You Can Earn $50K in Tax-Free Dividends But There’s A Catch

You Can Earn $50K in Tax-Free Dividends But There's A CatchWhile early retirement may be a pipe dream for most of us, every once in a while I hear from readers who have pulled it off and are living almost tax-free on dividend income alone. An example is Torontonian Phil McKinley, who retired in his early 40s a couple of years ago and has been living on his non-registered dividend income tax-free. While McKinley is reluctant to divulge his full…

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Do You Want High Tax-Free Income?

Do You Want High Tax-Free Income?If you want more income, one of the first places you can explore is real estate investment trusts (REITs). They own portfolios of properties that are diversified geographically and across many tenants. Some are diversified across asset types as well. Most importantly, many REITs pay juicy distributions that can help you pay your bills. Here are a couple of ideas. NorthWest Health Prop Real Est Inv Trust (TSX:NWH.UN) owns 120…

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Move Over RRSP, TFSA – 7 Strategies For Maximizing Investment Returns

Move Over RRSP, TFSA - 7 Strategies For Maximizing Investment ReturnsInvestors tend to focus first and foremost on gross returns. Since an investor only gets to keep their net return after-tax, tax should be an important factor when it comes to investment decisions. The most basic example of this is to make the most of available tax shelters. Most people are aware of tax shelters like RRSPs, TFSAs and RESPs, but, if you are self-employed, you can even create your…

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Take Full Advantage of Tax-Free Savings Accounts

Take Full Advantage of Tax-Free Savings AccountsRecent data indicate that Canadians are saving more. Statistics Canada reports the Household Savings Rate is currently 5.4%, a 0.4% increase from the previous year. Likewise, a recent BMO Bank of Montreal study found that 48% of Canadians are now investing in tax-free savings accounts, a 23% increase from 2012. It’s good that Canadians are saving, but unfortunately too few are making the most of it. Part of the problem…

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How to Make the Most of Your Tax-Free Account

How to Make the Most of Your Tax-Free AccountAlmost half of all Canadians have opened a tax-free savings account, according to a survey released last week by CIBC. That’s a remarkable take-up considering that TFSAs haven’t even been around for four years. That’s the good news. The bad news is that about half of those people aren’t actively contributing. According to the survey, 47 per cent have not put any money into the plan this year. What’s more,…

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Ottawa backs down on tax-free savings account errors

Ottawa backs down on tax-free savings account errorsFinally, the government has come to its senses about the 70,000 letters sent to Canadians who made over-contributions to tax-free savings accounts or transferred them without the proper paperwork. In a statement issued this afternoon, the two ministers responsible for the new tax shelter said they recognized the confusion that resulted from lack of understanding of the rules. And they’re trying to make amends. If you received a request to…

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Run, don’t walk, Run to open a TFSA

Run, don’t walk, Run to open a TFSALook.  There’s no downside and all kinds of upside to the Tax Free Savings Account. Become a saver, already! Here’s how it works: 1. Set up a Tax Free Savings Account at any Canadian bank you like. 2. Every year, you can put in up to $5000. But $100 is just fine too. 3. Whatever that $5000 earns, you are never taxed on.  So you can go conservative and just…

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