![\"Team\"](\"https:\/\/advisor.wellington-altus.ca\/goldsealfinancialgroup\/wp-content\/uploads\/sites\/159\/2024\/08\/Team.jpg\")
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\u201cLaughter is the best cleaner for the soul.\u201d<\/em><\/p>\n Now that spring has sprung and many of us are in spring cleaning mode, don\u2019t forget to declutter your finances! This is a great time of year to check in and eliminate any unused or unnecessary expenses.<\/p>\n Do you have any of the following?<\/em><\/u><\/p>\n Steps to purging:<\/em><\/u><\/p>\n Purging financial clutter can save money, simplify life administration, reduce stress, and ultimately contribute to improved financial well-being.<\/p>\n While Spring has sprung, Canada\u2019s inflation rate continued to cool.\u00a0The Consumer Price Index (CPI) went up by 2.8% in February, a slight drop from January’s 2.9% and lower than the 3.1% economists had anticipated. Food prices saw a significant improvement, with the rate slowing to 2.4% from the previous month’s 3.4%.<\/p>\n There’s talk of a possible rate cut by May, though the market\u00a0sees little chance of this happening<\/a>, viewing a cut in June or July as more likely. \u00a0This anticipation has\u00a0sparked speculation<\/a>\u00a0among wall street analysts that the U.S. Federal Reserve may choose to postpone any reductions in interest rates until the presidential election has passed.\u00a0 It seems Canada might reduce rates before the U.S. does.<\/p>\n The Federal Reserve’s Jerome Powell\u00a0<\/a>noted that inflation is on a downward trend while the job market remains robust, which is positive news. \u00a0Most Fed officials \u201csee it as likely to be appropriate\u201d to start cutting their key rate \u201cat some point this year,” he added.\u00a0 \u00a0However, experts like Larry Summers and\u00a0Mohamed El-Erian<\/a>\u00a0caution against the Fed cutting rates too quickly, pointing out that with February’s inflation at 3.2%, it’s still not close to the 2% goal. They highlight the risk of inflation getting out of hand.\u00a0Summers expressed confusion<\/a>\u00a0over the rush to ease monetary policy following Powell’s comments.<\/p>\n For investors, this scenario suggests confidence in the central banks’ ability to manage the inflation spurred by the global lockdown, signalling that the situation is under control, though the process isn’t finished.<\/p>\n This also means that 2024 could be a compelling year for bonds.\u00a0\u00a0Here’s what investors should understand about the outlook for the bond market and what to watch as the year unfolds.<\/a><\/strong><\/p>\n CRA recently announced that bare trusts are not required to file a T3 trust return for the 2023 tax year. This comes as welcome relief given the uncertainty and heavy compliance load generated by the new bare trust reporting requirement. The full CRA announcement can be found here<\/a>.<\/p>\n With rising rates, there has been increasing interest in guaranteed investment certificates (GICs). Now that tax season has arrived, here is a reminder of their tax treatment, as well as the taxation of bonds.<\/p>\n The taxation of GICs\u00a0<\/strong>\u2014 GICs are often \u201clocked-in\u201d and cannot be cashed in until their maturity date. As an example, for a five-year GIC purchased on July 1, 2023, the invested capital must remain in place until July 1, 2028, in order to receive the interest earned. However, this doesn\u2019t mean that there isn\u2019t a tax liability. For non-registered accounts, any accrued interest must be reported on an annual basis, even if it has yet to be received. Accrued interest is reported based on the anniversary date of the GIC\u2019s issue. So, for the five-year GIC noted above, the interest accrued during 2023 would be the equivalent of six months: July 1 to Dec. 31, 2023. For 2024, a full year of accrued interest would be reported. The exact amount would depend on when interest is calculated and compounded; in most cases, interest is calculated every six months, though some products may compound interest daily or monthly. A T5 information slip will be issued for interest amounts of $50 or more. This interest income is fully taxed at your marginal rate in the year it is earned.<\/p>\n The taxation of bonds<\/strong> \u2014 Interest income is also generated from bonds. Interest earned in non-registered accounts, often paid semiannually, must be reported each year on a tax return. The rapid rise in bond yields has resulted in many \u201cdiscounted bonds\u201d that may offer greater tax efficiency when compared to a GIC. When purchased on the open market, a bond\u2019s price can fluctuate based on changes to its stated interest rate. If the bond is purchased at a lower price and sold at maturity, a portion of the return will be a capital gain, taxed at a lower rate than interest income. Also notable, when accrued interest is paid at the time of purchase, it is deductible as an investment expense on a tax return for the year in which you bought the bond.<\/p>\n Welcome to April. Since our newsletter theme is Spring Cleaning<\/em>, it\u2019s a GREAT time to \u201cclean up\u201d our portfolios and position our capital for the next leg. It\u2019s also a great time to trim positions to build cash to prepare for any \u201cbigger\u201d expenses we may have looming. Will you be travelling in 2024? Do you need to purchase a new vehicle? Perhaps a home renovation is planned? It\u2019s a good time to chat!<\/p>\n The markets have been resilient since the Fall of 2023. We\u2019ve been hearing many of you comment on how well your accounts are doing, for good reason. Canada\u2019s S&P\/TSX Composite Index is finally back to all-time highs achieved in early 2022. It has taken Canada a lot longer to get here than our friends down south and we suggest this is due to a myriad of reasons. To name a few:<\/p>\n Here\u2019s a snapshot of the Canadian market:<\/p>\n The above 5-year chart shows a double top formation, indicating a bearish (negative) reversal pattern. It occurs when the price of an asset reaches a peak (early 2022), declines, then rallies back to approximately the same level as the previous peak before declining again.<\/p>\n The Relative Strength Index (RSI) also gives us clues as to where the TSX might be heading. The above chart shows a RSI reading of 72.10, confirming the market is overbought. A reading over 70 suggests it is overbought and a reading under 30 suggests it is oversold. Although we don’t know whether the market will move higher from here, we do believe it’s a great time to \u201cclean\u201d the portfolio and remove any clutter.<\/p>\n How is the US market (S&P 500)?<\/p>\n The potential double top presented itself earlier this year, but decisively broke the top and is now at all-time highs. The overbought market is even more apparent, currently registering a RSI reading of 77.56. Again, if you may need a little extra for upcoming purchases, in my opinion, now appears to be a perfect time to raise some cash. Happy cleaning!<\/p>\n It is personal income tax season once again. Given increasing interest rates, don\u2019t overlook the importance of filing your taxes and paying balances and instalments on time, as interest assessed on insufficient payments can be significant.<\/p>\n Remember that both individuals and corporations are required by law to keep tax records for six years from their filing date. The CRA may request these records for audit purposes. The timeframe for recordkeeping may be extended for documents essential in determining a person\u2019s future tax obligations.<\/p>\n As always, we recommend our clients work with a tax advisor to ensure you\u2019re claiming all of the credits and deductions to which you\u2019re entitled and completing all of the required reporting obligations.<\/p>\n <\/p>\n Be Aware: TFSA Contribution Information May Be Incorrect<\/strong><\/p>\n If you\u2019ve based your TFSA contribution on the CRA’s \u201cMy Account\u201d information, be aware that it may not be accurate. According to the CRA, any contributions made or withdrawn in the prior year may not be reflected in current year contribution room until \u201cafter the end of February,\u201d since issuers have until the last day of February to submit TFSA transactions to the CRA. Yet, the lag in updating this data may extend to March or even late April. The consequence, of course, is the one per cent per month penalty on excess TFSA contributions, which can add up. And, it appears that a growing number of TFSA holders are being assessed penalties. The total amount of overcontribution penalties paid in\u00a02022 was $132.6 million<\/a>, more than triple the $41.7 million paid in 2019 and 38 per cent higher than the $96.2 million paid in 2021.<\/p>\n While you\u00a0Spring Clean<\/em>\u00a0your homes, remember that there are many organizations in need of clothing and household item donations.\u00a0 For those that are located in the Okanagan,\u00a0Big Brothers Big Sisters of Central and Southern Interior of BC\u00a0 (BBBSCSI)<\/a>\u00a0eagerly requests that you donate these items either through their\u00a0RENEW CREW program<\/a>, or you can drop them off directly to\u00a0Value Village in Rutland<\/a>.\u00a0 The clothing doesn’t need to be in good quality as every item is either resold or repurposed.\u00a0 Let’s keep our clothing and household items out of the landfills while supporting our youth through this fantastic organization!!<\/p>\n Spring Cleaning your home? What about your finances? <\/p>\n Now that spring has sprung and many of us are in spring cleaning mode, don\u2019t forget to declutter your finances! This is a great time of year to check in and eliminate any unused or unnecessary expenses.<\/p>\n Do you have any of the following?Spring Cleaning your home? What about your finances?<\/h3>\n
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Inflating stocks to record levels<\/strong><\/h3>\n
\u200aImportant Update on Bare Trust Tax Filings<\/h3>\n
Gold Seal Insights<\/strong><\/h2>\n
![\"Tanya\"](\"https:\/\/advisor.wellington-altus.ca\/goldsealfinancialgroup\/wp-content\/uploads\/sites\/159\/2021\/12\/Tanya-web-1-150x150.jpg\")
<\/p>\nTanya’s Tips: Reminder of how interest income is taxed<\/span><\/h3>\n
![\"Brendan](\"https:\/\/advisor.wellington-altus.ca\/goldsealfinancialgroup\/wp-content\/uploads\/sites\/159\/2021\/12\/Brendan-web-e1670550189196-150x150.jpg\")
Brendan’s Banter : Spring clean your portfolio<\/h3>\n\n
![\"April](\"https:\/\/advisor.wellington-altus.ca\/goldsealfinancialgroup\/wp-content\/uploads\/sites\/159\/2024\/08\/April-chart.png\")
<\/p>\n![\"April](\"https:\/\/advisor.wellington-altus.ca\/goldsealfinancialgroup\/wp-content\/uploads\/sites\/159\/2024\/08\/April-chart-SP.png\")
<\/p>\nReminders For Tax Season: Unpaid Balances Incur Interest at 10%!<\/h3>\n
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Keep Good Records<\/strong><\/h4>\n
![\"Mallory\"](\"https:\/\/advisor.wellington-altus.ca\/goldsealfinancialgroup\/wp-content\/uploads\/sites\/159\/2021\/12\/Mallory-web-150x150.jpg\")
Mallory’s Memo:<\/h3>\nNoteworthy Links<\/h2>\n
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Picture of the month<\/strong><\/h2>\n
![\"BBBS\"](\"https:\/\/advisor.wellington-altus.ca\/goldsealfinancialgroup\/wp-content\/uploads\/sites\/159\/2024\/08\/BBBS.jpg\")
<\/p>\n","protected":false},"excerpt":{"rendered":"
\nUnread magazine subscriptions
\nUnwatched streaming services
\nUnused gym memberships
\nForgotten app subscriptions
\nOutdated software subscriptions
\nServices that do not match your financial goals
\nProducts that no longer align with your lifestyle needs
\nForgotten automatically billed services
\nOverlapping or redundant accounts or services<\/p>\n","protected":false},"author":169,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_oasis_is_in_workflow":0,"_oasis_original":0,"_oasis_task_priority":"","footnotes":""},"categories":[1],"tags":[],"class_list":["post-1799","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/advisor.wellington-altus.ca\/goldsealfinancialgroup\/wp-json\/wp\/v2\/posts\/1799","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/advisor.wellington-altus.ca\/goldsealfinancialgroup\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/advisor.wellington-altus.ca\/goldsealfinancialgroup\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/advisor.wellington-altus.ca\/goldsealfinancialgroup\/wp-json\/wp\/v2\/users\/169"}],"replies":[{"embeddable":true,"href":"https:\/\/advisor.wellington-altus.ca\/goldsealfinancialgroup\/wp-json\/wp\/v2\/comments?post=1799"}],"version-history":[{"count":2,"href":"https:\/\/advisor.wellington-altus.ca\/goldsealfinancialgroup\/wp-json\/wp\/v2\/posts\/1799\/revisions"}],"predecessor-version":[{"id":2440,"href":"https:\/\/advisor.wellington-altus.ca\/goldsealfinancialgroup\/wp-json\/wp\/v2\/posts\/1799\/revisions\/2440"}],"wp:attachment":[{"href":"https:\/\/advisor.wellington-altus.ca\/goldsealfinancialgroup\/wp-json\/wp\/v2\/media?parent=1799"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/advisor.wellington-altus.ca\/goldsealfinancialgroup\/wp-json\/wp\/v2\/categories?post=1799"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/advisor.wellington-altus.ca\/goldsealfinancialgroup\/wp-json\/wp\/v2\/tags?post=1799"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}