Jerome Bitun

It's been two months since I wrote something here. I must admit, writing is sometimes hard. Not that I don't have anything to write about, but more like I thought of something to write while walking/driving/showering but I forget to write it down immediately and when I'm ready to write, I forgot what I was going to write about. Anyway, I wasn't able to write anything last month because I was on vacation for three weeks. I went to the Philippines and Hong Kong as we usually do. I'm telling you this because it has something to do with what I am writing about today. As I usually do whenever I go somewhere, I like to observe everything. I not only try to enjoy the sights and the place, but I always try to look at the town or country from an economics point of view. I know, I'm weird that way. For my clients who are from the Philippines, here is what I observed. Philippines Compared to when I was in the Philippines back around 2009, when Gloria Arroyo was s

Starting January 2012, there will be changes made to the Canada Pension Plan or CPP. Here are the changes according to Service Canada 's website. These changes will affect you if you are: an employee who contributes to the Canada Pension Plan (CPP), whether you are just starting your career or you are planning to retire soon; a self-employed person who contributes to the CPP; between the ages of 60 and 70 and you work while receiving your CPP retirement pension (or if you work outside of Quebec while receiving a Quebec Pension Plan (QPP) retirement pension); or an employer who contributes to the CPP on behalf of your employees. You will not be affected by these changes if you started receiving a CPP retirement pension before December 31, 2010, and you remain out of the work force. The CPP operates throughout Canada, except in Quebec, where the Quebec Pension Plan (QPP) provides benefits. These changes do not  apply to the QPP. For information about the QPP, visit the Q

So the US debt deal has been passed and was presented to Obama a few hours before the deadline which Obama signed. The deal increases the US debt limit immediately by $400B and another $500B by February. This avoids a default by the US government. Part of the debt deal is to cut the US deficit by at least $2.1 trillion over 10 years. If you divide that, it's around $200B a year. To put that amount in context, in 2010, the interest alone paid by the US on its debt is $164B. The Department of Defense budget in 2010 is $663.7B. In short, the spending cuts are insignificant. Here's the sad part, the budget cut is not really a cut in spending. According to Presidential hopeful Ron Paul , the budget cut is akin to a family "saving" $100,000 in expenses by deciding not to buy a Lamborghini, and instead getting a fully loaded Mercedes, when really their budget dictates that they need to stick with their perfectly serviceable Honda. I know a lot of people are confused

I've been talking to a lot of my clients about education savings lately that I thought I should write some information about the cost of education. First let's look at education cost. How much does it cost? The average cost of University education in BC is around $4,300 a year. Here's a list of average cost of Universities around BC for 2010/2011 from the Province of British Columbia website. I also found this calculator from the University of British Columbia to estimate the cost of going to UBC. Including books and student fees, it currently cost around $7,200 a year for a science major. It's cheaper as a Fine Arts major at $6,500. Engineering major is around $8,500. But a law major would need $13,100 a year and to be a doctor will cost almost $20,000 a year. Luckily for British Columbians, tuition fee increases has been limited to just 2% per year which is pretty manageable for most families. Whether this trend continues in the future, we'll have to

A question I've been asked a lot lately is why are their home insurance rates going up? Home insurance rates are based on several factors. The factors that affect your rates directly are: Location of your home Cost to rebuild in your area Materials used House features Dollar amount of coverage Your location is usually the first place companies will use to determine the cost of your insurance premiums. If you live in an area where there has been a lot of claims, then your premiums will be higher compared to a similar home two blocks away from you if there has been no claims in that neighborhood. If you live in an are where the cost to rebuild is higher like on the islands with limited access or materials has to be shipped by ferry. Then the cost to rebuild is higher than one in the city. If your home uses high end materials like hardwood floors, solid oak wood cabinets, etc. Then naturally, the cost of materials to rebuild your home is more expensive than those which use

2011 Tax Deadline Just a reminder, you have to file your taxes by April 30, 2011. U.S. Outlook The rating agency S&P 500 issued a warning Monday, April 18, 2011 on US government debt. It said that there is a 33% chance it would lower the United States credit rating from AAA in the next two years if Washington failed to manage the country's debt. This sent the Dow Jones, S&P500 and the TSX lower. S&P said it has little confidence that the White House and Congress will agree on a deficit-reduction plan before the fall 2012 elections. By that time, the measures won't go into effect until the fiscal year 2014. This does not look good for the U.S. The ratings done by the three major ratings agency is very important and the AAA rating is one most sought after rating by both investors and debt issuers. The reason this is important is because most big pension funds, hedge funds and mutual funds have in their mandate to only buy "AAA" rated bonds. If the U.S. lose

Speaking at the Casey Research Gold and Resource Summit, Eric Sprott told investors that there is no more silver left to go around, "There's $22 billion of silver available in the world, of which the ETFs already own half, and between you guys and us we probably own the other half... Which means there's nothing left."

I'm sure you're heard of the recent earthquake that hit Japan yesterday. Here are some useful links on how to prepare for an emergency. Please check these websites: http://choicez.biz/FraserValleyEmergencyResources.htm http://www.pep.bc.ca/hazard_preparedness/earthquake_preparedness.html http://www.getprepared.gc.ca/index-eng.aspx http://vancouver.ca/emerg/ http://www.cooperators.ca/static/pdf/en/Prepare-for-the-unexpected.pdf 　 How to survive a major Earthquake: http://www.victoria.ca/cityhall/pdfs/departments_vepnei_ind_prepare.pdf http://www.taekwondo.bc.ca/Emergency%20Preparedness.pdf Check this PDF file: http://www.getprepared.gc.ca/_fl/guide/national-eng.pdf

Retirement This year, 2011, marks the year the first of the baby boomers turn 65. Baby boomers are those who were born between 1946 to 1964. So in this edition of the newsletter, I thought it would be good to talk about retirement since we’ve just finished the RRSP season. When you retire, you qualify for some government pension or benefits like CPP, OAS and GIS. So what are they and how do they work? Here’s a summary. CPP – Canada Pension Plan A CPP retirement pension is a monthly benefit paid to people who have contributed to the Canada Pension Plan. The pension is designed to replace about 25% of a person's earnings from employment, up to a maximum amount. For 2010, the maximum amount it was $934.17. Not very much is it? But there’s good news! CPP has increased their maximum benefit. For 2011, the maximum CPP benefit you can get is $960.00. Woohoo! And if you qualify, you can get Old Age Security (OAS) benefit as well, up to $524.23 and Guaranteed Income Supplement (GIS) of $661

Here's a video interview with Eric Sprott of Sprott Asset Management regarding his views on gold and silver.

It's RRSP Season Again! Yep, it's that time of the year again. Make sure you have your T4 ready and have calculated your maximum contribution. The deadline to contribute to your RRSP is March 1, 2011. Investment Landscape People have been asking me what's the best place to invest right now? Are we out of the recession yet? Is the U.S. back on track? Here's my own view and my views are not necessarily the same as what you hear or read in the media or from portfolio managers. Let me answer the first one as that is the easiest one to answer. The best place to invest is worldwide, always. You cannot have a portfolio concentrated into one country like Canada. Canada only represents a small percentage of the world market. Adding just 20% foreign equities into your portfolio would expose you a lot of potential growth from China, Europe, India, etc. But how much to invest in foreign equities will depend on what stage you are in your life. If you are nearing retirement or you ar