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Author: Maurie Backman

  • ‘Some of them are very upset’: Canadians selling off properties in this New York ski town over tariffs, ’51st state’ rhetoric. Here’s what the real estate shift could mean for property values

    ‘Some of them are very upset’: Canadians selling off properties in this New York ski town over tariffs, ’51st state’ rhetoric. Here’s what the real estate shift could mean for property values

    Roughly 90 minutes south of the Canadian border at Niagara Falls lies Ellicottville, New York. Known for its ski resorts and charming small-town atmosphere, it’s home to several hundred Airbnb listings.

    But recently, a number of Canadian homeowners have been putting their Ellicottville vacation properties up for sale. And according to mother-daughter real estate brokers Cathleen and Melanie Pritchard, this trend is happening as a result of President Donald Trump’s aggressive tariff policies.

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    “We have seen an uptick in listings from Canadians,” Melanie told ABC 7 News Buffalo.

    “Our Canadian friends, some of them are very upset. … They’re just feeling like they’re not being loved. They’re wondering why this is happening — as are we."

    How an uptick in listings could affect property values

    Realtor.com puts the median listing price in Ellicottville at about $420,000. Redfin reports that in February of 2025, home prices in Ellicottville were up 699.9% compared to last year, and that homes spend an average of 66 days on the market.

    But as sellers increasingly put their Ellicottville homes on the market, whether due to frustrations over U.S. economic policies or other factors, home values in the town have the potential to decline. And that’s not unique to Ellicottville — it’s how the real estate market generally works.

    A big reason home values are up on a national level right now is that inventory has been low for years. Mortgage lenders offered up record-low borrowing rates during the pandemic, which spurred a wave of refinances. When rates started creeping upward following the pandemic, housing inventory declined.

    And that made sense. Homeowners did not want to give up the super-low mortgage rates they had managed to lock in. But that lack of supply helped home prices rise, even at a time when mortgages were expensive to sign.

    But if the opposite happens in Ellicottville, and a large number of homes hit the market in short order, it could result in an oversupply. That, in turn, could lead to lower home prices and lower home values.

    Sellers who list their homes may not get the prices they want. And existing homeowners who aren’t selling could see a drop in equity.

    Furthermore, if ill feelings toward the U.S. drive Canadian buyers away, home values in Ellicottville could plunge even more as a large pool of buyers dwindles down. It’s been reported that an estimated 23% of homes in Ellicottville are owned by Canadians.

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    What a changing housing market means for buyers and sellers

    The housing market is typically subject to basic laws of supply and demand. When there’s a greater supply of homes than demand, prices tend to drop. When there’s more demand and less supply, prices can rise. And if supply continues to tick up in Ellicottville, both buyers and sellers will need to use those circumstances to their advantage.

    Sellers will need to be strategic to help their homes stand out and attract buyers. Those looking to sell can partner with a real estate agent who knows the area well in order to price their homes strategically. They can also focus on high-impact repairs and improvements that are likely to draw buyers in.

    Being flexible with closing dates is another tactic sellers can use. Similarly, offering added concessions, like covering closing costs, could help.

    Buyers, on the other hand, can take advantage of the changing market by negotiating lower prices. They can also ask sellers to make certain repairs or improvements as a condition of completing a sale.

    But, buyers do need to be careful about entering a shifting market. If Canadians continue to pull out of Ellicottville, home values could drop in coming years. For buyers making a minimal down payment, there’s the real risk of ending up underwater on a mortgage in short order.

    It’s especially important to be cautious about buying in a changing market when the home is being purchased as an income property, as opposed to a primary residence. Waning demand could lead to a decline in bookings, making it harder to cover the costs of owning the property.

    One thing Ellicottville buyers should do at a time like this is talk with real estate agents in the area and get their take on whether current sentiment and recent trends are likely to impact future rental income. Those agents may not have a crystal ball, but their insight could prove invaluable — and perhaps spare some buyers from making a bad decision.

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    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • I just inherited $10,000 — but all I’m hearing these days is the US is headed for a recession. Should I use the cash to pay off my $9,000 credit card debt or keep it for my emergency fund?

    I just inherited $10,000 — but all I’m hearing these days is the US is headed for a recession. Should I use the cash to pay off my $9,000 credit card debt or keep it for my emergency fund?

    If you’re worried about a near-term recession, you’re certainly not alone. According to a survey conducted by business outlet Chief Executive, American CEOs revealed their take on the current economy, and it found that 62% now anticipate a slowdown or recession in the next six months — up from 48% in March.

    Part of the reason for this concern stems from uncertainty around tariff policies. As it is, tariff announcements have managed to wreak havoc on the stock market. It’s not such a stretch to think that they might lead to a broad pullback in consumer spending, especially if they lead to higher costs.

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    If you’re worried about a recession and recently came into, say, a $10,000 inheritance, you may be wondering whether you should use that money to pay off a $9,000 credit card balance or put the money into an emergency fund.

    The truth is that paying off debt and boosting savings are both smart moves at a time like this. Let’s dig into the pros and cons of paying off debt versus increasing savings so you can decide what to do.

    Paying off debt

    The longer you carry debt, the more it can cost you. So, if you use your $10,000 inheritance to pay off your credit card balance, you’ll potentially save yourself a boatload of money on credit card interest.

    Plus, if a recession hits, it could result in more widespread layoffs. And if you end up losing your job, not having credit card minimums to meet could make that situation a lot less stressful.

    On the other hand, if you use your $10,000 inheritance to pay off $9,000 in credit card debt, you’ll only be leaving yourself with $1,000 for savings purposes.

    The fact that you owe $9,000 on credit cards means you may not have much in the way of savings to begin with. But a mere $1,000 cushion isn’t likely to get you very far if you lose your job and are unemployed for months. So, while paying off your credit cards solves one problem, it could open the door to another.

    Keeping the cash as an emergency fund

    A $10,000 emergency fund could be extremely handy if you were to lose your job in a recession.

    Generally speaking, it’s a good idea to have at least a three-month emergency fund to get through a layoff without having to resort to more debt. If you keep that $10,000 in your savings account, it could spare you from having to add to your credit card balances and rack up even more interest charges.

    Also, it happens to be that savings accounts are paying generously right now because interest rates are up.

    If your $9,000 credit card balance happens to be on a 0% interest credit card with a good number of months until that 0% rate goes away, you could keep the money in savings for a bit, earn some interest, and see how economic events shake out.

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    Of course, the downside of this approach is that if you’re not looking at a 0% APR on your credit card debt, keeping the money in savings could mean racking up extra interest needlessly.

    If your credit APR is 24% — which is roughly the average APR on new credit accounts these days — and it takes you three years to pay off your balance, it could cost you around $3,700 in interest alone.

    Plus, the reality is that even if a recession hits, you’re not guaranteed to lose your job, so you may not need the extra emergency savings immediately. On the other hand, you know for a fact that your credit card balance is there, and that the longer it takes you to repay it, the more money you stand to lose to interest.

    Taking a balanced approach

    A $10,000 windfall gives you a lot of leeway to better your financial situation ahead of a recession. One thing you could do is split that money between your credit card debt and your emergency savings.

    The upside of this approach is that you get more protection in case your job disappears, but you also whittle down your credit card balance to a point where your minimum payments should shrink and your interest charges should be reduced.

    The downside, though, is that you may feel like you haven’t fully tackled the goal of paying down your debt completely or building your emergency fund completely.

    Putting $5,000 toward your debt still leaves you with a $4,000 balance, which is not a small sum. And while $5,000 is a nice emergency fund, it’s probably not enough to float you for three months either.

    Then again, 40% of Americans can’t cover a $1,000 emergency expense from savings, according to U.S. News & World Report. With $5,000 in savings, you’re in a much better place than people in that boat, even if you don’t have a “complete” emergency fund.

    Ultimately, all of the choices above are financially responsible ones. You’ll need to think about how vulnerable your job and industry might be to layoffs in the event of a recession. You’ll also need to consider what your credit card debt is costing you before you can make a choice that’s right for you.

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    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • I’m 61 and recently got laid off, but I’m not a prime candidate for employment at my age. I still want to work, but no one will hire me. What can I do?

    I’m 61 and recently got laid off, but I’m not a prime candidate for employment at my age. I still want to work, but no one will hire me. What can I do?

    Getting laid off can be a harsh blow at any age. But at 61, it can be an extremely difficult thing.

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    Even if you’re well qualified to do what you do, employers may be hesitant to hire someone who’s perceived to be on the cusp of retirement. While age discrimination isn’t legal, it’s a pretty common thing for employers to pass over job candidates due to their older age.

    Unfortunately, it sounds like you were forced to retire before you wanted. You wouldn’t be alone in that boat. A 2024 Transamerica survey of retirees found that 58% ended their careers sooner than they had planned. Among them, 43% cited employment-related issues. The median age of retirement was 62, three years younger than the traditional retirement age of 65.

    Retiring at 61 could be particularly challenging because you’re still a year away from being eligible to claim Social Security (at a reduced rate, no less), and you’re also four years away from being able to get health coverage through Medicare.

    So, rather than resign yourself to a forced early retirement, you may want to explore your options for being able to continue to work.

    Don’t give up on being able to work just yet

    Losing a job in your early 60s can be financially and emotionally devastating. But that doesn’t mean you need to accept an early retirement.

    Thanks to the booming gig economy, you may be able to go out and find work on your own terms. You could try consulting in your former field, starting a new business, or even embracing different side hustles to cobble together an income for a period of time.

    A survey from Self Financial says that 33% of Americans ages 65 and over are looking into setting up side hustles. And people ages 65 and over earn an average of $581.32 per month this way. You, however, may be able to earn more if you’re passionate about what you’re doing and can dedicate more hours to it.

    You may also be able to leverage certain job skills of yours into a new role you find rewarding. For example, if you were an office manager, you’re probably very organized. You could look into becoming a personal organizer, where you help clients get their homes in order. This is the sort of role you might find fulfilling and flexible, and it could end up being lucrative.

    Another thing you can do is try seeking out free career resources to position yourself for a new full-time role. Sites like MyNextMove allow you to enter information about yourself to get guidance on a career pivot. LinkedIn also has free resources you can take advantage of.

    And speaking of LinkedIn, don’t hesitate to try to network your way into a new role. Reach out to former colleagues and managers, friends, and members of your community to see who’s hiring or who can refer you.

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    Protecting your finances after a late-in-life layoff

    Losing a job before retirement could be detrimental to your finances. Even though you’re old enough to tap an IRA or 401(k) plan without a penalty, you may not want to start dipping into your savings at such a young age.

    Also, while you may be able to piece together enough of a part-time income to keep your savings untouched until you’re 62 and eligible for Social Security, claiming benefits at that age means reducing them by 30% compared to waiting until your full retirement age of 67. So that may not be ideal, either.

    One thing you should do after getting laid off is put in a claim for unemployment benefits right away. You’re typically eligible if you were let go through no fault of your own.

    You may also be eligible for severance pay from your employer. And if that severance is based on tenure and you were at your company for a long time, you may be entitled to a decent-sized payout.

    That could buy you some time to figure out your next move without having to dip into your savings. Additionally, you should see if you have accrued vacation or sick time you’re eligible to get paid out on.

    Another smart thing to do following a layoff is to see what expenses you can reduce — either temporarily or permanently. If you’ve been toying with downsizing, it could be a great time to do so if it saves you money on housing. And if you have a reason to hang onto a larger home, you may want to look at renting out a room for some income.

    Also make sure to put health insurance in place following a layoff. COBRA might prove expensive, but you can explore options on the health insurance marketplace.

    It’s also a good idea to talk to a financial advisor when you experience a major change in income like the loss of a job — especially if it happens at an age where you may be forced into an early retirement.

    A financial advisor can help you assess your options and figure out the most efficient way to cover your expenses in the absence of a paycheck.

    They may, for example, suggest switching to assets like bonds in your portfolio so you can generate income and reduce your risk at a time when you might need the flexibility to tap your investments.

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    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • I’m 28 years old and my dad’s wealth management guy took me on as a favor — but he’s put my entire $50,000 in a single investment. Is this OK or is he setting me up for disaster?

    I’m 28 years old and my dad’s wealth management guy took me on as a favor — but he’s put my entire $50,000 in a single investment. Is this OK or is he setting me up for disaster?

    The benefit of hiring someone to manage your money is getting expert investment advice that protects your portfolio from market volatility while fueling its growth. But, what if you’re paying for advice you don’t agree with?

    Say you’ve decided to use your father’s wealth manager to oversee your own money, only they decide to put your entire portfolio into a single investment. That may seem like a suboptimal choice. And it could be a risky bet.

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    So it’s important to keep tabs on your portfolio, even if you’re paying someone else to do the work. And it’s equally important to make sure your investments are diversified.

    The problem with sticking to a single investment

    Whether this one investment of yours poses a risk depends on whether it’s truly a single asset, like bitcoin or a particular stock, or is something like an index fund or mutual fund or exchange-traded fund (ETF), which are actually bundles of many individual assets. An S&P 500 ETF, like the Vanguard S&P 500 ETF (VOO), for example, would contain exposure to hundreds of blue-chip U.S. companies.

    If a single fund matches your investing strategy, risk tolerance and time horizon, then that’s fine.

    Investing in only a single stock, on the other hand, even one with a storied history, can carry significant risk or volatility.

    The stock market has a long history of being volatile. Since 1929, it’s undergone 56 corrections where it lost at least 10% but less than 20% of its value. Plus, of those 56 corrections, 22 became bear markets where stocks lost 20% of their value or more.

    When the market tanks on a whole, even a well-diversified portfolio can lose value. But if you’re not diversified and a specific sector of the market takes a hit, your personal losses could end up being significant.

    Granted, you don’t officially lose money in the stock market until you actually go out and sell assets at a loss. But, you never know when you might need to tap your portfolio to address a need for cash.

    An estimated 42% of Americans do not have an emergency fund they can access to cover unplanned expenses, according to U.S. News & World Report. So even if your preference is to leave your portfolio alone during a market downturn, if you lose your job and have no emergency savings, you might have to liquidate some assets immediately. With a more diversified portfolio, you may end up with some assets that haven’t lost value in a broad market crash, or haven’t lost as much value as others.

    Furthermore, it’s possible for an individual stock to lose a lot of value even if the market on a whole is doing well. If you keep your entire portfolio in one stock, a significant loss in value could upend your financial plans.

    Just look at Intel Corporation (INTC). The stock has lost about 48% of its value over the past year alone. Now, imagine you had a $100,000 portfolio a year ago that consisted only of Intel. At this point, your portfolio would be down to $52,000.

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    How to build a diversified portfolio

    Your goal in investing should be to maintain a portfolio with different assets. That means dabbling in different asset classes, as well as different options within each asset class.

    When we talk about asset classes, we’re referring to types of investments, such as stocks versus bonds versus real estate. It’s a good idea to have money in all of these, though the percentage should hinge on your risk tolerance and how close or far you are from retirement.

    When you’re decades away from retirement, it’s a good idea to go heavy on stocks and put a smaller portion of your portfolio into bonds. When retirement gets closer, you may want to flip things around.

    Real estate is something you can invest in at any time, provided you understand the risks and are willing to do the work. With physical real estate, you can make money by renting out a property or seeing its value rise over time. But, there’s also the risk of costly repairs and going months without a tenant. Plus, you have to be willing to do the work.

    If you like the idea of investing in real estate for diversification, but you don’t like the idea of owning physical properties, you can look at real estate investment trusts (REITs) instead. Many trade publicly like stocks and offer generous dividends.

    Meanwhile, within each asset class in your portfolio, it’s important to diversify. On the bonds side, you may want to put money into corporate bonds as well as municipal bonds for the tax benefits, such as federally tax-exempt interest payments.

    On the stocks side, it’s a good idea to own shares of companies across a range of market sectors. If you don’t like the idea of choosing stocks specifically, you could fill your portfolio with sector-specific ETFs, like, say, some health care ETFs, energy ETFs, tech ETFs and so forth.

    You could even simplify things further by loading up on shares of a total stock market ETF like the Vanguard Total Stock Market Index Fund ETF (VTI). These types of ETFs give you exposure to the broad market, so this is the one situation where it may be okay to fill the stock portion of your portfolio with a single investment.

    But remember, broad market ETFs will allow you to match the performance of the stock market at large — not beat it. If doing better is a goal of yours, then you’ll need to branch out into individual stocks. And loading up on a wide variety of them could be your ticket to long-term success.

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    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • Retiring soon? Not so fast. Here are 3 serious retirement risks that older Americans often forget about — and how to deal with them ASAP

    Retiring soon? Not so fast. Here are 3 serious retirement risks that older Americans often forget about — and how to deal with them ASAP

    Planning for retirement is something that’s best to do throughout your career, not just when you’re approaching that milestone and have a year or two left to work.

    Only half of Americans have tried to calculate how much money they’ll need in retirement, according to a 2024 survey by the Employee Benefits Research Institute (EBRI).

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    However, among those workers who did the calculation, 52% were inspired to save more. Even if you feel confident in your ability to cover your retirement expenses, it’s important to be mindful of hidden costs that could impact your retirement finances. Here are three to keep on your radar.

    Healthcare expenses not covered by Medicare

    Fidelity Investments expects the typical 65-year-old to spend $165,000 on healthcare during retirement. That may sound surprising, but even with Medicare coverage, several expenses could arise.

    For one thing, Medicare isn’t entirely free. Most enrollees don’t pay a premium for Part A, which covers hospital care. However, Part B, which covers outpatient care, charges a monthly premium, as do some Part D drug and Medicare Advantage plans. Plus, higher earners risk surcharges on their Medicare premiums.

    Premiums aside, there are a number of expenses that original Medicare (Parts A and B plus a Part D drug plan) does not cover, which retirees commonly need. These include dental care, eye exams, prescription glasses and hearing aids.

    You’ll also face copays and coinsurance under Medicare that you must pay out of pocket. If enrolled in original Medicare, you can buy supplemental insurance known as Medigap to help offset those costs. But then you’re looking at premiums for Medigap, too.

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    Long-term care

    It’s a big misconception that Medicare will pay for you to live in a nursing home or cover the cost of a home health aide. Medicare’s scope of coverage is typically limited to medical issues only. So while Medicare might pay for rehab or physical therapy because you broke a hip, it won’t pay for a home health aide because you’re getting older and need help dressing yourself and using your kitchen.

    Meanwhile, the cost of long-term care can be astronomical. According to Genworth, here are the annual median costs for certain long-term care services in the U.S. for 2024:

    Home health aide: $77,792

    Assisted living: $70,800

    Shared nursing home room: $111,325

    Private nursing home room: $127,750

    One option for defraying these costs is to buy long-term care insurance. But that might bust your budget, too. The American Association for Long-Term Care Insurance says an average $165,000 policy with no inflation protection purchased at age 55 by a single male costs $950 a year. For a 55-year-old female, that policy costs an average of $1,500. And for a 55-year-old opposite-gendered couple, the average price is $2,080 combined.

    Of course, the actual cost of long-term care will depend on factors such as where you’re located, your age at the time of your application and the state of your health. But all told, you might spend a lot of money to put that coverage in place.

    Inflation

    In recent years, retirees and working Americans alike have experienced their share of rampant inflation. But even when inflation isn’t as aggressive, it’s still a hidden cost that can upend your retirement budget.

    Social Security benefits are, thankfully, designed to keep up with inflation. They’re eligible for an annual cost-of-living adjustment tied to the Consumer Price Index for Urban Wage Earners and Clerical Workers, a subset of the more widely known Consumer Price Index.

    But ensuring that your savings can keep up with inflation is also critical. One way to do this is to avoid eliminating equities from your portfolio in retirement. You need some growth in your portfolio to make up for rising living costs. You can work with a financial advisor to develop an appropriate asset mix based on your income needs and risk appetite.

    A financial advisor can also help set you up with assets in your portfolio that generate income. These could include dividend stocks, bonds and real estate investment trusts (REITs).

    It could also be a good idea to delay your Social Security claim past your full retirement age, which is 67 for anyone born in 1960 or later. For each year you do, until age 70, your benefits rise 8%. And that boost is guaranteed for life.

    Having a larger monthly benefit gives you more leeway to tackle not only inflation, but also surprise medical and health-related expenses. So it’s a move worth considering if you don’t need to sign up for Social Security sooner.

    What to read next

    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • I’m 62, ready to retire — but wondering if I’ll be penalized on my capital gains when I start cashing in my nest egg. The secret to turning capital gains into tax-efficient retirement income

    I’m 62, ready to retire — but wondering if I’ll be penalized on my capital gains when I start cashing in my nest egg. The secret to turning capital gains into tax-efficient retirement income

    Tax strategy should be top of mind when it comes to drawing down your retirement account.

    If you’ve held stocks in your retirement portfolio for a long time, you may be looking at significant gains.

    Those long-term capital gains could play a big role in your retirement finances — and a positive one.

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    But it’s important to balance your various income streams and cash out your gains strategically.

    The benefits of long-term capital gains

    Long-term capital gains are earnings on investments held for at least a year and a day. Any earnings on investments held for a shorter time are classified as short-term capital gains.

    There’s a major difference between them when it comes to taxes. Long-term capital gains are taxed at lower rates than short-term capital gains, which are taxed as ordinary income.

    You can leverage the tax-advantageous aspect of long-term capital gains when it comes to drawing on your nest egg for income.

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    The amount of tax you pay on long-term capital gains depends on your tax-filing status and your overall income. Here’s a rundown of long-term capital gains tax rates as of 2025.

    If you’re single, your long-term capital gains tax rate will be:

    • 0% if your income is $48,230 or less
    • 15% if your income is between $48,351 and $533,400
    • and 20% if your income is more than $533,400.

    If you’re married and filing jointly, your long-term capital gains tax rate will be:

    • 0% if your combined income is $96,700 or less
    • 15% if your income is between $96,701 and $600,050
    • and 20% if your income is more than $600,500.

    These are significantly better rates than the taxes levied on short-term capital gains.

    For example, if you’re single with an annual income of $45,000, you’ll pay a 12% tax on short-term capital gains versus no taxes at all on long-term capital gains.

    If you’re married and file jointly with an annual retirement income of $240,000, you’ll pay a 24% tax rate on short-term capital gains but almost 10% less (15%) tax on long-term capital gains.

    This tax advantage may be one reason to start withdrawing long-term capital gains as retirement income before you claim Social Security. The longer you wait to claim Social Security, the larger those monthly benefits will be — for life.

    Leveraging long-term capital gains

    It’s important to consider all your retirement income sources — including 401(k)s and Social Security benefits — as you plot out your tax strategy.

    Let’s say most years your retirement income is low enough for you to pay 0% taxes on long-term capital gains, but you get a windfall that bumps you into the 15% range in that year.

    If you have a Roth IRA, you could tap it for income in the year you get the windfall because Roth IRA withdrawals are tax-free.

    Then if your income shrinks the following year, you could return to cashing out long-term gains in a taxable account.

    It’s a good idea to talk to a financial advisor or tax professional about the best ways to minimize your tax burden in retirement.

    This could include doing a Roth conversion ahead of retirement so you have some tax-free income at your disposal later on.

    You may end up having to pay taxes on retirement savings if you have money in a traditional IRA or 401(k). At a certain point, you’ll be forced to take required minimum distributions (RMDs), which are a taxable event.

    That said, there are strategies to minimize the tax-related impact of RMDs. One option is to make qualified charitable distributions (QCDs) directly out of your traditional IRA or 401(k), although there is a limit to how much money you can donate.

    If your retirement income isn’t low enough to qualify for a 0% tax rate on long-term capital gains, you can try selling other investments strategically at a loss to offset those gains.

    For example, say you’re looking at a $10,000 long-term gain that’s subject to a 15% tax rate. If you’re able to take a $10,000 loss in a taxable account, that negates your tax obligation.

    Overall, long-term capital gains can be one of your greatest tax advantages in retirement.

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    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • Economist Joe Brusuelas says the Fed’s recent projections ‘implied mild stagflation’ for the US economy — but will it be as bad as the ’70s? Here’s how you can still invest wisely

    Economist Joe Brusuelas says the Fed’s recent projections ‘implied mild stagflation’ for the US economy — but will it be as bad as the ’70s? Here’s how you can still invest wisely

    Most consumers are familiar with the concept of inflation — a broad increase in prices as purchasing power declines. But stagflation is a concept you may not have heard of.

    Economists coined the term to describe a period of slow economic growth, high levels of unemployment and stubbornly high prices. During stagflation (or stagnant inflation), prices remain elevated while the economy remains in a slump.

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    And the recent fear is that new tariff policies will fuel a period of stagflation in the near term that could lead to a recession.

    In a recent analysis of a March Federal Reserve meeting, RSM chief economist Joe Brusuelas said policymakers “implied mild stagflation ahead in the near term as growth slows and inflation increases,” according to Reuters. Brusuelas also noted the “pervasive uncertainty around the size and magnitude of the trade shock."

    Here’s why the fear may be a valid concern and what you may want to keep in mind when investing amid economic uncertainty.

    Why stagflation fears are mounting

    The last time the U.S. had to deal with a prolonged period of stagflation was during the 1970s, when a large increase in oil prices triggered a series of suboptimal decisions around monetary policy and ultimately fueled a recession early on in the following decade.

    Now, the U.S. economy is showing signs of "stagflation-lite,” the title of Brusuelas’ recent analysis, as a growing number of economists are projecting a slowdown in growth and an uptick in prices as tariff policies come to life.

    Of course, it’s worth noting that unemployment is fairly low. March’s jobless rate was only 4.2%. By contrast, during the mid-1970s, it peaked at 9%. For this reason, economists aren’t necessarily predicting a repeat of the stagflation that occurred in the 1970s, but rather, a more mild version.

    "I don’t see any reason to think that we’re looking at a replay of the ’70s or anything like that," Federal Reserve Chair Jerome Powell said at a press conference after a recent central bank meeting, according to Reuters. "I wouldn’t say we’re in a situation that’s remotely comparable to that.”

    But Americans should still brace for a period of economic uncertainty ahead — one that may lead to higher costs across the board and lessen buying power on the whole.

    In February, 63% of Americans said inflation is a big problem for the country, according to Pew Research Center. And in a February CBS News and YouGov poll, 77% of Americans confirmed that their income wasn’t keeping up with inflation.

    If prices continue to rise, it could push a lot of people into serious debt and have long-lasting impacts. So when it comes to investing for your future (if you can afford to do so), you’ll want to be extra careful with your approach.

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    How to invest wisely in times of economic uncertainty

    It’s hard to know what’s in store for the U.S. economy in the course of the next few months. But it’s important to financially prepare as best you can.

    That means making sure you have a solid emergency fund with enough money to cover three to six months of essential bills as a starting point.

    It’s also a good time to pay off high-interest debt if you can. The Fed is unlikely to lower interest rates anytime soon given current inflation levels and general economic uncertainty (though the central bank did recently signal that it sees two more cuts coming before the end of the year). This means your credit card balances in particular may be costing you a lot of money.

    We don’t know what unemployment levels will look like for the remainder of the year. But if you’re able to shed high-interest debt, that’s one less expense to grapple with in the event of job loss.

    Beyond that, it’s important to invest your money strategically. During periods of economic instability, the stock market can be very volatile. And it’s already been pretty rocky so far in 2025.

    So you may want to consider two things.

    First, make sure your risk profile aligns with your life plans. If you’re aiming to retire in 2026, now’s not the time to have 80% of your portfolio or more in the stock market. However, if you’re decades away from retirement, a more stock-heavy portfolio may be appropriate since you have many years to recover from near-term market turbulence.

    Next, make sure your portfolio is well diversified. This is important whether you’re close to retirement or a long way off. Loading up on S&P 500 ETFs gives you exposure to the broad market, and it’s a good option for people who don’t have the time or skills to research stocks individually.

    Given the potential for near-term economic shakeups, you may also want to add some recession-proof stocks to your portfolio. Certain health care and consumer staple stocks fit the bill, since these are things Americans may not be able to cut back on even if living costs rise or unemployment levels climb.

    You can also look at inflation-resistant assets like real estate or Treasury Inflation-Protected Securities (TIPS). TIPS are Treasury bonds whose principal value rises as inflation increases. However, TIPS should be used as more of a long-term hedge against inflation rather than a short-term hedge.

    Also be mindful of the fact that in the coming months, your portfolio value might swing. Try not to make rash decisions when that happens, like unloading assets at a loss. If you’re invested appropriately for your age, you should be able to ride out whatever storm is coming until the market eventually recovers.

    What to read next

    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • I’m 31, making $70,000 annually and worried about a recession. Should I be doing anything differently with my 401(k) right now?

    I’m 31, making $70,000 annually and worried about a recession. Should I be doing anything differently with my 401(k) right now?

    Until recently, it seemed like the U.S. economy was in good shape. However, Trump’s tariff plans have made things a lot more uncertain, not only in the U.S. but around the world.

    Don’t miss

    The stock market plunged in response to Trump’s tariff policies, and an early April Ipsos poll found that 61% of Americans think the country is headed for a recession in the next 12 months.

    So, if you’re 31 years old, earning $70,000 a year — it’s likely you have enough to cover your monthly bills, but you don’t have much wiggle room left over to shore up your savings. If you’ve been steadily funding your 401(k) plan, the last thing you want is to see its value decline.

    Since bear markets and recessions often go hand in hand, you may be worried that your retirement account is about to take a serious dive (or more of a dive than it’s already taken). That’s a natural thing to be concerned with — but it doesn’t necessarily mean you need to change your long-term investing strategy.

    How a recession could impact your 401(k)

    It’s not a given that the economy will land in recession territory this year, or that any recession that ensues will be drawn out.

    In 2020, the start of the COVID-19 pandemic triggered a major economic downturn as stay-at-home orders cost millions of Americans their jobs. However, that recession only lasted for two months.

    Still, it’s essential to understand how a recession might impact your 401(k). There are a few ways that could shake out.

    First, if the stock market slumps, the value of your 401(k) could decline. While stock market declines don’t guarantee a recession, concerns about a slowing economy can cause markets to drop.

    Unemployment tends to rise during a recession. If you are laid off, you’ll lose the option to fund your 401(k), which can hurt its value over the long term. You also might struggle to pay your bills in general, leading you to potentially take an early 401(k) withdrawal or borrow against your balance if your plan allows for that. If you tapped into your 401(k) at age 31, you’d generally be looking at a 10% penalty, not to mention taxes on the amount you withdraw.

    If a recession hurts your employer’s bottom line, you may not end up out of a job, but your employer might have to cut certain workplace perks, including whatever 401(k) match it currently offers.

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    How to manage your 401(k) in light of recession fears

    It’s natural to be concerned about a recession’s impact on your 401(k). But here’s some good news: if you’re 31 and plan to retire at a conventional age — meaning, at some point during your 60s — current events may not mean that much in the grand scheme of your savings journey. Since you won’t be touching that money for decades, there’s plenty of time for your 401(k) to recover from whatever losses ensue in the coming months.

    That said, here are some steps you can take to safeguard your 401(k).

    Make sure your investments are well-diversified

    One thing that differentiates 401(k)s from IRAs is that they typically don’t let you hold individual stocks. By effectively forcing savers into various mutual funds or ETFs, 401(k)s lend to more built-in diversification, and that’s a good thing.

    Besides being diversified in terms of asset types, sectors, company sizes, countries etc., make sure your portfolio has the right asset allocation for your age. Since you’re investing for the long term, you can afford to take on more risk at your age.

    Boost your emergency fund

    You can safeguard your 401(k) by boosting your emergency fund. This lowers the chances of early withdrawal due to a financial emergency. A recent Empower survey found that over 20% of Americans have no emergency fund, and nearly 40% couldn’t afford an emergency of over $400.

    A recession may seem like a good time to add money to your 401(k), as you can invest while the market is down. But it’s probably not the right time if you’re short on emergency savings. Personal finance expert Ramit Sethi recently recommended building a 12-month emergency fund instead of the usual one that can cover three-to-six months’ of expenses.

    Once your emergency fund is fully funded, you can consider upping your contributions if your paycheck allows. With a $70,000 salary, that may or may not be possible. It’s a matter of what your expenses look like.

    Stay calm

    Finally, do your best to stay calm if a recession hits. Try to avoid checking your 401(k) balance every day. Looking at day-to-day losses will only mess with your head and potentially drive you to make rash decisions that hurt you financially in the long run.

    If retirement is still decades away for you, there’s no need to shift to a more conservative 401(k) investment strategy just because a recession may be coming. Stick to your current long-term plan, and remember that the stock market has a long history of recovering from volatile periods like the one investors are experiencing today.

    What to read next

    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • I’m 62, and I’ve been working the last 43 years. I haven’t set a retirement date yet. How do I know when it’s the right time to pull the trigger?

    I’m 62, and I’ve been working the last 43 years. I haven’t set a retirement date yet. How do I know when it’s the right time to pull the trigger?

    The decision to retire is rarely an easy one. Giving up your career means more than just losing a steady paycheque — it can also mean giving up part of your identity and upending your routine.

    At age 62, with a 43-year work history, you’re obviously contemplating a retirement date. After all, you’re tired and you’re old enough to claim Canada Pension Plan (CPP) benefits, albeit at a reduced rate. You may also be eager to kick off retirement at a time when your health is in solid shape.

    However, there can be advantages to holding off on retirement and working a few additional years, so it’s important to look at the big picture when making your choice.

    How to narrow down your retirement date

    Retiring too early could mean leaving your job at a time when you’re not financially or emotionally secure. However, retiring past the traditional age could mean missing out on things you’ve always wanted to do in your golden years.

    There are a number of things you should consider when deciding when to retire. First, think about CPP, and whether you’ll need to claim benefits right away if you retire.

    You can file as early as age 60, but your benefits will be increase for every year you delay up until 70.

    You should also think about health insurance, since that’s something you need to have at any age.

    According to data from the Conference Board of Canada, out of pocket health care costs for Canadian seniors is currently at $5,800 annually, with that figure expecting to rise to $8,000 by 2035.

    “Health care costs are among the most unpredictable expenses, especially when it comes to retirement planning,” said Robert Kennedy, SVP, workplace consulting at Fidelity.

    While every province and territory offers publically-funded, universal health care services to residents, ther are certain things that aren’t covered, but could be detrimental to your finances during a more precarious time of unemployment.

    Some things to look out for include:

    • Vision care such as glasses, contact lenses and corrective eye surgeries
    • Physiotherapy and rehabilitation due to injuries or hospitalization are mostly not covered throughout Canada
    • Part of the costs for nursing homes or residential care facilities — although, some provincial governments may provide partial monetary assistance
    • Some of the costs related to home care services, such as personal support workers or healthcare aides
    • Medications prescribed outside of a hospital visit
    • Portions of dental care not covered by the Canadian Dental Care Plan (CDCP)

    You’ll need to find out if your previous work’s insurance coverage can extend into retirement, whether through full access to workplace benefits or conversion options that will allow certain benefits to continue. You could also look into private options depending on your needs.

    In addition, it’s important to examine your finances and see what the numbers look like. A 2023 survey from the National Institute on Ageing found that only 34% of Canadians aged 50 and over are ready to retire, while one in four have saved $5,000 or less for retirement.

    However, a 2025 BMO survey found that Canadians believe it takes $1.54 million to pull off a comfortable retirement. So, you’ll need to see where your savings fall and what sort of annual income your nest egg might allow for.

    If you’re sitting on $1 million, for example, you can use the popular 4% rule to arrive at an annual income of about $40,000. You may decide you can live comfortably on that, in addition to whatever CPP pays you. But if not, that’s a good reason to work longer and save more.

    Also, think about how much debt you have (if any).

    The Credit Counselling Society found that Canadians aged 55+ are the fastest growing group seeking the organization’s help to manage credit card and other debt, with the average debt carried by its clients at $30,752. High-interest debt like that could eat up a big chunk of your retirement income, so you may want to try to hold off on ending your career until your credit card balances are gone.

    Finally, think about the non-financial side of retirement. Many people end their careers only to wind up lost. If you’re not sure how you’ll fill your days in retirement, you may want to keep working longer – even if you can afford to stop now.

    What’s the ideal age to retire?

    A 2023 report from Statistics Canada found that 45% of Canadians aged 60 to 64 are either completely or partially retired. For those who were fully retired, over one-third (35%) of men and more than one-quarter (28%) of women citing financial reasons as the main factor in determining the timing of their retirement. Additionally, people in this group reported that the most important factor was being financially ready, followed by qualifying for a pension or deferring the start of their Old Age Security (OAS) pension in exchange for a larger amount.

    The decision to retire is a very personal one. So, a good bet is to think about how you feel about working versus retiring.

    If you love your job and are someone who thrives on being busy, then you may not want to retire in the next year or two. Similarly, if you feel your savings could use a boost, working a bit longer could help pad your nest egg. In fact, the Stats Canada survey also found that among people who had not fully retired, 55% would continue working part-time, while 49% would work reduced hours if it didn’t effect their pension.

    On the other hand, if you’re miserable at your job and it’s a source of stress, you may want to consider retiring this year or next if you can afford to. Even if you like your job, if there are things you want to do in retirement that you fear you won’t be able to do a few years down the line, like take a six-month backpacking trip, that’s another reason to consider ending your career sooner as long as the finances work.

    If you’re really torn, you may want to talk to a financial advisor and get their guidance. A finance professional can help you understand the pros and cons of retiring at various points so you can feel more confident in your decision.

    Sources

    1. National Institute on Ageing: Perspectives on Growing Older in Canada: The 2023 NIA Ageing in Canada Survey (Jan 28, 2025)

    2. Credit Counselling Society: Seniors & Debt – A growing problem that we can help fix, by Tim St. Vincent (Jan 10, 2025)

    3. Statistics Canada: Majority of people planning to retire would continue working longer if they could reduce their hours and stress (Aug 1, 2023)

    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • Is a long-distance rental investment worth it? Here are the risks and rewards of managing rental properties from afar

    Is a long-distance rental investment worth it? Here are the risks and rewards of managing rental properties from afar

    Many people opt to buy real estate for the purpose of renting it out as an investment. And owning a rental property nearby is risky enough. But the risk can be even greater if you decide to buy a long-distance rental.

    It may be that you’re in your 20s or 30s without kids, so you have time to travel back and forth to a rental in another state. Or, it may be that you’re a recent retiree looking for a project plus extra money and can afford an income property that cash flows in a different market that’s a few hundred miles away.

    There can be benefits to going this route, but also drawbacks. So it’s important to know what you’re getting into.

    Don’t miss

    The pros and cons of a long-distance rental investment

    Investing in real estate isn’t for the faint of heart. The upside is obvious — you get a chance to diversify your portfolio, collect what could be a steady stream of rental income, and have someone else’s money paying the mortgage on a property that could gain a lot of value over time.

    But investing in real estate carries risk. Your property might sit vacant, leaving you to cover its mortgage — or worse. Your property taxes could rise. Things could break. Or a tenant could do far more damage than what their security deposit covers and leave you on the hook for the bill.

    When you invest in a long-distance rental, the potential for complications could increase. Since you’re not there all the time to oversee the property, your tenants might have an easier time violating your rules (such as smoking when the lease forbids it or having pets when they’re not allowed).

    Also, being many miles away from your rental makes it challenging to address repair issues as they arise. You could hire a property manager who’s local to oversee your rental for you, but that’ll eat into your profits.

    Coastline Equity says that property managers typically charge fees as a percentage of monthly rent collected. A common range is 4% to 12%. Maintenance fees may be extra.

    On the other hand, buying a long-distance rental investment could make it possible to tap into a less expensive or less saturated market, and one that is emerging. If your local area is filled with available rentals, there’s more competition. And if your local area is expensive, a rental property may not fit into your budget. So going outside your immediate geographic area could work to your benefit.

    Also, buying a rental property in a new area might afford you the opportunity to spend time and discover another place you enjoy. If you’re fairly young and unattached, you might even look forward to visiting a different city a few times a year to check in on your rental (and potentially getting to write off that trip as an expense on your taxes). And as a retiree, you might appreciate the change of scenery.

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    Also, depending on the nature of your long-distance rental, it could serve as a vacation spot for you. This may not work with a property you rent out on a yearly basis. But if you live in the mountains and buy a rental property 300 miles away near the beach that you rent out week by week, you can block off a few weeks to enjoy that property yourself. And that way, you can visit a favorite area repeatedly without having to worry about securing lodging.

    How to make smart long-distance rental investment decisions

    A 2024 Clever survey found that 90% of residential real estate investors have lost money on an investment. And 87% have regrets about investing in real estate. So if you’re going to buy a long-distance rental property, it’s important to do your research.

    First, get the scoop on the local market. This may be easier with the help of a real estate agent who knows your prospective area very well and who will be familiar with the local rental trends. Find out what vacancy rates tend to look like and ask for numbers to see what sort of rent you can reasonably expect.

    There are certain types of areas you may want to focus on for a long-distance rental. First, areas with highly rated school districts tend to be a draw. You can research school districts here.

    Secondly, college towns tend to be perpetually busy, with students and staff alike needing housing on a year-to-year basis. The same holds true for areas with large hospital systems. Medical residents often need housing close to work. The same holds true for areas with booming job markets or industries.

    You can also look at rentals that are in close proximity to attractions like theme parks, beaches, and ski resorts. But again, it pays to work with a real estate agent, because some of these areas may be fairly saturated with rentals already.

    Another thing you may want to look at is up-and-coming neighborhoods — those that are being developed but aren’t quite there yet. Neighborhoods in this category often allow investors to get in at lower price points and then profit when property values soar.

    You’ll also want to be mindful of local landlord-tenant laws in any area you opt to buy. To this end, you may need — not just a good real estate agent — but an attorney as well.

    If you’re going to buy a long-distance rental, you’ll also need to have the right support system in place. That could mean hiring a competent property manager (or property management company) familiar with the area and that can handle day-to-day operations effectively. Alternately, it could mean maintaining a list of trusted contractors in the area you can call in a pinch.

    There are also different online tools landlords can use to manage their rentals, like Avail or Rent Manager. It pays to explore different options to see which platform you find easiest.

    Finally, before you buy a rental property in an area you’re not familiar with or close to, spend some time there and talk to the locals. That may give you enough insight to decide whether you’ve chosen the right location for a long-distance rental, or whether you’re about to make a decision that groups you with the other 87% of those who regret such an investment.

    In the end, if you decide that buying a rental property outright isn’t for you, you can always explore other ways to invest, such as with real estate crowdfunding platforms.

    What to read next

    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.