Preet Banerjee from WhereDoesAllMyMoneyGo recently wrote a great book for Canadians called “The RRSP Book” which he has provided to us for review. This book includes a lot of rules and strategies which most investors will find useful. If you want to buy this book directly from Preet then you can easily do so by visiting the secure book purchase site he has set up. Note – the only compensation we are getting is a free book for the review.
To help kick things off we are going to have a book giveaway – just leave a comment below and you will be entered. Contest ends Monday, January 21 at midnight.
I’d like to point out that Canadian Capitalist already did a review of this book (he’s a speed reader) and is giving away four copies of this book. Now four books sounds mighty impressive compared to our one, but if you consider that his traffic is at least a thousand times more than ours, your odds of winning are a lot better on this site!
Mike at The Financial Blogger also did a review – check it out!
For the non-Canadian readers – sorry, but this contest is only open to Canadian residents – but trust me, this book is of no use to someone living outside of Canada.
What’s it all about?
Good introduction to Canadian tax tax system and exactly how RRSPs work.
He starts off with various strategies surrounding RRSP some of them are fairly basic but most are quite innovative. The book is very well written with an appropriate amount of humour – he even has a subtle reference to Star Wars in it.
Strategies that I found most interesting
RRSP loans – He suggests various strategies around RRSP, loans for example such as getting two separate RRSP loans – one which you will pay back monthly and a smaller one which will be paid back in six months with the tax refund thereby managing your cash flow a bit better.
Home Buyer’s Plan – Very good discussion of the various rules and I learned that I could have used the HBP to borrow from my RRSP for my second house. He talks about not paying back the HBP in a down year and claiming the repayment as income – we are doing this since my wife is not working and it is a great strategy. The downside is that I lose a bit on the spousal credit but the saved tax is well worth it.
RRSP over-contribution – Preet suggests an interesting over contribution strategy for someone who is 71 – excellent advice.
Investment swapping – He also covers why you should hold fixed income investments inside your rrsp and also offers a “swapping” strategy to switch investments around if you have FI outside the rrsp which can be switched with equities inside the rrsp. Another use for the swap is to get cash out of the rrsp which can be switched with investments outside the rrsp. I learned a lot in this section.
RRSP planning – A great discussion of the cons of a poorly planned RRSP – they are a great tax saving tool for most Canadians but if the planning isn’t done properly you can end up “shooting yourself in the foot”
Best advice in the book concerns investors who save too much in their RRSP “RETIRE EARLIER!”
RRSP Beneficiary – This section has some excellent advice about naming a beneficiary for your RRSPs. If you haven’t done this or it’s out of date then do this now!!!
Leveraged investing – A good look at leveraged investing including the “Preet” principle.
An excellent book on the topic of RRSPs.
Once again, if you want to order this book then visit the secure book purchase site he has set up.
Want to learn more about RESPs? Buy The Book:
The RESP Book: The Simple Guide to Registered Education Savings Plans
Everything you need to know about RESPs.