It seems like an obvious move as tax season begins: contribute to your registered retirement savings plan (RRSP) and reap the rewards of a larger tax return. Right?
Not necessarily. it’s a misconception that William Chan, a certified financial planner and principal of Modern Vision Planning, says is fairly common.
“Sometimes people’s deposits are for amounts that aren’t necessarily beneficial for them, because they don’t take into account the tax implications of what they’re doing, there’s just this concept of RRSPs and refunds,” Mr. Chan said.
If you’re not already familiar, RRSPs are tax-sheltered investment accounts, and one of their incentives is that the money you invest is deducted from your income taxes, which can lead to extra money in your tax refund. Your investments are also sheltered from capital gains taxes as they grow, but you’ll eventually pay income tax when you withdraw money from the account in retirement.
That’s different from accounts such as the tax-free savings account (TFSA), where there’s no upfront tax benefit, but you’ll also be untaxed on both capital gains and any withdrawals in the future.
There have always been arguments to be made for certain subsets of the population to prioritize one of either accounts, and things are further complicated now with the introduction of the First Home Savings Account (FHSA), a powerful new tool that combines the income tax benefits of RRSPs and the complete shelter from withdrawal and gains taxes of TFSAs.
We’ll parse through some arguments against contributing to an RRSP for certain parts of the population. In particular, younger or lower-income investors likely have many alternatives they should consider first.
1. If you don’t already have an emergency fund or other investments that are liquid
One of the biggest downsides of the RRSP is that the money is essentially locked away until you’re 71. Withdrawing earlier than that can lead to significant penalties (there are some exceptions, such as withdrawing some money for a home purchase).
Scheherazade Hasan, a senior adviser at Wealthsimple, said you should ensure that you have funds that could cover at least three to six months of living costs saved in an account that isn’t linked to the stock market at all – ideally in a high-interest savings account.
Even after that, it could be a good idea to have some investments in a TFSA first – or an FHSA if you plan to buy a home – especially if you foresee having to take out money in the near future for a large expense.
2. If you make roughly $100,000 or less
Ms. Hasan says anyone making under $50,000 should focus on their TFSA or FHSA, since the tax deferral benefits for the RRSP are quite small if you’re in a lower income tax bracket. Plus, the TFSA has the added benefit of its flexibility and the lack of any taxation upon withdrawal, which could be extra beneficial if your investments have many decades to grow exponentially.
Even for people approaching around $100,000 of income in a year, the decision isn’t necessarily clear cut. If you expect your income to grow into higher tax brackets as you progress in your career, Ms. Hasan says it could be worth saving your RRSP contribution room for future years, when larger contributions could save you further money by lowering your tax bracket.
The same is true if you expect a windfall down the road. Since your RRSP contribution room carries forward, it could shelter you from a large tax bill if you were to sell an investment property or receive a large inheritance.
3. If you plan to just spend the extra money from your RRSP refund
In a way, Mr. Chan says you aren’t necessarily saving on income tax with the RRSP. You’re just delaying your taxation until retirement, since your withdrawals will be taxed as income.
That’s why it’s important to use your tax refund smartly. For example, using the money to invest in a TFSA is one of the best ways to capitalize on your return, especially if you’re young and have a long investment horizon.
But if you plan to use your tax refund on an unnecessary purchase, you’re probably not making the best financial decision.
“Ask yourself, do you need that refund … because if not, you’re just kicking the can down the road,” said Mr. Chan.
4. If you have unpaid debt
This one may seem obvious in today’s interest environment, but paying debt off first wasn’t always the right move when rates were low and investments could outperform the cost of servicing debt.
Today, Mr. Chan says your priority should be to pay down any debt you’re carrying, especially higher-interest loans like credit cards or even your balance on a line of credit.
5. If you have children and could qualify for extra RESP grants
The Registered Education Savings Plan is one of the best tools for Canadians to invest for their children’s postsecondary education. Capital gains are untaxed, and the government matches 20 per cent of your contributions per year, up to a maximum of $500.
But households under different thresholds of income can qualify for various extra grants from both provincial and federal governments just for taking part in the program. Mr. Chan says it can make for a better value proposition for parents who want to ensure that their children can afford to study.
There’s another bonus: Once your kids are in university or college, the money is actually fairly liquid. If it turns out there is excess unneeded money because of scholarships or other factors, your own contributions can be taken out and used as long as your child is in school.
6. If you have a robust workplace pension, especially a defined benefit pension plan
One of the key caveats around the RRSP is that withdrawals will count as income and be taxed as such when you retire. Pensions also count as income, so relying on both an RRSP and a pension in old age could put you at risk of being placed in a higher tax bracket and paying more than necessary.
For that reason, maxing out your TFSA first may be a better option if you’re confident you’ll have a good pension to rely on, since those withdrawals are completely untaxed.
Mr. Chan adds that defined benefit pension plans are a particularly robust and reliable form of retirement income. If your workplace offers one, it might be even more reason to max out your other investment vehicles before contributing to an RRSP.
7. If you plan to buy a home
The FHSA, which was introduced in 2023, is a very powerful investment tool. Your contributions are deducted from taxes the same as an RRSP, and your withdrawals are untaxed like a TFSA.
Another benefit is that if you end up not buying a home, the money can be rolled into an RRSP without affecting your RRSP’s contribution room. So there’s little reason not to max your FHSA first if there’s some chance of you buying a home.
There are just two things to keep in mind. The first is that an FHSA can only be open for a maximum of 15 years before it must be closed. If it’s very likely that it’ll take longer than 15 years for you to purchase a home, it could be a reason for pause.
And lastly, the deadline to receive income tax refunds based on FHSA contributions is not the same as the RRSP. The deadline for the FHSA was Dec. 31, meaning that you won’t get a refund this year for contributions you make now. But you will get them next year, and that’s still enough reason for advisers to recommend FHSA contributions first.
With increased adoption of cryptocurrencies and proliferation in the online gaming industry, Bitcoin casinos are becoming increasingly common. Bitcoin, being one of the alternative currencies, may offer immense advantages in security, anonymity, and speed of every transaction, from appealing to new and seasoned players. The following article will outline the main benefits of using Bitcoin for online casino betting and will describe in detail how this cryptocurrency enhances gaming.
For those interested in exploring the benefits of Bitcoin gaming, theonlinecasinos offers a carefully curated list of reliable Bitcoin casinos. Their guide helps players find the best options available, ensuring a seamless, secure, and rewarding gaming experience.
1. Speed of Transaction
The main benefit linked to the use of Bitcoin in online casino betting is that it possesses high transaction speed. Unlike the bank transfers and card payments, which take several hours or even days, Bitcoin transactions take just minutes.
Why does this matter?
Fast transactions equal the ability for players to fund their accounts straight away with no need for confirmation. Since some gamers just want to get started immediately, or just simply cash out and go, this can come pretty in handy. While most bank transfers involve verification by means of a financial intermediary that is likely to be slow, Bitcoin involves a decentralized network of computers handling processing without any interference from an intermediary.
2. Savings on Fees
Deposits and withdrawals have made it possible for players to cut down or totally eliminate fees imposed by financial institutions through Bitcoin. Banks, credit organizations, and networks of all kinds impose a fee on any transaction, but especially international ones. Due to the fact that this is a network where users make transactions directly, the network fees for Bitcoin are minimal.
How Does This Affect Players?
The lower fees translate to savings that the player will make every time a transfer is made. There are some online casinos that absorb even this negligible Bitcoin network fee; thus, this makes deposits and withdrawals absolutely free for players. To players usually performing lots of transactions or large quantities, this difference in fees may prove critical.
3. Improved Security and Data Protection
Bitcoin uses blockchain technology, one of the most secure and transparent systems in the world. All the transactions involved in blockchain are encrypted; hence, fraud and hacking have almost nil chances of being performed. Furthermore, there is no necessity for sharing personal data while using Bitcoin for online betting as your card number or bank details will not come into play.
Anonymity and Privacy Protection
In the case of Bitcoin, players can preserve anonymity, since for a transaction, one needs only a Bitcoin address. Hence, Bitcoin casinos are true Catch-22 for those who value privacy in financial operations and want to avoid unnecessary checks from banks and other institutions.
4. Fewer Restrictions and Regulations
A lot of countries ban gambling or strictly regulate any operations including online casino transactions. This may raise serious barriers for players to access their favorite platforms or even to get accounts suspended. Bitcoin transactions do not go through the banking system and therefore are not regulated like traditional money. This means greater freedom for users.
Benefits to International Players
For players whose countries have restricted gambling, Bitcoin is an easy way around any legal restrictions. For people in countries with unfinished developed banking or those, due to which one can’t access every type of payment, Bitcoin casinos are a great way to access different kinds of bets.
5. Bonuses and Special Offers for Bitcoin Users
Most online casinos welcome the use of Bitcoin by giving bonuses for cryptocurrency choices. In many cases, higher welcome bonuses, cashback on deposits, free spins within the slot machines, and others are common.
How Does This Benefit Players?
The Bitcoin bonus can increase the player’s budget very much and bring extra value to players. Online casinos are happy to see this cryptocurrency, as it cuts some transaction processing costs for them, either. Because of that, promotion activities targeting depositors and withdrawers of Bitcoins can be regularly found.
6. Bitcoin for Gaming Bankroll Management
Being a cryptocurrency, Bitcoin allows players to have flexible banking of their bankroll. Many users keep their winnings in the form of Bitcoins, since it can surge in price. This adds the opportunity to earn extra income from its volatility when Bitcoin prices surge upwards.
Example of Bankroll Management
Using Bitcoin Many players keep their winnings in Bitcoin, due to the fact that its price might go up. In this case, casino winnings create passive income. But one should keep in mind that Bitcoin’s price also goes down, so this strategy is to be used with care.
Financial independence is an important component of success. To avoid wasting everything, you need to be able to save and invest. Thanks to this, it will be possible to create a financial cushion. You can get additional income with the help of brokers. Every adult can register on the Trade-X website and start trading activity. The latter is based on the conclusion of transactions for the purchase and sale of material values, currency, contacts and shares of well-known companies. As reviews show, the broker sets a minimum commission and charges the trader a certain amount after a successful profit. With the right approach and the ability to analyze data, the trader receives a tangible profit from his deals.
Let’s consider what the trader’s work is and read the real comments of Trade-X clients.
Recommendations and reviews about Trade-X
Choosing a source of income, many people monitor websites and look for what they write about the broker in reviews. After all, safety on the Internet, especially when entering your personal data and bank cards is very important. Newcomers who are just entering the market are especially concerned. It is known that the Trade-X company is officially registered in London and acts according to the legislation. It carries out work with an exchange expert and a hedge fund, has more than 200 assets. Trading conditions, including commissions and spreads, are transparent, which does not allow the broker to change them in its favor.
Participants of Medium, Linkedin, Reddit platforms often write good reviews that no fraudulent schemes were observed on the sites, and the support service always responded quickly to questions and any difficulties, if they arose. The broker company has an arsenal of trading tools, signals and training materials, where everyone can understand the nuances of the profession for free. The reviews also say that the terminals work well without delays, price movements are displayed on the charts. By the way, you can monitor the status of the launched order both from your computer and from your phone by installing the Trade-X broker application.
Features of cooperation with the provider of trading platforms
The provider offers trading platforms with access to many financial instruments. It is a kind of analytical center with access points to currencies.
The following are the features of operations:
Ease of management of the personal account and the site as a whole for novice depositors and professionals.
Analysis tools: different timeframes, indicators and analytical tools, which simplifies predicting and planning transactions.
Minimal costs. Trade-X brokers provide competitive spreads on major assets, as well as no commissions for certain types of accounts, which can be beneficial for traders with frequent trades.
24/7 market access: support for 24/7 trading, especially for cryptocurrencies and some international markets.
Margin trading and leverage: Trade-X offers leverage to help increase trade volume, although it also increases risk.
Automation and trading robots: integration with trading robots and algorithmic systems is supported, allowing for automated trades.
Security: state-of-the-art technology to protect funds and data, such as encryption and two-factor authentication.
Training and support: video tutorials, personalized mentoring, group webinars, literature.
Access to the platforms is open to adults who have completed the registration and document verification process. The minimum deposit is 500 dollars. After depositing this amount, you can start investing in any asset. You can follow the course of events by connecting to mobile Internet from anywhere in the city and even in the country. They write in the reviews that it is very convenient. The international resource Trade-X operates in 197 countries, so entry is free for those wishing to invest in the most popular resources. In case of difficulties with authorization, you can use the site mirror or connect VPN services.
What to trade on Trade-X site
More than 200 assets are presented on the site. It is easy to get confused when choosing from such an arsenal. However, experienced participants of the investment market recommend choosing currency pairs. In any case, it is necessary to be aware of possible rate drops or growth. You can learn this from the news, the current chart and your observations.
The most common trading options on the Trade-X website:
Currency pairs, which are the ratio of the prices of two currencies.
Resources: gas, oil, ores, metals.
Stocks: a share of ownership in a company.
Futures: a contract on future purchase.
Trading on the stock exchange for beginners most often starts with currency pairs – they seem more familiar, clear and predictable. It is not difficult to calculate the dynamics of quotations with the large availability of tools and comprehensive assistance from the administration. Visual representation of price movements is significant for a trader, and the latest news in the world economy provides an additional stimulus for correct calculation of ask and bid.
Trade-X services have long been considered the gold standard of the industry. Since its foundation, the online broker has not stopped its development even for a day or an hour. Its services are becoming more and more technological and interesting for users. This allows to get a significant increase in the client base. Positive reviews allowed the company to stand out among other trading platforms, and assigning a personal manager to you will allow you to feel more confident if you are just at the start of trading.
NEW YORK (AP) — Shares of Tesla soared Wednesday as investors bet that the electric vehicle maker and its CEO Elon Musk will benefit from Donald Trump’s return to the White House.
Tesla stands to make significant gains under a Trump administration with the threat of diminished subsidies for alternative energy and electric vehicles doing the most harm to smaller competitors. Trump’s plans for extensive tariffs on Chinese imports make it less likely that Chinese EVs will be sold in bulk in the U.S. anytime soon.
“Tesla has the scale and scope that is unmatched,” said Wedbush analyst Dan Ives, in a note to investors. “This dynamic could give Musk and Tesla a clear competitive advantage in a non-EV subsidy environment, coupled by likely higher China tariffs that would continue to push away cheaper Chinese EV players.”
Tesla shares jumped 14.8% Wednesday while shares of rival electric vehicle makers tumbled. Nio, based in Shanghai, fell 5.3%. Shares of electric truck maker Rivian dropped 8.3% and Lucid Group fell 5.3%.
Tesla dominates sales of electric vehicles in the U.S, with 48.9% in market share through the middle of 2024, according to the U.S. Energy Information Administration.
Subsidies for clean energy are part of the Inflation Reduction Act, signed into law by President Joe Biden in 2022. It included tax credits for manufacturing, along with tax credits for consumers of electric vehicles.
Musk was one of Trump’s biggest donors, spending at least $119 million mobilizing Trump’s supporters to back the Republican nominee. He also pledged to give away $1 million a day to voters signing a petition for his political action committee.
In some ways, it has been a rocky year for Tesla, with sales and profit declining through the first half of the year. Profit did rise 17.3% in the third quarter.
The U.S. opened an investigation into the company’s “Full Self-Driving” system after reports of crashes in low-visibility conditions, including one that killed a pedestrian. The investigation covers roughly 2.4 million Teslas from the 2016 through 2024 model years.
And investors sent company shares tumbling last month after Tesla unveiled its long-awaited robotaxi at a Hollywood studio Thursday night, seeing not much progress at Tesla on autonomous vehicles while other companies have been making notable progress.
