Twitter Tuesday Profile: @CanadianFinance

For this week’s Twitter Tuesday Profile, we’re introducing you to one of our neighbors to the north. Tom Drake tweets from @CanadianFinance and blogs at CanadianFinance.com. When he’s not writing or tweeting he’s working as a financial analyst for Canada’s second largest grocery retailer which means he budgets money for about 200 stores in western Canada. He lives in Edmonton, Alberta with his wife and an 11 month old son.

OODC: How did you get started blogging and tweeting?
@CanadianFinance: I started Canadian Finance Blog as I was going through quite a few major personal finance decisions in life. When I started the site in February of 2009, I had been married for just over four months, we just found out we were expecting our first child and we were looking to sell our townhouse and move to a house in a nicer neighbourhood. These were all big moves that effected us financially, and I wanted to do everything properly and decided to start the blog to share what I was learning with others.

OODC:Are there similarities in the way that Canadians and Americans typically deal with personal finance and debt?
@CanadianFinance: A lot of it is the same, we still have a need for emergency funds and retirement planning. While the American blogs write about 401ks, Roth IRAs and 529s, we Canadians have RRSPs, TFSAs and RESPs. We didn’t have as big of a housing correction though, that’s caused a bit of talk of real estate bubbles and whether our market will eventually drop. While we pay more taxes, we supposedly get more for it with public healthcare and other government programs.

OODC:You mention on your blog that you are using the Smith Manoeuvre to reduce your mortgage. Can you explain what that is and how it works?
@CanadianFinance: This is another time where the Canada and the US are not the same. In the United States, mortgage interest is tax deductible, here in Canada it isn’t. However, interest paid on an investment loan is tax deductible. The Smith Manoeuvre is a way for Canadians to make their mortgage tax deductible. You start with a readvancable mortgage, meaning that as you pay down your mortgage principle you free up room on your line of credit. Every time you make a mortgage payment, you borrow it back through your LOC and invest it in dividend paying stocks. This has a snowball effect and eventually you have paid your mortgage off sooner, but now have a large balance on your line of credit. While you have to be comfortable with that amount of debt, the nice part is that the dividends can pay for the interest, so ultimately you could keep this debt for the rest of your life.

OODC:Who are some of your favorite money tweeters?
@CanadianFinance: Here in Canada, @JonChevreau stays busy on Twitter and shares some great articles. @OutOfYourRut has some great tweets, offering more than just post titles, he draws you in with interesting questions and thoughts. I follow over 200 great personal finance bloggers on my list, those I have been tweeting back and forth with lately include @moneyhighway, @MMarquit and @bigcajunman.

Thanks again to @CanadianFinance for being part of this week’s Twitter Tuesday Profile. Want to be considered for an upcoming profile? Just tweet me!

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