Weekend Reading: Get LIT(erate) Edition

Get Lit(erate). Pizza, Pints, and Pennies

Financial author Rob Brown, of Wealthing Like Rabbits fame, is on a cross-country financial literacy tour. His mission: target universities and colleges across the country and speak to post-secondary students, new graduates, and young alumni about the importance of financial literacy.

There’s a lot of talk about developing and improving financial literacy curriculum in high schools. While it’s important to teach money concepts to young people, the lack of practical application leaves a gap in turning that knowledge into action.

That’s why Rob Brown is onto something with this initiative. By partnering with post-secondary institutions and alumni associations he can deliver the right message at the right time to the right audience – the key ingredients for any marketing strategy. That demographic, say from age 20 to 34, is the prime target for teaching the tools and skills to take charge of your personal finances and set yourself up for financial success.

Next week I’m excited to host Rob at the University of Lethbridge for our inaugural Get LIT(erate): Pizza, Pints and Pennies event for new graduating students and young alumni.

Update on Brock Hirsche’s scholarship:

Many thanks to those of you who contributed to the Brock Hirsche Pronghorn Hockey Award – a scholarship to honour the former University of Lethbridge Pronghorn men’s hockey captain who was diagnosed with testicular cancer and recently learned that the cancer is terminal.

I am extremely humbled to be involved in this initiative, and to learn more about Brock and what a truly remarkable young man he is. I’m also pleased to say that his fund has already exceeded $21,000 thanks to the support of nearly 50 donors so far.

You can make a charitable donation here at gohorns.ca/for-brock.

This Week’s Recap:

On Monday I did the math on your investment fees and the results weren’t pretty.

On Wednesday Marie looked at our ever-rising grocery bills and the cost of convenience.

And on Friday I explained how families can get more out of the Canada Child Benefit by making RRSP contributions to reduce their overall net household income.

Weekend Reading:

Following up from last year’s CBC Go Public scandal that revealed the prevalence of high pressure sales tactics at Canada’s big banks, the Financial Consumer Agency of Canada (FCAC) launched an investigation and released a report this week that says, among other things, that there are insufficient controls in place at Canada’s Big Six banks to protect clients from aggressive sales tactics.

That’s no surprise, says the Globe & Mail’s Rob Carrick, who writes that the Big Six banks will fleece you if you let them, while calling on more financial literacy in dealing with personal banking:

“Unfortunately, banks are big players in financial-literacy initiatives in Canada. In return for their financial contributions, banks get to polish their image in the same way as a soft-drink or fast-food company that supports fitness or good eating habits. Can a credible, national financial-literacy program exist without bank support? Let’s find out.”

Meanwhile, the federal government said in its budget last month it would introduce legislation that “would strengthen the Financial Consumer Agency of Canada’s tools and mandate and continue to advance consumers’ rights and interests when dealing with their banks.”

In another good step for consumer protection the Ontario Securities Commission plans to introduce guidance and educational initiatives for firms and advisers who work with older investors.

There’s evidence that investors are starting to clue-in on the long-term impact of high fees on their investment portfolios.

In a bizarre mix-up, Manulife wired more than $170,000 from a long-time client’s RRSP to a foreign third-party stock transfer company without warning.

Your backup retirement savings plan is to work longer, maybe well into your 70s. Here’s why that could be a problem.

PBS has a terrific video summary of behavioural economics and the dumb, yet predictable, things we do with our money:

In the latest Canadian Couch Potato podcast, Dan Bortolotti interviews The Value of Simple author John Robertson about the relationship between cost and complexity in your investment plan.

Boosting your savings in your final 5-10 working years could make the difference between scraping by or enjoying a comfortable retirement.

A great first-person account on the retirement dilemma gripping today’s baby boomers at the tail-end of their careers: How do I know when I’m supposed to retire?

Today’s parents are sparing no expense on their children’s lifestyles, leaving them mired in debt and stressed about their financial future:

“Ms. Van de Geyn says many parents she knows feel they have to keep up with their friends. They believe that if they don’t spend $700 on a video-gaming party in a private van – or $10 on each party loot bag – they will lose social status. But “nobody is prepared for the sticker shock,” she says.”

My Own Advisor blogger Mark Seed is faced with a housing dilemma; stay in the suburbs with a crippling daily commute, or adjust to condo life in downtown Ottawa.

Read this if you’re considering getting a mortgage from someone other than a big bank.

Jason Heath explains how to cut down on capital gains tax on real estate sales. I like that he highlights the common misconception about the “50 percent tax” and what it really means:

“A capital gain, Dennis, is 50% taxable. I want to clarify this because you referred to paying 50% capital gains tax. The tax rate for capital gains isn’t 50%. The income inclusion is 50% of the capital gain, with the gain taxable at your marginal tax rate. Even someone with a high income will only pay 27% tax at most on their capital gains.”

An interesting article by Felix Salmon on the future of robo-advisors and how companies like Wealthfront (U.S.) are moving away from their early ideals of low-fee passive investing—and why customers should be skeptical.

Finally, an important post from new mother Bridget Casey on the impossible price of the motherhood tax.

Have a great weekend, everyone!

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