Short Takes: Foreign Withholding Taxes, Financial Happiness, and more

I wrote one post in the past two weeks:

Fortress Fiasco

Here are some short takes and some weekend reading:

Justin Bender brings us his ultimate guide to foreign withholding taxes on ETFs.  Unlike other so-called “ultimate guides” I’ve seen from other financial writers, this one really is comprehensive and useful.

Morgan Housel says being happy financially requires managing your expectations as much as making more money.

Alexandra Macqueen explains what goes into calculating official inflation figures and the controversies surrounding what is and is not included.

Jason Heath is a Certified Financial Planner who refers to his practice as “advice-only” to try to distinguish his services from those paid by commissions or percentage of assets.

The Blunt Bean Counter explains how large gifts to grandchildren can have some unpleasant tax implications if you’re not careful.

<< Previous Next >>

Comments

  1. Returns ReaperSeptember 25, 2020 at 12:26 PM

    I enjoyed the article on the inflation controversy. It's a difficult problem, and nothing will ever make everyone happy. While the "interactive CPI" tool described might be interesting to some, I don't think it will really be of much value. I doubt an employer would take my personally calculated CPI increase of 20% as a good argument that I should receive a 20% wage increase. Likewise, it's unlikely it would affect the BoC's decision on interest rates.

    Perhaps if its usage is monitored, insight might be gained into what Canadians consider important, and perhaps change the official CPI for the better. But I think its a losing battle. For every change you make that makes someone happy, someone else will argue it's a poor representation of true costs.

    @Michael do you have any thoughts on how to make the CPI measurement better?

    ReplyDelete
    Replies
    1. Michael JamesSeptember 26, 2020 at 9:27 AM

      Hi Returns Reaper,

      I don't have any ideas for improving CPI calculations, but I do find it interesting that almost everyone who comments on it believes their personal CPI is higher. I guess the ones whose CPI is lower don't complain.

      Whenever I think about CPI, university costs come to mind because they've risen faster than CPI for so many years. I wonder why it is that it costs so much more to educate people today than it did 40 years ago.

      Delete

Post a Comment

Popular posts from this blog

Short Takes: InvestorLine’s HISAs, 24-Hour Trading, and more

I recently moved some cash into BMO InvestorLine’s high-interest savings accounts (HISAs) that are structured as mutual funds.  Their designations are BMT104, BMT109, and BMT114, and they purportedly pay 4.35% annual interest (which they can change whenever they like).  However, the way they report the monthly interest payments is so baffling that I wasn’t able to sort it out in my first 15 minutes of trying.  A further complication is the following text in the HISA description: “The Bank may pay, monthly or quarterly, compensation to your Dealer at an annual rate of up to 0.25% of the daily closing balance in the BMO HISA.”  I couldn’t find any evidence of such a charge, but I haven’t been invested for a full quarter, and I can’t yet say that such a charge isn’t buried somehow in the confusing reporting.  I have more digging to do before I can recommend these HISAs. Here are some short takes and some weekend reading: Preet Banerjee explains the dangers of Robi...
Read more

My Asset Allocation

I’ve resisted discussing my asset allocation for some time, but now is finally the time to describe it and the reasons behind it. I’m not holding it out as a model portfolio; I believe it’s suitable for me and not necessarily anyone else. With that warning, enjoy the discussion and feel free to ask questions or take some pot-shots. The main reason why I haven’t discussed my asset allocation in detail before now is that I don’t want readers to treat it like a model portfolio and follow it blindly. Everyone’s situation is different. The need for variation in asset allocation from one investor to the next usually isn’t huge, but there is no one-size-fits-all portfolio. A secondary reason for keeping my asset allocation to myself is that I can’t be sure I’ll never change it. For example, I recently made the minor change of switching from an ETF of small-cap stocks to an ETF of small-cap value stocks . I don’t have any plans to change my current allocation, but I may think differe...
Read more

What to Do About Crazy Stock Valuations

Image
The last time I had to put a lot of effort into thinking about my finances was back when I retired in mid-2017.  I had ideas of how to manage my money after retirement, but it wasn’t until a couple of years had gone by that I felt confident that my long-term plans would work for me.  I had my portfolio on autopilot, and my investing spreadsheet would email me if I needed to take some action. I was fortunate that I happened to retire into a huge bull market.  I got the upside of sequence-of-returns risk.  The downside risk is that stocks will plummet during your early retirement years, and your regular spending will dig deep into your portfolio.  Happily for me, I got the opposite result.  My family’s spending barely made a dent in the relentless rise of the stock market. However, stock prices have become crazy, particularly in the U.S.  One measure of stock priciness is Robert Shiller’s Cyclically Adjusted Price-Earnings (CAPE) ratio .  In the U.S...
Read more

Archive

Show more