Aug 262014

Looks like a merger is on the menu for Burger King 🙂 It’s currently in talks to merge with Canadian company Tim Hortons and move its headquarters up here to Canada 😀 Tim Hortons is a quick service coffee chain that has a strong Canadian identity. Here’s a drive thru window at a typical Tim Hortons.


Last year I blogged about buying some Tim Hortons shares and how investing in the coffee industry is the best idea ever! Thankfully my investment paid off because each share today is worth about 62% more than when I purchased them. Tim Hortons’ performance has beaten the overall stock market index in both Canada and the U.S. 🙂

If the acquisition is successful Burger King and Tim Hortons would continue to operate as individual franchises. You won’t find Timbits in your Whopper, and you won’t be offered fries with your coffee, haha 😆

The merger would benefit both companies. Right now Tim Hortons sells most of its coffee in Canada because it faces tough competition in the U.S. from Starbucks and Dunkin’ Donuts. But Burger King is already established in the U.S. and also has locations in Latin America and Europe, so Tim Hortons can use those valuable business channels to expand its brand awareness, and gain better access to global markets. Meanwhile Burger King would benefit from the high margin coffee business and also save money via tax inversion.

Tax inversion is when a U.S. company that has large overseas markets moves its main corporate office into a lower tax country. This allows the company to reposition itself as a foreign corporation so it can return foreign profits to stockholders without double taxation. This means if the merger is successful Burger King will get to pay a lower income tax, which will leave more after tax profits for its shareholders 😀


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Aug 152013

Earlier this year in April I started a swing trade which included some Suncor stocks. I mentioned how it was an undervalued company and how the stock will likely make a comeback 🙂 So I bought 100 shares at $28 each. Well I just heard on the news that Warren Buffett also bought some Suncor shares for his holding company Berkshire Hathaway 🙂 Hey, maybe… just MAYBE.. he reads my blog and that’s what gave him the idea to invest in Suncor as well (^_-) Hi Warren 🙂 I’m a big fan!

Buffett had picked up 17,800,000 shares of Suncor 😯 When the oracle of Omaha is confident enough to put over $500 million into a company, you know it’s a good investment 😎 Right now Suncor is the only Canadian holding inside Birkshire. Yay, go oil sands!  Represent Canada! I”m not sure what price Buffett paid for his SU shares, but I managed to get mine around when the stock bottomed, so this could mean I’m a better investor than Warren Buffett 😆 Or I just got lucky I suppose. But now I’m faced with a dilemma. I was planning to sell my swing trade when I made $1,000 from it, which I have now. The stock climbed to $35/share today. But now that the world knows Suncor is in Berkshire Hathaway’s portfolio there may be increased global interest in this company. Selling when Warren Buffett is buying may not be smart 😕13_08_suncorchart

Eventually though I will have to sell and most likely make a nice profit from it. But one drawback of making money through any kind of investing is those darn taxes on dividends, interest, etc (>.<) Here’s a simple tip to save butt-loads on investment taxes. Before you invest, give the money to someone else in a lower tax bracket whom you trust, and invest the money under his or her name instead of yours 😀 Continue reading »

Jul 162012

What is the largest expense you have? For me, it’s taxes, which makes up about 30% of everything I make. As a democratic society we are not only responsible to pay our fair share of taxes, but we should also try to understand where our tax money goes.  Did you know the CRA (IRS equivalent) uses up 3% of all our tax money?  Before the next time you sit down with your accountant or pull up some tax software, have a look at these charts below showing where the federal government gets all their taxes from, and where they spend it on.

image source:

In today’s reality it’s common practice to want the best education for our kids and the best health care for our elderly parents, despite whether or not we have the ability to afford it or not. So if a family is already in debt and is living paycheck to paycheck, what can they do to maintain their style of living? They borrow more money of course and dig deeper into debt, just so they can pay for those services with the hope that their financial situation will get better in the future. Sounds familiar?

Canada is in a similar situation. This country is in debt. And instead of saving money each year to pay off that debt it chooses to borrow even more money to continue paying for all it’s important federal services. Our teachers and nurses are being paid by borrowed money (a loan) that every future tax payer is on the hook for. It’s a fine balance between doing what’s best for our people now, VS what’s best for the future. I would personally like to see a balanced federal budget and will gladly pay more taxes, or receive less social benefits, or some combination of both. But I know not everyone would be on board with that. Fortunately our financial situation hasn’t hit a point of no return yet. But if we continue to spend more than we make then eventually, if nothing is done about it, we might find ourselves facing the same challenges as Greece is right now. The United States also has their own financial difficulties.

May 022012

If you work in the financial services industry then April was probably a busy month for you because this is when taxes are due. According to a recent survey by BMO Nesbitt Burns, many people are unaware of the tax implications of investment income. The poll of 1,500 Canadians, conducted by Leger Marketing, showed that 58% do not know how capital gains are taxed, and 63% do not know how dividend income is taxed. This is surprisingly low to me. Does that mean 37% of people know that the maximum tax rate on their non-eligible dividends is about 33% if they live in Ontario? Even I had to look that up.

With Europe’s fiscal situation still uncertain, China’s growth slowing down and a mix of other good and bad economic news from the US and around the world, our Canadian stocks stayed pretty much flat in April.

*Side Income:
  • Part-Time Work = $900
  • Dividends = $500

*Discretionary Spending:

  • Eating Out = $0
  • Others = $0
*Net Worth: (MoM)

  • Assets:
  • Cash = $3,000 (-$900)
  • Stocks = $69,700 (-$500)
  • RRSP = $21,700 (Unch)
  • Home  = $248,000
  • Liabilities:
  • Mortgage = $207,200 (-$300)
  • Margin Loan = $18,700 (Unch)
  • Bank Loans = $400 (-$2,200)

*Total Net Worth = $116,100 (+0.96%

I am back in the black. But not by much. The extra money I made from my second job and the savings from my no spend challenge were pretty much wiped out by a special levy, lol.  More details on that later this month. I didn’t make any new investments in April, however I deposited some money into my brokerage account because I’m anticipating to buy some stocks for my buy and hold portfolio soon. I don’t believe in the saying “sell in May and go away,” because perhaps buying when others are selling might not be a bad idea. I’m not sure yet. Just waiting on the sidelines for now.

* Numbers are rounded to the nearest $100.


Mar 222012

RRSPs can be used to lower our overall tax burden. Continued from How to Use the RRSP: Part 1

Another use for an RRSP is to treat it as a jobless fund. I don’t have an emergency fund in the traditional sense, but if for whatever reason I stopped working, didn’t qualify for E.I. benefits, and ran out of TFSA money, I would immediately sell $12,000 of the stocks in my RRSP account and withdraw small amounts of money from it each month to cover my living expenses until I can find a more permanent solution. Luckily I have never had to resort to such an emergency ( ´_⊃`) I do have to pay a withholding tax when I withdraw money from an RRSP account, but depending on the circumstances I might get that tax refunded. Spending RRSP money when I have NO other taxable income is even better than spending it when I retire when I’ll have CPP benefits, (social security,) OAS,and other government or private pensions to push my income into a higher tax bracket. I do lose the contribution room, but I will likely be using spousal RRSPs to lower my RRSP portfolio anyway.

In the tables above, an RRSP strategy can help save $3,000 in taxes. Money invested in RRSPs can grow tax free so it’s a good place to hold bonds and US equities.

Another possible use for RRSPs is the Home Buyer’s Plan. As long as contributions are made to an RRSP for at least 90 days, home buyers can take up to $25,000 out of their RRSPs without any penalty to buy a qualifying home. For couples, that means they can take out $50,000 to help pay for their home together. Certain restrictions apply such as the couple will need to repay all their RRSP withdrawals within 15 years. But it’s another option for people with large retirement accounts, but very little savings otherwise. Similarly the Lifelong Learning Plan allows you to borrow money from your RRSP to finance full-time schooling for either you or your spouse. So if your wife or husband is going through school, this is another option besides student loans. But you do have to pay back the withdrawn RRSP funds within 10 years.

Like I said before, the RRSP is not a retirement tool, but rather it’s a tool for creating wealth. Next time, spousal RRSPs (゜∀゜)

Random Useless Fact: One third of Americans now plan on working past the age of 70.