When is a bubble a bubble? The Oxford English Dictionary defines a bubble as “a significant, usually rapid, increase in asset prices that is soon followed by a collapse in prices… typically arises from speculation or enthusiasm rather than intrinsic increases in value.” The question is vital right now, for one of the best guides […] Read more
Guarding Wealth: When will the stock market bubble pop?
Stock markets are soaring in spite of increasing risks. If this is a bubble, will it last?
Farm Financial Planner: Income issues block couple’s retirement
Working, good investments and selling the land, will fund this couple’s retirement
In south central Manitoba, a farming couple we’ll call Jorg, 59, and his wife, who we’ll call Carole, 57, want to retire. Their 480-acre mixed cattle and grain operation has not been very profitable for many years. To keep the farm going, they have had off-farm jobs, diverting their income to the operation. Now, nearing […] Read more
Guarding Wealth: Farmers would be hostages in a trade war
Canadian farmers could suffer from American initiatives to shut borders to imports
Donald Trump’s elevation from businessman to American president could injure Canadian farmers gravely. Little is known of his plans, less of the laws he may try to push through the Congress and executive orders he may issue. But trade war is on the table and through no fault of their own, Canadian farmers may be […] Read more
Farm Financial Planner: Planning a less taxing retirement
Herb and Martha are working on a plan to retire while their son takes over the farm
In central Manitoba, a couple we’ll call Herb, 54, and Martha, 52, have farmed for 25 years. The farm is in a partnership with Herb’s brother, who we’ll call Larry. Each brother has an interest in the partnership through his own holding company. The main operating entity is the partnership that does the actual farming […] Read more
Guarding Wealth: The alternative minimum tax
Passing on the farm can trigger an unpleasant surprise: an unexpected tax alternative minimum tax
The Alternative Minimum Tax is yet another wrinkle in preparing and paying income taxes. It’s particularly relevant to farmers going through succession planning where capital gains of six figures or more may be realized. The Alternative Minimum Tax (AMT) may apply to you even if you have not reached the limit of your Lifetime Capital […] Read more
Guarding Wealth: Changes ahead for 2017
Rising interest rates and the Trump Effect bring uncertainties in the New Year
If investing were easy, we’d all be rich. Today, capital markets have many new uncertainties. Top of the list: the Trump Effect. That is, what the new President may do after his inauguration on January 20. Also worrisome is where Europe is going if other members of the EU follow the United Kingdom out of […] Read more
Farm Financial Planner: Tax planning critical for farm widow
More paperwork leads to lower taxes for this farm widow and her adult children
A couple we’ll call Lisa and Herbert emigrated to Canada 34 years ago. They left a small farm in England and bought a 1,120 acre farm in central Manitoba. With their children, a daughter, now 51, and a son, now 48, they ran a mixed grain and beef operation. Herbert passed away in 2010. Lisa, […] Read more
Guarding Wealth: Canadian interest rates to rise
But don’t hold your breath — any big rate moves are at least 18 months ahead
To quote the most recent winner of the Nobel Prize for literature, Bob Dylan, “the times, they are a-changin’.” In capital markets, the U.S. Federal Reserve Board is likely to raise the interest rate it charges banks to borrow money overnight to maintain reserves — a key indicator for all other interest rates in the economy. This increase […] Read more
Farm Financial Planner: Switching up a succession plan
When children change their minds, parents revise their farm succession plans
Central Manitoba farmers Lloyd, 59, and his wife Ellie, 58, have been running their grain farm for four decades. With 1,920 acres of land they own personally and 960 acres in their farming corporation and reasonably up to date machinery owned by the corporation, they face the common problem of generational succession. They have two […] Read more
Farm Financial Planner: No heirs? That’s not a problem
A solution for retirement and a legacy for a Manitoba couple with no farm successor
In south central Manitoba, a couple we’ll call the Bretts have a 640-acre mixed farming operation. Jack and his wife, Martha, each 61, have a son, 30, with an off-farm job. Their son is not interested in taking over the family business. It’s inevitable that Jack and Martha will want to leave their farm. It […] Read more
Cyber-Savvy Farmer
