Keeping You Informed – Goodbye to 2023!

December 14, 2023 | Joanne Livingston


I really don’t know where the time goes… 2023 is coming to a close and we are already making plans and booking appointments for 2024. It has been a full year on the Livingston team. Suzanne has returned from maternity leave in September and Jenny began a maternity leave of her own a few weeks ago. We were delighted to welcome Ina Song to the team in October. You will no doubt hear from her in the New Year as she has taken over the responsibility for booking appointments and managing the annual review program. 

We wrote about many things throughout the year, but a couple stand out and are worth repeating:

•In 2021, equity markets and bond markets both rose to new heights. Interest rates were virtually nil, which supported existing higher levels for bonds and preferred shares while simultaneously providing the equity market with a huge tailwind. It is almost a perfect scenario for investors… but volatile with no opportunity for rebalancing. In 2022, interest rates began to rise, taking the wind out of the sails of bonds and stocks. Debt and equity markets both decline, and again, volatile with no opportunity for rebalancing. Along comes 2023… finally the asset classes begin to diverge and it becomes one of those rare opportunities to capitalize on asset allocation. Interest rates are higher than they have been in more than 20 years.

•We love bonds…again! Nothing is more painful than watching the price of your fixed income investments drop. The 2022/2023 steep rise in interest rates caused just that in our preferred share and bond portfolios. As we find ourselves at the top (or near top) of this rate cycle, we are starting to see that perseverance pay off. By itself this is great, but we are still finding opportunities to add new, high-yielding, fixed income to your portfolios… and that is celebration worthy!

•We’ll always love dividends and the magic of compound interest… it is worth repeating every year. Canadian Banks, Telco’s and Utilities all raised their dividends in 2023, providing a tidy amount of inflation protection and tax efficient income.

•The First Time Home Savings account became a reality in 2023. While it is a bit of a mystery as to why this wasn’t administered within one of the existing tax-free vehicles, we have to love it! With a contribution limit of $8,000 per year (up to a maximum of $40,000), this account gets you a tax receipt for deposits, tax-free growth, and a tax-free withdrawal when you are ready to purchase a house. Once the account is open, you have 15 years to apply the funds to your first home. If you don’t buy a home in the time allotted, the total amount of deposits and growth can be rolled tax-free into your RRSP -without ever disturbing your RSP limits. One catch is that you need to open an account to start earning the eligible room.

•Another vehicle we love is the Tax-Free Savings Account. Starting January 1st, 2024, the new limit is $7,000 per year. The clock starts ticking when you reach the age of majority and every year thereafter you are entitled to the annual deposit amount along with any unused contribution room from previous years. While you do not get a tax receipt for deposits, the funds grow tax-free, and all withdrawals are tax-free. 

We are just completing our year end readiness activities which include reviewing all of the taxable accounts for gains/losses, making charitable donations and generally ensuring that the preparations are done ahead of tax season. If you have any questions please reach out, we are happy to help.

What is definitely worth repeating is our sincere thanks for your trust and support. We count ourselves lucky to provide this service and privileged to be entrusted with managing your financial future.

Our very best this holiday season! Stay healthy and well.

From all of us at Livingston Wealth Management Group