2020 was a year where I promised myself I would increase my financial literacy. My experience going through the public school system was that financial literacy wasn’t even on the radar of any course. I vowed to myself that I would leave behind more than just assets and liabilities to my kids when I pass, I promised that I would provide some sort of knowledge based on experiences I’ve had along the way. One thing I wanted to learn more about was mortgage-hacking; and whether or not there are ways to be more efficient with probably the biggest purchase the average Canadian makes in their lifetime.
I learnt about the Smith Manoeuvre years ago while exploring some online forums and posts. First thing I thought: This is difficult to understand, you need to be really careful not to screw things up and I probably wouldn’t be a good candidate for it.
Fast forward 5 years, and after listening to a few podcasts, that re-triggered my attention, and being aware of how quickly home prices were going up and up and up, I finally decided to look into it.
If you dont know about it, its a strategy convert your mortgage on your primary residence from non-deductible debt to deductible debt by taking advantage of readvanceable mortgages which have become more and more available in the past few years. Reason? To allow one to enjoy the three benefits of reducing their tax bill, paying off their non-deductible mortgage faster, AND investing for retirement.
I must say, the way its being explained in this book is awesome. It breaks it down in a way where the average person (me) can understand by talking about the foundation of the strategy, and different ‘accelerators’ that anyone can take advantage of. I highly recommend the book to anyone interested in looking at different ways to fund their retirement.
Big disclaimer, since reading the book, and listening to the podcast over and over again, I have become a Smith Manoeuvre Certified Ambassador and as of November 30th, 2020 have executed the process on my own personal property. Being an Ambassador gives me the benefit of having a huge network of Real Estate Agents, Mortgage Brokers, Accountants, Lawyers, Insurance Agents and Investment Advisors who are well versed in the process; and it is a direct benefit to my clients (and me).
I plan to post about the process, and my experience with my very own readvanceable mortgage, and how it has impacted my own situation in the next few months; so stay tuned. There is nothing like getting info from someone who has implemented it first hand (Not only am I a client…flashback to those balding hair commercials).