Money Scope Ep 9 Cases: Keeping The Tax Hobbits At Bay

In this episode, we explore some common issues that investors can run into when they are investing in a taxable investment account.

Taxable investing has no limits on contributions, so it’s possible to accumulate a lot of taxable wealth, but it’s important to be mindful of tax-hobbits.

Learn about some traps we can fall into, to avoid them. There are also ways to improve the tax efficiency of without sacrificing their role as a stabilizer in your portfolio. We also go through a case about using leverage to invest coupled with nuances of the attribution rules.

Case 1: Searching for Income

Case 2: Premium vs Discount Bond Tax Efficiency

Case 3: Leveraging Home Equity to Invest

“Dividends can be markers for other things.”


“If your income is at risk due to layoffs or your business [takes] a downturn when the general business environment and markets are under stress, then that can make it a whole lot scarier and riskier to be using leverage.”


“One of the nuances about using a loan to invest is, if you sell some of the investments that you used the loan to buy and don’t reinvest that money, you’ve actually decreased the amount of initial capital invested.”


“If your expectations are unrealistic, then you’ll see the plan not working out like you thought it would. You’ll be more likely to bail when it’s not working out, whether that’s a good or a bad decision.”


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