Author: kiara

With flowers blooming and sunlight lasting longer, spring is the perfect time to refresh not just your home, but also your finances. Just like your closet or garage, your finances can accumulate clutter—outdated strategies, neglected accounts, and missed opportunities. A financial spring cleaning can help you regain clarity on your goals, optimize your wealth, and set the stage for the rest of the year.

Here are some suggestions on how you can tidy up your finances:

1. Declutter Old Accounts
   Do you have un-used bank accounts, forgotten credit cards, or overlapping investment accounts? Consolidating can reduce fees, simplify management, and improve performance tracking.
2. Review Your Budget and Spending Habits
   Inflation and lifestyle changes can quietly dig into your savings. A seasonal review of your budget helps you identify areas where costs have increased, or even decreased, and redirect funds toward your priorities. Budgeting apps or spreadsheets are great tools to help with a monthly budget.
3. Refresh Your Emergency Fund
   With economic uncertainty still lingering, a well-stocked emergency fund is more important than ever. Determine how much you would need in your account to get you through 3-6 months. This should be in an accessible account where you can have easy access to cash. If you dipped into your emergency fund recently, create a plan to replenish it.
4. Shred Financial Clutter
   Go paperless where possible and securely dispose of outdated documents. Organize digital records for easy access during tax season or estate planning. Keep only essential documents and shred the rest.
5. Connect with your Rothenberg advisor
   We’re always here to support you! Questions about investments? Want to discuss your portfolio? We are always available to answer any questions, review your investments and discuss your goals.

Spring cleaning your finances isn’t just about tidying up – it’s about creating space for growth, clarity, and confidence.

Earth Day is a time to reflect on our planet’s health and the actions we can take to protect it. The 2025 Earth Day theme is “Our Power, Our Planet” and calls to promote renewable energy and energy efficiency. Here are some tips to help you save energy and lower your utility bills.

1. Upgrade to Energy-Efficient Appliances
   • Replacing old appliances with energy-efficient models can make a big difference by using less electricity and water. You can also Invest in renewable energy sources like solar panels which can lead to long-term savings on your electricity bills.
2. Install a Programmable Thermostat
   • A programmable thermostat allows you to set your heating and cooling systems to operate only when needed. For example, you can program the thermostat to lower the temperature when you’re asleep or away from home.
3. Seal Windows and Doors
   • Drafty windows and doors can lead to significant heat loss in the winter and heat gain in the summer. Sealing gaps with weatherstripping can improve your home’s insulation.
4. Use Cold Water for Laundry
   • Many detergents are designed to work effectively in cold water. Washing clothes in cold water can save a considerable amount of energy, as heating water accounts for a large portion of the energy used in laundry.
5. Take Advantage of Natural Light
   • Maximize the use of natural light during the day to reduce the need for artificial lighting. Open curtains and blinds to let in sunlight instead of turning on the light switch.
6. Perform Regular Maintenance
   • Regular maintenance of your heating and cooling systems ensures they operate efficiently. Replace air filters regularly, clean vents and ducts, and schedule annual inspections to keep your systems running smoothly.

Implementing these energy-saving tips can help you reduce your environmental impact and save money on your utility bills. By making small changes and investing in energy-efficient technologies, you can contribute to a more sustainable future while enjoying the financial benefits of lower energy costs.

Every day, Canadians across the country are targeted by scam artists. With tax season in progress, scammers may try contacting you, pretending to be your financial service provider or even the CRA.

How to protect yourself from scams
Cyber security is essential in protecting personal and financial information from fraud and scams. Below are key steps to protect your wealth and stay safe:

1. Use strong, unique passwords. Enable multi-factor authentication (MFA) where applicable.
2. Be cautious with links and attachments
   • Never click an unverified link or download an unknown attachment
   • Check for spelling and grammar errors: Phishing emails often have minor mistakes.
3. Verify emails and web addresses
   • Look for small differences in URLS
   • Check the senders email address
4. Confirm who’s contacting you
   • Confirm full phone number – don’t trust caller ID alone
   • Verify identity by contacting your financial services provider directly using their official contact information

AI makes fraud even harder to identify
As advancements in Artificial Intelligence (AI) have made scams more sophisticated, the risk of fraud has increased, and additional steps must be taken to recognize scams. The following are examples of AI-generated scams:

• Voice cloning: Scammers can mimic the voices of loved ones over the phone claiming they need financial help.
• Deepfake videos and images: Scammers can create realistic videos or images to impersonate family members or coworkers.
  You can protect yourself from these AI generated scams by implementing these additional tips:
• Create a safe word or phrase that only close family members know which can be used to verify emergencies
• Be skeptical of urgent requests
• Verify unexpected calls or messages by calling a contact back using a known number to confirm

How to identify CRA scams
It is important to know when to be suspicious and how to recognize a scam. The CRA website outlines how you can protect yourself against fraud. The CRA may contact you by phone, automated message, letter, or email. The CRA will NOT:

• Send you refunds by e-transfer or text message
• Demand or pressure immediate payments by e-transfer, Cryptocurrency, prepaid credit cards, gift cards
• Threaten to deport or arrest you
• Use aggressive or threatening language
• Set-up an in person meeting in a public location to collect a payment
• Charge a fee to speak with a call centre agent
• Ask for personal or financial information in a voicemail or email

If you are unsure or suspicious:

• Do not click any buttons, links, or reply to the message
• Do not provide any personal or financial information
• Hang up and contact the CRA directly for any tax-related manners.

There is no need to stress or worry about scams, however it is important to stay vigilant, recognize the signs and know how to respond if you are ever contacted by a potential scammer.

For further details contact a Rothenberg Wealth Management advisor.

Information in this article was taken from the Canada Revenue Agency’s website: https://www.canada.ca/en/revenue-agency/corporate/scams-fraud/recognize-scam.html

It’s that time of year again, and you might be asking yourself, “Should I contribute to my Registered Retirement Savings Plan (RRSP) or my Tax-Free Savings Account (TFSA)?”  Ideally, contributing to both is the best strategy, but if you’re forced with making a decision between the two, this article can help guide you.

Here are a few important elements to consider when deciding between RRSPs and TFSAs:

First consider your marginal tax bracket.

Start by looking at your marginal tax rate. If you’re in a higher tax bracket, contributing to an RRSP can lower your taxable income and offer a substantial tax break. In contrast, TFSA contributions don’t provide an immediate tax deduction since they are made with after-tax dollars. However, the growth within the TFSA is entirely tax-free, and withdrawals won’t be taxed either.

The second factor to consider is the contribution limit.

Contribution limits are also important to keep in mind. For TFSAs, the contribution limit is $7,000, with a cumulative total of $102,000 if you’ve been a Canadian resident since 2009 and were 18 years old at that time. That’s a significant opportunity for tax-free growth over time.

For RRSPs, the contribution limit is 18% of the earned income you reported in the previous year, up to $32,490. If you don’t use your full contribution room in any given year, it carries forward, allowing you to contribute more in the future.

Third factor and an important one, are the withdrawals.

Withdrawals are another important consideration. RRSPs are designed specifically for retirement savings, and any amount you withdraw is subject to income tax. Contributions can be made up to the age of 71, at which point you must convert your RRSP into a Registered Retirement Income Fund (RRIF).

On the other hand, TFSA withdrawals are completely tax-free. Plus, when you withdraw from a TFSA, the amount is added back to your contribution room in the following year, so you can re-contribute it later. TFSA accounts also don’t have an age limit, and there’s no need to convert it to a different account type.

Conclusion

Both RRSPs and TFSAs offer excellent opportunities for tax-free growth, but they serve different purposes in your wealth-building strategy.

RRSPs are ideal for long-term retirement savings, particularly if you’re in a higher tax bracket now. TFSAs, however, offer more flexibility and are great for both short- and long-term goals, whether you’re saving for a major purchase or looking for another option to grow your retirement savings.

The right choice depends on your personal financial situation—your income, goals, and timeline. There’s no one-size-fits-all answer, but by understanding these key differences, you’ll be in a better position to make the best decision for your financial future.

For further details contact a Rothenberg Wealth Management advisor.

In this article, we share some insights on what to expect in 2025.

Broadening Equity Market Returns

Equity markets delivered strong returns in 2024, driven by the earnings growth of a few players—the Magnificent 7, which includes Alphabet (Google), Amazon, Apple, Meta (Facebook), Microsoft, NVIDIA and Tesla. The rest of the market is expected to catch up in 2025 and deliver more balanced and diverse growth within and across sectors.

Policy Uncertainty

Economic uncertainty will be a defining theme in 2025:

• With Prime Minister Justin Trudeau stepping down, the fate of important policy proposals, such as the planned increase to capital gains tax, is now unclear. The upcoming leadership transition will play a key role in shaping Canada’s future economic policies.
• Trump’s proposed 25% tariffs on all Canadian exports, if implemented, could disrupt cross-border supply chains and have widespread economic ramifications, both for Canada and globally.

Interest Rates

After five consecutive interest rate cuts in 2024, Canadians can expect continued rate reductions in 2025 as the Bank of Canada seeks to stimulate economic growth. Lower rates should improve borrowing conditions, benefiting both consumers and businesses by lowering financing costs and stimulating demand.

Continued Growth of Private Markets

With many unknowns, asset classes that are uncorrelated to market fluctuations will continue to demonstrate value to investors as sources of risk-adjusted returns. In particular, lower interest rates and healthy economic activity are expected to be positive for private equity.

Conclusion

As 2025 unfolds, staying informed will be crucial to navigating an uncertain environment, capitalizing on emerging opportunities and turning potential challenges into avenues for growth.

If you would like to discuss investment opportunities and how to position your portfolio for the year ahead, contact us today and start a conversation.

Eligible Canadians can contribute up to $8,000 each year to an FHSA up to a lifetime contribution limit of $40,000 to help them buy their first home.

Purchasing a home is an important decision that requires careful financial planning. Fortunately, there is a specialized tool designed to help Canadians save tax-free towards their goal of buying a first home – the new Tax-Free First Home Savings Account (FHSA).

The FHSA is a game-changer for aspiring homeowners. This unique type of savings account allows eligible Canadians to contribute up to $8,000 a year with a lifetime maximum contribution limit of $40,000 towards the purchase of their first home. This can help you break down the cost of buying your first home into tangible yearly savings goals.

Once funds are deposited in an FHSA, you can watch them grow tax-free. This means that any interest earned, or investment gains made within the account are also free from taxes, allowing for potential compounding and greater returns. Most importantly, any qualifying withdrawals are tax-free. You also have the option to transfer existing RRSP amounts into the FHSA.

Adding to its appeal, contributions made to the FHSA are tax deductible, meaning you can claim them on your personal income tax return filing to lower your taxable income and potentially save more money in taxes. In this way, an FHSA is similar to an RRSP.

To be eligible to open an FHSA, you must meet certain criteria set by the government. These eligibility requirements are designed to ensure that the FHSA is accessible to those who genuinely need it and are committed to buying their first home.

Once you’re ready to purchase your first home and have a written agreement to buy or build your home, you can use the money in the FHSA towards a qualified home purchase, which can include a down payment, closing costs, and other related qualifying first home expenses.

You can even use an FHSA in conjunction with the Home Buyer’s Plan (HBP) to have an even greater amount to use for the purchase of your first home. It’s important to note, however, that the money in an FHSA can only be withdrawn for the purpose of buying your first home but you won’t need to pay it back like you do with the HBP.

If you already own a home, unfortunately, you cannot use the funds for a second home or investment property. You may also incur penalties and tax consequences if you withdraw funds from an FHSA for a non-qualified purpose.

But should you decide to forego your first home purchase and use your funds for something else, you can always transfer the money to your RRSP or RRIF on non-taxable basis until December 31 of the year following the year of your first qualifying withdrawal, without affecting your RRSP contribution room.

For complete details, please review the FHSA resources available on the CRA website. You can also find all applicable definitions for FHSAs here.

Starting on November 20, 2023, Rothenberg Wealth Management is offering clients the option to open their FHSA.

Contact a Rothenberg Wealth Management Advisor to discuss your goals and get advice on how to customize your investment portfolio in your FHSA to maximize your future savings potential. If you are not eligible (or are unsure you are eligible) for the FHSA, a Rothenberg Advisor can assess your situation and help you explore other savings options to meet your financial goals.