A new survey says nearly one quarter of Canadians won’t be travelling this summer, with budget concerns keeping them close to home.

The survey by digital offers website RetailMeNot.ca says the high price of gas and accommodations are the top reasons for keeping 23 per cent of Canadians at home, followed by high air fares.

Just seven per cent say they’ll be travelling overseas this summer.

And 28 per cent plan to limit their spending on summer travel and transportation to $100 or less.

But the survey found that Canadians will spend $100 to $300 on alcohol during their summer holiday, while 60 per cent will spend under $200 on food.

Canadians do appear to like camping, regardless of how much money they make, with 40 per cent of those with an income of $100,000 a year or more saying they are heading to the woods this summer.

Just 16 per cent of consumers are using coupon sites to save money on things like rental cars, hotels or airfare, according to the survey.

THE CANADIAN PRESS
July 22, 2014

TORONTO – CA new survey says Canadians, on average, expect to be mortgage-free by age 58, one year later than in a similar poll a year ago.

But the survey, conducted for CIBC by Angus Reid, found some big discrepancies across the country.

For example, homeowners in British Columbia thought they wouldn’t be able to pay off their mortgages until they hit 66, while those in Alberta expected to be mortgage-free more than a decade earlier at 55.

The survey also found that just over half of those polled were taking advantage of the current low interest rate environment to pay down their mortgages faster.

Fifty-five percent said they were putting in extra effort into repaying their mortgages, although that was down from 68% last year.

CIBC says even small efforts can lead to big savings for homeowners in the long run.

For example, someone paying 4.99% interest on a $250,000 mortgage with 25-year amortization can expect to save nearly $35,000 of interest if they add $147 to their $1,453 monthly payments.

The same homeowner can save as much as $30,000 on interest if they make $726 payments every two weeks, instead of waiting until the end of the month to make a payment.

The bank pointed out that even making a lump sum payment every year — for instance, putting the average $1,600 tax refund towards the mortgage — would shave off $33,103 of interest.

“Employing one or more of these strategies does take some planning and discipline,” said Barry Gollom, vice-president of secured lending and product policy at CIBC.

“If becoming mortgage-free sooner is something you want to achieve, it’s important to look at your mortgage as part of your overall financial picture and to balance your mortgage payment plan against your other goals.”

Of those paying off their mortgages quicker than necessary, 32% said they were making payments more often, 28% were increasing the amount they pay while 18% said they had made either an additional prepayment or a lump sump payment.

Beyond Alberta and British Columbia, the survey found the average age respondents expected to be mortgage-free ranged from 56 years in Quebec to 57 years in Atlantic Canada and Ontario and 58 years in Manitoba and Saskatchewan.

The online poll was conducted by Angus Reid Forum with 1,509 Canadian adults between May 21 and May 22.

The polling industry’s professional body, the Marketing Research and Intelligence Association, says online surveys cannot be assigned a margin of error as they are not a random sample and therefore are not necessarily representative of the whole population.

THE CANADIAN PRESS
Updated: July 21, 2014 | 9:02 AM ET

By Lakshmi Gandhi, Metro World News

From site to skill. Beat summer brain drain with these five sites that will help you to use your cranium

Hazy, hot and humid summer afternoons have often been used as the perfect excuse to procrastinate. But summer can be a great time to learn a new skill. Here are some easy and fun ways to do so.

Learn the ins and outs of the stock market

The new online investing platform Kapitall is designed for those who are just starting to get into the world of finance. Founded by veterans of the finance and tech worlds and a video game designer, Kapitall allows users to set up a virtual stock portfolio. Utilizing virtual money, users can practice trading stocks, take lessons, and compete tournament-style against other users.

“There are many that would say that the market is a game, but we’re not trying to say that,” says Kapitall’s CEO Jarett Lilien. “But if you look at games, games should be approachable to those who are new to it.”

Many people think that the markets are extremely hard to understand, Lilien continues. “There are a lot of barriers to entry and the problem is that they are intimidating to access as a newbie,” he says. “We really try to target a mindset, and that’s somebody who wants something that’s less intimidating.”

More advanced users can use the software to create a real portfolio.

Become bilingual

Are you sad you’ve lost all of your high school Spanish or French? The free program duolingo.com lets aspiring students study French, Spanish, Italian and Portuguese with a variety of games and quizzes.

Read the classics

If you are looking for something a bit more intellectually heavy than the stereotypical summer beach read, thousands of classic books are available to download for free. Sites like Project Gutenberg and classicreader.com make it easy to access great works of literature.

Join a book club

The New York Times recently noted that about 5 million Americans are currently in a book club. It’s a great way to both get exposed to different authors and ideas and to make new friends. Search on meetup.com for clubs that cover everything from books on entrepreneurs to LGBT issues.

A professional plus

Lynda.com offers hundreds of courses and online tutorials on everything from video editing, photography and design. Use it to learn programs like Photoshop or Final Cut Pro.

metronews.ca
July 21, 2014

By Jim Bronskill

Privacy. Data, including names, email addresses, may be kept for 30 years

OTTAWA – Canada’s electronic spy agency says it gathers and sometimes keeps personal information — including names and email addresses of Canadians — as part of efforts to protect vital networks from cyberattacks.

Communications Security Establishment Canada maintains an information bank containing the personal information of “potentially any individual” who communicates electronically with a key federal computer network while CSEC is assessing its vulnerability.

Information in the bank — known as CSEC PPU 007 — is held for up to 30 years before being transferred to Library and Archives Canada, says a description in the federal Info Source guide, which lists the various categories of personal information held by the government.

“Personal information may be used to assess potential threats to information technology systems subject to the assessment, and to help ensure the security of these electronic systems,” the notice says.

The listing sheds light on a little-known aspect of CSEC’s work — threat assessments and technical analyses aimed at strengthening federal defences against foreign cyberattacks on government computers.

The Ottawa-based spy agency has come under intense scrutiny in recent months due to leaks by a former contractor for the National Security Agency, CSEC’s American counterpart and close working ally.

CSEC insists it targets only foreign communications — from email to satellite traffic — of intelligence interest to Canada. However, the spy service acknowledges it cannot monitor global communications in the modern era without sweeping up at least some Canadian information.

As a result, CSEC’s cyberdefence activities are permitted through special authorization of the federal defence minister. Otherwise, they would risk contravening the Criminal Code provision against intercepting the private communications of Canadians.

Records recently obtained under the Access to Information Act say CSEC planned to focus its cyberdefence operations in 2012-13 on its own computer networks and those of three other federal institutions: National Defence, Foreign Affairs and Shared Services Canada, which administers the federal secure communication channel, known as SC Net.

The Info Source listing says personal information collected by CSEC during cyberdefence efforts may include a person’s full name, email address, Internet Protocol (IP) address and any incidental personal details contained in electronic routing codes, or metadata.

Information from the databank may be shared with domestic police agencies “or foreign bodies” in keeping with formal agreements, the listing says.

The foreign bodies are surely CSEC’s Five Eyes partners — the U.S. NSA and similar agencies in Britain, Australia and New Zealand, said Wesley Wark, a visiting professor at the University of Ottawa’s graduate school of public and international affairs.

Wark called it “remarkable” that information can be held for 30 years.

“What this material does not tell us, of course, is the extent of the personal information held as a result of cybersecurity activities,” he noted.

READ FULL STORY

THE CANADIAN PRESS
Updated: May 28, 2014 | 6:34 pm

By Jessie Archambault

Almost 9,000 more public service jobs will be cut in the next three years, according to a recent report by the Parliamentary Budget Officer.

More than 20,000 full-time jobs have already been cut since 2010. By 2017, the total population of civil servants in Canada will drop its lowest numbers in seven years, according to the Expenditure Monitor report for the 2013-14 third quarter, released April 11, “Many departments will have some cuts,” said Mostafa Askari, assistant PBO. But most of the new cuts, about 3,000, will come from Human Resources and Skills Development, he said.

The report states that many “back office” jobs will be part of the upcoming cuts. These include internal services positions such as communications, human resources and information technology. Former Parliamentary Budget Officer Kevin Page says the government needs to make the cuts in order to balance the budget, as it was in 2006-07.

To gauge the effects, the level of service must be compared to what was offered back then, he said.

“I think the government has been very negligent when it comes to telling us how this will affect the service levels,” said Page, who had asked the various ministers to provide their plans for maintaining service levels during his time as Officer. He is still waiting.

Askari couldn’t say on Thursday how Ottawa will specifically be affected by the cuts, which will occur in federal departments and agencies throughout the country.

He said the government will attempt to maintaion service levels through increased productivity.

“Any kind of reduction will affect the civil servants in a negative way,” Askari said.

The Ottawa Sun – By Julian Beltrame
Thursday, April 17, 2014 07:29 PM EDT

Well, Canada is actually more like No. 5, says OECD

OTTAWA – Finance Minister Joe Oliver and his predecessor have been fond of trumpeting Canada’s economic and job creation performance since the recession, claiming it is unequalled among the Group of Seven large industrialized nations.

The minister made the boast again this week in a speech to employers in Halifax, noting that “our government has created over one million net new jobs … the strongest job growth over the recovery among G7 countries.”

But a recent report from the Paris-based OECD suggests that Canada’s employment record is not near the best.

According to 34-nation Organization for Economic Co-operation and Development, Canada would place fifth during the recovery period according to the percentage of the working age population that held a job at the end of 2013, compared to the situation prior to the 2008-09 recession.

Economists view the employment rate as a good barometer of overall strength in labour markets because it reflects the portion of people in any given population that has jobs. The more commonly quoted unemployment rate is based on individuals actively looking for work. It can mask weakness in the market if there are large numbers of discouraged workers, as in the U.S. which now has a lower jobless rate than Canada despite a poor job creation record.

Read full story.

The Canadian Press – By Julian Beltrame
Published Wednesday, April 23, 2014 | 2:14 pm

OTTAWA – A new deal with the United States over an American law aimed at rooting out tax cheats north of the border will ensure that Canadian financial institutions won’t be required to report directly to American tax authorities, Finance Minister Jim Flaherty announced Wednesday.

The U.S. Foreign Account Tax Compliance Act, which takes effect in July, would compel Canadian banks to report information about anyone considered to be a U.S. resident or citizen, including dual citizens, directly to the U.S. Internal Revenue Service.

The new arrangement means Canadian banks would report “relevant” information on accounts held by U.S. residents or citizens to the Canada Revenue Agency, which would share it with the IRS under existing tax treaty rules — making it consistent with Canadian privacy laws, said senior government officials.

The IRS will also provide more information on certain accounts of Canadian residents in U.S. financial institutions, they said.

The deal narrows the scope of information that banks would be required to collect and avoids the U.S. imposing a withholding tax to enforce the law, officials said.

Canadian financial institutions won’t have to report on accounts smaller than $50,000, they said. It exempts most federal registered accounts, such as registered retirement savings plans, pension plans and tax-free savings accounts.

Local banks with 98 per cent or more of their account value with Canadian residents, as well as small financial institutions with assets totalling less than $175 million — such as credit unions — are also exempt, officials said.

Although financial institutions will have to start collecting the information in July, officials say the CRA isn’t expected to start sharing the information with the IRS until 2015.

Canadian bankers had previously said that such an arrangement would be an improvement over what the U.S. initially wanted, but it’s not ideal.

They say current Canadian law does not require banks to ask clients whether they are also U.S. citizens and changing bank procedures could cost tens of millions of dollars in administrative fees.

The Canadian Press
Published Wednesday, February 5, 2014 4:10PM EST

MONTREAL – The RCMP has arrested seven people as part of alleged fraud that involved some Canada Revenue Agency employees.

Charges laid include bribery of public officers, conspiracy, fraud, breach of trust by a public officer and fraud against the government.

Five of the accused allegedly received commissions on tax credits that were obtained through fraudulent means.

The Mounties said in a statement Monday that three of those five were active Canada Revenue Agency officials at the time the alleged offences took place.

The five are scheduled to appear in court in Montreal on April 7.

One of the five plus two other people have also been charged in a separate component of the investigation and will appear in court on March 19.

The investigation, known as Project Coche, began in 2008 and resulted in the arrest of 15 people, including eight former Canada Revenue Agency officials.

National Revenue Minister Kerry-Lynne Findlay said any misconduct by agency officials is “completely unacceptable.”

“The CRA will continue to investigate any allegations of misconduct and continue to cooperate with the RCMP to ensure that the individuals responsible face the full force of the law,” she said in a statement.

The Canadian Press
Published Monday, February 10, 2014 8:03PM EST

by YLVA VAN BURREN
For Metro – Tues, 11 Feb, 2014

Since it was introduced in 2009, the tax-free savings account (TFSA) has changed the complexion of financial planning, says Anthony Williams, vice-president of academic affairs with The Canadian Institute of Financial Planning.

“You can use it for any purpose … short term, long term, rainy day fund, a special purchase, a 25th anniversary, and for retirement — with tax-free growth. And the
money can be pulled out at any time at no taxable cost.”

Here are some ways to use a TFSA.

• Pension plan plus: Anyone with a good pension can use a TSFA. “You don’t get a tax deduction (like you do with an RRSP contribution) but where an RRSP will hurt is when you start to take it out,” said Dean Owen, a Saskatoon financial adviser with Advocis, The Financial Advisors Association of Canada. “RRSP money may push you
  into a higher tax bracket.” TFSA funds are not taxable.
• Windfall: If you receive a windfall of some kind and tax payable is zero, putting it into an RRSP is not going to provide a significant income tax break and you will pay tax later. If you don’t have a TSFA, open one. You can carry forward unused contributions this year, $31,000 total since 2009.
• Retirement savings: When a a marginal tax rate is not high ($40,000 or less), the deduction from an RRSP contribution will not affect tax rate significantly. But a TFSA allows for tax-free growth.
• Emergencies: Using a TSFA as an emergency fund is absolutely a good idea, Owen said. The money is accessible and can still make money with no penalty or tax if you decide to withdraw it.
• Investments: The TSFA is functional for conservative and speculative investments. “If you earn $100 in interest, you would normally have to pay tax on that,” Williams said.

“But in a TFSA, there are no tax implications. If you get lucky and your investment goes from $5,000 to $25,000, you still don’t pay tax on the growth. Pull the money out of TFSA and contribution space would be restored in the next year.”

by Dale Jackson
Balance Sheet – Thu, 16 Jan, 2014 3:36 PM EST

It’s a profound thing that RRSP season comes right after holiday-bill season.

As Canadians get set to deal with an average $28,000 in consumer debt, the finance industry launches an onslaught of ads telling us we’re richer than we think.

They know about our debt. They profit from our debt. Getting us to buy their investment products allows them to reach into another pocket and get more of our money. They even have a way to get more from both pockets by offering RRSP loans.

And it seems to be working according to a recent poll by RBC that finds Canadians are focusing more on savings than paying off debt. It says 52 per cent of respondents are increasing retirement saving compared to 44 per cent last year. Only 48 per cent are making debt reduction a priority compared to 54 per cent last year.

RBC concludes: “Canadians are more comfortable with how they are managing their debt.” According to industry-speak “managing debt” means servicing debt, which means earning enough to make regular payments. It does not necessarily mean significantly paying down debt or consolidating high interest debt into one lower interest loan to pay down more of the principal. A good chunk of consumer debt goes toward paying down credit card balances with interest rates in the high teens. Credit card companies and banks with a stake in credit card companies love that.

The finance industry can relax as long as our earnings keep a shade ahead of our regular debt payments. They’re rooting for us to earn more so we can keep spending to fuel an economy that relies on consumer purchases for two-thirds of all goods and services produced.

That’s why government and businesses get jumpy when the household debt to income ratio rises. According to Statistics Canada we owe a record $1.64 of debt for every $1 earned each year. The income/debt treadmill can only generate bigger profits if household earnings keep pace with debt. If the cost of servicing debt grows faster, it breaks down.

Savings and debt in harmony

The household debt to income ratio means little to individual households. A young family with a modest income and a big new mortgage, for example, could get by comfortably owing $3 for every dollar earned to invest in a home. Mortgages rates, which are in the low single digits right now, are among the lowest of any debt. In most cases household incomes rise over time and the balance owing on the house drops – eventually bringing the debt to income ratio lower.

When that time comes, savings and debt can live in harmony. Those higher incomes mean more money to pay down debt and save at the same time. They also put individuals in higher tax brackets, which means bigger refunds on registered retirement savings plan contributions.

Keep in mind your RRSP nest-egg is taxed when it is withdrawn; hopefully when you are in a low tax bracket in retirement. Contributing to an RRSP during your low income years is pointless if you will be withdrawing in the same tax bracket in retirement. The only advantage is the ability for your savings to grow tax free (in which case the government gets a bigger chunk of your retirement savings).

In any case, if you are paying down debt – especially high interest debt – there are likely no other investments that can guarantee a tax-free return equal to the amount of interest being charged.

To put it another way, investing in an outstanding VISA balance at a rate of 18 per cent is like investing in a Triple A bond that yields 18 per cent. Good luck finding that.