March 2013 return

SPP posted a return of 0.60 to the balanced fund (BF) and 0.037 to the short-term fund (STF). The year to date return in the BF is 4.65% and in the STF is 0.110%.

Market index returns for March 2013 were:

Index Mar 2013 return (%)
S&P/TSX Composite (Canadian equities) -0.19
S&P 500 (C$) (US equities) 2.53
MSCI EAFE (C$)
(Non-north American equities)
-0.37
DEX Universe Bond (Canadian bonds) 0.44
DEX 91 day T-bill 0.07

Click here for a complete list of returns.

10 tax deductions to remember

By Sheryl Smolkin

SOURCE: SHUTTERSTOCK
SOURCE: SHUTTERSTOCK

It seems like filing income tax returns gets more complicated every year. Most of us will be e-filing this year because the Canada Revenue Agency is no longer sending paper forms to every household. But even if you carefully fill in the blanks on an electronic form, it’s easy to miss important deductions or tax credits that will help you to hold on to more of your hard-earned money.

Here is a list of 10 tax deductions and tax credits to remember when you are filing your tax return.

  1. Line 208 – Saskatchewan Pension Plan contributions
    You must have available RRSP room to make an SPP contribution. SPP contributions should be reported on Schedule 7 of your income tax form and claimed on line 208. Both your application and your contribution must be received by SPP before a tax receipt will be issued.SPP contributions will be taken into account in determining RRSP over-contributions. Spousal contributions are permitted and if the contributor has available RRSP room, he or she may contribute and receive a tax deduction for both their personal and their spouse’s account. Spousal attribution rules apply to SPP.
  2. Line 214 – Childcare expenses
    The annual childcare expenses you can deduct depend on the age of your child. For example:

    • For a child born in 2006 and later: $7,000
    • For a child born in 2012 or earlier: $10,000
    • For a child born 1996-2005:            $4,000

    What qualifies as a childcare expense and who can make the claim are discussed in detail on the Information Sheet and Form T778.

  3. Line 215 – Disability supports deduction
    If you have an impairment in physical or mental functions, you can claim a disability supports deduction if you paid expenses that no one has claimed as medical expenses, and you paid them so you could:

    • Be employed or carry on a business (either alone or as an active partner).
    • Do research or similar work for which you received a grant; or
    • Attend a designated educational institution or a secondary school where you were enrolled in an educational program.

    You cannot claim amounts that were reimbursed by a non-taxable payment such as insurance. Expenses must be claimed in the same year they are paid.

  4. Line 301 – Age amount
    You can claim this amount if you were 65 years of age or older on December 31, 2012, and your net income is less than $78,684. If your net income was:

    • $33,884 or less, you can claim $6,720.
    • More than $33,884, but less than $78,684, complete the chart for line 301 on the Federal Worksheet to calculate your claim.

    Don’t forget to also claim the corresponding provincial tax credit.

  5. Line 319 –  Interest paid on your student loan
    You may be eligible to claim an amount for the interest paid on your student loan in 2012 or the preceding five years for post-secondary education if you received it under:

    • The Canada Student Loans Act.
    • The Canada Student Financial Assistance Act; or
    • A similar provincial or territorial government law.
  6. Line 324 – Tuition, education, and textbook amounts transferred from a child
    The maximum tuition, education, and textbook amount transferred from a child (or from each child), is $5,000 minus the amounts that he or she uses, even if there is still an unclaimed part. Tuition, education, and textbook amounts that the student carried forward from a previous year cannot be transferred. Only one person can claim this transfer from the student. However, it does not have to be the same parent or grandparent that claims the student as a dependant.
  7. Line 330 – Medical expenses
    You can claim on line 330 the total eligible medical expenses you or your spouse or common-law partner paid for:

    • Yourself.
    • Your spouse or common-law partner; and
    • Your child or your spouse’s or common-law partner’s child born in 1995 or later.

    The amount you can claim is the lesser of:

    • 3% of your net income; or
    • $2,109.

    To maximize this claim, it should be deducted by the spouse with the lower income.

  8. Line 331 – Allowable amount of medical expenses for other dependants
    Claim on line 331 the part of eligible medical expenses you or your spouse or common-law partner paid for the following persons who depended on you for support:

    • Your child or your spouse’s or common-law partner’s child who was born in 1994 or earlier, or grandchild; or
    • Your or your spouse’s or common-law partner’s parent, grandparent, brother, sister, aunt, uncle, niece, or nephew who was a resident of Canada at any time in the year.
  9. Line 365 – Children’s fitness amount
    You can claim to a maximum of $500 per child, the fees paid in 2012 relating to the cost of registration or membership for your child or your spouse’s or common-law partner’s child in a prescribed program of physical activity.
  10. Line 370 – Children’s arts amount
    You can claim to a maximum of $500 per child the fees paid in 2012 relating to the cost of registration or membership of your child or your spouse’s or common-law partner’s child in a prescribed program of artistic, cultural, recreational, or developmental activity.

Have you filed your taxes already? Send us an email to socialmedia@saskpension.com and tell us about other valuable tax deductions we may have missed. If your story is posted, your name will be entered in a quarterly draw for a gift card. And remember to put a dollar in the retirement savings jar every time you use one of our money-saving ideas.

If you would like to send us other money saving ideas, here are the themes for the next three weeks:

18-Apr Wedding How to beat the high cost of weddings
25-Apr Taxes Why you should file your tax return on time
2-May Gardening Cheapest ways to plant a maintenance-free garden

Apr 8: Best from the blogosphere

By Sheryl Smolkin

blogospheregraphic

“Best from Blogosphere” took a week off due to the Easter break, but our favourite bloggers just kept on writing. Therefore this issue reports on 10 interesting blog posts, rather than the usual five.

Contemplating winters in a warmer climate? Read the key questions Jim Yih on retirehappy says you should ask about retirement in a different country.

Saskatchewan blogger Tim Stubbs tells us on Canadian Dream: Free at 45   how he spent the week before Easter shovelling snow off his roof and away from his foundations to try and avoid a flooded basement.

On Brighter Life, Deanne Gage offers home-staging tips from the pros for those of you selling your house this spring and important information about insurance coverage for single parents with children.

$he Thinks I’m Cheap blogger Andrew explores the touchy subject of money and relationships. His rule #1 is do not discuss money on the first date!

If you are planning a one day or longer shopping trip to the U.S. check out articles on the Canadian Finance Blog about new cross-border shopping exemptions and how to save money on hotel rooms.

Continuing with a shopping theme, on Boomer and Echo, Robb Engen investigates how much you have to spend to make a Costco executive membership worth buying and Gail Vaz-Oxlade says companies marketing to women should cut the cute stuff and take them seriously.

And last but not least, Squawkfox (Kerry K. Taylor) gives detailed instructions on how to make a healthier McDonald’s Egg McMuffin for 65% less. We are NOT surprised that she managed to both cut the calories and cut the cost.

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?”  Send us an email with the information to socialmedia@saskpension.com and your name will be entered in a quarterly draw for a gift card.

New house vs resale? Which should you choose?

By Sheryl Smolkin

SHUTTERSTOCK

SOURCE: SHUTTERSTOCK

After renovating an old house and then buying a new house in the suburbs, we think we finally got it right with our current home which is close to the Finch subway station in Toronto.

Over 10 years ago, the builder assembled three large lots with small bungalows, tore them down and built five new two-story detached homes. We got the end unit surrounded by a park. We have an energy efficient furnace, the house is fully wired for Internet and it was a lovely blank, clean canvas to decorate.

I thoroughly enjoy working at home in my cheerful, bright office. When I do have to go downtown for meetings in off peak hours, I walk to the subway in five minutes and I always get a seat.

But whether to buy a new house or a resale is a very personal decision. Here are a few of the things you should consider before making up your mind.

Location:

If you want to live in a built up neighbourhood, close to public transportation you will generally opt for a resale home. Unless you can get an infill house in an old neighbourhood, new homes tend to be in a suburban area which can mean a longer daily commute.

Cost:

In a new development you will typically get more house for your money. But depending where you work, you also have to figure in the cost, wear and tear of a longer commute. Furthermore, resale homes generally already have paved driveways, fences, decks and landscaping which you will have to shell out for on top of the initial purchase price of a new home. Proximity of local schools and other services may also influence your decision.

Layout:

Older homes often have traditional layouts. It may be possible to add another bedroom, an ensuite bathroom, an upgraded kitchen or a main floor family room.  However, renovating can be hard on both your nerves and your wallet.

When you buy a home from the plans, you can select the layout you prefer and in some cases you can even customize. You also get to chose from a broad selection of paint colours, kitchen cabinets, counter tops, carpet and flooring.

Energy efficiency:

Newly constructed homes are typically better insulated and have double or triple glazed windows which will save you money on heating and cooling costs. They also generally come with a high energy furnace and new more efficient appliances.

Maintenance:

Upkeep for an older home can be more expensive because of older appliances, plumbing and electrical systems. You may need a new roof or a new furnace sooner than you think. Old windows and inadequate insulation can drive up heating bills. In contrast, every new home in Saskatchewan is covered by the New Home Warranty Program.

What I’m hoping is that someone will decide to build new, affordable infill bungalows close by so for the next chapter we can have the best of all worlds – a new home on one floor in an established neighbourhood that is also accessible to public transit.

And the icing on the cake would be if our wonderful neighbours keep their promise to buy the house next door.

Have you bought or sold a house lately? Send us an email to socialmedia@saskpension.com and tell us whether you bought a new or resale house and why. If your story is posted, your name will be entered in a quarterly draw for a gift card. And remember to put a dollar in the retirement savings jar every time you use one of our money-saving ideas.

If you would like to send us other money saving ideas, here are the themes for the next three weeks:

11-Apr Taxes 10 tax deductions you might miss
18-Apr Wedding How to beat the high cost of weddings
25-Apr Taxes Why you should file your tax return on time

February 2013 return

SPP posted a return of 1.78% to the balanced fund (BF) and 0.028% to the short-term fund (STF). The year to date return in the BF is 4.02% and in the STF is 0.073%.

Market index returns for February 2013 were:

Index  Feb 2013 return (%)
S&P/TSX Composite (Canadian equities) 1.26
S&P 500 (C$) (US equities) 4.32
MSCI EAFE (C$)
(Non-north American equities)
1.95
DEX Universe Bond (Canadian bonds) 1.00
DEX 91 day T-bill 0.07

Click here for a complete list of returns.

A comprehensive investment update to the end of the fourth quarter is available on our website at saskpension.com.

How to choose an eReader

By Sheryl Smolkin

SHUTTERSTOCK
SHUTTERSTOCK

On a recent 10 day trip to California I read an 800 page book using the Kobo app on my PlayBook. I agree with journalist and technology expert Marc Saltzman that electronic books have many advantages. For example:

  1. I can store hundreds of books on small device.
  2. I can buy books 24/7 as long as there is wifi and they are generally cheaper than hard copy.
  3. I can download library books and there are no late fees because they automatically expire after a certain date.
  4. I can adjust the font style and size, and click on hyperlinks to get definitions of words and other background information.
  5. Music and audiobooks are also available on some models.

However, the battery on my tablet only lasted about six hours before it had to be recharged. As a result, I’m looking for a lighter digital reader with a longer battery life to take on future trips to Eastern Europe and the Far East.

So I asked Saltzman for some hints about what I should look for. Here’s what he told me:

Q. Who are the major players in the Canadian eReader market?

A. I would say Kindle, Kobo and Sony.  They each have a line of products ranging from an entry level bare bones eReader up to something more sophisticated with colour and apps that acts a little bit more like a tablet computer. Kindle has the largest library but you have to purchase Kindles from the U.S. and they are the only one of the three that won’t let you borrow books from the public library.

Q. What questions should consumers ask if they are considering an eReader purchase?

A. I first ask people whether they are looking for a straightforward device for reading books or if they want something with colour that will allow them to surf the web, play games or read email. That’s when you go for the higher end eReaders that are more like a tablet computer.

If all you want is to read books, then look for a black and white touch screen wifi eReader that costs between $60 and $120. Once you start adding things like cellular connectivity (only offered by Kindle) then you will pay $200 or more for better screens, larger screens, colour screens and app stores.

Q. How does battery life stack up?

A. The Kindle Paperwhite is the eReader with the longest battery life – about two months on a single charge. The Sony and Kobo last about a month depending on usage. More advanced tablets with backlit screens max out at about 10 hours. They are also heavier.

I prefer my iPad mini with the Kobo and Kindle apps because I have everything I need on it when I travel to meetings. I can leave my computer in the hotel.

Q. What about downloading library books?

A. Both Kobo and Sony let you do that. What is required is a personal computer, some free Adobe software, and your library card. You go to your local library’s website, and if they offer eBooks, you sign on with your library card number and then it will walk you through the software you need.

Then you reserve books in advance like you would at your local library, and when the book is available, you download it to your computer. The next step is to tether your eReader to your PC or Mac with the USB cable in the box, and it copies the book over to the mobile device. On the day it expires you will no longer be able to access  the digital book unless you can renew it in advance.

Q. Do any of the ebook readers allow you to share books with other people on their eReaders?

A. That’s one of the downsides of an eBook. You can’t share them. It’s intangible so  you can’t put it on a bookshelf or give an autographed copy to someone as a gift. In the U.S. Kindle has something called the Kindle Lending Library, but it is not available in Canada.

Q. What’s next, what’s on the horizon for eBooks?

A. I think more and more of them are going to have tablet features. The line is going to blur between an eReader and a tablet. Even entry level eReaders are going to have a lot more capabilities. We’ll see faster wireless connectivity, more storage and more people subscribing to electronic newspapers and magazines. And down the road they are going to be thinner, lighter and even roll-able.

So that’s the skinny on eReaders from one Canada’s top experts. You can see a comparison of prices and features for four different Kobo models here.

Have you purchased an eReader or tablet computer lately? Send us an email to socialmedia@saskpension.com and tell us what you like and don’t like about your device. If your story is posted, your name will be entered in a quarterly draw for a gift card. And remember to put a dollar in the retirement savings jar every time you use one of our money-saving ideas.

If you would like to send us other money saving ideas, here are the themes for the next three weeks:

04-Apr Real estate New or resale house? Pros and cons
11-Apr Taxes 10 tax deductions you might miss
18-Apr Wedding How to beat the high cost of weddings

Mar 25: Best from the blogosphere

By Sheryl Smolkin

blogospheregraphic

Our best favourite bloggers continue to explore a number of interesting themes this week.

On Boomer & Echo, we hear from Boomer this week about How Her Retirement Plans Got Derailed – Big Time, and what her options may be to get back on track.

The Blunt Bean Counter is an accountant and this week he presents valuable information on stress testing your finances so you are protected in the event of death or other unforeseeable events.

When you purchase real estate is resale value important to you? Then read what shethinksimcheap has to say about how future transit plans can affect real estate.

Last week we talked about job hunting strategies. When you land a new position, you will be interested in Anne Levy-Ward’s new job survival guide on Brighter Life.

And finally, although you got a new job with a huge salary jump, you may wonder why you don’t seem to be able to save more. Krystal Yee calls it lifestyle inflation and discusses how you can manage it.

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?”  Send us an email with the information to socialmedia@saskpension.com and your name will be entered in a quarterly draw for a gift card.

How to save money on home, auto insurance

By Sheryl Smolkin

Shutterstock.com
Shutterstock.com

Nobody likes paying for home or automobile insurance. But you can’t get a mortgage or drive a car without it. And if you are involved in an accident or a natural disaster your insurance company will suddenly become your best friend.

But insurance premiums are going up all the time and there is no reason why you should pay anymore than you have to. Recently the insurance rating website InsurEye put together a comprehensive list of “101 tips on how to save money on insurance.”

Some of the more obvious, general suggestions are:

  • Shop around online and on the telephone.
  • Bundle home and auto insurance with the same carrier.
  • If you are a member of an association (i.e. professional engineers) or an alumni group there may be a deal for members.
  • Staying with one insurer longer may result in loyalty discounts.

However, the list also includes some unusual money-saving options which were news to me. Here are some of my favourite.

Auto insurance

  1. Welcome discount: Some insurers offer a welcome discount just for becoming a customer. E.g. five per cent at Grey Power.
  2. Rental car rider: If your existing auto insurance policy does not cover rental cars, you can often add it as a rider (policy extension) for $20-$30/year. Compared to the $20/day you might pay when renting a car, it’s not a bad deal.
  3. Dashboard camera: Get a dashboard camera for your vehicle. Insurance companies do not offer any premium discount related to dashboard cameras, but it can help you prove you are not at fault if you have an accident.
  4. Claims history: Keeping a clean claims history may make more sense than submitting claims for small damage repairs that could result in increased premiums. Contact your insurance provider/broker before you decide whether or not to claim for minor property damage.
  5. Good students: Students with good grades may be eligible for a break on car insurance rates. For example, the State Farm good student discount rewards student who are younger than 25 with a discount of 25% if they have a B average or better.
  6. Short distance to work: If you are located close to work, the distance you need to drive is short or you may not have to drive at all. The further you have to drive to work, the higher your premiums.

Home insurance

  1. Valuing your contents: If you are renting an apartment or condo and you only have a laptop and some IKEA furniture you may not need hundreds of thousands of dollars worth of coverage. Check the policy to see what you are paying for.
  2. Mortgage free home: When you have paid off your mortgage, some insurers will reward you with lower premiums. This one was news to me and I am now looking into discharging my mortgage.
  3. Heating: Insurers like forced-air gas furnaces or electric heating. If you have an oil-heated home, you might be paying more than your peers who have alternative heating sources.
  4. Stability of residence: Some insurance companies will offer a stability of residence discount if you have lived at the same address for a certain number of years.
  5. Dependent students: Some insurers will cover dependent students living in their own apartment under their parents’ home insurance policy at no additional charge.
  6. Credit scores: Some insurers factor in credit scores when calculating home insurance premiums. If you have a good credit rating your rates will be lower.

These are only a few of the tips. However, the list also includes some interesting ways to keep down premiums for life insurance, travel insurance and credit card protection.

Some of these ideas are more practical than others, but every little bit helps.

Have you saved money on insurance lately? Send us an email to socialmedia@saskpension.com. If your story is posted, your name will be entered in a quarterly draw for a gift card. And remember to put a dollar in the retirement savings jar every time you use one of our money-saving ideas.

If you would like to send us other money saving ideas, here are the themes for the next three weeks:

28-Mar Books Comparing eReaders
04-Apr Real estate New or resale house? Pros and cons
11-Apr Taxes 10 tax deductions you might miss

Also see:

Car insurance: 10 things you need to know 

Does your home insurance cover storm damage?

Mar 18: Best from the blogosphere

By Sheryl Smolkin

blogospheregraphic

Whether you are a student looking for a summer job, a new graduate seeking a career opportunity or a recently laid off worker looking for a new position, hunting for work can be nerve-wracking.

In Boomer & Echo, Robb Engen talks about cutbacks in the Alberta university sector where he is employed and how he would manage financially if he lost his job.

Mochimac shares her top 5 career regrets. She suggests that you see how little money you can live on so you can expand your career options.

Brighter Life blogger Kevin Press regales us with a humorous story about a seven hour interview for a job he did not get writing for a Manhattan magazine published for global investors. No regrets though, because soon after in Toronto he met his wife “the lovely Lisa.”

The Blunt Bean Counter Mark Goodfield discusses why references are a no win situation for past and future employers. That’s because employers feel compelled to give “plain vanilla” references because they are worried about defamation or negligent misrepresentation lawsuits.

And finally, on Canadian Dream – Free at 45, Dave tries to figure out how to productively spend the extra time he has now that he has finished courses for his CGA designation.

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?”  Send us an email with the information to socialmedia@saskpension.com and your name will be entered in a quarterly draw for a gift card.

How to choose a travel rewards card

By Sheryl Smolkin

SOURCE: SHUTTERSTOCK
SOURCE: SHUTTERSTOCK

I got my first travel rewards card in the mid-1990s when I was doing a distance LLM at University of Leicester and had to travel to Europe for series of residential weekends.

Without a great deal of thought, I opted for a CIBC Aerogold card because in addition to getting one point for every mile in the air, points were also awarded for amounts spent on household expenses with 1.5 per dollar credited for purchases at some grocery stores, drug stores and gas stations.

But it was often very hard to get Aeroplan seats on the flights we wanted to take. And it got even more difficult when Aeroplan instituted the current program, where the number of points required to reach a particular destination varies depending on the time of day, the day of the week or the time of the year.

When I started researching travel rewards cards again for this article, I realized that the current selection of over 70 cards is mind boggling and selecting a card that delivers the best value depends on whether you pay a fee, how much you spend each year and where you want to go.

In all cases, unless you pay off your credit card balance every month, the interest you pay on the outstanding balance will quickly erode the value of any travel benefits.

The most up-to-date resource I found was Rewards Canada. Here is their top 2012 pick in two categories with some of the key features of each card.

Top Travel Points Credit Card (with annual fee)

Capital One® Aspire Travel™ World MasterCard®*

The Capital One Aspire Travel World MasterCard has has been number 1 in this category for three years. Here are some of the reasons why:

  • Earn 2 reward miles for every $1 – on all purchases
  • Get 35,000 bonus reward miles with your first purchase
  • Get 10,000 anniversary bonus reward miles every year
  • Annual fee of $120. No additional fee to get a second card for “an authorized user.”
  • This card can be a good choice for someone who spends at least $2,000/month.

A requirement of this card is a minimum personal income of $60,000 or household income of $100,000.

Top Travel Points Credit Card (with no annual fee)

American Express Blue Sky Credit Card (2011: 1)

The Blue Sky Credit Card has been top in this category for four years. Here’s why:

  • Earn 2 points for every $1 in eligible card purchases at your chosen 5 places.
  • Earn 1 point for every $1 in card purchases everywhere else.
  • Earn a welcome bonus of 7,500 points the first time you use the approved card

I encourage you to follow the five step guide to choosing a travel rewards on the Rewards Canada website for a brief description of the types of travel rewards credit cards and what to look out for when choosing one.

There is an excellent chart updated to January 2013 comparing features of a series of the most popular Canadian travel cards. The Choosing a Travel Rewards Credit Card Flow Chart can also help you narrow down what category and type of card you should choose.

Have you selected a new travel rewards credit card lately? Have you had good or bad experiences with the card you are currently using? Send us an email socialmedia@saskpension.com. If your story is posted, your name will be entered in a quarterly draw for a gift card. And remember to put a dollar in the retirement savings jar every time you use one of our money-saving ideas.

If you would like to send us other money saving ideas, here are the themes for the next three weeks:

21-Mar Insurance Getting a better deal on car, house insurance
28-Mar Books Comparing eReaders
04-Apr Real estate New or resale house? Pros and cons