With growing economic uncertainty during the COVID-19 pandemic, the financial landscape is shifting every day.
Whether it's dealing with sudden unemployment, ballooning debt, or expenses related to working from home, BNN Bloomberg wants to help Canadians navigate these uncharted waters.
That’s why we created Ask BNN Bloomberg, where you can have your personal finance questions answered by industry professionals.
Email or send your questions via video to email@example.com, and we will aim to answer them weekly.
Questions and answers have been edited for clarity. Last names will not be used.
Financial aid for low-income Canadians
Bonny in Portage La Prairie, Man.:
I was on social assistance until April 2020. I then started to receive my Canada Pension Plan Disability (CPPD) at the end of April 2020.
Is there any financial aid for people who are only on CPPD? Payments are less than $1,000 after taxes are deducted. This is my only source of income. I can’t find any type of assistance for those on a low income. (May 3, 2020)
Chantel Chapman, founder of What The Finances:
Thank you so much for your question and I'm really sorry that you’re experiencing financial difficulty. So you’re allowed to be on disability and apply for the Canada Emergency Response Benefit (CERB) provided that you stopped working due to COVID-19 specifically. If you were not working in advance of this pandemic and there’s no obvious loss of income, that would impact your eligibility. There’s also another layer of eligibility, and this is that you’ve had to have made a minimum of $5,000 in the last 12 months from employment or self-employment income.
So unfortunately based on this scenario that you described and the information that you provided, it seems that you are not fitting the eligibility criteria for CERB.
I would recommend contacting the department that handles your disability payments and having a discussion with them about your income amount if this is not a sufficient amount to meet your bare needs. Good luck with everything. (May 7, 2020)
Looking for work after maternity leave
Tinu from Vancouver:
I was previously working a maternity coverage position last year (one-year contract) and I had to go on maternity leave before the end of the contract. My leave just ended on April 11 and I am unable to find another job due to COVID-19. Do you think I might be eligible for CERB?
Thanks for your help. (May 7, 2020)
Peter Papadakis, principal of financial planning and tax advisory services at Kerr Financial Consultants:
To qualify for the CERB, you must reside in Canada, be at least 15 years old, have stopped working because of reasons related to COVID-19, had income of at least $5,000 in 2019 or in the 12 months prior to the date of your application, and have not quit your job voluntarily.
The Canada Revenue Agency (CRA) states if you cannot return to work due to COVID-19 following your maternity or parental leave, you would be considered to have stopped working due to COVID-19 under the CERB program.
Accordingly, you would qualify for the CERB provided you have employment insurance (EI) maternity or parental income of at least $5,000 in 2019 or in the 12 months prior to the date of your application. (May 8, 2020)
Will a top-up from work impact CERB?
Bethany in Edmonton:
I have received a top-up from my work and it was sent as employment income. I am going to have to report it on my next update. It was under $100. I am on CERB via EI.
I am confused, as I have heard mixed messages in regards to top ups to CERB and EI; that if you are on CERB via EI you can't earn any money, but if you are on CERB with the CRA, you can earn up to $1,000. Am I going to lose my CERB when I report it? (May 4, 2020)
Christine Ibbotson, financial advisor and author of Don't Panic: How to Manage Your Finances - And Financial Anxieties - Before and After Coronavirus:
Thank you so much for your question. I know it is a little confusing when it comes to the wording with the government benefits. The $100 bonus income will not affect your CERB benefit when you report it, nor will you lose the benefit.
The exact wording from the Canadian government benefit plan is "You cannot have earned more than $1,000 in employment and/or self-employment income for the entire four-week benefit period of your new claim." Since it is only an extra $100 this will not affect your benefit. (May 8, 2020)
Qualifying for CEBA
Ira in Toronto:
I have a small and medium-sized business (SME). In 2019 I paid $15,000 in wages for permanent employees (I issued T4s) and $15,000 for contract work (I did not issue any T4s, just had a contract signed).
Does this count as $30,000 employment wages to apply for the Canada Emergency Business Account (CEBA)? (May 2, 2020)
Barry Choi, personal finance blogger for Moneywehave.com:
I wasn't able to find a definite answer on the government of Canada website, but from what I understand, income paid to both employees and contractors would count towards the minimum threshold amount of $20,000 to qualify for the CEBA.
How is the stock market climbing in this environment?
Paul in Dead Mans Flats, Alba.:
With the massive job losses globally, interest rates almost in negative territory, deficits in the stratosphere, dividends being slashed, most small business on life support, most large businesses looking for bailouts, how is it possible for the stock markets to be climbing?
I understand liquidity, but there is so much debt and the outlook is so grim. There seems to be this massive disconnect between the markets and reality. (April 30, 2020)
Brian Belski, chief investment strategist at BMO Capital Markets:
Stock markets do not necessarily reflect the state of the economy; rather, they present themselves as an indicator of where the economy is going. In the current case, uncertainties surrounding coronavirus and the significant economic impact rapidly led the market to a bottom on March 23. The sharp rebound since reflects a number of long-term factors.
One, corporate fundamentals are intact and have not changed from three months ago. While consumption and profits will drop in the near term, the expectation is that earnings will grow even as early as the second half of 2020.
Two, there is unprecedented support from the government in the form of liquidity and low interest rates, which assure investors that the government will continue to prop up the economy.
Three, we note there is a clear winner of this crisis, namely technology and communication services stocks that have benefited from the dislocation and are expected to be long-term performers. (May 8, 2020)
Financial aid for landlords
Eddie in Montreal:
I am a landlord of a few triplexes which is a mix of two residential apartments and one commercial business. Will I be qualified for Canada Emergency Commercial Rent Assistance (CECRA)?
My understanding from Trudeau is that the commercial rent assist will only apply to landlords that have a mortgage on their property. This is not fair and it penalizes landlords like me, as some of my properties do not have any mortgages. This is my only main income. (April 27, 2020)
Rob McLister, founder of RateSpy.com:
CECRA provides forgivable loans to eligible commercial property owners who waive 75 per cent of their small business tenants’ rent for three months which can apply retroactively to April and May rent. The government pays 50 per cent of the rent, the landlord pays 25 per cent and tenant pays 25 per cent. Landlords must agree not to evict the tenants during the term of the agreement or ask tenants to repay the rent abatement later.
CECRA is expected to launch in mid-May, has an August 31, 2020 application deadline and applies to mixed use properties as well (i.e. those with commercial and residential units).
The problem is, CECRA requires you to have a mortgage loan secured by the commercial property, says program administrator CMHC. So, you would not qualify as of today. But there’s cause for hope. The government is aware of this problem and CMHC says: "For those property owners who do not have a mortgage, an alternative mechanism will be implemented" with details provided "in the near future." (May 11, 2020)
To have your personal finance question answered an industry professional, send an email to firstname.lastname@example.org.
Sign up for BNN Bloomberg's new weekly newsletter, Home Economics, which aims to help Canadians navigate their personal finances in the age of social distancing and beyond. Have it delivered to your inbox every Friday by subscribing at https://www.bnnbloomberg.ca/subscribe.