Lab-Grown Diamonds vs Mined Diamonds

Up until recently, many scientists were still struggling to create high-quality diamonds in a lab setting. Experts have been trying to recreate diamonds in a scientific environment for decades – mostly with limited success. Many companies found that the results of their efforts were small, and only appropriate for industrial purposes, like making cutting tools. However, now that the processes used to create man-made diamonds are more sophisticated, companies can finally simulate the extreme pressure required to create stunning engagement rings and jewelry. The question is, what makes lab-grown diamonds so much more superior to their mined counterparts?

Lab-Grown Diamonds are Better Quality

Deciding to choose lab-grown diamonds over mined stones isn’t just a good financial decision, it means you end up with better value too. Ultimately, grown diamonds have more clarity and beauty than diamonds that are simply blasted out of the earth using dynamite and other explosive sources. Diamonds grown by man have fewer defects, and a better carbon structure. This means you get a stronger, more pure diamond.

Lab Diamonds are More Ethical

Although a jeweler can tell you that a traditional diamond comes from an ethical source, it’s hard to know for certain the exact origin of every mined diamond. Ultimately, many diamonds were mined in the time before the Kimberley Process was implemented in 2003. When you choose a lab-grown diamond, you know for certain that no-one suffered to give you the incredible jewelry that you’re buying.

Lab Diamonds are Environmentally Friendly

Diamonds are responsible for some of the biggest holes ever dug into the earth. Mining for diamonds requires immense amounts of fossil fuels to assist with extracting complex pieces of gemstone. On the other hand, lab diamonds are entirely eco-friendly. They don’t use the same level of fossil fuels, and they don’t dig huge holes into the planet.

More Stone for Your Budget

Although lab-grown diamonds give you the exact same quality (if not better) in your stones, you can pay a lot less for them. Most lab-grown diamonds are available for at least 30% less than you would expect to pay for a traditional diamond. On the other hand, you could get a 30% larger stone for the same budget. This means that when you choose a grown diamond, you get a lot more bang for your buck, and you don’t have to compromise on the style of diamond that appeals to you.

They’re Still Authentic Diamonds

Finally, a lot of consumers assume that growing a diamond in the lab means that it isn’t an authentic gemstone. However, the truth is that labs use all the same carbon processes and materials to create your diamond as you would find in the earth. The only difference is that the eco-friendly processes used in a lab setting are much faster and more efficient when it comes to creating the diamond stones.

You won’t be able to tell the difference between a lab-grown diamond and one mined out of the earth, and you’ll pay a lot less for the privilege of getting the perfect stone too.

Common Mistakes Canadians Make When Saving for Retirement and How to Avoid Them

Disclaimer: The following post is sponsored by Sun Life Financial.

The biggest mistakes most Canadians make when it comes to retirement planning is not saving anything at all. A recent study from Sun Life Financial shows that 25% of retired Canadians are in debt and 24% of working Canadians have raided their retirement savings. Canadians seem to be underestimating the amount of income they will require to spend their sunset years comfortably. Some may expect that government benefit pension programs will be adequate, believing that government money would be sufficient for their needs late in life. While the exact amount required for retirement can vary between individuals, the final years can be financially excruciating for those who don’t plan ahead and save for retirement. Lacking a workable plan is not the only mistake Canadians make when saving or investing for retirement.

Not Taking Advantage of Government-Supported Savings Plans

The defined benefit pension plan an employer offers is an increasingly rare retirement option for Canadian employees. In fact, relying entirely on a pension plan is risky. Because these pension plans are very expensive for employers, employees risk having their retirement savings seriously underfunded. The Canadian government supports multiple alternate pension plans that average income earners can benefit from. The Canada Pension Plan, or CPP, will cover you in addition to an employer’s pension, if one exists. Along with this, Canadians can also take advantage of retirement vehicles such as the  Registered Retirement Savings Plan (RRSP) or a Tax-Free Savings Accounts (a TFSA). Using both RRSP and TFSA plans are highly beneficial retirement savings strategies, however, there are several key differences between the two; therefore, it’s up to the individual to choose a plan that best suits their needs. Canadians are more familiar with RRSPs than TFSAs because the RRSP has been around since 1957. TFSAs are a more recently introduced savings tool that can actually be more beneficial than RRSPs for some Canadians. What matters is that there is a retirement saving option in your life that is not limited to the defined benefit pension.

Not Considering Tax Implications

Your retirement savings are not necessarily free of taxation. All Canadians ultimately have to pay taxes sometime in the retirement-saving process; either when sourcing contributions or upon withdrawal in retirement. And because your retirement savings won’t be the same after paying taxes, don’t ignore this consideration when planning your retirement fund. Canadians ultimately face a dilemma on whether it’s best to choose a TFSA or an RRSP for current and post-retirement tax purposes; one influencing factor could be whether you expect to receive a defined benefit pension.

Whether an RRSP or a TFSA is better for you depends on your marginal tax rate at the time of contribution and at the time of withdrawal. RRSP holders pay taxes upon withdrawal. This tax rate is calculated based on the person’s income at the time of withdrawal. If your income level is low at the time of withdrawal compared to when you made contributions, then you can enjoy a lower tax rate on your withdrawn RRSP funds. However, like RRSP withdrawals, a person’s pension receipts are considered to be taxable income. In this light, RRSP withdrawals that are made while receiving pension amounts can actually be disadvantageous tax-wise, if the receipt of pension amounts has already put the tax payer in a high tax bracket.

Retirees don’t have to worry about increases to taxable income with a TFSA, because all contributions to such an account are made with after-tax dollars. As per the TFSA withdrawal rules, no additional taxes apply regardless of income levels upon withdrawal of fund. If you are in a higher income bracket in your sixties than you were in your thirties, a TFSA would be an excellent source of income-neutral account withdrawals.

Think about seriously planning for retirement right now, even if you are just 20 years old. Use professional financial advice to come up with a retirement savings strategy. Remember that taxes and fees will take a chunk out of your available funds, and plan accordingly; avoid the above-listed mistakes to enjoy your retirement without having to worry about taxes or debt.