Monthly Archives: March 2012

Are you under 54?

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On Thursday Finance Minister Jim Flaherty announced the new Federal budget in Canada. There is too much information in it to fit in a blog post, but I wanted to make sure you are aware of it and add some links so you can do some reading.

One again I want to remind you to read and learn as much as you can about saving and investing. It is my opinion that by the time we retire, there will be very few government benefits to draw on. The cost of an aging population is weighing heavily on our country and people are now living longer, so they are withdrawing benefits for an extended period of time.

In 2011 the cost of the Old Age Security Program was $38 billion. In 2030 the cost of the program will hit $108 billion. This has forced the government to increase the eligible age for old age security from 65 to 67 and offer a 7.2% bonus for each year that you delay receiving benefits (for up to 5 years).

Ottawa will start making the adjustments in 2023, and phase them in gradually over six years. That means anyone over 54 won’t be affected. People in their early 50s will see moderate changes. And people under 50 will feel the full force of the new policy.

The details…

Garth Turner – Geezer Dole

Yahoo Finance – Budget changes old age security

Filming on location, location, location.

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One of the things I enjoy about working in the film industry is that I get to work with new people and visit different towns. I am currently working on the film “The 12 Disasters of Christmas” which is shooting on location in the city of Squamish, B.C.

I have spent my time in Squamish talking to the locals and walking around on my lunch break so I could read the listings at the local real estate offices.

It turns out that Squamish is the fastest growing community in Canada with a population growth of 14.6% between 2006 and 2011 which is more than double the national average.

Squamish is located half way between Vancouver and the famous Whistler ski resort. Many people who live in North Vancouver have decided to drive a half hour North where their real estate dollars go twice as far. There are 15 new residential developments currently for sale in Squamish, as well as extensive plans to develop the waterfront lands and revitalize the downtown core.

The picture above is an example of a beautiful one bedroom condo built in 2011 which is currently for sale for under $200k.

This week in money

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  1. This week Apple finally announced it will start paying a quarterly dividend of $2.65 per share (1.8% of current price), starting in its fiscal fourth quarter, which begins July 1. The dividend opens up ownership of Apple shares to a wider range of stock mutual funds, potentially boosting the stock price in the long term. Many “value-oriented” funds are not allowed to buy stocks that don’t pay dividends.
  2. Netflix Chief Executive Reed Hastings has quietly met with some of the largest U.S. cable companies in recent weeks to discuss adding the online movie streaming service to their cable offerings.
  3. Vancouver based Lions Gate Entertainment stands to profit big from “The Hunger Games” franchise. The film scored the best opening day ever for a non-sequel movie earning 68.3 Million. Lions Gate Entertainment owns the rights to 4 Hunger Games films.
  4. Canada’s lenders are growing weary of the mortgage war. Bank of Nova Scotia informed brokers this week that it was pulling its 2.99% rate on four-year, fixed-rate mortgages. The move is significant because it suggests the ultralow rates could soon dry up.
  5. CMHC has announced it’s dramatically scaling back the number of new high-ratio (less than 20% down) mortgages it will insure as it reaches it’s $600 billion limit. By the way, 9 out of 10 mortgages last year were “high-ratio”.

This week in money

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  1. BCE (Bell Canada) announced a $3-billion dollar deal to buy Astral Media Inc. The deal, announced Friday, gives the country’s largest communications firm a stable of French-language television and radio stations. Since 2010, BCE has announced deals worth nearly $7-billion to buy control of CTV Inc. and Maple Leafs Sports and Entertainment Ltd.
  2. The Vancouver Airport Authority confirmed Tuesday that it’s in talks with London-based developer McArthurGlen to bring a premium outlet centre to Vancouver Inter-national Airport land slated for commercial development. The site of the proposed Sea Island outlet mall would be next to the B.C. Institute of Technology campus on Russ Baker Way.
  3. Tsawwassen First Nations plan to build a mega-mall near the BC Ferries terminal. The plans include two shopping malls on 180 acres, which together will include 1.8 million square feet of retail space – 20 major retailers, and nearly 200 smaller shops, restaurants and kiosks. The first shovel is expected to turn the earth this summer, while the grand opening is scheduled for mid-2015.
  4. I have been keeping an eye on Le Chateau stock over the last year trying to figure out if it was a buying opportunity. The stock had dropped and was paying a juicy 10% dividend. The company has since cancelled its dividend and dropped sharply from $11.55 in April 2011 to $1.37 today. In the past month they have closed their 4th Ave. store and their South Granville store. Will they still be in business in 2013?
  5. People lined up all across Canada Friday to get their hands on the new iPad. Since November, Apple’s shares have risen from $363.57 (U.S.) to $600 in trading on the Nasdaq market. On Thursday, they rose as high as $600.01 before dropping to close at $585.56, down $4.02 from the previous day. This week, several analysts raised their target price on Apple shares to a once unheard of $700.
  6. Bloomberg reported this week that the dividends being paid by companies in the S&P 500 (American’s top 500 companies) have reached a record level. A sign that American companies are feeling better about the economy?
  7. Disney’s “John Carter” cost $350 million to produce and market. The opening box office in the U.S. was a disappointing $30 million.
  8. In the U.S., the Federal Reserve completed its annual “stress test” on the major banks. The Fed said on Tuesday that 15 of the 19 banks tested would have enough capital, even if they suffered a financial shock that would see unemployment hit 13 percent and housing prices drop 21 percent. The results paved the way for many of the passing banks to announce highly anticipated plans to boost dividends and buy back stock.
  9. My own company got a boost this week when I signed on to work on the film “Twelve Disasters of Christmas” which will shoot outside of Vancouver for the next three weeks.

 

 

 

This week in money

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  1. Greece took a critical step Friday towards avoiding bankruptcy with an unprecedented debt write-off deal, opening the door for the country’s second massive bailout deal by the IMF and the European Union.
  2. The success of the deal meant Greece would be able to meet a looming debt payment deadline and that the eurozone had dodged a chaotic default that would have destabilised global financial markets.
  3. After a big drop on Tuesday, North American markets recovered most of their losses with the TSX and the Dow ending the week just slightly lower than where they started on Monday.
  4. Recent U.S. payroll numbers suggest three consecutive months of job growth which is better than Wall Street analysts were expecting and bolstered the perception that the U.S. economy has turned a corner.
  5. In an effort to boost mortgage lending, the Royal Bank released the results of its housing affordability survey. This laughable report stated that for the second quarter in a row all housing categories became more affordable in Canada.
  6. The Royal Bank reported that because housing prices have softened slightly and interest rates will remain low in 2012, “housing in Canada is as affordable as it was a year ago, and only slightly less affordable on average than it has been over the long-term.”
  7.  A day after the Royal Bank report, Bank of Canada Governor Mark Carney said that household debt levels are the biggest domestic risk to Canadians. While Carny kept his key rate at 1% he is expected to start raising rates in 2013.
  8. Bank of Montreal disagreed that Canadians have too much debt and started another mortgage war this week. BMO announced that it is dropping the rate on its 5 year mortgage to 2.99% and lowering its 10 year mortgage to 3.99%.
  9. To help clear inventory, Apple announced a $100 discount on iPad 2 models. Canadian iPad 2 pricing now starts at $419 for the WiFi-only 16GB models. The new iPad will be available for a starting price of $519, with 4G-enabled models starting at $649.
  10. Daylight savings time begins Sunday at 2am. Don’t forget to turn your clocks ahead one hour before you go to bed on Saturday.

Pay off debt or invest?

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Do you think you should wait until you are debt free to start investing, or start investing even though you are still in debt?

I don’t have a definitive answer for you on this one and welcome your feedback in the comments section. I think everyone’s personal situation is different and there is no “one size fits all” answer.

Some things to think about… 

  • There is nothing more important to your financial health than becoming debt free. The average Canadian’s non-mortgage debt in 2011 was $25,594.
  • There is no point working, paying tax on the income, then investing what’s left over in a “high interest” savings account earning 1.5% (taxable income!) while paying 18% interest on a department store credit card balance.
  • Every dollar you use to pay down a credit card balance at 18% is the same as investing a dollar in an investment with a guaranteed rate of return of 18%.
  • Not all debt is “bad debt”. Money borrowed for investment purposes is tax deductible. Using leverage to grow your investments can be very powerful.
  • It takes years of experience to become a savvy investor. Even if most of your money is being used to pay down debt, using a small amount to invest can be a great learning experience.
  • Learn how to set up a mutual fund, and then invest $50/month into it. Follow that fund and learn how global events are effecting the value of the companies that fund holds.
  • Learn how to set up a brokerage account and buy a few shares of your favourite company. Go to Tim Hortons every day? Buy a few shares, follow the company, feel like an owner when you walk in!
  • Treat yourself like a business. Businesses have some debt and they also have some assets, but they always try and do what’s best for their balance sheet.
  • Create a personal balance sheet. List all your assets, then list all your liabilities. Subtract your liabilities from your assets. This is your net worth. Do you have a negative net worth?
  • Try and improve your net worth. Notice how both paying off liabilities and adding assets improves your net worth equally.

Although paying off debt is important, I also know that when it comes to investing, there is nothing more important than starting early.

10 Money Stories

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A reader called in and said she enjoyed the bite-sized format of my last post, so here goes another one…

  1. On Wednesday Apple became the 6th company in U.S. history to have a market cap (total number of shares multiplied by share price) of $500-Billion.
  2. Apple has gained 32% since the beginning of the year, which is more than it gained in all of 2011.
  3. Tomorrow Apple will unveil a faster and better-equipped iPad 3 at the Yerba Buena Center for the Arts in San Francisco. It will be Chief Executive Tim Cook’s second major product launch after the death of Steve Jobs.
  4.  Tim Hortons announced today that it is buying back up to 1.2 million of its common shares for cancellation. Remember, the less shares that are out there, the more they are worth.
  5. The federal government has announced measures that will stop banks from mailing unsolicited credit card convenience cheques to customers. These cheques are treated like a cash advance and forgo the usual interest-free grace period credit cards offer.
  6. Stocks suffered their worst selloff of the year today with the Dow (American market) down 1.6% and the TSX (Canadian market) down 1.8%. Investors are worried about a recession in the euro zone, a Greek debt swap deadline and China lowering it’s target for economic growth.
  7. Over the past decade, shares of Fortis (Canada’s largest publicly traded gas and electricity distributor) have posted an average gain of 10.3 per cent annually. Throw in dividends, which Fortis has raised every year, and the total return has been a sizzling 14.3 per cent.
  8. Bank of Nova Scotia reported a 15% increase in first-quarter profit today, but the increase was helped significantly by the recent sale of several high-profile office buildings.
  9. Scotiabank, Royal Bank of Canada and Toronto-Dominion Bank all increased their quarterly dividend by 6% this quarter.
  10. Scotiabank is the most international of Canada’s banks, with branches in Canada, Mexico, South America and Asia.

7 Money Stories

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  1. Iceland is thinking of adopting the Canadian dollar instead of the Krona. The Loonie was up $0.40 Friday to close at $101.08 U.S. 
  2. GM is suspending production of it’s Chevrolet Volt electric car amid disappointing sales.
  3. Sears Canada is closing it’s Pacific Centre location in Vancouver (might become Nordstrom).
  4. The Nasdaq (U.S. tech heavy index) hit it’s highest level since the year 20000 when it reached 3,0000 points Wednesday. Apple stock can take most of the credit!
  5. Shares of Royal Bank jumped this week after Canada’s biggest bank posted a better-than-expected first-quarter profit of $1.86-billion and raised its dividend by 6%. (Bank of Nova Scotia reports earnings on Tuesday)
  6. Shares of Lululemon also surged to a new high this week closing at $69.68 a share. 
  7. Real Estate Board of Greater Vancouver reports that housing sales fell in Feb. 17.8% over the same month in 2011.

Unreal Estate

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Leaky condo owners in Vancouver touched by a rainbow.

Everyone who lives in Vancouver knows how crazy the real estate market is right now. You may feel bad that you can’t afford to buy a place and are forced to rent. Don’t.

Things are getting crazy out there fast! Stay put, pay your rent and don’t listen to people who say renting is like throwing money away. If you are dying to buy real estate, buy a real estate investment trust (REIT) that invests in rental apartment buildings. You will get monthly income from it and the shares are liquid and can be sold within hours.

Continue reading →

Auditioning sucks!

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One of the bad things about being an actor is that in order to get a job and get paid, you must first attend an audition.

With all the modern advances in computers and communication, the casting directors still prefer that you drive across town, sit in a waiting room with a bunch of other nervous strangers and wait for your chance to read for them.

Sometimes the casting director will allow you to submit your audition on tape which I think is a much more sane way to proceed. This way the actor is able to work with his coach in a relaxed setting, record the audition a few times and send in the best take. I think casting gets a much better idea of what that actor is capable of this way.

Rachel McAdams auditions for “The Notebook”

This is an example of a near perfect audition. There is a reason this talented actress went on to become a big star. And she’s from St. Thomas, Ontario!

She is 100% focused and connected to the person she is reading with. She brings in a simple prop and makes it work for her. The scene has structure and she is clear on the beat changes and when she is going to turn away and when she is going to come at the reader. And the main thing is she is emotionally full and trying hard to cap those emotions (but fails beautifully).

More celebrity auditions: Continue reading →