Comments on: How to Pick Income Trusts: its in the numbers http://www.thickenmywallet.com/blog/wp/2007/07/11/how-to-analyze-an-income-trust-the-financials/ Everything to do with thickening your wallet by entrepreneur turned President of an Investment Company Sun, 14 Mar 2010 13:48:52 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: Traciatim http://www.thickenmywallet.com/blog/wp/2007/07/11/how-to-analyze-an-income-trust-the-financials/comment-page-1/#comment-347 Traciatim Fri, 13 Jul 2007 20:46:22 +0000 http://www.thickenmywallet.com/blog/wp/?p=86#comment-347 I found a reference for it, a little google goes a long way I guess. This link is specifically talking about the new rules for grossing up dividend income: "That means the 45% gross up will gross up the income used to calculate the clawback for OAS and the age credit and result in a higher likelihood that more people will have their benefits clawed back." Found: http://www.fundfilter.com/article/644/changes-to-dividend-income-and-pension.aspx I kind of look at it as a 'Well, maybe I should stop working because I'm giving up my social assistance payments by working' . . . so maybe you don't care as much. It's just if you plan a retirement solely around dividend payments keep in mind that your OAS will be calculated based on 145% of the actual income amount and then your credit applied. I found a reference for it, a little google goes a long way I guess. This link is specifically talking about the new rules for grossing up dividend income:

“That means the 45% gross up will gross up the income used to calculate the clawback for OAS and the age credit and result in a higher likelihood that more people will have their benefits clawed back.”

Found:
http://www.fundfilter.com/article/644/changes-to-dividend-income-and-pension.aspx

I kind of look at it as a ‘Well, maybe I should stop working because I’m giving up my social assistance payments by working’ . . . so maybe you don’t care as much. It’s just if you plan a retirement solely around dividend payments keep in mind that your OAS will be calculated based on 145% of the actual income amount and then your credit applied.

]]> By: Traciatim http://www.thickenmywallet.com/blog/wp/2007/07/11/how-to-analyze-an-income-trust-the-financials/comment-page-1/#comment-344 Traciatim Fri, 13 Jul 2007 17:20:37 +0000 http://www.thickenmywallet.com/blog/wp/?p=86#comment-344 FourPillars, I believe I read somewhere that many Government funded programs like the OAS will be clawed back based on income levels alone before credits are applied. This could make Dividends in retirement a less desirable option. Can anyone confirm this is true? FourPillars, I believe I read somewhere that many Government funded programs like the OAS will be clawed back based on income levels alone before credits are applied. This could make Dividends in retirement a less desirable option. Can anyone confirm this is true?

]]> By: moneygardener http://www.thickenmywallet.com/blog/wp/2007/07/11/how-to-analyze-an-income-trust-the-financials/comment-page-1/#comment-343 moneygardener Fri, 13 Jul 2007 15:44:04 +0000 http://www.thickenmywallet.com/blog/wp/?p=86#comment-343 CWI.UN = 130% EP.UN = 200% IPL.UN = 123% PIF.UN = 160% FCE.UN = 150% CWI.UN = 130%
EP.UN = 200%
IPL.UN = 123%
PIF.UN = 160%
FCE.UN = 150%

]]> By: admin http://www.thickenmywallet.com/blog/wp/2007/07/11/how-to-analyze-an-income-trust-the-financials/comment-page-1/#comment-341 admin Fri, 13 Jul 2007 14:01:14 +0000 http://www.thickenmywallet.com/blog/wp/?p=86#comment-341 MoneyGardener- in isolation, paying out more money than you have is a bad thing from a cash flow perspective. I will have to look at the utility income trust issue for you. Any particular one in you are looking at? MoneyGardener- in isolation, paying out more money than you have is a bad thing from a cash flow perspective. I will have to look at the utility income trust issue for you. Any particular one in you are looking at?

]]> By: Income Trusts and More - July 13, 2007 - Million Dollar Journey http://www.thickenmywallet.com/blog/wp/2007/07/11/how-to-analyze-an-income-trust-the-financials/comment-page-1/#comment-338 Income Trusts and More - July 13, 2007 - Million Dollar Journey Fri, 13 Jul 2007 11:24:41 +0000 http://www.thickenmywallet.com/blog/wp/?p=86#comment-338 [...] posted earlier this week about Canadian Real Estate Investment Trusts (REITs). Thicken My Wallet, Financial Jungle, and Canadian Capitalist has continued this theme with informative articles about [...] [...] posted earlier this week about Canadian Real Estate Investment Trusts (REITs). Thicken My Wallet, Financial Jungle, and Canadian Capitalist has continued this theme with informative articles about [...]

]]> By: moneygardener http://www.thickenmywallet.com/blog/wp/2007/07/11/how-to-analyze-an-income-trust-the-financials/comment-page-1/#comment-333 moneygardener Thu, 12 Jul 2007 19:36:58 +0000 http://www.thickenmywallet.com/blog/wp/?p=86#comment-333 Is a pay out ratio over 100% always a bad thing? Why are most if not all of the utility income trusts paying out greater than 100%? Could you explain why in simple terms? I know it has to do with the depreciation of their (eventually worthless) assets, but I don't quite understand it fully. Is a pay out ratio over 100% always a bad thing?

Why are most if not all of the utility income trusts paying out greater than 100%? Could you explain why in simple terms? I know it has to do with the depreciation of their (eventually worthless) assets, but I don’t quite understand it fully.

]]> By: FourPillars http://www.thickenmywallet.com/blog/wp/2007/07/11/how-to-analyze-an-income-trust-the-financials/comment-page-1/#comment-324 FourPillars Thu, 12 Jul 2007 03:39:57 +0000 http://www.thickenmywallet.com/blog/wp/?p=86#comment-324 Fine, make me wait :) You fixed your layout! Looks much better. Mike Fine, make me wait :)

You fixed your layout! Looks much better.

Mike

]]> By: admin http://www.thickenmywallet.com/blog/wp/2007/07/11/how-to-analyze-an-income-trust-the-financials/comment-page-1/#comment-321 admin Wed, 11 Jul 2007 20:06:08 +0000 http://www.thickenmywallet.com/blog/wp/?p=86#comment-321 Four Pillars- Financial Jungle and I agreed that I would do a companion piece on income trust and taxes next week. I'll address this topic next week. Good question though. Four Pillars- Financial Jungle and I agreed that I would do a companion piece on income trust and taxes next week. I’ll address this topic next week. Good question though.

]]> By: FourPillars http://www.thickenmywallet.com/blog/wp/2007/07/11/how-to-analyze-an-income-trust-the-financials/comment-page-1/#comment-318 FourPillars Wed, 11 Jul 2007 12:46:41 +0000 http://www.thickenmywallet.com/blog/wp/?p=86#comment-318 Good post. I was wondering if you can comment (post?) on who should buy income trusts or why someone would buy one rather than say a Canadian corporation that pays reasonable dividends (ie big banks). Personally in retirement I would rather own a company such as BMO - earn the dividend with reduced taxes and then sell shares periodically to make up the difference. This seems like a better plan than buying a smaller income trust which pays dividends which are income (for now) and might be paying out capital. Mike Good post.

I was wondering if you can comment (post?) on who should buy income trusts or why someone would buy one rather than say a Canadian corporation that pays reasonable dividends (ie big banks).

Personally in retirement I would rather own a company such as BMO – earn the dividend with reduced taxes and then sell shares periodically to make up the difference. This seems like a better plan than buying a smaller income trust which pays dividends which are income (for now) and might be paying out capital.

Mike

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