HAVING TOO MUCH MONEY IN RRSP'S IS BAD!!!! | Page 2 | Your stories | Discussion forum

To HappyNewYear

I have experience with RRSP/TFSA in Mortgage Investments. I currently work for a developer which offers this type of investment. I have been doing this for 2 years now and these investments are safe and secure. A company which starts a Mortgage Investment can not mess with registered funds because we have to report to CRA and the Securities Commission. None of my clients have had any problems with any investments made with registerd funds and non-registered funds.

I repeat... you CANNOT conduct business from within an RRSP. Holding an arms-length mortgage inside an RRSP would require you to lend money in the RRSP out to someone other than yourself or someone related to you with the expectation of PROFIT. This is a BUSINESS ACTIVITY and cannot be done within an RRSP. Anyone who says otherwise either doesn`t know what they are talking about, or they are a scam artist.

Well, if a retiree is pulling in 50k+ then why do they NEED the extras? In my opinion, I support the clawbacks. They are there to ensure the old people who don't have much are not forgotten and left to sell vegetables at the bus station like in a lot of countries around the world. If one can save and engineer a senior's income sufficient to lead a very decent life...higher than many working people even...then the extra trimmings should go to somebody else who needs it more. I am continually shocked by the overwhelming sense of entitlement in this country. No, I am not a foreigner...I'm 20th generation Canadian. And, no, I do not have a puffy pension of any kind. And, yes, I strategically contribute towards RRSPs...only during periods if higher income...which makes me a bit of a fence sitter as I agree with points on both sides. I'm aiming for a target income that is self generated...if it gets padded, fine. If it doesn't, that's fine too. Property tax, food, meds, play, and travel will hopefully be my outputs. Meds is a wild card as we never know what will hit us as we progress! Mitigate that with a healthy lifestyle is all you can do. I reckon without any debts, 30k is more than sufficient for a decent life. That's why I think that any trimmings that are cut is fine. No kids is one saving that I'm planning on. Even if I do end up having kids I plan to spend my money and not preoccupy myself with a legacy. Why penny pinch and make wise money choices and fret about clawbacks and stuff only to pass it on to somebody else?? Nope. As a matter of fact, I would support a death clawback that would see any hoarded trimmings taxed heavily if not spent(subject to some modelling analysis, of course...for example if one is 95 and their nest egg is growing).
I'm not sure exactly where I sit on the teacher issue. I do not think that they should be singled out, that's not fair. If one wishes to focus their envy then they should refer to the entire 'public sector' and not specifically teachers. They do, after all, educate us. Which is a tad bit more important to me than many Ottawa jobs.
Bottom line: I would want to see that seniors who have lived a long life in our society not forgotten. And not left with only enough income to scratch by. This means that people who are more fortunate should be OK with their clawbacks...it means they're doing well...and they deserve it.

http://www.tdwaterhouse.ca/dis.....?id=524848

Check out this site; please provide your comments to this . Thanks.

Has anyone had any experience dealing with TD Waterhouse Arms Length Mortgage package? Thanks

Wow .. I guess this goes to show, be careful who you take advice from in a discussion forum!

Contrary to virtually everything you've suggested, "Guest", you're wrong on every single element of what you've said.

Arm's length mortgages are completely legal, and are not restricted to charging interest rates in the 4-5% range. That is the MINIMUM interest rate allowed by CRA, as it is required to be a "commercially reasonable" rate.

It's one of the most predictable, solid and attractive investment strategies that is RRSP eligible. Done properly, your risk is very low, and you're able to generate double digit returns.

For anyone reading this thread, do yourself a favor and get some actual information and facts. My book goes through the entire strategy A to Z, and also outlines both sides of the coin - it's a fantastic investment strategy, but there are risks if you don't know how to invest properly.

I don't sell mortgages or anything like that, so I have nothing to sell (other than the book of course, but trust me, writing books doesn't make you wealthy!) The book is a Canadian best-seller for a reason -- because it's good information, and it works.

There's more information on my website at http://www.RRSPSecrets.com and my book is available in all major bookstores, Amazon.ca, etc.

The best advice is to UNDERSTAND what you're investing in, and choose something that makes sense for your situation. Don't listen to armchair experts who mislead people in forums, simply because they're too ignorant to acknowledge they really don't know what they're talking about.

Thanks for the entertainment, but it gets frustrating to see average Canadians trying to get good information, and being misled by those who have no idea what they're talking about.

Cheers,
Greg Habstritt

Wow .. I guess this goes to show, be careful who you take advice from in a discussion forum!

Uhh... I believe this goes for the rest of life too and not just discussion forums. Any advice should be analysed using critical thinking skills.

Contrary to virtually everything you've suggested, "Guest", you're wrong on every single element of what you've said.

Nice one there, except that Guest admitted that he was wrong 3 posts above yours. I believe this is the point of discussion forums. If HappyNewYear didn't bring it up, there wouldn't have been a discussion. The discussion ultimately led to something useful because enough people participated and produced some evidence.

Arm's length mortgages are completely legal, and are not restricted to charging interest rates in the 4-5% range. That is the MINIMUM interest rate allowed by CRA, as it is required to be a "commercially reasonable" rate.

It's one of the most predictable, solid and attractive investment strategies that is RRSP eligible. Done properly, your risk is very low, and you're able to generate double digit returns.

Giving advice on a discussion forum eh? I advise the rest of you to "be careful who you take advice from in a discussion forum!"

For anyone reading this thread, do yourself a favor and get some actual information and facts. My book goes through the entire strategy A to Z, and also outlines both sides of the coin - it's a fantastic investment strategy, but there are risks if you don't know how to invest properly.

Patronizing and plugging your book at the same time? Nice. I believe everyone here is trying to "get some actual information and facts".

The best advice is to UNDERSTAND what you're investing in, and choose something that makes sense for your situation. Don't listen to armchair experts who mislead people in forums, simply because they're too ignorant to acknowledge they really don't know what they're talking about.

Thanks for the entertainment, but it gets frustrating to see average Canadians trying to get good information, and being misled by those who have no idea what they're talking about.

That's right, don't listen to "armchair experts", listen to "experts" who have written books and who like to belittle people in discussion forums.

Please note that I am not saying that Arm's Length Mortgages in RRSPs are not a good idea or that your book may not contain factual information, I am simply stating that you got some information in your post wrong, it is quite patronizing, and I will look into Arm's Length Mortgages in RRSPs, but I won't be looking at your website or buying into your book to enrich you because of this very post. You can be all high and mighty about having secrets that I can't discover myself, although is it really a secret if you share it? Have a nice day.

guest said:

HappyNewYear said:

What about Greg Habstritt's website , check it out http://www.rrspsecrets.com/live - any comments?

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yeah:

#1 any website that starts with "Dear Friend" usually has "scam" written all over it.

#2 not surprisingly, there is no reference to canadian legislation or regulations that might suggest what they are proposing is actually LEGAL.

#3 who the hell is greg hasbritt?

those are my comments. 🙂

The scam is not the Arm's Length Mortgage...

gotta love people like greg hasbritt who argue by assertion instead of providing any facts to back up his arguments. of course, he suggests you can learn the "facts" if you buy a copy of his book... wonder what the publisher's return policy on the book is if the "facts" turn out to be 100% horsefeathers? yes, i admitted above i was wrong about arms-length mortgages in rrsps, but i am right when i say that you cannot use an rrsp as a tax shelter within which you can conduct business and avoid paying tax. mortgage lending seem to be an exception to that general rule. i also notice that greg didn't attempt to address my concerns about using rrsp funds to lend people money to buy real estate (which is what mortgages are all about). with respect to the interest rate you can charge, greg states that you can only charge a "commercially reasonable" rate, which is correct, but greg doesn't seem to understand that in this case you want to MAXIMIZE the rate you charge, not "minimize", which he clearly suggests in his post. if you lend money to someone from within your rrsp, obviously as the lender you want to charge the highest interest rate possible to whoever you are lending your money to. you cannot lend money to someone at a rate of say 8% for a 5 year term when the going rate is around 4%. while a 4% return doesn't sound bad in this climate, that assumes that the person you lend money to doesn't default on the mortgage (i.e. stop paying you). i think greg revealed himself as a used car salesman when he stated that "done properly, your risk is very low". that's a ridiculous statement. what guarantee do you have that the person you lend money to is going to actually pay you back? the obvious answer is that there is no such guarantee. one option you have to protect your interests is to insist that the person borrowing your money take out mortgage insurance from the CDIC (as i stated in my post above). you MIGHT be able to do this, but the borrower is going to have to arrange this all by himself. CMHC mortgage insurance details are usually taken care of by a bank when you get a high-ratio mortgage the usual way. this is going to be a BIG pain in the butt for the borrower, who may re-evaluate his decision to get a mortgage through you. this leads to another obvious question... why would someone choose to borrow money from you instead of go through a bank? is it because the bank doesn't think they are credit-worthy? if you choose to go ahead without mortgage insurance and the borrower defaults, YOU are stuck with the costs of foreclosing on the loan. that means hiring lawyers and using the court process to get a judgment which can be used to seize and sell the mortgaged property. all this takes a lot of time and a lot of MONEY. you would NOT be feeling all that great knowing that a substantial portion of your RRSP is in jeapordy because the person or business you lent money to all of a sudden stopped paying. contrary to what greg says, i'd say that this is a pretty big risk. OK greg, your turn... are you going to address these perfectly valid concerns, or are you just going to keep telling people to "buy your book". by the way, do you know russ whitney? you and he seem to share a few things in common...

it was "doink" the clown actually... and russ whitney was a meat-packer before he got lucky with a few real estate deals and parlayed that into a business that sells people dreams for money. what's your point?