The federal government delivered a package of goodies for seniors and middle-class families in its 2015 budget this week. The TFSA contribution limit was increased to $10,000 – fulfilling an election promise from 2011 – however it will no longer be indexed to inflation. Changes were made to the RRIF withdrawal schedule – effective immediately a 71-year-old will only need to withdraw 5.28 percent of their portfolio’s value, down from 7.38 percent.
Tax benefits for Canadian families include the enhanced Universal Child Care Benefit ($160 per month for children under 6, and $60 per month for children aged 6-17), a $1,000 child care expense deduction, a $1,000 children’s fitness tax credit, plus the family tax cut – a $2,000 tax credit for couples with children under 18.
Book giveaway: The Opposite of Spoiled
Speaking of children, my own will turn 6 and 3 this spring. The oldest has lost two teeth already, with customary visits from the tooth fairy, and we’re considering an allowance for her this year. Not knowing the going rate for the tooth fairy, or whether to tie the allowance to household chores, I’ve found guidance from New York Times personal finance columnist Ron Lieber’s new book, The Opposite of Spoiled.
The sub-title is how to raise kids who are grounded, generous, and smart about money. Lieber says good parenting means talking about money with our kids and not shying away from a topic that is all-too-often considered taboo in the family household.
The author shares a detailed blueprint for the best ways to handle the basics: the tooth fairy, allowance, chores, charity, saving, birthdays, holidays, cell phones, chequing accounts, clothing, cars, part-time jobs, and college tuition.
I reached out to Lieber’s publicist and got an extra copy of The Opposite of Spoiled to give away to a lucky Boomer & Echo reader. To enter, just leave a comment below that answers the following questions:
- What’s the going rate for the tooth fairy in your household? (For the record, we gave $5 for the first tooth and $2 for the second).
- What age do you think is appropriate to start your child on an allowance?
We’ll keep the contest open until Friday May 1st at 5:00pm EST and I’ll announce the winner in the next edition of weekend reading.
This week’s recap:
On Monday I wrote a controversial post – why living off the dividends no longer appeals to me.
On Wednesday Marie asked, what’s the right amount of retirement income?
And on Friday Lama Farran stopped by to offer 4 simple tools to stop drowning in debt.
Weekend Reading:
It pays to have seniority, according to Rob Carrick, who says that seniors were the runaway winners in the pre-election budget.
How will budget 2015 affect investors? Dan Bortolotti weighs in on asset location, withdrawal rates, and more.
Economist Kevin Milligan suggests that – due to the new $10,000 TFSA contribution limits – within 10 years, our tax system will become one in which almost no one under 40 pays any tax on investment income.
Jonathan Chevreau says to go ahead and contribute an extra $4,500 to your TFSA now. He just did.
Adam Mayers answers 20 questions about tax free savings accounts.
Crying the RRIF blues? Many people did not realize that, when the government gave them a tax deduction for their RRSP contributions, it was effectively buying a share of their retirement portfolio.
Here’s why the increase to TFSA limits has some rethinking RRSPs and retirement savings.
Fee-only planner Jason Heath explains why this reader thinks he’s working with a financial advisor while in fact he’s simply working with a bank mutual fund representative.
This article explains why performance benchmarks aren’t part of the upcoming CRM2 disclosure rules.
Michael James on Money wonders if “dividend haters” exist.
Ben Carlson wrote an open letter to Vice News about their new personal finance show for millennials.
Stephen Weyman put out the ultimate guide to spending less eating out at restaurants.
Blogger Jordann Brown reached her biggest financial milestone – hitting the $30,000 net worth mark.
Finally, Moshe Milevsky explains what’s really scary about high ratio mortgages in Canada.
Have a great weekend everyone!
