Many individuals ask us: “How much money will I need in retirement?”  The real answer is the amount of money you have saved is what you will have to live on, and your lifestyle will be determined by that. Sort of like the old ‘which came first: the chicken or the egg?’ puzzle.  Your lifestyle will be determined by your savings, but your savings are often determined by your lifestyle!

To answer the question in another way, it can be helpful to use something called the Rule of 20.  For the average Canadian, for every $1 of annual income you want to have in retirement you will need to have saved $20.  So, if you need $1,000 per month (i.e.: $12,000 per year) you must save $240,000 by the time you retire.  The numbers may seem intimidating, but working with a professional financial advisor to help you build and follow a plan, they are achievable.

For more information on the Rule of 20, please review the linked article and let us know if we should do a projection of where you are today and where you will likely be in the future. Our services include a breakdown of all your investments, projecting where you will be at and during retirement, and building a plan to get you the lifestyle you want to enjoy as simply and safely as possible.

Wishing you a great summer,

Harvey

CNW Group | Russell Investment Services Canada: Retirement Rule of $20 helps Canadians concerned about market volatility and longevity risk

The Department of Finance has introduced new legislation, called Credit Business Practice Regulations, intended to protect Canadian consumers from practices deemed potentially harmful by the banks and other credit card issuers.

There are three main areas that stand out:

The most significant proposal that may be noticed by clients is the creation of a 21-day grace period on all credit card purchases. Currently some card issuers offer 15- to 24-day grace periods on new purchases when a customer pays the outstanding balance in full. Other issuers tally interest in that period if there is an outstanding balance carried forward from the previous period.

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The new legislation will require financial institutions to cease the practice of automatically allocating payments above a minimum repayment to outstanding balances with the lowest-interest rates if a borrower has multiple balances with different rates.

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The new legislation will also require credit card issuers to get permission from a card holder before they increase the credit limit. Issuers will be required to either call the consumer or mention in their monthly statement that they have been approved for extended credit. Issuers will not be allowed to automatically extend the credit limit without the expressed consent of the consumer.

Advisor.ca - New Credit Card Rules: What Clients Should Know

(click image to see full size)

Photo Credit: “Too Much Credit” by Andres Rueda

Courtesy of iNews 880:

Taxed for Time?

8:54am

4/30/2009

It may end up being a taxing day for many Canadians.

Your annual contributions are due at midnight tonight. If you’re late, you’ll see a penalty if you owe the government money. The exception is residents of Manitoba that have been affected by the recent flooding in the province. They’ll have until June 1st to file. 

The best resource for federal taxes is at the Canadian Revenue Service Website. Be sure to check out the Claim It section, which breaks down common tax cuts for Canadians from all walks of life. 

Also helpful in figuring out how much you owe, try out the Tax Calculator at Tax-services.ca.

Once you’ve got it all figured out, you can file your taxes electronically using the CRA’s NETFILE . Or, you can do it the old-fashioned way by mailing it. You can find the tax forms for Alberta here. 

If you have any questions, you can phone the CRA at 1-800-267-6999 or 1-800-959-8281… although be prepared for a wait. You’re probably not the only one calling.

(sl)