Week 22: Taxes!

Full disclosure… I got really behind on these and they are slightly out of order. BUT, I did my taxes early, so I’m sure I’ll be forgiven.

While I usually like to do my taxes at the very last minute and scramble to finish them on time, I actually did them early this year. I think I know why – I was procrastinating from doing other stuff. I actually decided I’d rather do my taxes than say, write a blog post. That’s never happened to me before, but at least I found my incentive.

It still wasn’t easy. I did procrastinate, but I was also motivated by the idea of a tax return. I really wasn’t sure I’d be getting one this year – I had a bunch of T4s, and a multitude of independent jobs that I hadn’t been paying tax on, so it was anyone’s guess as to whether I’d be getting money back or paying it.

But somehow, everything worked out for me! Thank goodness for TurboTax. I’ve used them in the past and they are so straightforward and helpful. I absolutely hate filling out paperwork (like filing taxes), so their system of answering questions and copying my pay stubs etc. over is not bad at all. It’s still not fun, but it’s not the worst way to go about earning money.

The program also reminds me of potential deductions… like for the transit passes I forgot I had purchased in January and February of last year! What really helped me was that I shut down my tax free savings account (TFSA) and put all that money in my RSP. While I love the idea of a TFSA, the American government doesn’t quite understand it, and when I eventually decide to file US taxes (as a US citizen I’m technically supposed to, even though my income isn’t high enough that I would owe anything), a TFSA would be a non-compute. Apparently, when you invest in your RSP, there’s a bunch of money coming your way come tax season.

I briefly toyed with the idea of filing US taxes, but I quickly became baffled by the process. I don’t even want to talk about it. It’s complicated. And if you do something wrong, the IRS is all over you for years. I’m unwilling to put myself through this.

Now, because I am awesome and filed my taxes not only on time, but really early, I have a sweet tax return, which will pay for my trip to Yellowknife in June! I’m really excited for the trip, and now super relieved that I have a way of paying for it.

Week 9: Financial Planning

Well, they can’t all be lipstick and tattoos. Occasionally, I force myself to do something responsible and adult-y. So this week, I went to the bank, and actually sat down and had someone explain to me (for the 3rd time) what an RSP is.

Years ago, an article was published saying that someone who starts an RSP in their early 20’s is better off than someone who starts an RSP in their 30’s, regardless of how much the person in their 30’s actually puts into the account. So obviously both of my parents sent me this article every day for 2 weeks. I finally just set up an RSP to make them stop. (The same thing happened when an article came out recommending to wash the outside of cantaloupes before cutting into them, because salmonella had been found on the outside of some melons.)

So I set up an RSP, started automatic monthly deposits, and didn’t look at it again for 4 years.

Smart, right? Turns out, could have been smarter about that.

But this isn’t a post about whether I invested in GIC’s or mutual funds (ha, as if I know what either of those are), it’s a post about growing up and actually paying attention to what the big bank is doing with my money (or lack thereof).

I got to the bank and met my advisor, Brad. Apparently Brad thought it would be a good idea to participate in Movember. He’s a financial advisor. With a patchy moustache. It did not inspire confidence.

Although Brad was definitely better than the people I’ve had before. I don’t know if it’s because I’m young or don’t have a lot of money, but banks seem to set me up with their freshest advisors. The last guy I had had so much gel in his hair that I initially thought he was wearing a helmet. He did tell me about a pretty cool party he’d gone to though, which was awesome. I’m super interested in where the guy who is handling my money goes to get drunk.

When you are setting up an RSP with TD bank, they make you fill out a questionnaire. My two favourite questions were as follows (paraphrased):

  • How long do you intend on living once you’ve retired? (The options were pretty grim, with the max being 10+ years.)
  • Do you plan on needing to withdraw a large sum of money in the next few years for a house, wedding, or child? (Because I love planning out the next few years of my personal life in a bank.)

But I’m glad that I went. I now have a pretty decent idea of how much money I have (clue: not much), how much interest it’s getting, and how much cat food I’ll be able to afford when I retire and die almost immediately after.

bored-woman.jpeg

How I feel about financial planning.