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An Overview of the First Home Savings Account (FHSA)

To start, let me simply state that if you are Canadian and you have a goal to buy your first home, you should use an FHSA as the best way to save for your down payment.  Also, if you are a parent with a goal of contributing  to your child’s first house down payment, then helping them with an FHSA contribution is a  great idea too. Now that I have your attention, let’s first dive into the details and facts surrounding the First Home Savings Account.    Then,   we’ll talk about some strategies and recommendations to squeeze maximum advantage from this program. What is the FHSA? The FHSA is a new tax advantaged registered account meant to help Canadians save for and purchase their first home. Like an RRSP or a TFSA, the FHSA is something you must register for by opening a specific FHSA account and then deposit savings into that account.   The key advantage of an FHSA is that it provides direct tax savings in three ways: First, when you put money i...
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What should I do with my portfolio in 2025 (or the Fine Art of Doing Nothing)?

I've been asked a few times quite recently some variation of the following question: "Given the recent political turmoil, especially with Canada and the US, what should  I do with my portfolio?   Should I have more/less US dollars?   More (or less) US equities? What about Canadian stocks?"      The  short answer is I have no idea nor does anyone else and so staying the course is usually your best option.  That is, one of your most important investing skills is the ability to do nothing. At first glance, this might not seem like a skill at all. Isn't investing about making timely decisions, identifying opportunities, and reacting to market movements?  For a select few maybe, but successful retail investors, especially when facing unsteady or volatile markets, practice the fine art  of doing nothing. Why Do Nothing? The Nature of Markets: Markets are inherently cyclical. They experience periods of growth followed by inevi...

Investing with margin or leverage for retail investors

This article was inspired by a marketing email I recently received from Wealthsimple.  The subject line read: " Coming soon: margin trading ".  The email goes on to say "Margin trading can help you boost your buying power by borrowing against your portfolio. Applying for your account is fast, hassle-free, and there are no hidden fees.  Best of all, our margin interest rate are as low as prime - 0.5% — lower than what you’d pay at your bank."   In fairness to Wealthsimple, the email further  explains what margin trading is, how it works, and what some of the risks are to using margin. It really got me thinking more about margin and leverage and especially the surprising findings regarding who can benefit the most from using margin and leverage.   What is Margin and Leverage? Margin investing refers to borrowing funds from a brokerage firm to purchase securities, using investments like stocks and bonds already in your account as collateral. This all...