Mortgage Down Payment
Today’s mortgage market allows potential homeowners to purchase their dream property in Canada with as little as five per cent down.
Any down payment that totals less than 20 per cent of the property value will require mortgage default insurance, and is considered to be a high ratio loan.
A conventional mortgage is defined as a mortgage loan where 80 per cent or less of the property value is financed through a lender. The percentage of your home value that is financed, or not paid for by the down payment, is defined in a Loan to Value ratio (LTV) (loan amount divided by property value). The LTV has a large influence on the mortgage product you will be eligible to qualify for on the purchase of your new property.
The greater the down payment you can accumulate, the greater the contribution you are making toward the principal value of your home, and thus the less of the mortgage loan amount you will be paying interest on over time.
An increased number of Canadians will reach retirement during the next few years, but while saving as much as possible is important, how a retirement fund is fulfilled may be equally or more vital.
According to a recent Certified General Accountants Association of Canada report, saving for retirement the correct way is just as crucial as saving in general.
"Saving regularly for your retirement is commendable," said Rock Lefebvre, CGA-Canada's vice president of research and standards. "But without considering the best blend of alternatives, you could be overlooking some important strategies for building retirement capital." Continue reading
Perhaps jumping into the stock market has turned out to be more of a chore than you and your child anticipated. If savings bonds and GICs are not offering the rates of return you and your child would like to see their savings yielding, mutual funds are a promising alternative.
At current Canadians have well over 1,200 different mutual funds to select from. How do you know which is right for you? Here is some general information on the various types of mutual funds available in Canada.
How will the Canada Tax Free Savings Account Guard your Retirement Funds?
Registered or unregistered – that seems to be the question as Canadians plan and gear their savings and investment accounts toward retirement. Most experts advise that your investments gain a return in excess of two per cent in order to beat annual inflation. In addition, there are several tax strategies you should keep in mind as you allocate your investment dollars to specific accounts.
The Canadian Tax Free Savings Account (TFSA) allows for tax-free earnings off investments with aggressive return potential, yet only half of Canadians are utilizing this account – why is that? H&R Block suggests there are several myths acting as hurdles on the path to earning tax-free investment income. Continue reading
According to an Ipsos Reid Retirement Risk survey conducted earlier this year, roughly 72 per cent of Canadians approaching retirement are concerned over how they will maintain a comfortable standard of living through their retirement years. Most Canadians are additionally anxious that their savings will not be sufficient in covering needed health care expenses.
Sun Life Financial spoke to two experts in the finance field – Jim Yih, author of 10 Things I Wish Someone Had Told Me About Retirement and Gail Bebee, author of No Hype – The Straight Goods on Investing Your Money – who recommended the following tips on building, and maintaining, your emergency retirement fund. Continue reading
As debate between Tax-Free Savings Accounts and Registered Retirement Savings Plans continues, and the deadline for Canadians to contribute to their RRSPs approaches, experts at CIBC say that people need to start taking advantage of the programs.
Financial planning analysts said that the decision between TFSAs and RRSPs relies on a a number of different factors, such as the rate of return, consumers’ tax brackets and how long it will be until they need to access the funds. However, the important part, they said, was to start investing.
“No matter which plan you choose, you have the ability to earn tax-free investment income for life – an opportunity that no one should pass up,” said Jamie Golombek, CIBC’s managing director of tax and estate planning. “Canadians need to stop procrastinating and just contribute.”
Despite the advantageous investment vehicle the Bank of Canada affords Canadians with the Tax-Free Savings Account (TFSA), a recent survey has found that the majority of Canadians are choosing not to utilize these benefits.
The countrywide survey, commissioned by ING Direct and conducted by Angus Reid Public Opinion, found that of Canadians polled, more than half did not have a TFSA and nearly 15 per cent had never heard of the tax-efficient investment opportunity.
Research conducted recently in Canada lends evidence that utilizing a financial planner to aid in the development and enactment of your financial plan does yield substantive benefit.
The study, ordered by the Financial Planning Standards Council (FPSC), found that of the 20 per cent, or less, Canadians who actually employ a financial planning strategy, virtually all state that doing so has affected an increased ability to save, and an improved sense of security and lifestyle comfort.
“Those with comprehensive financial plans are saving more proactively for the things that matter to them,” Cary List, president and CEO of FPSC, says. “[Planners] are reporting much higher levels of confidence in dealing with life’s uncertainties and in reaching their financial and life goals.”