News for residents of the “11th province”: Canadians abroad.
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Currency Hedging Gets Less Academic
The weak loonie has made currency hedging feel less like investing and more like a hot-potato question for Canadians with money parked at home while their live their lives somewhere else. The Canadian dollar fell near 70 cents U.S. in mid-June and was still soft through August, partly because tariff threats shook confidence.
The practical bit isn’t too complicated - a Canadian-listed U.S. stock ETF without a hedge gives you the market return in addition to whatever ride the exchange rate takes you on. If the U.S. dollar rises, that’s often a lovely tailwind, if the loonie climbs, it can often feel a little discouraging. Hedged funds try to strip out that currency swing, often without greatly increased management fees, but the hedge itself is never magic.
If you’re earning in one currency, spending in another, and investing back in Canada, you probably already know most off the drill. Rent, salary, school fees and retirement money might all sit in different buckets, but an ETF wrapper is another place the loonie can join the conversation in a safe way, provided you know what the options are.
Read more: MoneySense
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Pensions Need an Earlier Look
Here’s a sensible reminder for anyone treating retirement like a folder marked “Future Me”: your pension picture should start being formed long before you need the money. As it happens some of the boring details and bigger pitfalls are easier to manage and fix while you still have years until you need the cash.
In Canada, the basic stack is CPP, workplace pensions, and personal savings through RRSPs or TFSAs. CPP contributions are mandatory and employer matched, and younger workers will normally get more from the enhanced CPP if they contribute long enough. Workplace coverage is patchier - only 38% of Canadian employees had an employer-sponsored pension plan in 2023.
If your career has crossed a borders, foreign jobs, years outside Canada, local pension schemes, RRSP room, TFSA eligibility and OAS residence rules can all turn a neat Canadian retirement spreadsheet into what might more look like modern art. It could be beautiful from a distance, but less helpful at tax time. Think ahead.
Read more: The Conversation Canada