LITMIR.BIZ

      Cover Design: Wiley

      Copyright © 2015 by David Trahair. All rights reserved.

      Published by John Wiley & Sons, Inc., Hoboken, New Jersey.

      Published simultaneously in Canada.

      No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, (978) 750-8400, fax (978) 646-8600, or on the Web at www.copyright.com. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, (201) 748-6011, fax (201) 748-6008, or online at http://www.wiley.com/go/permissions.

      Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts in preparing this book, they make no representations or warranties with respect to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability or fitness for a particular purpose. No warranty may be created or extended by sales representatives or written sales materials. The advice and strategies contained herein may not be suitable for your situation. You should consult with a professional where appropriate. Neither the publisher nor author shall be liable for any loss of profit or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

      For general information on our other products and services or for technical support, please contact our Customer Care Department within the United States at (800) 762-2974, outside the United States at (317) 572-3993 or fax (317) 572-4002.

      Wiley publishes in a variety of print and electronic formats and by print-on-demand. Some material included with standard print versions of this book may not be included in e-books or in print-on-demand. If this book refers to media such as a CD or DVD that is not included in the version you purchased, you may download this material at http://booksupport.wiley.com. For more information about Wiley products, visit www.wiley.com.

       Library of Congress Cataloging-in-Publication Data:

      ISBN 9781118994177 (Hardcover)

      ISBN 9781118994191 (ePDF)

      ISBN 9781118994184 (ePub)

      About the Author

      DAVID TRAHAIR, CPA, CA, is a speaker, national bestselling author and financial columnist for CPA Magazine. His other books include Smoke and Mirrors: Financial Myths That Will Ruin Your Retirement Dreams, Crushing Debt: Why Canadians Should Drop Everything and Pay Off Debt and Cash Cows, Pigs and Jackpots: The Simplest Personal Finance Strategy Ever. He is known for his ability to explain the often-confusing world of personal finance in plain English. Canadians appreciate his no-nonsense style and the fact that his views are totally independent because he does not sell any financial products. He currently operates his own financial consulting firm and gives seminars on his books to accountants in B.C., Alberta, Saskatchewan, Manitoba, Ontario and Nova Scotia.

      Acknowledgements

      I’d like to start off by thanking the two people that are responsible for the creation of this book. Those people are my literary agent, Hilary McMahon of Westwood Creative Artists, and Karen Milner of John Wiley & Sons Canada, Ltd., my publisher. If not for Hilary’s belief in the idea and Karen’s enthusiasm for seeing it get into print, you wouldn’t be holding it right now.

      I’d like to dedicate it to two other significant people in my life. First, to my mom, Florence Trahair, who passed away in 2008 at age eighty-two. She was always my biggest supporter. I felt her presence as I wrote this book. And second, to my father-in-law, Jack Baxter, who passed away in 2006 at age sixty-eight. Jack was one of my best buddies. He taught me how to enjoy life. I know he enjoyed each and every day of his.

      And much thanks to Tula Batanchiev and Lia Ottaviano at Wiley for all the hard work in making this second edition a reality.

      Introduction

      Welcome to the second edition! A lot has happened since the first edition of this book came out in early 2009. As I read through the first edition to see what needed updated, it occurred to me that my opinions haven’t changed. I still stand by everything I said the first time – the stock market is no place to trust your hard-earned retirement savings in.

      But some sections needed updated. For example the whole chapter on CPP is revised for the new rules that came into effect after edition one was published. And here’s a bonus: this edition now includes step-by-step instructions for you to compute exactly how much CPP pension you can expect.

      Ok, let’s start at the beginning.

      The period of time we lived through in 2008 and 2009 shifted the financial world on its axis. The old rules regarding personal finance are now history, as in obsolete.

      This happened in the last quarter, the autumn of 2008. Let’s call it “The Fall of 2008.”

      During this period financial institutions that had existed for more than a century simply disappeared. World stock markets tanked. Entire investment portfolios were devastated. Retirement dreams wiped out.

      What this series of events has done is show quite clearly the naked truth: traditional financial planning techniques don’t work. In fact, if we had done the opposite of what the “experts” have told us to do to get ahead financially, we would be far better off today. Here are some of the past theories and the new reality:

      I am not opposed to capitalism. We need efficient stock markets so that entrepreneurial people can grow businesses that flourish – businesses that create great products, deliver excellent services, hire good people, make profits and pay taxes.

      The problem is that, obviously, markets have not been regulated satisfactorily. Businesses, especially financial ones in the United States, have been allowed to run rampant in the quest for riches. Thousands of intelligent, well-educated people making six-figure salaries and multi-million dollar bonuses spent years creating complex financial products that were sold to unsuspecting members of the public.

      Ever heard of collateralized debt obligations? Mortgage-backed securities? Non-bank asset-backed commercial paper? What about income trusts? Or even mutual funds?

      These complex instruments made many people rich. The people that invented them. The people that re-packaged them. And the people that sold them.

      Unfortunately,

Скачать книгу