe on your taxes is related to your earnings and income situation. But before you take money from your RRSP, it is essential to understand whether it could put you in a higher tax bracket and end up costing you a whole lot.

What is the anti-avoidance rule?

In July of 2011, a new anti-avoidance rule went into effect to encourage people not to take money from their Assiniboine Credit Union RRSP accounts. The government decided that any money that you withdraw before retiring is considered income and taxed accordingly. The rule is that you are supposed to pay the amount of tax that equals the total amount of money that you gained at a rate of 100%.

What are the two reasons that withdrawing from your RRSP makes financial sense?

If you use it to buy your first home

The laws state that you and your spouse are both allowed to borrow as much as $25,000 out of your RRSP account if you are going to use it as a down payment on your first home. Under the Home Buyers’ Plan, if you use your RRSP money for a home purchase, then you don’t have to pay any taxes on it – as long as you pay it back within 15 years from when you borrow it.

If you use it to pay for training or education

If you or your spouse wants to use your RRSP for educational goals or to attend training, then you may both borrow up to $20,000 from your plan to pay for either part-time or full-time educational expenses under the LifeLong Learning Plan. The maximum you can withdraw in any one year is $10,000. If you do take out money to further your educational goals, it won’t be taxed as long as you pay it back within 10 years from when you borrow it.

If you find yourself in an emergency where you need money quickly, then you might want to really think twice about withdrawing money from your RRSP instead of trying to take out a loan. Sometimes, depending on the amount you withdraw and your income tax bracket, you might end up owing more than you think. If you use it for either a first-time home purchase or to further your education, then it might be a good idea. Just make sure that you pay it back in the time allotted, or you can end up being taxed on it twice – which can add up quickly.

Benefits of Owning Your Own Business

A lot of people would agree that putting up your own business brings a lot of benefits. Surely enough, that is true, but it has to be a successful one.

Now, if you’ve saved up some money and you’re still contemplating whether or not you’re going to create your own business venture, then I am here to convince you.

In today’s article, I will be going over some of the benefits of owning your own business.

  1.    You are the Boss

So, you’re probably accustomed to taking orders from your boss and doing what is required of you every single day.

That may be good and all, but there might be times where you just don’t want to work on something, especially if it is something that you do not want to do.

Well, if you have your own business, you are the boss. You are going to be the one calling the shots. You are going to be the one who steers the company/business towards the direction you want to go.

Essentially, you have all the power. Don’t want to work for today? That’s fine, you can just have someone to work on something for you.

  1.    Hire Your Own Staff

When you are going to do something grand, say, putting up your own money-making machine, you need to have people who you can trust.

When you are the leader of the business, you have the responsibility of hiring your own staff. Perhaps you want to hire your best friend to do some accounting duties. Or maybe, you want your wife to do the Human resources work that is needed by your business. Whatever it is, you have complete control of who you want to hire.

  1.    You Can Make Investments

Maybe you want to create a restaurant business or maybe, you want to sell some computer components. Whatever it is, you’re going to be the one to make the investments. After all, you are the boss, right?

  1.    Management

Running a venture from the ground up can be tiresome, so you definitely need to be in complete control.

If your business has grown considerably, you will need to hire more personnel to handle the workload. The beauty of owning your own business is that you can manage everything in your company. You even have the power to manage the finances as well.

Speaking of finances, if you find that your business requires some more money, you might want to consider getting some from cash advance online schemes.

From the staff person to the manager, you have what it takes to keep your service up and running.

  1.    Feel Pride

And lastly, once you’ve built your own business and made it successful for the years to come, you will feel that sense of pride and accomplishment.

Let me tell you, owning your own business is hard. But, once you’ve figured it out how to stay relevant for the years to come, nothing can beat that feeling of pride.

Conclusion

So there you have it. There are a lot of benefits to owning your own business. You are the boss, you can hire the people you trust, you can steer the company to the right direction, and best of all, you can feel awesome just making a venture from the ground up.

Refocusing Your Financial Strategy for 2018

A troubling trend is taking hold in U.S. households; nearly 8 out of 10 workers report they are living paycheck to paycheck, and the number of Americans living on the financial edge is only growing. The paycheck to paycheck lifestyle drives many people to incur debt or otherwise struggle and sacrifice when expected expenses arise, and far too many people are relying on credit cards to make ends meet. This has resulted in crisis-level debt situations for far too many families, with 1 in every 50 households (approximately 2 million families) carrying more than $20,000 in credit card debt. In fact, revolving credit has experienced an annual growth rate of about 4.9 percent, and with a greater number of consumers (even those with subprime credit scores) being approved for credit cards, it’s likely those numbers will continue to rise.

 

But credit card debt isn’t the only storm cloud hanging above the heads of the American majority; mortgages, student debt, auto loans, and personal loans account for a huge portion of the debt burden in the United States as well. For many American families living paycheck to paycheck, what feels like a manageable amount of debt one day can start to feel like drowning in the space of one small crisis.

For all these reasons, it’s important to refocus your financial strategy as we enter into the new year; when it comes to getting out of debt, saving for retirement, or making smart investments, time is money.

  1. Analyze your spending habits. If you haven’t already taken control of your finances by getting a realistic sense of where your money is going, it’s time to start balancing the budget. Many people not only don’t know what they actually spend their money on, but also don’t have any real knowledge of just how much they owe. You should be managing your finances with a big picture sense of all your expenses and an honest assessment of how much money you have coming in each month. Once you’ve sorted out the budget, you can start making adjustments to your spending habits. Analyze what financial planning strategies work for you and which don’t pay off, and adjust accordingly.
  2. Invest in yourself. If you’re regularly finding that you’ve got a bit too much month at the end of your money, it may be time to consider some sort of side hustle or a second job to gain some financial traction. While most people are in debt, nearly 80 percent of Americans report that they incurred that debt to invest in themselves or opportunities. If you’ve got a creative talent or a compelling product or service, check out Shopify templates to earn some extra cash on the side or even launch a full-time entrepreneurial endeavor.
  3. Take advantage of balance transfers. One of the fastest ways to get out of debt is to transfer the high-interest debt to a low or 0 percent interest balance transfer card so that the money you put toward your debt makes a greater impact. Assess all your credit card debt and consolidate as many high-interest cards as possible; since most people have debt spread across several credit cards, you’ll want to understand exactly which transfers will make the greatest difference in your overall financial health. Remember that your best bet is to pay off the balance of your transferred debt within the promotional period so you save money on interest, so pay particular attention to those details when selecting a balance transfer card.
  4. Avalanche debt. You may have heard of debt advisor and media personality Dave Ramsey’s recommendation of “snowballing debt,” in which you pay off the lowest balance first, then apply those payments to the next lowest balance once the first is paid off, and so on. This strategy can be super motivating since you get to see debt disappear quickly when you focus on the smallest bills, but an even more focused version of this strategy is the “avalanche” method, where you attack the highest interest rates first to reduce the amount of unnecessary interest spending. The most targeted financial strategy would be to strike a balance between the two; for example, taking the extra money you save each month by paying off the lowest balance debt and applying it to the card with the highest interest rate instead of the next smallest balance.
  5. Start tracking your credit. Now that you’ve got a handle on what’s happening with your finances, it’s important to stay in the know. Start tracking your credit through any number of free websites and apps; not only will a healthy credit score help you get the best rates and offers, but tracking it will ensure identity fraud or other security threats don’t compromise all your hard work.

If you feel as though you’re shackled to your debt and the risky paycheck to paycheck lifestyle that necessitates it, know that you can remove the irons. By refocusing your financial strategy as we approach the new year, you can start taking steps toward establishing greater financial freedom in the future.

What strategies have helped you focus on and improve your financial health?

BENEFITS OF A VPN

A Virtual Private Network, or VPN is a service that provides a securely encrypted connection to the internet. It basically enhances your security and privacy when it comes to your internet activity. It allows you to do such things as gain access to region-restricted websites, download torrent files anonymously, mask your internet usage from your ISP and prevent prying eyes from listening in on your activity on public Wi-Fi.

Benefits

There are many benefits to using a VPN and the first is obviously privacy. If you do not like the idea of someone watching your every move then this is something to think about. By connecting through a VPN you are hiding your internet activity from your internet service provider, government or anyone who wants to record your every move if they wanted to.

Another capability VPNs have is to evade censorship. An example of this would be if your work or school is blocking a certain site or only low you to do you certain things. By logging into a private VPN you will be able to get around this.

Similar to evading censorship, it also allows you to geo-spoof your location. This is basically tricking your device into thinking you are somewhere else. If you are being denied access to services or sites based on your geographical location this may come in handy.

One extremely convenient benefit to using a VPN is that you are protection your security and privacy. When using WIFI or a public hot spot you are susceptible to hackers getting into your connection and accessing your information. Whether it being your bank account information, password information or websites visited, it is scary to think people can see this information. A VPN may put your mind at ease.

If you are involved with P2P networks (Peer to Peer networks), it will allow you to download files safely. P2P networks are computer systems connected to each other so that files can be shared directly without the need of a central server. Again, VPNs allow you to securely and privately participate in this sort of network.

HOW IT WORKS

In order to use a VPN you must sign up for a VPN service. This type of service typically cost about $5 to $10 a month. You need to contact service providers to get information on how to get you started.

By weighing these benefits you will be able to determine if investing in this service is right for you and your business or family.

Keeping Costs Down On Your Home

Dealing with repairs to your home can be tough when you are working to a strict budget or you have just splashed out on decorating or getting a new appliance. You can never tell when the next thing will break or when you will need a repair, but there are a few ways to keep on top of some common issues to avoid any big bills.

Keep The Boiler Ticking Over:

When your boiler breaks down it is a serious inconvenience and can often be quite expensive and really put you out without hot water and heating at the wrong time. One of the best ways to keep on top of your boiler is to not abuse it, only use hot water when you need it and don’t whack your heating all the way up, give your boiler a chance to do it’s job.

Keep on top of your boiler services, a cheap quick fix can help avoid a burst pipe or a replacement that can cost you quite a few pennies. Make sure your boiler is getting serviced yearly and if you can get you radiators, sinks and piping checked too.

Look After Your Bathroom:

Your bathroom is an essential part of your daily routine, make sure to clean it as and when you can and keep an eye out for any breaks in the seals around sinks, baths and showers as this can cause damp in the floors and walls.

Make sure that whenever someone uses the shower or bath that either they use an extractor fan or open the window to let out the excess moisture, yes even in the middle of winter. The extra moisture can cause untold damage that can come back and bite you with a hefty bill later.

Check The Roof:

It’s always worth checking in the loft for any leaks or cracks in the roof especially around winter or rainy periods. You never know when tiles will crack or fall off, but try to keep an eye out and keep on top of this. If there are any faults or if you want a professional to check, this doesn’t cost too much, it certainly will save money if it stops damp getting in.

Managing Your Garage:

It’s easy to forget and neglect your garage if it isn’t a living space, but if not looked after there can be a number of problems from pests to damp and rust. Make sure that your garage is properly insulated, There’s a great article on insulation if you haven’t read it, and if the floor is concrete that it is sealed to stop the cold and moisture seeping in. A garage door seal is a great way to prevent the elements getting in as well. Look after the garage door especially if it electric and get it checked if it needs to be serviced to avoid a nasty bill when it breaks or you accidentally crash into it because it stops half way through opening.

White Goods:

Electronics in the house always have a tendancy to break when you least expect it, Computers are widely used now and can make life difficult when they crash. If you know somebody who is good with computers you might be able to mitigate your computer repair cost. White goods like washing machines, tumble driers and dishwashers  and anything mechanical make it hard to know when they are reaching the end of their life span. All of these appliances can be serviced or treated. Many companies offer a variety of products that you can use normally in an empty wash to clear our limescale and build ups, a small purchase every now and then will save you from needing a replacement in future.

 

 

 

Use These Steps to Budget for Your Next Home Improvement

Does your house need a makeover? As much as you may have loved your home when you first purchased it, the years you’ve spent living in it has created some memories, and some wear and tear. Home improvements like painting, kitchen and bathroom upgrades, as well as additions or add-ons, not only make the home look better, but also help to drive the value up. If you’re planning to renovate your home soon, you’ll want to follow these budgeting steps.

Get an Idea of What You Want

Before you can determine whether you can afford a home improvement project, you’ll first need to understand what you want so you can get a ballpark idea of what it would cost. Though any improvement is better than none, some home improvements known to increase property value include:

  • Deck or additional patio space
  • Upgraded kitchen and/or bathroom
  • Room addition
  • New roof

There are also smaller jobs you can do to update the aesthetics of the home like painting the interior and exterior of the home or updating the landscaping.

Get an Idea of Costs

Now that you’ve chosen the projects you want to work on, you can do some research to determine how much you’ll need to get the job done. The best way to accomplish this would be to contact local contractors who specialize in the home improvement jobs you want to have done. Discuss your ideas and have them do a view of the home and provide you with an estimate. You should get at least three different estimates to ensure you’re choosing the best rate.

Can You Afford It?

Based on the estimates you were provided; can you afford the home renovation? Since most major home improvements can cost thousands of dollars, unless you’ve been saving for a while, you likely don’t have the money to afford the renovations on your own.

Homeowners who want to improve their homes do have options, however. One option would be to search for a mortgage company that would give you a loan. Cash-out refinance loans, second mortgages, home equity loans, and home equity lines of credit could be reasonable options to secure the cash. These options, however, should only be considered if you have the means to repay the loan. As the loan will be attached to your home for collateral, should you default on it, you’ll lose your home and all the hard work you put into it.

Dreams Vs. Budget

If you’re not in the best position financially, there’s not much equity in your home, or you still won’t have enough for the home renovation, you can find ways to budget and cut costs so that you can afford the improvements. Here are some tips below:

Trim the fat – The first bit of advice would be to review your budget and get disciplined about sticking to it. Review your income to expenses and find ways to trim the fat on your budget. If there are things you can remove or reduce to save money for your home improvement, do it.

DIY – Depending on what you want to have done in the home and your level of skill and comfortability, you can do many home improvement jobs on your own to save on labor costs. Things like painting, updating the landscaping, and even small kitchen and bathroom upgrades can be done with the right tools and references to guide you.

Consider low-cost alternatives – Though you may have imagined granite kitchen countertops, scaling back and finding affordable alternatives can be just as attractive. Choosing laminate countertops, for instance, can save you hundreds of dollars, but give the same chic and timeless look you were dreaming of.

Refurbish some things – Instead of getting all new kitchen appliances or living room furniture, see what you can salvage to save you some money. You’d be surprised how you can bring kitchen cabinets back to life with a little sandpaper, paint, and new handles. This would eliminate the need to buy new kitchen cabinets but still give the room a facelift.

Buy the supplies yourself – Homeowners can save a lot of money on the cost of home renovation projects by purchasing the parts and supplies themselves. Talk with your contractor to ensure that you’re getting the right products.

Figuring out how you’d like your dream home to look is easy, the hard part is figuring out how you’re going to afford it. Whether you’re doing improvements to sell the home or you just want to give your home a makeover, there are options for making your home look great. Before getting involved in any home improvement project make sure that you have a financial plan that includes getting estimates, finding a source of cash, and budgeting. If you’re not able to afford it now, try doing one project at a time and before you know it, your home will look just the way you dreamed it would.

WAYS TO WIN ROULETTE

When gambling most people think it is pure luck. Some do it recreationally while having a few drinks while others take it on as a sport. There are many ways to look at different casino games and gambling in general but there are actually some winning betting tips. There are ways to help your odds at the game and help you win that money whether it is for fun or for sport. Below are some tips that can be used to help you excel in the game of roulette.

Betting Strategies

There are different methods to betting but the two most popular are the Martingale Strategy and the Paroli system. The Martingale Strategy is basically a doubling up your bet strategy. If you bet an amount on red and it lands on black, keep betting on red and double your bet each time until you win the money that you lost back. This is a good strategy for those who have the money to front. The amount of money you have to spend needs to be decided before you start. The Paroli System is similar except you don’t double until you win. If you win three times in a row then you return to your original bet.

Table Tips

There are some steps you should follow before entering a game on a particular table. The first step is to obviously make sure you are at a reputable location with a reputable casino. They will follow gaming regulations and the proper rules to make sure you are playing a fair game. Another good tip is to watch for a couple spins to see if there is a bias. Certain wheels may have a tendency to land on particular colors or numbers and if a worker has been there for long they may be able to use the same force to hit the same numbers. If you observe for a little bit of time before committing to the table than you may be able to pick up on this and avoid money lost.

If you follow these strategies when going to a casino or even gambling online than you will have a leg up on the odds. By doing your due diligence than you can make a large impact on your winnings. Be sure to choose the betting method and table that works best for you to optomize your winnings.