DENVER — Supporters and participants of the Denver Basic Income Project rallied at the state capitol and outside Denver’s City and County Building on Wednesday, calling for more funding to continue and expand the program.
As Denver city leaders comb through Mayor Mike Johnston’s 2025 budget proposal, supporters of the project are asking city leaders for more support.
“We’re asking for $1.7 million to complete the second year,” said Maria Sierra, a community engagement manager with the Denver Basic Income Project. “And we’re also asking for money to extend the project for future cohorts so that we can replicate this on to the greater community and impact more cohorts.”
The Denver Basic Income Project provides direct cash to people experiencing homelessness with no strings attached.
The project’s founder, Denver entrepreneur, and philanthropist Mark Donovan spoke with Denver7 earlier this summer.
“I was seeing this growing wealth disparity and income disparities, and I wanted to find a way to give back,” Donovan said. “This is a group of people that are largely often overlooked, looked down upon, and not given the same opportunities.”
Critics of programs like this say they discourage people from working and make them more dependent on the government.
Michael Neil says he, too, was skeptical — until he saw the data.
“I’m a data guy,” Neil said. “Looking at the qualitative data, who was helped, how many were helped, and how many are now in stable housing, whatever that may look like for them is, I think, tells the story.”
Neil volunteers with the Colorado Cross-Disability Coalition, one of several groups that make up the Denver Guaranteed Income Now! Coalition.
The Denver Basic Income Project says 45% of participants found housing.
They also say participants reported fewer emergency room visits and hospital and jail stays.
They say the project saved taxpayers $590,000.
They say the results will improve if the city provides additional funding.
“Our results speak for themselves,” said Sierra. “We don’t understand why they’re not seeing that.”
Last year, the city provided $2 million for the program.
However, the program is not included in the mayor’s 2025 budget proposal.
Denver7 contacted the mayor’s office to ask why but did not hear back Wednesday.
The mayor’s budget proposal will likely undergo changes as the city council reviews it.
Last week, Johnston said next year’s budget will be tighter than in recent years as pandemic-era funding runs out and sales tax revenue softens.
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The legislation proposes a pilot initiative offering $1,400 in direct cash aid for 36 months to emancipated minors and individuals under 30 experiencing homelessness. Housing, health, and other facets of the program will be studied.
“We can’t keep repeating the same policy approaches that haven’t ended the youth homelessness crisis. By providing direct cash assistance, we can address our housing crisis while respecting the autonomy and dignity of the folks receiving assistance,” Tlaib said in a press release. “This bill came directly from young people with lived experience. They helped craft the bill to ensure that it meets the real needs of our unhoused neighbors. In the richest country in the history of the world, it’s time to eradicate homelessness. The Youth Homelessness Guaranteed Income Pilot Program Act brings us closer to that goal.”
The proposed bill is endorsed by national and local organizations including Detroit Justice Center, Homeless Action Network of Detroit, Michigan Coalition Against Homelessness, MiSide Community Impact Network, and the Ruth Ellis Center, among many others. The legislation is also cosponsored by representatives Cori Bush, Sylvia Garcia, Eleanor Holmes Norton, Barbara Lee, and Jan Schakowsky.
I’m a 65-year-old preparing for retirement within the next three to five years. I’m looking at different types of retirement funds. Would adding stocks that are dividend-structured along with gold and cryptocurrencies be a good mixture?
-Earl
Shifting from building wealth for retirement to distributing wealth during retirement involves considering preferences related to your life and money. Those factors can include your risk capacity, risk tolerance, lifestyle preferences, longevity, needs, diversification and tax location. Retirement planning happens in stages, with a pre-retirement stage occurring over three to five years during which you begin adjusting your mindset, lifestyle and investments to fit your next stage.
Ask an Advisor: I’m 65 Years Old and Going to Retire Soon. How Should I Structure My Portfolio?
The structure of your retirement portfolio should reflect your needs, lifestyle, risk tolerance and capacity, and financial resources. Diversification across tax location, investment type, time horizon and goals will help optimize your retirement portfolio.
Start by assessing your “sleep-well-at-night meter.” Your risk tolerance may or may not match the risk you need to maintain purchasing power and growth. Maximizing for factors such as growth can help you meet your longevity and medical expense needs.
Second, select fundamental investments that meet your foundational lifestyle needs, commonly called your core portfolio. For example, three to four low-cost, diversified index or exchange-traded funds (ETFs) may suit your core portfolio across equities, bonds and domestic and international investments.
Your market equity participation will depend on how much guaranteed income coverage you have from resources such as Social Security and your risk tolerance.
If you have the capacity and resources to accept volatility and risk for potential additional growth opportunities, consider adding speculative assets to your portfolio, such as gold and cryptocurrencies, and take advantage of bear market corrections.
Let’s dive a bit more into each of these categories of lifestyle and risk considerations. (If you have additional questions about investing or retirement, this tool can help match you with potential advisors.)
Longevity
Although Americans’ average life expectancy has taken a hit in recent years, they still enjoy long retirements by historical standards. The average life expectancy is approximately 80 years for women and 74 for men, respectively, according to the Centers for Disease Control and Prevention. These are averages, meaning retirement can span 25 to 35 years. Longer time spent in retirement requires more funding, and more funding requires a balance of conservation and growth.
If your investment selections are too conservative, they may not provide the growth necessary to accommodate your potential longevity. Consequently, if selections are too aggressive, there is a risk of poor extended performance contributing to a longevity shortfall. (If you have additional questions about investing or retirement, this tool can help match you with potential advisors.)
Lifestyle Needs and Preferences
Ask an Advisor: I’m 65 Years Old and Going to Retire Soon. How Should I Structure My Portfolio?
Your needs and lifestyle preferences are essential when considering investment choices. If your lifestyle preferences require higher levels of funding, your investment selection may orient more toward growth.
You may have travel aspirations, be philanthropic, have wealth transference goals and have higher daily lifestyle standards, all of which require a tilt toward growth. Contrarily, more reserved lifestyle preferences will shift your investment selections toward a more balanced, conservative growth approach.
Fundamental care and needs must be met during retirement. Medical expenses during retirement and long-term care support and services toward the end of life are expensive. These services require a combination of public or private insurance protection with private funding supplements.
Medicare supports a vast amount of medical care beginning at age 65, yet it leaves gaps in coverage that require money. If long-term care insurance has been purchased approaching 65, premiums are expensive, meaning self-funding. Current and long-term care coverage, need and resources will influence portfolio construction. (If you have additional questions about investing or retirement, this tool can help match you with potential advisors.)
If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.
Risk Capacity and Tolerance
Risk capacity is your ability to take investment risk, and risk tolerance is your willingness to take that risk. Both forms of risk evaluation will influence your retirement planning and the structure of your retirement portfolio. When considering risk capacity, you must consider your other available financial resources, which affect your risk tolerance.
Other financial resources such as Social Security and a pension, private annuity, or income streams from real estate properties will factor in how much risk you can accept in your market portfolio. For example, Social Security, pensions and private annuities are guaranteed income streams that fund a certain percentage of essential lifestyle needs over time.
The presence of fixed resources reduces the retirement funding need with additional market resources. It increases the risk capacity you can accept to foster growth in your portfolio to combat inflation and longevity risk. Furthermore, you may not need to replicate income types in the market if abundant resources mirror income.
Risk tolerance also includes your emotional ability to sleep well at night during periods of market volatility. The economic and financial markets are cyclical and fluctuate. While additional risk could foster more growth opportunities, more risk also welcomes more volatility during hostile market times. Growth allocation is not to be feared. However, it is to be accounted for both economically and emotionally.
Bottom Line
The structure of your retirement portfolio will depend on your risk tolerance, needs, lifestyle and other factors. Consider evaluating those considerations as you approach portfolio design.
Tips for Finding a Financial Advisor
Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Consider a few advisors before settling on one. It’s important to make sure you find someone you trust to manage your money. As your consider your options, these are the questions you should ask an advisor to ensure you make the right choice.
Preston Cherry, CFP® is a financial planning columnist for SmartAsset and answers reader questions on personal finance topics. Got a question you’d like answered? Email AskAnAdvisor@smartasset.com and your question may be answered in a future column.
Please note that Preston is not a participant in the SmartAdvisor Match platform, and he has been compensated for this article.
As a result of these rate hikes, the interest rates available on guaranteed investment certificates (GICs) have risen as well—leading to renewed interest from savers and investors. In fact, over the past 12 months, the average one-year Canadian GIC rate has shot up from 2% to 4.90%. As a result of this move-up in rates, even market-linked GICs—which offer a lower guaranteed interest rate because of higher potential gains linked to the stock market—are offering a minimum guaranteed rate over 2%, as of mid-December 2023.
How high will GIC interest rates go?
The interest rates you pay on various types of debt, like a mortgage or a line of credit, depends mainly on the benchmark rate set by the BoC. This, in turn, depends on the prevailing rate of inflation. Simply put, the higher inflation is in Canada, the higher the BoC’s benchmark rate, and the higher the interest rate you pay on your loans. On the bright side, a high-rate environment also offers high GIC interest rates—a boon for Canadian investors.
When you buy a GIC, you lend money to a bank or other GIC issuer in exchange for a guaranteed amount of interest at the end of an agreed-upon period (such as one, two or five years).
We can’t predict future interest rates, but for now, here are some interest rates you can get on long-term non-redeemable GICs at Scotiabank as of mid-December 2023.
Term
Interest rate
1-year
5%
2-year
4.3%
3-year
4.1%
4-year
4.45%
5-year
4.35%
Rates are provided for information purposes only and are subject to change at any time.
It’s notoriously tricky to pinpoint precisely where interest rates will go, but we can expect that GIC rates will remain relatively high as long as inflation persists in Canada. While inflation is down from the scary heights of 8% in June 2022, it’s still above the BoC’s target rate of 2%. So, rates may remain flat until we see significant cooling in the Canadian economy. This means that while GIC rates may not spike further, the current rates could persist for a while.
GIC vs. high-interest savings account (HISA)
Just as the rates for GICs are up, so are those offered on high-interest savings accounts (HISAs). As a result, Canadians are exploring HISAs and drawing comparisons between these and GICs to determine the better investment. While a HISA may be more flexible than a GIC, if you’re looking for higher guaranteed rates of return, GICs could be the way to go. For example, as of early December 2023, money held in a Scotiabank HISA for 360 days will offer you 2.55% to 2.65%.
HISA
Cashable GIC
Non-redeemable GIC
Term
360 days
1 year
1 year
Interest rate
2.55% to 2.65%
2.85%
5%
Rates are provided for information purposes only and are subject to change at any time.
Choosing a GIC
If you’re considering investing in a GIC, here are the various types on offer:
Non-redeemable GICs: You buy a GIC for a set period (called the “term”), with a fixed and guaranteed annual interest rate. At the end of the term, you get your principal back, along with the interest earned. These GICs cannot be cashed in prematurely.
Cashable GICs: Unlike non-redeemable GICs, cashable GICs can be cashed in prematurely—before the term of the GIC is complete. You must hold this GIC for at least 30 days, and you can keep the interest earned up to the date you redeem it.
Personable redeemable GICs: At Scotiabank, these GICs are currently available for a two-year term. They offer a higher rate of interest than a cashable GIC, and they can be redeemed early, either partially or fully.
Market-linked GICs: Market-linked GICs offer investors the safety of traditional GICs and the potential to earn higher returns linked to the stock market. Like a conventional GIC, your principal is protected, and you get a minimum guaranteed interest rate (though it is typically lower than for other GIC types). Additionally, the GIC is linked to a major U.S. or Canadian stock market index—such as the S&P 500 or the S&P/TSX 60. For example, if the index rises 8%, you will get 8% on your GIC instead of the minimum guaranteed rate of about 2.4%.
Market-linked GICs: pros and cons
Before you buy a market-linked GIC, here are some points to consider:
In addition to these three core benefits, a cashable GIC offers investors the option of getting their money back even before the term of the GIC has ended, if they so choose. For example, as of Dec. 14, 2023, you could buy a one-year cashable GIC from Scotiabank at an interest rate of 2.85%. If you need your money back sooner than anticipated, you can redeem the GIC. There is no interest penalty for cashing out early—so you will get the interest earned to date—but you must hold the GIC for at least 30 days before you can do so. Cashable or redeemable GICs offer investors great flexibility but note that banks typically offer higher rates for non-redeemable GICs—currently even 5% for a one-year GIC, as shown in the table below.
1-year non-redeemable GIC (paid annually)
1-year non-redeemable GIC (paid semi-annually)
1-year cashable GIC (paid at maturity)
Interest rate
5%
4.92%
2.85%
Redeemable early
No
No
Yes
Eligible for registered accounts
Yes
Yes
Yes
CDIC-eligible
Yes
Yes
Yes
Rates are provided for information purposes only and are subject to change at any time.
Are cashable GICs a good investment?
Here are some reasons why cashable GICs may be a good investment:
They can be used for tax planning—for example, by buying a GIC in an RRSP account to get a tax deduction, or by holding a GIC in an FHSA to get a deduction and tax-free growth—as long the money is eventually used towards buying a first home.
They are flexible—giving investors the option of fully or partially redeeming their investment, depending on the type of product chosen.
These GICs have a low minimum investment amount of $500 and no investment fees—making them accessible to smaller and newer investors.
Cashable GICs are eligible for CDIC protection, up to $100,000 per depositor, at CDIC member institutions.
Given these benefits, a cashable GIC may be suitable for an investor who wants to combine the benefits of traditional GICs—like principal protection and a guaranteed interest rate—with the flexibility of cashing out anytime. (Note, however, that if you redeem within 30 days of the GIC’s issuance, you will forfeit the accumulated interest.)
If you’re saving up to buy a car or a home, for example, GICs are a safe and reliable way to grow your money and access it when you need it.
Can I transfer my GIC?
Canadians are accustomed to transferring their investments from one institution to another if needed—say, from one bank to another. However, unlike mutual funds, exchange-traded funds (ETFs) and stocks, GICs typically cannot be transferred. This is because a GIC is a contract between you and the institution, and each institution offers its own GIC interest rates, terms and conditions. So, if you’re buying a GIC, be prepared to hold it at the financial institution where you bought it. If you have a cashable GIC and you need to move your investments to another institution, you could cash in the GIC and reinvest the cash in a GIC at the new institution.
How to buy Scotiabank cashable GICs
If the ability to access your cash early is what you need, here are two options available through Scotiabank:
Cashable GIC
Personal redeemable GIC
Minimum investment amount
$500
$500
Term
1 year
2 years
Annual interest rate
2.85%
4.75%
Partially or fully redeemable
Fully or partially
Fully or partially
Investment fees
No
No
Principal protection
Yes
Yes
Guaranteed interest rate
Yes
Yes
Eligible for registered accounts
Yes
Yes
CDIC-eligible
Yes
Yes
Rates are provided for information purposes only and are subject to change at any time.
How do you buy a cashable GIC?
Cashable GICs are typically available wherever you buy your other GICs. For example, you can purchase Scotiabank GICs, including cashable/redeemable GICs, through a Scotiabank advisor. Book an appointment with an advisor online or by phone. Read more about Scotiabank GICs.
You generally need 40 years of residency in Canada after the age of 18 to qualify for the maximum OAS pension. The maximum monthly payment as of the fourth quarter of 2023 is $707.68 for someone who started their OAS at age 65. Someone aged 75 or older would be entitled to up to $778.45.
Exceptions to the OAS residency requirement
There may be situations where you qualify for the full pension without meeting the 40-year residency requirement. One example would be if you were over 25 and lived in Canada or had an immigration visa on or before July 1, 1977.
Another instance where you may qualify for a higher pension is if you lived in a country with a social security agreement with Canada. Time spent in other countries may count towards your OAS residency formula. If you worked outside Canada for the Canadian Armed Forces or an international charitable organization, this time might also count.
Deferring OAS to increase residency requirements
If you have under 40 years of residency, your pension is pro-rated. You need to have lived in Canada for at least 10 years after the age of 18 if you apply for OAS as a Canadian resident. If you live outside of Canada when you apply, you need 20 years of residency.
Interestingly, Amin, you can defer your OAS pension after age 65 to increase your residency requirements. This can work well for someone who is trying to get to 10 or 20 years, respectively, to qualify for the pension at all. In your case, the deferral will not have an impact on the residency calculation. I will explain why.
The reason is an OAS recipient deferring their pension after age 65 can only benefit from one of two enhancements: one, the years of residency; or two, the age-based increase. If you defer OAS to after age 65, your age 65 entitlement increases by 0.6% per month or 7.2% per year of deferral. You can start it as late as 70 for a maximum 36% increase.
If you get an extra year or 1/40th of residency, that amounts to a 2.5% boost in your OAS.
Unfortunately, Amin, you cannot get the 2.5% residency boost and the 7.2% age boost for deferring. You get the higher of the two, which is obviously the age-based adjustment of 7.2%.
