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Owning is better than renting,' and other financial beliefs that may be dated



Times change, and so do the rules of money management. What your parents or grandparents swore by might not hold true today. Despite good intentions, outdated financial advice can lead younger generations astray. Here's what experts have to say about some common myths and misconceptions.


The Canada Pension Plan (CPP) often raises eyebrows among the younger crowd. Many doubt its longevity, fearing it might vanish before they retire. Jason Heath, a certified financial planner, clarifies that the CPP is independent of the federal government, with a robust portfolio ensuring its sustainability for at least the next 75 years.


Dividends, while appealing, aren't magic. Investors shouldn't fixate solely on them. High dividend payouts could mean missed opportunities for a company's growth. Diversification is key, with a mix of high and low dividend stocks providing a balanced portfolio.


Contributing to an RRSP isn't always the golden ticket to tax savings. Heath advises against maximizing RRSP contributions blindly, especially for those in lower tax brackets. Tax-Free Savings Accounts (TFSA) might be a better fit, offering flexibility in withdrawal and tax benefits.


The traditional 50-30-20 budgeting rule doesn't always fit today's realities. Jessica Morgan suggests a zero-based budgeting approach, where every dollar has a purpose, even if it's just safeguarding against unexpected expenses. Budgeting isn't about deprivation but rather about aligning spending with personal goals.


Investing no longer requires a degree in finance. Robo-advisors like Wealthsimple have made investing accessible to everyone, simplifying complex financial concepts.


The age-old debate of owning versus renting also deserves a second look. Reni Odetoyinbo emphasizes the importance of crunching the numbers. Homeownership entails more than just mortgage payments, with additional expenses like maintenance often overlooked. Renting might offer financial flexibility and investment opportunities elsewhere.


In conclusion, financial wisdom evolves with time. It's essential to question old beliefs and adapt to the changing financial landscape. Whether it's retirement planning, budgeting, or investing, staying informed is the key to financial success in today's world.


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