The money doesn’t “flow" from you spouse’s TFSA to your account.

For each spouse, the TIME MACHINE calculates a surplus or deficit at the end of each year after all incomes, expenses, automatic deposits/withdrawals and taxes have been paid.

Any surplus is dealt with by making deposits to the person's accounts following the Deposit Priorities table applicable at the time.

Any deficit is dealt with by making withdrawals from the person's accounts following the Withdrawal Priorities table applicable at the time.

Remember that for each Deposit or Withdrawal PRIORTIES table there are 2 intermingled: one for each spouse. Joint accounts will be in both spouse's tables. If you have a CCPC with multiple accounts/loans there is a thid table in there too.

You have set your spouse’s expenses to 100K with income of 50K, and your expenses of 60K with income of 105K

Your spouse’s expenses are too high for their income, and thus requires a withdrawal from their accounts. Their first priority for withdrawal is their TFSA.

Your expenses are lower than your income, and thus require a deposit to your accounts. your first priority for deposit is your TFSA if you have room, then your non-registered account.

You may want to adjust the expenses to shift some to you, or make some joint. You could also make your non-registered account joint so that your spouse has access to those funds.

The TIME MACHINE considers account ownership to not run into CRA attribution rules. It won’t just take from your account to pay for your spouse’s expenses/savings, unless your spouse is broke (no savings), then it has no choice.

What you may have read is that the Windfall Elimination Provision (WEP) does not directly apply to spousal benefits. WEP can only apply to Social Security retirement or disability benefits payable based on a person's own work record. WEP can indirectly affect spousal benefits, though, in that spousal benefits are paid based on a percentage of the worker's primary insurance amount (PIA). A person's PIA is equal to their Social Security retirement benefit rate if they start drawing their benefits at full retirement age (FRA). Therefore, if a worker's PIA is lower due to WEP, any auxiliary (e.g. spousal, child) benefits payable from that worker's record would also be lower.

I get asked a lot about the first year,  it confuses people to see pro-rated amounts, and I would love to find a way to make it clearer. However I suppose I don’t really understand your question. What exactly would you like to see?

The full year amounts for expenses/incomes etc, you know what they are. You know how much you have earned and spent this year so far. The deposits/withdrawals to accounts have to be done from today because the balance we have is today’s. This is important because most of my users have their accounts/investments automatically updated with Fundata and/or Wealthica. Again, you know what withdrawals/deposits were already done this year. You know how your investments did. The TIME MACHINE projects in the future from today, it does not project back into the past as we assume you know the past already, and your knowledge would be most accurate.

Maybe you could clarify more on what exactly you are trying to achieve? If I can implement it without having to ask many additional questions from the user, I will consider it.

Dear MoneyReady App users,

You can now run 100 market model simulations with one click.
I've written about it in a new blog post on "Stress testing your financial plan":
https://www.moneyreadyapp.ca/blog/post/14, and there's more details in the eBook.

A subscription is required to use this feature.

I wish you a happy, healthy, and prosperous 2023!

Your comments and feedback are always appreciated.
Elisabeth Tillier, Ph.D.
Head of MoneyReady

Dear MoneyReady App users,

We've completely revamped the MoneyReady App reports you can print or download to pdf.
You can download a sample report from https://www.moneyreadyapp.ca/sampleplan (no login required).
For your own reports, you may need a fresh TIME MACHINE run to see all the new features.

Your comments and feedback are always appreciated.
Elisabeth Tillier, Ph.D.
Head of MoneyReady

Dear MoneyReady App users,

The MoneyReady App is all about exploring different financial planning scenarios. However, until now, you could only explore one scenario at a time and you couldn't return to a previous scenario easily.

Today I am very excited to announce that saved TIME MACHINE runs will now also save a snapshot of the scenario that was run so that you can go back to it with one click. In your list of saved runs, you can click on the button 'Restore' which will appear for all runs going forward. This will replace entries in your current workspace with those from the imported one.

Not everything is restored, as LOAN balances, ACCOUNT and INVESTMENT values, CPP/QPP earnings and current year tax information will retain their most recently updated values.

This allows you to rerun a previous scenario but with updated information quite easily. It is most useful when you have different scenarios with multiple things changed, added, or deleted. For example, you can try different retirement dates that will affect things like your incomes and expenses, and rerun these scenarios any time with updated market information. It also makes it easy to try out a new scenario, for example buying an investment property with a mortgage that adds rental income, and be able to revert back easily if that turns out not to be what you want to do.

Restoring an older scenario can be a dangerous operation if you have entries in your current workspace that aren't saved, but we give you warnings. Just make sure to run the TIME MACHINE and to save your new scenario before restoring an older one.

You will also be able to import ACCOUNTS and INVESTMENTS found in any previously saved scenario that are not in your current workspace: you will see a new button for that beneath your list of ACCOUNTS. These are kept updated in whatever way you keep your accounts updated (manually, with FUNData, or Wealthica) the same way as in your current workspace.

You can find the details in the Help for the 'list of saved runs' page, and in a new section of the MoneyReady App eBook.

This feature has been requested often by many of you for a long time, so thank you for your patience in waiting for its implementation. Note that this feature is not backwards-compatible with runs before today.

Your comments and feedback are always appreciated.
Elisabeth Tillier, Ph.D.
Head of MoneyReady

Dear MoneyReady App users,

The Tax-Free First Home Savings Account (FHSA) is a new type of registered account to help individuals save for their first home.
In a nutshell, you can open one if you haven't owned a home in the last 4 years. Deposits are tax-deductible, and withdrawals are not taxed if used to buy a home but taxed otherwise. They must be closed within 15 years of opening.
They were introduced in the April 2022 federal budget but won't be available until sometime in 2023.

We make them available now for planning with the TIME MACHINE.

Because of their tax benefits and flexibility of transfers to/from RRSPs, they do present planning opportunities whether or not you are planning a home purchase.
If you are planning to buy a first home, the FHSA offers several advantages over the Home Buyer's plan (which the MoneyReady App also considers) due to its flexibility, but there are some caveats.
Lots more details on the FHSA and how you can use it in the MoneyReady App eBook, so make sure to download the latest version.

Your questions and feedback are always welcome.
Elisabeth Tillier, Ph.D.
Head of MoneyReady

Dear MoneyReady App users,

Updates in the last couple of months:

  1. New features:

      a) Two new graphs in TIME MACHINE.
           i. A summary of all accounts by type (non-registered, tax-free, and tax-deferred) in every year. For those of you with a spouse or many accounts, a summary can be useful.
           ii. Rate of saving or of withdrawal by age. When positive, it shows the savings rate as a percentage of income. When negative, it shows the withdrawal rate as a percentage of account balances.

      b) Employee stock options.
        You can now add employee stock options as INVESTMENTS. For publicly traded North-American companies, you can track their value if you enter a stock ticker. You can also add private company options. The TIME MACHINE will exercise the options on the exercise date and calculate the appropriate taxes, enforcing the new tax rules.

      c) Time Value of Money Calculator.
        In case you don't own a financial calculator, you can use this one to solve TVM problems.

  2. Under the hood:

    a) Pension income splitting in the Withdrawal Optimizer.
      The TIME MACHINE has always considered pension income-splitting. To implement it in the Withdrawal Optimizer algorithm was more difficult as the algorithm itself considers each spouse independently. The algorithm now considers pension income splitting, and the pension deduction, recursively. This converges nicely, and provides better withdrawal suggestions to the TIME MACHINE, making it even more likely to find a more optimal withdrawal strategy.

    b) Tax timing in the TIME MACHINE.
      The TIME MACHINE no longer delays any tax implications of deposits and withdrawals, for zeroing the Wallet account, to the following year. The earlier approximation had made the TIME MACHINE faster with little loss in accuracy, so this change makes it a little slower (it may need to recalculate taxes several times in the same year) but it doesn't change the results much. However, the advantages are that this change provides clearer tax reports, and more accurate calculations of benefits, tax credits, and taxes, that depend on the previous year's taxable income. This applies to all runs from May 9, 2022.

Your comments and feedback are always welcome.

Elisabeth Tillier, Ph.D.
Head of MoneyReady

Dear MoneyReady App users,

Updates in the last couple of month:

   1. The principal residence capital gains exemption and change of use.
   If you have more than one real estate property, a button now appears below your list of properties where you can specify the years for which you will claim the principal residence exemption for each property when it is sold in the TIME MACHINE. This is useful if you have changed the designation of principal residence in the past, or plan to do so in the future.

   2. Equity market crashes.
   Setting up an equity market crash scenario no longer adds future rates for your investments in your rates table. Instead, the scenario is saved and rates are calculated on the fly when choosing to run the TIME MACHINE with that scenario. This makes it simpler, faster, and allowed us to remove the limit on the number of stocks and funds you can have for running a market crash scenario.

   3. Friends and Family Advisor 5-pack subscriptions.
   I'm pleased to announce these new subscriptions that make it more affordable for users that advise a number of friends and family.
   You can manage your account and add up to 4 client accounts for $350+tax/year.
   These subscriptions will be available when payment on your account is required, or you can contact me to be switched to an advisor account anytime.
   If you need more clients, you can add them individually, add additional 5-packs, or switch to a Professional Advisor Unlimited yearly subscription.
   All advisor subscriptions are described at www.moneyreadyapp.ca/advisors.

Your comments and feedback are always welcome.

Elisabeth Tillier, Ph.D.
Head of MoneyReady

Dear MoneyReady App users,

A new chart suggested by a user that you might find useful is now included in the TIME MACHINE results. It shows your Incomes from all sources (salary, pensions, etc), separately from income from public pensions, and net withdrawals from tax-free, tax deferred, and non-registered accounts. This chart will also show up on old runs and saved runs, as long as they are not too old.

A checklist for advisors or other users coming from other financial planning software is now in the EXPENSES' "Help for this page” and in the corresponding section of the eBook. It shows how to set up the TIME MACHINE in a similar way as other software programs <b>that assume all money not explicitly saved before retirement is spent.

My new blog post on CPP and QPP dropout provisions explores differences between the two plans, and their impact on the size and timing of your public pension. https://www.moneyreadyapp.ca/blog/post/12.
Mon nouvel article de blogue sur les clauses d’exclusion de la période de cotisation du RPC et du RRQ explore les différences entre les deux régimes et leurs effets sur le montant et le timing de votre rente. https://www.moneyreadyapp.ca/blog/post/13.

Your comments and feedback are always welcome.
Vous pouvez nous écrire en Français.

Elisabeth Tillier, Ph.D.

Head of MoneyReady

Dear MoneyReady App users,

Updates and new features in the last month:

   1. CPP/QPP sharing. You can apply to the CRA or Retraite Québec for a 2-way transfer of a portion of a pension payment to the other spouse. This can create a tax advantage if it decreases the taxable income of the spouse in a higher tax bracket. As the portion of the amount that can be transferred depends on how long you have been living together, you can now in the MoneyReady App enter a date of when you started cohabitating (approximately) in the CPP/QPP/OAS tab, and pension sharing will then be applied. The resulting net transfer will be shown in the Warnings column of the Timetable.
   2. RDSPs. Calculations of grants, bonds and taxes have been updated. Please make sure to enter previous contributions for accurate calculations. o avoid penalties, RDSP DAP payments will not be made in the TIME MACHINE if there are grant or bond repayments to be made.
   3. GIS. The TIME MACHINE has always calculated GIS and GIS allowance to a spouse when applicable. The amount is included in the OAS column, but we now also show the GIS amounts separately in the Warnings column.

New Year checklist:
  My favourite day to run the TIME MACHINE is January 1. This is because the current year then acts very much like a future year in the TIME MACHINE. There is no need to consider what contributions have already been made, what taxes have already been paid, and no need to prorate any amounts for incomes, expenses and savings. Here is a list of things that need to be updated at the start of the year, and sometimes throughout the year to keep the current year calculation as accurate as possible.

  1. CPP/QPP table(s). An entry for pensionable earnings for last year will appear. You will need to estimate what those were until the actual amount is updated at the CRA or Retraite Québec later in the year.
  2. RRIFs and LIFs.  For each of these, within 'Edit Account properties' enter the balance of the account at the end of last year. If you make any withdrawals during the year, update the total withdrawn this year.
  3. RDSPs. 'Edit Account properties' for these, and update the table of previous contributions if one appears. If you make a contribution this year, enter the amount once made, and you will need to come back and check the box once the grants/bonds have been received so that they are not double counted in the TIME MACHINE.
  4. PRIORITIES. Just review the PRIORITIES. A new entry for this year will be created automatically from last year if you hadn't created one for the new year previously.
  5. TIME MACHINE. There are up to 3 screens that capture current year tax information before running the TIME MACHINE: one for yourself, one for your spouse and one for your CCPC when applicable. Please update the amounts asked for the current year, and keep them updated throughout the year.
  6. Tax owing or refund. If you expect a tax refund from the previous year's taxes, you can enter it as an Income (Other, not taxable) with start and end dates on the date you expect to receive it. Similarly for tax owing, enter it as an Expense for the date you expect to pay it.

Happy New Year!

Elisabeth Tillier, Ph.D.
Head of MoneyReady

Dear MoneyReady App users,

No new features this past month, however a lot of updates as we get close to 2022.

  1. All values for taxes/deductions/credits/limits have been updated for 2021 and 2022. These should be final for 2021, but changes could still happen for 2022.
  2. The TFSA contribution limit increase remains at $6,000 for 2022.
     For those of you who plan to contribute the maximum every year
     and have entered an AUTOMATIC DEPOSIT to a TFSA at $6,000 to be indexed with inflation,
     the TIME MACHINE will now increase that amount to the increased limits expected in future years given your set inflation rate and rounded to the nearest $500 to match the maximum.
  3. When inflation started creeping up,
     I changed the default inflation rate for new users to the latest value obtained from the Bank of Canada.
     That value is now so high that I reversed course and have now set the default back to 2%,
     the Bank of Canada’s long-term target, which is appropriate for long-term planning.
     The values set for inflation and prime are now shown on the Dashboard to avoid any surprises.
     You can change them in RATES/YIELDS/CURRENCIES.
  4. Advisors can set their preferred default inflation and prime rates for all of their clients at once.
  5. The CPP and QPP calculations have been updated.
     For QPP, the link to obtain your earnings table (relevé de participation) has been updated
     to the Retraite Québec website.
     You should be able to just copy and paste the table, but contact me if you have a problem.
  6. The Withdrawal OPTIMIZER has been tweaked to better handle portfolios with multiple investments and is even better at finding an optimal withdrawal strategy.

I've gotten a lot of great questions and feedback lately. Thank you!
They are always welcome.

Elisabeth Tillier, Ph.D.
Head of MoneyReady

Dear MoneyReady App users,

The Canada-U.S. border is reopening soon and I'm happy to announce some new features for Canadian residents that have worked in the U.S.
We've added support for IRAs, traditional and Roth IRAs, 401(k)s and similar accounts. You'll see this option when you add an ACCOUNT or import one from Wealthica.
We've added U.S. Social Security calculations. If you or your spouse had eligible earnings, check the box in your PROFILE and a new US SOCIAL SECURITY tab will be added on the left menu.
The MoneyReady App is for current Canadian residents and we assume there will no more contributions made to the accounts or to social security.
Please read the new sections of the eBook for details and all the caveats. Cross-border financial planning is tricky, so make sure to speak to an advisor knowledgeable in the area before changing country.

Other recent updates:
We've moved managing two-factor-authentication and your email address to the new PREFERENCES tab.
There you can also set the default TIME MACHINE view to today's or future dollars.
You can also set your preference for the display of negative currency amounts which will apply to tables throughout the app.

We've also made the Simple Retirement Calculator free without registration, it's available
https://www.moneyreadyapp.ca/simple-retirement-calculator/
That function is very limited but can be useful for very simple scenarios.
We've opened it up to generate more traffic and awareness, so please tell your friends!

Your questions and feedback are always welcome.

Elisabeth Tillier, Ph.D.
Head of MoneyReady

Dear MoneyReady App users,

You can (and should) now add two-factor authentication in your PROFILE.
You can use an authenticator app on your smartphone to secure your MoneyReady App account. There are many free authenticator apps available for Android and iOS.
This method of two-factor authentication is highly private and secure as it does not require us to have your phone number.
You just scan the QR code generated by the MoneyReady App to tie your account to your authenticator app. The authenticator app will then automatically generate a 6-digit code that changes every 30 seconds. You will be prompted for the current code to subsequently log in to your MoneyReady App account. It acts as a second temporary password.

Other updates in the last month:

With inflation being so volatile these days, we now update inflation and prime rates nightly from the Bank of Canada. To update your default rate, go to RATES/YIELDS/CURRENCIES. You can use the Search function for "Inflation" or "Prime" and click on Update for the current rate.

Advisors can update the default inflation and prime rates, and also all default investment growth rates according to asset-allocation, for all their clients at once. The relevant buttons are below your client list.

Hybrid HELOC/chequing accounts. We've improved the handling of these types of accounts when imported from Wealthica. The MoneyReady App now splits the same account into a LOAN component and an ACCOUNT component when appropriate.

Your questions and feedback are always welcome.

Elisabeth Tillier, Ph.D.
Head of MoneyReady

Dear MoneyReady App users,

Updates in the last month::

Save up to 6 runs.
You can now save up to 6 runs of the TIME MACHINE (per user or client). A list of your saved runs is shown on your dashboard. Advisors should save the runs they want clients to see on their dashboard when the client logs in.

Annotate saved runs.
You can add a description for each run saved. We provide a rich-text editor that you can use to make formatted annotations/comments that will be shown above the TIME MACHINE results and at the top of the report for the saved run.

Compare runs.
Saved runs can be compared pairwise. Additional graphs with the difference between the two runs are shown, where applicable.

Expand graphs.
Click on a graph in the TIME MACHINE results to expand it to the full size of the browser window, or to return to the original view.

Input tables in Excel workbook.
Input tables such as INVESTMENTS, INCOMES, EXPENSES, PRIORITIES, etc. are now included in the Excel download of any TIME MACHINE run.

An additional loan modification stategy.
You can now modify term loans to increase the payment by a given percentage on each of the loan’s anniversaries between any two dates.

These improvements were user-suggested or inferred from your questions and feedback, so thank you and keep them coming! This is your financial plannning app, Canada. Whether you're DIY or an advisor helping others to reach their financial goals, we're here to help.

Elisabeth Tillier, Ph.D.
Head of MoneyReady

Dear {{user.username}} and all MoneyReady App users,

A mix of user-suggested updates in the last month:

  1. Cryptocurrencies and Currencies.
    We now treat cryptocurrencies as investments. They can be updated from Wealthica, or they can be added manually. We update to latest prices using the CoinGecko API with a click of a button (no charge). Since they are treated as investments, they work quite well with the PORTFOLIO OPTIMIZER we introduced last month that analyses risk and return.
    Regular currency investments now also work with that tool.

  2. Spousal prescribed-rate investment loans.
    One of the few income-splitting opportunities left for Canadians is to lend money to their lower-income spouse to invest. When set up properly, investment returns will then be taxed at a lower rate. You can now set that up in LOANS.

  3. Loan modifications.
    You can now modify loans by setting a new payment between any two dates. This can be used to skip payments, or to plan to pay down an interest-only line of credit.

  4. Other Income.
    Other Income has been expanded to allow different tax treatments to allow income from trusts, companies you don't own, and other scenarios. It now allows non-taxable income, regular income (not earned), eligible dividends, non-eligible dividends and capital gains. Do not duplicate income already automatically considered by the app such as from your INVESTMENTS, your CCPC, and CPP/QPP/OAS.

I strongly encourage you to read the relevant sections of the updated eBook or the help pages for details on these features.

Your questions and feedback are always welcome.

Elisabeth Tillier, Ph.D.
Head of MoneyReady

Dear MoneyReady App users,

With our Wealthica integration, it is very easy to quickly import accounts into the MoneyReady App and many have imported portfolios with many investments.
You can also add the investments manually. In any case we have daily market data provided by Fundata for most Canadian and US stocks and Canadian Mutual Funds.

I'm happy to announce that the MoneyReady App now provides users the ability to optimize and rebalance their portfolios using Modern Portfolio Theory to maximize return and minimize risk, given the historical market performance of their assets.
I've written more about it in a blog post that you can find at https://www.moneyreadyapp.ca/blog/post/11.

This new feature is included with a subscription.

Your questions and feedback are always welcome.

Elisabeth Tillier, Ph.D.
Head of MoneyReady

Dear {{user.username}} and all MoneyReady App users,

One thing that I always wanted in the MoneyReady App is the ability to run die-broke scenarios.
Today I announce a new feature that does that and more.
I call it CHOOSE YOUR LEGACY.
The tool will let you set your desired liquid net-worth at the end of the TIME MACHINE.
It will then find amounts and time-frames to add EXPENSES or to reduce your current EXPENSES so that you have no cash-flow problems in your lifetime and leave the desired legacy after all taxes to your heirs.
I've written more about it in a blog post that you can find at https://www.moneyreadyapp.ca/blog/post/10.
This feature is included with a subscription.

Your questions and feedback are always welcome.

Elisabeth Tillier, Ph.D.
Head of MoneyReady

Dear MoneyReady App users,

Today I am excited to announce our new tool to optimize the age to start CPP/QPP.
I wrote a blog post that you can find at https://www.moneyreadyapp.ca/blog/post/9 that explains the procedure and my analysis.
This feature is included with a subscription.

I've also made changes for advisor accounts. We have added an optional quick entry form for clients so you can get started faster.
If an email address is given (again optional), the client will be able to login to a simplified version of the MoneyReadyApp to edit and add to the data, so you can get all the information you need from them directly.
They will not be able to run any tools, and you can revoke the permission anytime.
Once you are done with their plan, you can allow them to see the results and download them.
We have also added a yearly subscription feature, or you can pay as-you-go when adding clients.

Your questions and feedback is always welcome.

Elisabeth Tillier, Ph.D.
Head of MoneyReady