Take Charge of Your Financial Well-being

Each November, many agencies coordinate efforts to strengthen the financial literacy of Canadians and empower them to:

  • Manage money and debt wisely
  • Save for the future
  • Understand financial rights and responsibilities

While most of the people I meet as an accountant and advisor are knowledgeable and successful, they rely on others to advise them without gaining their own understanding of investments, taxes, retirement or insurance needs, or the costs, benefits, and risks that come with allowing someone else to make decisions for them.

Let me give you some examples of where financial literacy can help you make better decisions.

Canada Pension Benefits

Individuals may apply for Canada Pension benefits as early as age 60 with a discount, or as late as age 70 with an increase.  If you continue to work after you start receiving your CPP benefits, you can elect to continue to contribute and receive a post-retirement benefit.

Before doing anything, consideration needs be given to your age and health, financial situation, company pensions, RRSP’s and RRIF’s, impact on Old Age Security payments, taxes and your marital status.  Not considering these could cost you thousands in benefits and taxes.

Estate Planning

Death and taxes are inevitable. But proper planning can reduce taxes, legal and probate fees, and allow for efficient distributions to your beneficiaries.

Consider donating shares you own in public corporations during your lifetime.  Not only will you do a good deed, but your estate will avoid taxes on capital gains on your death. You will receive a donation receipt for the market value of the shares donated, and the donation receipt will reduce your current year’s tax, and taxes for up to 5 years.

Make sure your Will is updated if there have been changes to your marital status, or there have been significant changes to your financial situation.  In some situations, multiple Wills may be appropriate. A Will for assets requiring probate and a Will(s) for assets not requiring probate.

Your estate and Will planning should involve your accountant, lawyer and Financial Advisor.

Understand Your Tax Return

You gathered all the slips and receipts, prepared the summaries and sent them to your accountant who put them through the magic tax preparation machine and then provided you with the results.  Maybe you received a refund, or maybe a big unexpected tax bill.  Do you understand what happened?

Now is the time to review your tax return and understand what is included on each line, how the amounts interact, the differences between tax deductions, tax credits, and the different tax rates on various types of income.

Banking, credit cards and their benefits

When was the last time you looked at the service fees on your bank account or shopped for better savings on loan rates?  Every bank wants your business but what are they willing “pay” you for your loyalty?

You may have been invited to meet with a financial advisor at your bank, who suggests a wide range of investment opportunities.  They may be great, but he or she works for the bank, and likely their priority is promoting the bank’s products. Compare them independently to other alternatives.

Review the agreements and the various benefits that come with your credit cards.  Are the rewards of value to you?  Will you use them?  Look at the price protection, extended warranty, travel insurance and car rental insurance benefits that are included with many credit cards.  Before buying additional insurance for your next trip, call the bank and get an explanation of your coverage.  And if you need more or different shop around.

We learn how to ride a bike, drive a car, make coffee or tea, use computers, plan vacations and be good parents.  Do the same about learning more about the financial matters that affect your life every day.

Financial Literacy Resources

CPA Canada

Financial Planning for Canadians

Stan Swartz, CPA, CMA, CMC is a retired Partner of Sloan Partners LLP and Certified Financial Planner.  He is a volunteer presenter for Chartered Professional Accountants Canada Financial Literacy program.  If you would like more information, contact Stan at or 416 659 7734.


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