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A $2.77 Lesson: Why I’m Opting Out of Securities Lending
As I was doing my taxes this year, I noticed a surprising 1099-MISC from my Canadian brokerage. After a bit of research, I learned that this was the result of my participating in a securities lending program, where my brokerage would loan my shares out and split the fees with me. At first, I was excited — the amount on my 1099-MISC was about 80% of what I had on my 1099-DIV. Almost doubling my dividend yield by loaning out my holdings? Sign me up. Unfortunately, the truth is not nearly so exciting. As you can see in the screenshot…
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A Sunbird’s Guide to Canada: Key Financial Tips for US Citizens
This article is for the “sunbird” (aka a “reverse snow bird”)—a US citizen owning property in Canada and spending several months here each year, but whose primary home and tax residency remain in the United States. If this describes you, you’re in a unique financial situation that requires careful planning. My goal here is to outline the key financial issues for US citizens who spend significant time in Canada but remain US tax residents. Like all aspects of cross-border personal finance, there are lots of nuances and exceptions here, so please take the time to read through the official info…
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Escaping the Optimization Trap
In the world of personal finance, it’s easy to get lost in the weeds of optimization. We tweak withdrawal strategies to reduce our 40-year failure rate by 1%. We passionately debate the merits of a market-weighted portfolio versus a factor-based one. We scrutinize MERs, ready to switch ETFs for a .02% advantage. We post our budgets on internet forums, asking strangers how to shave a few dollars off our monthly spending. This culture of comparison can make you feel like you’re never doing enough. Insidiously, it feels rational—as if we’re just trying to make the “best” objective decision. In reality,…
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How Best to Exchange Currency (CAD and USD)
A thread that winds through many of the posts on this site is the idea of finding the balance between satisficing and optimizing, and currency exchange strategies are no exception. Below, I’ll outline some of the best ways to exchange currency between Canadian Dollars (CAD) and US Dollars (USD). There isn’t one best way, though, and the best way for you will ultimately depend on where you draw the line in terms of how much effort you want to expend on optimization. It will also likely vary based on the amount and frequency of your currency exchanges. Currency Exchange Overview:…
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Moving from the US to Canada – Part 3: After You Move
In Part 1 of this series on moving to Canada we covered some of the key finance related differences between the US and Canada. Part 2 highlights some important things to consider doing before you move, and here in Part 3 we’re going to focus on actions and considerations after you’ve made the move. This information is focused on things you’ll need to do to maintain compliance, ways to optimize your finances, and common pitfalls you’ll definitely want to steer clear of. Taxation US Tax Filing Requirement Most importantly, know that if you’re a US person (meaning a US citizen…
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Moving from the US to Canada – Part 2: Before You Move
If you’re planning to move the US to Canada and are looking for some personal finance tips, you’re in the right place. Part 1 of this series covers some of the differences between the US and Canada in terms of things like taxation, investing, banking and estate planning. Here in Part 2, we have a financial checklist of key items to consider before you move. And later, in Part 3, we’ll go over some actions you may want to take after moving. As discussed previously, engaging with experts in crossborder tax, financial and estate planning is absolutely a good idea.…
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Moving from the US to Canada – Part 1: What’s Different?
So you’ve decided to move to Canada. Welcome! My family made the move in 2020, and we haven’t regretted it for a moment. At the same time, in the process of moving, we’ve had a lot to learn. Personal finance in the US and Canada differ in some important ways. I’ll provide an overview of these below. In Part 2, I’ll also outline some things you might want to do before you move and in Part 3 we’ll talk about things to do (and not do) after you move. I’m writing primarily for US persons (meaning people with US tax…
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How to Move a Roth IRA to Canada
The US-Canada Tax Treaty allows Canada to recognize Roth IRAs. If you follow a few simple steps, the CRA will treat your Roth IRA similarly to the US: capital gains, interest, and withdrawals will remain tax-free in Canada. When we moved to Canada, we found the election filing process a bit daunting, but it’s actually quite simple. This article explains the steps you need to take and the crucial things to avoid, so your Roth IRA maintains its tax-free status in Canada. Roth IRA Considerations Before Moving to Canada Before you move, you should probably shift your Roth IRA to…
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Key Takeaways: How to Survive Tax Day as an American Abroad 2025 Webinar
US expat tax filing is an annual challenge, which is why I attended yesterday’s How to Survive Tax Day as an American Abroad 2025 webinar by the Democrats Abroad Taxation Task Force. It was packed with valuable information, and if you’re navigating the US expat tax filing maze, I highly recommend checking it out. Here are a few things that stood out for me: 1. DIY Accuracy vs. Accountant “Audit Insurance” One point that really resonated was the discussion around tax preparation accuracy. The webinar highlighted something crucial: hiring an accountant isn’t necessarily “audit insurance,” and accuracy can often be higher when…
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Investing Advice for Teens
When he was 16 and got his first job, my nephew (wisely) expressed an interest in starting to invest. So I put together some investing advice for teens and sent it to him. Please let me know in the comments if you have any questions or if there is anything you think should be added or changed. And note that he’s in the US, but I think this advice would apply equally well in Canada (swapping the Roth IRA for a TFSA). — TL;DR version Here’s all the investment advice you really need, as concisely as possible: A Bit More…
