Remember Cryoptocurrency

[AlbertaFarmer5]

I've been saving in RRSP's since my early twenties...tick tock tick tock.

I got in when locked in savings interest rates were very respectable. Then they went for shit and useless mutual funds and ETF's came into the scene, dismal since then.

I kept track of deposits over the years and I bet I don't have a pile of more money in the portfolio than I deposited. Nothing to write home about anyway. I expected to be much further along than I am thirty years later.

Best investments ever made were in "myself"!

So, why does a farmer invest in RRSP's instead of investing in his own business?

Any RRSP indexed to mutual funds, or investing directly in stocks is just investing in someone else's business, with many layers of middlemen taking their cut inbetween, businesses we know very little about, meanwhile, we borrow money to finance our own businesses simultaneously.

I realize that you started investing in a completely different era than some of us, when interest bearing investments did very well, and land didn't, so obviously we were imprinted by different factors at different times.

[farmaholic]

So, why does a farmer invest in RRSP's instead of investing in his own business?

Any RRSP indexed to mutual funds, or investing directly in stocks is just investing in someone else's business, with many layers of middlemen taking their cut inbetween, businesses we know very little about, meanwhile, we borrow money to finance our own businesses simultaneously.

I realize that you started investing in a completely different era than some of us, when interest bearing investments did very well, and land didn't, so obviously we were imprinted by different factors at different times.

I did invest in the farm, took it from about 4 quarters to 16. "Invested" in machinery to do it too. TFSA(actual stocks), RRSP(ETFs), Non Registered(ETFs and cash). I don't have all my eggs in one basket.

Here's a thought, why does every generation of a family farm have to buy the same land? At today's prices and farm size that isn't even feasible anymore.

[AlbertaFarmer5]

I did invest in the farm, took it from about 4 quarters to 16. "Invested" in machinery to do it too. TFSA(actual stocks), RRSP(ETFs), Non Registered(ETFs and cash). I don't have all my eggs in one basket.

Here's a thought, why does every generation of a family farm have to buy the same land? At today's prices and farm size that isn't even feasible anymore.

On your second point, what a drastic difference it would make to an operation if each generation didn't have to buy the farm all over again. But on the same note, I often ask a different question:

Just because ones parents were successful farmers and business people, does that guarantee that the offspring are the best possible operators to take over that farm? Or does giving them a break exclude someone who might have been much more competent and motivated, who never gets the chance?

[Rareearth]

Rules always changing, for estate and transition planning.
- gone are the trust benefits
- capital gains?
- life insurance proceeds next?

It might be impossible to transfer businesses in the future?

Investing In your self is always a wise investment.

As for diversification, farming is a diversified business, currency, commodity, land, Catepillar ( farm machinery) etc

[farmaholic]

I had a goal of not having to rely on the farm's income, or selling farmland, to fund my retirement.

Maybe I was expecting or asking for too much.

The power of compounding got lost along the way.

I guess Savers have been subsidizing Borrowers.

[Rareearth]

Think of it this way,
I’m going to invest in what I believe to be in my families best interests, farm business best interests, creating a work - life best interest.

Many investment bankers, financial advisors, bankers, life insurance companies etc all suggest diversification, financial and life insurance instruments to set up for retirement and estate planning to create fairness, equality and tax estate payments, etc

If there is any equity at all in the business or farm it should not be a burden for the successors to borrow on the equity to maintain and grow the business further.

[farmaholic]

Since the investments aren't performing up to my expectations I thought I'd cash them in for one of the world's cheapest currencies and use it to heat the house.

[Richard5]

Just wait till you start your rrsp withdrawals and conversion to a rrif. once the taxman gets his due your "investments" will be very disappointing. if you figure in oas clawbacks and the fact that you'll likely be in the highest tax bracket tax rate could well be north of 75%.
investing in fast cars, loose women and booze couldn't have been a whole lot worse;>)

The solution to this is managing it early. Don’t wait until you have to “convert to a RRIF”. For those in farm corporations, which is most, make sure you are reporting 100,000 or more personal income and not nothing or very low so that you get child tax benefits and all the gov’t hand outs you think you need to exist.

Not sure how you equate to 75% final tax rate but that seems a bit high. 48-52% is possible if you keep pushing off the inevitable