What matters

dog-toy

What is it about the end of the year that makes us question everything? Our finances. Relationships. Jobs. Love handles. And real estate. It may only be the flip of a calendar page, but every January brings such angst because this is an emotional time of the year. Even for the wealthy. Like Aaron.

“I have been following your blog for 10 plus years and love the dog pictures,” he says, in the obligatory genuflect. “I am an ER doc in the last 10 years of my career.  My wife works part-time and we have 2 kids at university with money leaking out of our bank account for them.  We have $1,000,000 in investments, RRSP, TFSA, RESP and corporate saving.  Our house is in a hot market (Victoria) and is between $1.4 to $ 1.5 million with a $500K mortgage thanks to a reno and foundation issues.  We have an opportunity to sell and rent a nice smaller house ($3000 / month) in the same neighbourhood.

“What do you think?  If we sell where would we invest and what happens if the market hits Vancouver levels and we get kicked out of our rental?”

See? Being full of doubts and turning to a pathetic blog populated by deplorables is not mutually exclusive with being a pillar of society. So let’s parse Aaron.

Being an experienced emerg doc he probably earns about $300,000, so savings of a million a decade prior to retirement is not that stellar an achievement. Sounds like those are expensive kids. Or maybe there’s a mistress tucked away up in Ladysmith. In any case, doctors don’t normally have pensions, so when the salary ends life will change abruptly – even with a million.

Meanwhile there’s another mill in real estate equity plus $500,000 in mortgage debt in a house in steamy little Victoria – where VYR refugees have imported their dread mainlander disease called FOMO. So should the doctor just ride the housing wave higher and cash in later when his digs are worth $2 million? Or bail, get liquid, and prepare for retirement?

That’s easy. The market is over-valued, speculative and on the cusp of big changes (rising rates, tighter lending, Trump), while his medical career barrels towards a fixed termination date. Keeping 50% of net worth in real estate (one asset) likely constitutes more risk than investing in a balanced and diversified way to support the rest of his days. In other words, it’s a stretch to think the house will double in value in a decade, but reasonable to assume his portfolio will – simply based on historic norms and conservative projections.

Selling the house, harvesting the million and investing it in a balanced way for ten years should turn that into two million, while eliminating debt that will renew at a higher rate. The numbers are compelling. A million in equity could be earning $60,000 a year. The mortgage, property taxes and insurance require $3,000. So, that house represents a cost of roughly $8,000 a month. If the family can live in an equal house in the same hood for three grand, with no debt, what’s to debate?

Oh yeah, houses could continue to rise, or Aaron might become homeless. Greed and fear. See how emotions work?

Nothing in life is for sure. It’s a matter of playing the odds. The fact that half of all marriages survive is astonishing, given how they occur. So, yes, Victoria real estate could continue to plump in value, though the odds of that are falling rapidly.  Even if it were so, the doc would have to sell his place at some point to free the money for retirement – and what if the market sagged at just that moment? Unlike financial assets, which can be liquidated in small amounts to liberate cash (no matter what the prevailing conditions) a house is a one-and-done deal. You can’t sell a chimney to make ends meet.

So why not harvest the tax-free capital gain when the buyers are buying? Duh.

As for getting kicked out of a rental, well, deal with it. The chances of this happening are less than the 100% certainty the mortgage will renew at a higher rate or that over time the furnace will croak or the shingles fail. With two kids leaving the nest and retirement within view, it’s probable he’ll want a different (smaller) place down the road anyway. The rental house is not the F home. That forever place might end up being in someplace more exotic and electric. Like Etobicoke.

Well, Aaron, suck it up.  Apply some of the skill, reasoning and intuition you use in saving lives to improving your own. Emotion’s so over-rated. It’s only a house. Not the goal of life. More than anyone, you should know what that is.

129 comments ↓

#1 mark on 12.28.16 at 6:00 pm

For those that like to noodle with numbers, the USA based on the CAPE numbers are poised to deliver sub par returns to say the least going forward next decade, no one has a crystal ball but its the best guess we got.

http://www.starcapital.de/research/CAPE_Stock_Market_Expectations

Looks like Emerging markets, and Europe (EAFE) index poised to delivery 2x what the USA market is giving.

#2 Randy Belwood on 12.28.16 at 6:08 pm

Today at the gym I asked a girl what her New Years Resolution was, she said
“Screw you”.
So I’m pretty excited about 2017 !!

#3 conan on 12.28.16 at 6:09 pm

It is indeed the prediction time of the year.

Here is one of many that I have:

SIS killed people who got in their way and then stole their stuff. Aleppo was a military operation to move people out of an area. Mosul will be the same thing, but much larger.
It does not take a rocket scientist to guess out loud, that Israel might use this “busy time”, to take care of their own people problems.
I predict a one state solution Doctrine from Israel in the near future. Expect powder kegs on top of powder kegs.

You thought 2016 was a humdinger….. bet accordingly.

#4 Muttley O'Toole on 12.28.16 at 6:13 pm

Garth I would like to do a bit of brown nosing please and say that your brilliant entertaining style of prose, with factual s laid out plainly for all to see, places you in the blue ribbon seat for a Nobel prize of some sort.
Your one blemish was your failure to see The Donald barrelling down the highway.
Well, that is in my humble opinion.

#5 Victoria Real Estate Update on 12.28.16 at 6:17 pm

Sales of detached houses have fallen 58% since April across Greater Victoria.

In 2015 sales declined only 34% (38% in 2014) over the same period.

The market is signalling that falling prices are ahead.

That began before rates started to rise. Anyone who knows anything about real estate knows that prices fall as rates rise.

#6 Victoria - the original on 12.28.16 at 6:22 pm

My husband was in a victoria shoe store the other day – I won’t say which one – okay Front Runners on View street – anyway there was a dude in there trying on running shoes. He was talking in the loudest voice for all to here that he was a real estate agent and if agents are not making $500,000 – at least – a year then something is terribly wrong. I am looking forward to this market collapsing.

#7 Smoking Man's Old Man on 12.28.16 at 6:38 pm

I’ve always been a home owner and could never see myself renting.

Following a divorce, part of the settlement was for her to keep the house (paid for). I’ve rented a one bedroom apartment in Vancouver for the last 3 years and have grown to love renting.

I thought I would never fall in that category, it’s very freeing. More time reading and less time weeding.

It’s too bad we’re conditioned to value things in life that ultimately bring no long term happiness (houses, marriage, titles)

#8 Grey Dog on 12.28.16 at 6:52 pm

Aaron, I don’t understand how you have been a dedicated blog reader, and only have 1M$ with 10 years left in your career. Selling and renting makes the most sense for your family…you will also be subliminally sending them the message not to be frivolous with cash. The austerity program begins now for a comfortable retirement for you and your wife. Encourage your kids towards the COOP education, gaining work experience while going through university and them contributing to their education along the way. Yes it may take a year or two longer, but I have yet to hear of a COOP student not landing employment immediately upon graduating!
Get the entire family on board with the change in their life. Wake up and don’t live with the illusion that just because you have an MD you are a phd (poppa has dough). Your funds are limited, your family needs to be educated via Garth’s Way. You never know this education may have your children choosing a career in finance interning for Garth!

#9 non-taxable on 12.28.16 at 6:52 pm

Dr Aaron, RUN, don’t walk. SELL THE HOUSE. It is better to be a year early, than a day late.

#10 Context on 12.28.16 at 6:54 pm

Victoria, BC has a strange home rental market as it appears that ownership comes and goes with restrictions because there are too many short terms rentals available. This market really demands a home search with a property management company for the long term. $3,000 a month seems about right, but what if your kicked out? The way to go is with a lawyer prepared long term lease with the right client at the property management company. Perhaps a meeting of the minds can take place with an escape clause for both the renter and the owner with terms to be agreed upon; some long term leases can even be registered against the title depending on the provincial laws.

#11 Leo Trollstoy on 12.28.16 at 6:55 pm

Emotion’s so over-rated. It’s only a house. Not the goal of life. More than anyone, you should know what that is.

docs are too busy chasing $ to spend time thinking about the meaning of life… that’s the irony…

#12 YYZ-YVR on 12.28.16 at 6:56 pm

You nailed Etobicoke. Exotic and electric.

ROFL

#13 ER on 12.28.16 at 7:05 pm

Hopefully Garth never ends up at Aaron’s ER, although the chances that he will visit one in the next 10 years is almost 100%.

It would be interesting to see if Aaron would make comments about life choices that leads to the ER in similar smug style what was dispensed to the doc.

He asked. — Garth

#14 I'm stupid on 12.28.16 at 7:13 pm

That’s incredible… he’s a Doctor making 300k and he’s nervous. Remember that money can buy anything but houses need to be sold to buy things.

I look at some of my neighbours and know that they’re house poor. I can’t imagine looking at a 5k a month nut. How can you sleep at night owing 8-900k how do you satisfy your wife with all that pressure of making the monthly payments. I guess when you can’t even scrape together 10% down payments you really aren’t afraid.

#15 I'm stupid on 12.28.16 at 7:17 pm

#2 Randy Bellwood

That made me laugh thank you!

#16 Freedom First on 12.28.16 at 7:24 pm

#108 Metaxa

Yes. Metaxa. I am a pacifist. But I will answer the idiotic twisted comments that you fire at me. Remember, Metaxa, you started it.

And I keep forgiving you. As I love you. But I am not a doormat.

#17 ER on 12.28.16 at 7:28 pm

#13 ER on 12.28.16 at 7:05 pm

Hopefully Garth never ends up at Aaron’s ER, although the chances that he will visit one in the next 10 years is almost 100%.

It would be interesting to see if Aaron would make comments about life choices that leads to the ER in similar smug style what was dispensed to the doc.

He asked. — Garth

I bet you will have a couple of questions at the ER, as well.

#18 cramar on 12.28.16 at 7:28 pm

I was browsing through a souvenir store today and saw a line of white Bistro towels that were each printed with various witty statements. One grabbed my attention. It just about sums up a lot of Canadians, would have made a great future picture for this blog. It said . . .

I going to
RETIRE
and live off
my savings.

What I will do
the following week,
I have no idea!

#19 Roial1 on 12.28.16 at 7:43 pm

That forever place might end up being in someplace more exotic and electric. Like Etobicoke.– GT

Garth, how could you??

I would not even send ” The Donald” there. (maybe a Harpo)

As a kid I was forced to live there so I can say from life experience “Don’t ever threaten someone with that kind of fate.” Might as well send them to ODDAWA.

#20 westcdn on 12.28.16 at 7:57 pm

Well it looks like I will be early with my viewpoints. Boom was a favourite of my mind. We had a lot of common ground – I regret not engaging him because he was overloaded with common sense and intelligence. What could I tell an honest man – you are wrong because… The world is short without him.
I am still alive with my ideals – better for good or worse, time will tell. I found this interview with Michael Lewis on his new book fascinating. It may take some time to load up.

Basically it seems to say that human minds are flawed to think they are right. Nothing wrong with this thought as I could not exist if I thought I was useless. There are a couple of ideas that strike me hard.

1. When people are paid to do something stupid, they will do stupid things. It is something I see more with the public sector than the private sector.
2. When it takes a person longer to recognise a person smarter than them – the dumber they are!
3. The more certain of yourself – you are prone to are making horrible mistakes

I have reservations about Trump – prove it to me that I am wrong! He seems to think the ends justify the means – well screw someone over and see what happens.

I thought this interview had meaning.
https://www.bloomberg.com/news/videos/2016-12-27/goldman-sachs-place-in-trump-s-world

The four years are going to be interesting – hope you are being alert. Don’t forget I am wrong a lot.

#21 InvestorsFriend on 12.28.16 at 7:58 pm

Congratulations to the ER Doctor

Doctors have been at the top of the career ladder in terms of prestige all my life (I am age 56). SOME people in other professions make more money but few or no career choices deliver an average wage as high. And the well deserved respect level from society is second to none. None of this is about to change.

I respect the accomplishments of this ER doctor. He has done very well.

Whether he decides to sell-and-rent-and-invest or not, the fact is that he is a highly respected and accomplished man.

#22 Context on 12.28.16 at 8:06 pm

#12 WYZ:- I have fond memories of the Etobicoke region in the past, but not so much anymore. Those who lived elsewhere missed out on the wildest nightclub activity in the GTA, and the young women couldn’t have been finer. There was a nurses teaching hospital on Hwy 10 who loved to party. Need I say more!

#23 Fed-up on 12.28.16 at 8:18 pm

Dear Aaron,

Why bother asking? You know what the answer will be right? The same one that has been given for the past 9 years…sell, rent and invest etc etc.Whether or not that has been the right answer and course of action, is entirely another story ;)

In my opinion, you’re doing just fine. You make a fantastic salary, have another 10 years to add to your million in investments that will only grow (perhaps painfully slowly but nonetheless) and you have a dump load of equity in your beautiful home.

Rock on with your 1st world problems.

#24 Okanagan Man on 12.28.16 at 8:24 pm

How does an ER doc making $300k per year plus have only a million in non real estate assets 10 years from retirement.

Wow Aaron, where did the money go?

#25 hope & ruin on 12.28.16 at 8:33 pm

#88 InvestorsFriend on 12.28.16 at 11:39 am

I guess partly it has to do with my recent comment about averages. The fact that the typical American (95% who bothered to look) had a job and that most (though not all) had good jobs was not gong to stop the 5% unemployed (15% or more in some areas) and the other 15% or so that felt way underemployed from being absolutely bitter.
__________________________________

I don’t think your assumption that the “bitter un/under-employed” elected Trump isn’t backed up.

State-by-state look at unemployment rates and election results:

Top 10 States Lowest Unemployment Rate + Election Results:

New Hampshire………..2.7%………Clinton
South Dakota…………..2.7%……….Trump
Massachusetts…………2.9%……….Clinton
North Dakota…………..2.9%………..Trump
Hawaii……………………3.0%……….Clinton
Utah………………………3.1%………..Trump
Colorado…………………3.2%………..Clinton
Vermont…………………3.2%………..Clinton
Nebraska………………..3.4%………..Trump
Idaho……………………..3.8%………..Trump

Clinton = 5; Trump = 5

Top 10 States Highest Unemployment Rate + Election Results

Alaska…………………6.8%……….Trump
New Mexico………….6.7%……….Clinton
Louisiana……………..6.2%……….Trump
West Virginia…………6.0%……….Trump
District of Columbia…6.0%……….Clinton
Alabama……………….5.9%……….Trump
Pennsylvania………….5.7%………Trump
Mississippi……………..5.7%………Trump
Illinois………………….5.6%……….Clinton
Washington…………..5.3%……….Clinton

Clinton = 4; Trump = 6

Doesn’t seem like much of a link to me, at least at the state-level. Maybe if you have data breaking down voting districts, unemployment rates and election results, that showed high unemployment areas swinging the whole states vote. Those I would be interested in.

I think the reason behind Trump’s victory are a lot more complex. If it was this simple then it would have been a massive oversight by Clinton’s campaign team.

https://www.bls.gov/web/laus/laumstrk.htm

#26 Polls R Phake on 12.28.16 at 8:36 pm

another boo hoo hoo public sector worker making 300k

Wow.

#27 AJ on 12.28.16 at 8:45 pm

It’s says something scary about our society when a high achiever with an excellent salary is fearful about their future wellbeing. How must the rest of the pleebs feel?

#28 meslippery on 12.28.16 at 8:46 pm

You can’t sell a chimney to make ends meet.

Not now but spring?

#29 paulo on 12.28.16 at 8:53 pm

Aaron : Grab The Tax Free Cash And Run !

Garth: on the “grab your hard hat for January 23/17 ”
pondering, between central bank meetings/rate set days
3 days after Potus gets closes and gets the keys…. um
Ok care to throw a few more “Scoobie Snacks”

#30 boonerator on 12.28.16 at 9:02 pm

$3000 /month?

Townhouses off Larchwood, 1800 sq ft on 3 floors.
$1650

Not exactly luxe accommodation, long way from Broadmead in terms of social class, but if you want to have a great nut when you retire, you can save a ton of money.
Depends on priorities, as always.

#31 Smoking Man on 12.28.16 at 9:07 pm

Aeron, Dr to Dr.

I don’t know shit about that market so I can’t advise you.

Your name sounds Jewish. One million after 10 years, shame on your parents is what I’m thinking.

For the record, I’m not Jewish, but I do like them, moreover the very charitable ones I know in Toronto.

I knew one Israeli, he was one crazy bastard, nice and friendly, but boy did he hate Palestinians and was not shy to say so. Looking at the images of the poor Gaza people getting whacked from wars MSM reporting it. What’s wrong with the guy I think?

For years I despised NutAndYahoo. The way the prick treated the people of Gaza annoyed the shit out of me.

Guess what, I’m with NutAndYahoo now, looking for my Zionist leather jacket patch. I have seen in the election cycle how MSM totally distorts reality, and they must do it there too.

The left SJW Agenda at Universities, Hate Jews, Hate White people, Hate Entrepreneurs.

A Drexel University professor who called for “white genocide” WHAT? then following his follower’s tweets, tons of SJW calling for the same thing. What did I do you little shits?

I’m white and straight, never had a racist bone in my body, but because I have white skin, you want me and my family dead.

I’m with the Zionists now, they got experience with that kind of shit, and know how to deal with it.

University is out of control. Shut it down and re-tool

Oh, one more thing, the only thing the loony left as on me. I’m a sexist, I like curves on Woman. I also tend to objectify them, especially when they wear high heels and short skirts. Deal with it.

Dr. Smoking Man
Phd Herdonomics

#32 yorkville renter on 12.28.16 at 9:10 pm

Doctors are notoriously bad with money

#33 yorkville renter on 12.28.16 at 9:15 pm

#27 – people always want more.

you fill the space you live in … smaller space, less stuff. more space, more stuff.

how you choose to live determines your happiness and stress

#34 Wrk.dover on 12.28.16 at 9:22 pm

And he made it through med school.

Hope I don’t end up in emerg.

but seriously motel 6 and 70 hr weeks for another decade and he can retire as well as a kindergarten teacher.

#35 TurnerNation on 12.28.16 at 9:24 pm

Boomer parent to kid on why he should always buya da house (goes uppa): “Son, I tautology you well”.

CCR Fortunate Son live: https://www.youtube.com/watch?v=f33qUqdZapw

#36 Smoking Man on 12.28.16 at 9:46 pm

Debbie Reynolds only survives her daughters death Cary Fisher by one day.

That day was a entire life time of pain… It killed her dead.

Rip Debbie.

#37 Metaxa on 12.28.16 at 10:02 pm

How does an ER doc making $300k per year plus have only a million in non real estate assets 10 years from retirement.
He didn’t make $300K each and every year, perhaps he worked with Doctors Without Borders until very recently or lets not forget he pays entirely out of his income for his office space, a receptionist and a nurse at minimum. Etc.

another boo hoo hoo public sector worker making 300k
very few Doctors are public sector workers, the vast majority are small business owners who run their businesses under a set fee schedule negotiated between their college and the province. Many hospitals in BC are not owned by the province, he may work for one of those, in which case the hospital runs under contract to Island Health…and pay rates would be set in a competitive marketplace.

Not enough information to be able to constructively comment on this guy’s real position…we should be happy for him and his family, after all he is seeking advice, but instead of help he gets crapped on.

Perhaps the good Doctor could recommend some meds that would help you guys with this pervasive gloom and doom and you might find out that life is good…if you want it to be.

#38 Self Directed on 12.28.16 at 10:06 pm

Aaron…. I’m going to give some advice Garth simply can’t.

First off, yes. Of course selling and investing is the right thing to do for your retirement. But you are married, so it’s not as simple as to just ask Garth because he is not sleeping with your wife at night. Fortunately, you are.

If your wife is on board with the idea of dumping the property? Sell in the spring. Both agree that no matter what the outcome, you could not predict it, and that markets are volatile (even RE) and it was a prudent decision to make.

If your wife BELIEVES that real estate is going up? Don’t sell. It is far better that you only suggest selling, and if she insists, you will agree to sell. Better if she is wrong than you. If you end up being right, NEVER EVER rub it in or say “I told you so”.

There you go. That’s it. That’s everything you need to make your decision. (trust me on this one)

#39 Ret on 12.28.16 at 10:09 pm

Dec. 22 from the Politburo
“With today’s ruling, the CRTC has set new targets for internet service providers to offer customers in all parts of the country download speeds of at least 50 megabits per second (Mbps)…”

I checked my download speed from Ma B— yesterday. 2.5 megabits per second so no Netflix for me. I live in Hamilton five blocks from a major university, McMaster, which is not exactly in Canada’s sub Arctic tundra region.

Oh, and I just got a price service update. Internet rates from Bell go up Feb. 1 by $5/month. One guess who will be paying to upgrade services for those in remote regions and it won’t be those who live there.

Not a day goes by that some telemarketer is not calling trying to pitch a phoney internet scam to me or offering to clean my ducks (ducts???).

Another CRTC permitted intrusion in the lives of our family, usually as I am just about to dig into the meat and potatoes.

If JT really wants to improve the internet service in Canada and the lives of Canadians, he can get rid of the CRTC. The government might even allow us to see the US Superbowl commercials again.

http://www.cbc.ca/news/politics/crtc-internet-essential-service-1.3906664

#40 JSS on 12.28.16 at 10:09 pm

An ER who averaged $250-$300K/yr over say a 30 year career and only managed to grow money to $1M?

Man that’s not very good. There are couples out there who make barely make a third of that as family income, and have crossed $1M in investable assets. Really it’s not that hard to do over a thirty year period. Where did all that money go?

#41 S.Bby on 12.28.16 at 10:11 pm

Love that pic today!

#42 S.Bby on 12.28.16 at 10:35 pm

or the doc could try this:

http://bc.ctvnews.ca/west-vancouver-doctor-asks-patients-to-help-fund-retirement-1.3192049

#43 Doug t on 12.28.16 at 10:47 pm

Don’t sweat it people – step outside the box – we all will be dead in what constitutes a very short time- soooo head into the new year with a different mindset. Stop worrying about this shit more and start living spontaneously more cause we all will be gone before you know it and this shit truly means nada

#44 InvestorsFriend on 12.28.16 at 10:48 pm

U.S. Economy rocks?

#25 hope & ruin on 12.28.16 at 8:33 pm

Figures at 25 show just how amazingly low the unemployment rate was in the U.S. leading up to the election. Even the high unemployment rate States had relatively low unemployment.

Yet it was not fashionable to say so and the democrats did not trumpet the strong economy.

“Bring back the jobs” Trump said. Well apparently there are not many people actually looking for the work!
Yeah, I know there are the under employed and those that can’t be bothered even to look for work. But the unemployment rate measured in the same way as eight years prior was amazingly low but it was unpopular to say so.

#45 Smoking Man on 12.28.16 at 10:52 pm

Today’s blog title.

What Matters?

https://www.youtube.com/watch?v=tAGnKpE4NCI

Finding your voice, cause nothing else matters, as imperfect, as it may be. It’s yours, and it’s all you really got.

Cherish it.

#46 Why sell? on 12.28.16 at 11:06 pm

In 10 years, the $1m investment will grow close to $2m, plus the extra savings. They have enough for retirement. By then, the mortgage will be paid off. ER doc must have pension too. Why bother selling and moving around if it is a house they can live in for 3 or 4 more decades? Unless they want to retire early.

Forty more years in the same house? In Victoria? Seriously? — Garth

#47 Self Directed on 12.28.16 at 11:08 pm

#1 mark on 12.28.16 at 6:00 pm
—————–
re: Emerging Markets… anyone with insight on recommending an ETF?

iSHARES CORE MSCI EMERGING MKTS IMI ETF
(TSE:XEC) — MER: 0.27% — 12 mo. yield: 2.12% — Market Cap: 204M

Vanguard FTSE Emerging Markets All Cap Index ETF (TSE:VEE) — MER: 0.24% — 12 mo. yield: 2.02% — market cap: 373M

I can’t tell if there is any difference or advantages between the two. Can I play Eeny-meeny-miny-moe on this one?

#48 45north on 12.28.16 at 11:10 pm

this article prompted my thinking on how high property taxes can go:

the article is about Greece:

In 2010, property taxes accounted for 0.26 percent of gross domestic product, while this year they are around 2 percent, according to state budget figures. ‘Suddenly, the state treated the Greeks as if they were rich, at the precise moment that they ceased to be rich.’

http://www.financialsense.com/charles-hugh-smith/when-assets-become-liabilities

in major cities in Canada, voters stop politicians from raising the property taxes too high. In Ottawa politicians aim for a 2% increase. The City Council has an acute awareness of the pain threshold and strives to stay below it.

It’s my impression that property taxes in smaller rural places are more likely to rise. First of all because services are now required where before they weren’t. For example cottages are occupied year round and now require school buses and snow ploughing. Second, the councils are more influenced by family contracts. This is just an impression without any specific examples.

Another factor is geographic information systems: new builds and major renovations can now be detected from air photos. There’s no more back-40.

#49 Smoking Man on 12.28.16 at 11:12 pm

The road of life.

It’s unpredictable, curves and twists, surprises and shocks. How does one deal with it without going bat shit crazy?
Go crazy before it happens silly.

Why do I know all this shit?

Orange plasma flyer over Long Branch May of a few years ago, forcing me to tell their story.
A heathen earthling with no work ethic. Aliens from Nicotine not that smart.

https://www.youtube.com/watch?v=Rz-ZdCEHbao

Singer of this band could not handle SF weirdos everywhere. moved to Colorado.

Ahhhhhhh

#50 Self Directed on 12.28.16 at 11:14 pm

Oh wait! Vanguard VEE looking better now… distributions are different
iSHARES (TSE:XEC) Semi-Annually
Vanguard (TSE:VEE) Quarterly

#51 ShawnG in TO on 12.28.16 at 11:15 pm

I agree with most here (and not InvestorsFriend ) – Aaron, you don’t have enough saved.

let’s suppose you don’t sell your house. you invest your $1M and add to it. in 10 years you double it to $2M. but your current take home pay is about $200k a year. so that $2M will only last you 10 years.

don’t gimme the crap that in retirement you’ll spend less. with $2M in the bank and lots of free time you’ll probably travel travel travel, and you spend spend spend. 6 months in europe will probably cost you $200k, then it’s too late to get nervous.

at this point selling the house isn’t even your priority. get your spending is.

#52 Smoking Man on 12.28.16 at 11:21 pm

Hey, unelected globalists slime sucking one-eyed dwarfs with the half of your shirt not tucked in.
To your plan. Davos Switzerland.

https://www.youtube.com/watch?v=Lin-a2lTelg

#53 Pssssst... on 12.28.16 at 11:29 pm

Hey everyone, if you have an extra 60 seconds to spare check out the link in comment #77 Josh Carriere, from last nights maple post. You want to see visual proof of the Batman that Smokey highlights every so often. Well there it is, in all its macro glory.. the man knows of what he speaks. Bet accordingly.

Still a megaton of value left in some of the highly levered oil plays on both sides of the border. But if you wanna keep hitting infield singles and buy bank stocks at ALL TIME HIGHS – 3.5% divi yields that’s cool, I don’t mind staying at the Howard Johnson after a long road trip either just don’t complain about it!!

-Bj

#54 ShawnG in TO on 12.28.16 at 11:29 pm

> #36 Smoking Man on 12.28.16 at 9:46 pm

there is an expression in Chinese : the grey haired sends off the black haired.

it is an extreme type of pain.

RIP Cary, RIP Debbie

#55 Smoking Man on 12.28.16 at 11:33 pm

A padded billionaire bank account, a homeless prick begging for money to eat something in the dead of winter.

The difference. The fork in the road.

One when right, one went left.

Same biology, one had luck, one did not.

Brains, the same.

#56 Polls R Phake on 12.28.16 at 11:38 pm

#44 InvestorsFriend on 12.28.16 at 10:48 pm
U.S. Economy rocks?

#25 hope & ruin on 12.28.16 at 8:33 pm

Figures at 25 show just how amazingly low the unemployment rate was in the U.S. leading up to the election. Even the high unemployment rate States had relatively low unemployment.

Yet it was not fashionable to say so and the democrats did not trumpet the strong economy.

“Bring back the jobs” Trump said. Well apparently there are not many people actually looking for the work!
Yeah, I know there are the under employed and those that can’t be bothered even to look for work. But the unemployment rate measured in the same way as eight years prior was amazingly low but it was unpopular to say so.

__________________________________________

I want whatever mind altering drug you are smoking.

#57 Polls R Phake on 12.28.16 at 11:40 pm

#37 Metaxa on 12.28.16 at 10:02 pm
.

another boo hoo hoo public sector worker making 300k
very few Doctors are public sector workers, the vast majority are small business owners who run their businesses under a set fee schedule negotiated between their college and the province. Many hospitals in BC are not owned by the province, he may work for one of those, in which case the hospital runs under contract to Island Health…and pay rates would be set in a competitive marketplace.

____________________________________________

Doctors in Canada bill the Govt not the people. They are public sector workers.

#58 Al on 12.28.16 at 11:57 pm

Stay put.

Wait till the kids are done school and then re assess

Or even better, at that time rent it out to someone for $3000 a month, take out a HELOC on the house and invest that money and write off the interest. Huge win win win.

#59 Scott on 12.29.16 at 12:05 am

#34 what the hell have you accomplished? Maybe money isn’t this man’s priority. You money mongers make me sick.

#60 snowboard junkie on 12.29.16 at 12:05 am

A lot of assumptions about Aaron…
Firstly, Emergency Medicine is a high stress shiftwork profession.
Secondly, there is a very long lead time re: education & training.
Thirdly, there is no guarantee that Aaron grew up & trained in Canada, he may in fact have immigrated more recently.
Fourthly, there are huge student loans that may need to be paid off prior to investing.
Fifthly, it may not be realistic for an emergency doctor to work until 65 (see first point) so early retirement may be what is being contemplated.

#61 Context on 12.29.16 at 12:20 am

#40 JSS: Whispers Mistress.

#62 Leslie on 12.29.16 at 12:54 am

2 million bucks .. I think you can retire now why wait 10 years

#63 #34 wrk.dover on 12.29.16 at 12:55 am

And he made it through med school.

Hope I don’t end up in emerg.

but seriously motel 6 and 70 hr weeks for another decade and he can retire as well as a kindergarten teacher.
…..

Because he was a spender , that makes him a dummy?

You will end up at an ER. And then hope to hell they can help you ; that they are compassionate , thorough. That they save your pathetic ass

…….btw, you don’t come across as the sharpest knife in the drawer.May want to hold on prematurely judging another’s intellect

#64 Pete on 12.29.16 at 12:58 am

Stop worrying about this shit more and start living spontaneously more cause we all will be gone before you know it and this shit truly means nada.
————————–
It always amazes me how the same people who are always saying “live every day as if it is your last” get really peeved when they meet people who actually do live their lives that way. Similar to the way people who always claim that “they don’t take no crap from no-one” are actually the very people who spend their entire lives taking crap from others.

#65 #23 fed-up ; good post on 12.29.16 at 1:08 am

Why bother asking? You know what the answer will be right? The same one that has been given for the past 9 years…sell, rent and invest etc etc.Whether or not that has been the right answer and course of action, is entirely another story ;)

In my opinion, you’re doing just fine. You make a fantastic salary, have another 10 years to add to your million in investments that will only grow (perhaps painfully slowly but nonetheless) and you have a dump load of equity in your beautiful home

………

Yup .

If they LIKE the community , house ? Why sell!

And with that salary ? Change spending habits . The chap can put away $100,000 a year in savings .

He is set

#66 BC_Doc on 12.29.16 at 2:11 am

Aaron– I’m the country mouse to your city mouse (I work in the BC Interior).

Safe withdrawal rate for investments is commonly said to be 3.5-4%. You have $1M in investments– that’s good for $40k/year in retirement plus CPP of about $1000/month. Probably not enough to fund the manner to which you’ve become accustomed. In my opinion, you should be aiming to have $3M invested when you walk away from practicing medicine in a decade. How to get there?

I think I would sell the house, down-size to a rental, and invest the second million. If your with MD Management, I would run– they love to peddle their “exclusive” high cost MD Mutual Funds that benefit them much more than you. I am a “Do It Yourself Investor”– I love the three fund portfolio (VXC-T, VCN-T, VAB-T). It’s simple, cheap, and efficient.

You’ll need to get aggressive with saving in your last decade of practice. I practiced the “rule of 1/3s” with my income over the year. 1/3 of what I make gets spent now. 1/3 gets saved and invested for retirement. The final 1/3 gets set aside for the CRA. So with a decade to go, you should be able to set aside another million. That should get you to $3M plus some (current investments $1M, invest proceeds of home sale $1M, new money $1M) as your pot grows and compounds.

Final comment– if you have leaks in your boat (i.e. kids spending too much money), you’ll want to patch those up ASAP.

#67 BC_Doc on 12.29.16 at 2:21 am

“#40 JSS on 12.28.16 at 10:09 pm

An ER who averaged $250-$300K/yr over say a 30 year career and only managed to grow money to $1M?

Man that’s not very good. There are couples out there who make barely make a third of that as family income, and have crossed $1M in investable assets. Really it’s not that hard to do over a thirty year period. Where did all that money go?”
*********************************************

@JSS– It would be rare for an ER physician to last 30 years. The stress and the shift work (nights, holidays, weekends) is career shortening.

#68 Freedom First on 12.29.16 at 2:27 am

#38 Self Directed

Yes. That thinking is why so many married men end up divorced and bankrupt. Married men are always wrong, no matter what they do. I see everything.

However. I am always right.

#1
Freedom First
Master of Freedomonics

#69 Sell the house... on 12.29.16 at 2:54 am

Sell the house, invest at annual rates Garth has recently quoted – doubles just in time for retirement.

Rule of 72 (annual compound interest rate):

$1 MM @ 6% will take about 12 years to double to $2 MM.
$1 MM @ 7% will take about 10.3 years to double to $2 MM.

His primary residence sale may not be a 100% tax free gain Garth if he has been claiming a portion of mortgage expenses for a home office (as a sole proprietor).

bsant

#70 TRT on 12.29.16 at 2:56 am

#32 yorkville renter on 12.28.16 at 9:10 pm
Doctors are notoriously bad with money

Hahaha. A myth.

Docs are extremely good with money. They are numbers people.

Writers and people concerned with grammar and neat writing are extremely bad with money. Source: Late NASA scientist R Haynes.

#71 Bobby on 12.29.16 at 3:02 am

For #6 Victoria-The Original,

The last person I would believe is a realtor. I know the market in Victoria very well. There are over 1100 realtors and given the number of sales, it is virtually impossible for many to make a significant salary. Yes, the top 20% will fare well, but most only scrape by. I’ve spoke to many who have given up as realtors because they couldn’t make a go of it.

Many people take the simple real estate course, thinking it is a route to easy salary. In a up market, it doesn’t take much to sell a house, the real challenge comes when the market subsides. Watch for just as many to leave when the market changes.

#72 Bobby on 12.29.16 at 3:10 am

I think everyone is being rather unfair to the good doctor. My guess is he initially took on significant student debt to get where he is. Yes, his salary is significant compared to most, but if he is salaried, he has very few tax deductions. RRSP’s and perhaps contributions to a pension or such. Most deductions are harvested solely through having a business. Ask any accountant.
I fortunately make a comparable salary in another field but am quickly starting to realize there is no point in continuing to work as hard. Governments on all three levels are continuing to pile on the tax load to high earning individuals. It makes for good politics, tax the wealthy. But what most don’t realize, many at those salary scales have worked extremely hard and given up a lot.
If you are giving more than 50% to the government so they can waste it away, it begs the question, why continue to work.
I’ll bet my comment will rile a few lefties, but who cares.

#73 When Will They Raise Rates? on 12.29.16 at 4:24 am

Aaron, in addition to Garth’s advice, consider the following:

“..the core population with all the income, savings, and access to credit ends decelerating and begins outright contracting (in 2017)…and will contract for the rest of our lives. Fewer homebuyers, fewer consumers, coupled with contracting jobs as automation and innovation replace millions of low skill jobs around the world.

I personally don’t expect a market based crash or collapse…the central banks and federal governments no longer believe in free markets as allowing transactions between willing, capable buyers and sellers would result in collapsing asset prices. Instead, I believe they will literally do whatever they deem necessary to maintain the incredibly unsustainable present. Anticipating that they will move from partial market support to total support (or outright market closures) is not hard to see. Of course, it’s nearly impossible to imagine how this central control doesn’t end terribly but all I can do at this point is hope, against all odds, for the best.”

Read the whole article:

https://econimica.blogspot.ca/2016/12/when-this-bubble-popsdont-expect-to-see.html

#74 jane24 on 12.29.16 at 4:50 am

Aaron whenever I don’t know which way to jump for major decision I often do a 50/50. That way you are neither 100% a hero or 100% an idiot. Sell the family home and downsize into something smaller and easier to manage. That way you have both security with your shelter but you have cashed in some RE profits.

#75 Shanghai Sharon on 12.29.16 at 5:56 am

#24 OK….doctors need to keep up appearances more than the rest of us….special location vacations…better cars….golf club memberships….private schools for the kids….wine tastings….events…wives with hair. It’s expensive to be at the top.

Dentists are worse…they have a terrific complex about not being doctors

#76 Stupesing in Cabbagetown on 12.29.16 at 6:27 am

My father was a doctor. He used to tell us that, after the 12 years of school required to qualify, two years of internship, then borrowing to buy the equipment to set-up a practice, he was well into his thirties before he began to make any real money. Over a working lifetime, he reasoned, a plumber makes more money than a doctor.

#77 Polls R Phake on 12.29.16 at 7:47 am

http://www.ekathimerini.com/214909/article/ekathimerini/news/snow-sweeps-into-greece-dusting-capitals-center

The global warming continues as the snow falls in Greece. The lefty socialists are going deeper and deeper into the hole everyday. Soon the world will come out of their trance.

#78 suburban coyote and pup on 12.29.16 at 8:31 am

#66 BC_doctor great comment and advice for Aaron to consider. I work with many doctors and a lot of them seem to struggle with retirement planning and general cash flow management. Quite often the retirement plan seems to be work until they drop dead or become hopelessly impaired. Take the time to really look at numbers and a vision for your retirement. A lifestyle diet for a few years prior to exiting workforce may not be as onerous as you think!

The important things in life; health, family, being connected and engaged with the world are not intrinsically connected to huge $$$.

Onf51

#79 crowdedelevatorfartz on 12.29.16 at 8:36 am

300k per year and 1mil invested over 20 years.
Expensive lifstyle?
Expensive kids?

Time to stop frittering away the money on “must haves” and focus on retirement funding/ saving
Sell the house and rent.
10 years is gonna fly by.
Get busy.

PS. Why do so many Doctors introduce themselves as “Doctor So and so”
Seems very pretentious.
Judges dont proclaim their job titles.
Nor do Engineers, accountants, paramedics, teachers, etc.,etc., etc.
And the wives, OMG the wives.
” Im MRS Doctor So and So”….
I replied to an unbelievably pretentious woman at a party.
“Your name is Mrs Doctor So and So”?
REALLY?
You had to surrender your entire identity when you married? Sad…..”
If she had a knife in her hand I may have needed a doctor.

@#75 Shanghai Sharon
And yes, dentists(DDS) that pretentiously introduce themselves as doctors seem to be careful they dont say it too loudly if there’s an MD within earshot….

But after years of training and being constantly told “your special” the inDOCtrination does wear off.
A friend of mine is an Anethesiologist.
He considers Himself above doctors…….?

The snobbery of the professions I suppose.

#80 FreedomBird on 12.29.16 at 8:49 am

@#57
Doctors in Canada bill the Govt not the people. They are public sector workers.
—————————

And where does government get the money?

BTW to others we have friends who are docs on both sides of border (as well as hard working nurses) and some come out with massive debt and or volunteer in orgs like DWOB or in Haiti. While I agree $1M isn’t great for the given timeline we don’t know all the facts.

#81 FreedomBird on 12.29.16 at 8:50 am

#55
Same biology, one had luck, one did not.

#82 FreedomBird on 12.29.16 at 8:57 am

#55
Same biology, one had luck, one did not.

————–

Warren Buffet on luck of the womb.

https://www.google.ca/amp/s/amp.businessinsider.com/warren-buffett-on-the-ovarian-lottery-2013-12?client=safari

#83 coopoiler on 12.29.16 at 9:13 am

I can not believe the number of negative comments about Arron only saving 1 mill. What ? You did better living in a cave? Or can not achieve it yourself? Which is it?

#84 Zen Headspace on 12.29.16 at 9:33 am

Dr. Aaron:

In order to make an informed decision when faced with a predicament, you must consult the I Ching.

http://www.iging.com/intro/introduc.htm

http://www.ichingfortune.com/hexagrams.php

By studying the I Ching, you will discover the correct questions to ask yourself regarding the decisions you are faced with making. The answers to these questions will lead you down the correct path, and will remove all doubt that you may be harbouring.

This will change your life.

#85 Mixed Bag on 12.29.16 at 9:41 am

#75 Shanghai Sharon on 12.29.16 at 5:56 am

LOL, wives with hair.

#86 When Will They Raise Rates? on 12.29.16 at 9:42 am

#80 FreedomBird on 12.29.16 at 8:49 am

And where does government get the money?
—————————————

Why, they make money the old fashion way. They steal it.

To Aaron, sorry, it appears that the last portion of my post in #73 got cut off…

I meant to add that the era of growth (in the traditional sense) appears to be over, due to demographics. So, invest, but I believe that preserving what you do have (purchasing power) will be equally important going forward…

#87 DoomandGloomer on 12.29.16 at 9:53 am

DELETED

#88 Ace Goodheart on 12.29.16 at 10:02 am

RE: #3 conan :

“I predict a one state solution Doctrine from Israel in the near future. Expect powder kegs on top of powder kegs.”

Israel has bigger “problems” than that. Their political system is premised on each and every party (there are many) having to support the doctrine that Israel is a “Jewish” (ie monotheistic) state. No party can be eligible for representation in their Knesset if that requirement is not met.

The “one state solution” requires a massive increase in the number of eligible Palestinian voters.

As of 2012, of the people living within the “green line”, 5,463,071 Israeli Jews (citizens) had voting rights, 1,361,800 Palestinians (citizens) had voting rights and 318,200 non-Arab Christians, those listed as having no religion, and others (citizens) had voting rights.

This situation of course ensures that Israel remains a politically Jewish, monotheistic state.

However, there are another approximately 5,000,000 people living in Israeli controlled territory who do not have voting rights. About 4,500,000 of them are Palestinians, the rest are Golan Heights Druze or persons with no religious affiliation/Christians.

If one does the math, you can see that in the case of the “one state solution” there are actually about a million more Palestinian voters in the “one state” of Israel than there are Jewish voters.

The Palestinian birth rate is about 3 times that of the Israeli Jewish birth rate.

John Kerry correctly pointed this out in his speech last week (but he was grossly misinterpreted). If you are going to have a “one state solution” for Israel, it cannot be a monotheistic Jewish state, as the majority of its citizens and registered voters will not be Jewish.

#89 Keith in Rio on 12.29.16 at 10:19 am

The previous statement about doctors being bad with money is very true.

I know a guy like this one who has all his money in RE and fancy cars……etc……spends it like crazy. Doctors also love to invest in romantic things they know nothing about like restaurants, etc…….seem many loose hundreds of thousands this way. They are one of the dumbest professions when it comes to personal finances.

#90 Smoking Man on 12.29.16 at 10:31 am

#77 Polls R Phake on 12.29.16 at 7:47 am
http://www.ekathimerini.com/214909/article/ekathimerini/news/snow-sweeps-into-greece-dusting-capitals-center

The global warming continues as the snow falls in Greece. The lefty socialists are going deeper and deeper into the hole everyday. Soon the world will come out of their trance.
…………..

Sooner than you think. NASA Fudged
http://www.realclimatescience.com/2016/12/100-of-us-warming-is-due-to-noaa-data-tampering/

And Soros is becoming unhinged.
https://www.project-syndicate.org/onpoint/open-society-needs-defending-by-george-soros-2016-12

Suck to be a lefty on the run, whiskey and play gun, chasing unicorns all dayyyyyyy.

#91 crossbordershopper on 12.29.16 at 10:47 am

millionaire problems, its tough. people go hungry at christmas time every year, and this doctor has millionaire problems, . Sure, pass the spiked egg nog. its tough out there.
people live in their own world,

#92 Waiterextraordinaire on 12.29.16 at 10:49 am

Only a million dollars! Are you kidding me! My heart bleeds for him. You know I like reading this blog but for me it’s a joke how people who are richer than I will ever be are worried. Listen I am a waiter and when you retire you can have 2 trillion dollars in the bank. You got till about 73 to enjoy it. After that you will be splitting 1/2 chickens at Swiss Chalet because physically and mentally your body will start to give up. So if you got money now enjoy it and stop worrying because when you retire you never know. Dementia, arthritis, etc. all starts.

#93 tkid on 12.29.16 at 10:53 am

#83 coopoiler, the issue is he’s making approx $300,000 a year but only has $500,000 stashed in the bank. This isn’t a heck of a lot when you make the dough that he makes.

($1,000,000 minus a $500,000 mortgage equals $500,000 stashed in the bank)

I don’t include house value in his net worth because houses can be hard to sell, and he doesn’t seem the type to sell. And relying on a mortgage or line of credit to finance one’s retirement just isn’t a good thing.

Plus he has kids who are a drain on his net worth. It’s likely he’ll end up with less than a million bucks to finance an expensive lifestyle. Sure, he can make do with $50,000 a year from his investments, the question is does he want to make do on $50,000 a year?

The answer is probably no.

So Aaron either cuts the spending (and this requires the help of the other 3 members of his immediate family, and is unlikely), or he puts his investments on steroids.

#94 Context on 12.29.16 at 10:54 am

It don’t take much to blow away $1 million on women. I knew this man in Toronto who was the President of a company you all would know with his mansion on Old Forest Hill Road. He had two weaknesses booze and women, but was always a humble man as went to his office on occasion. Here we have a married man with children, and who would have guessed his secret life. He had a room leased year round at the Royal York Hotel.

#95 SWL1976 on 12.29.16 at 11:16 am

#77 Polls R Phake

What trance???

Some of us are still waiting on your explanation to record shattering temperatures in the arctic this year

Feel free to ignore the data though and carry on with your meme.

Also, someone here questioned the other day as to how all of earths oceans are warming in a very childish way, while trying to sound smart. White snow and ice reflect the suns rays and energy, while darker ocean waters absorb. This my friends is a positive feed back loop.

Perhaps when Mr Phake awakens from his Trump trance he can also explaain to us how the swamp is being drained with Trumps new cabinet???

There is far more CO2 in the atmosphere today than there has been in the last 800,00 years. Yes we are between ice ages, and yes the climate does change on its own, but the level of change over the last 100 years is monumental, for what is considered a geological blink in time

Deny the change all you want for we are just beginning to reap what we have sown

#96 traderJim on 12.29.16 at 11:35 am

When you make $300k a year and are married with kids your lifestyle rises up to your salary.

Private school for the kids, Audi, Lexus, BMW’s for all, and updated frequently, italian clothes, expensive restaurants.

Vacations to Switzerland and Anguilla.

It’s a wonder there’s anything left at all.

Doctors spend, dentists are infamous for investing in penny stocks and scams. Dentists all want to get rich quick.

Psychiatrists are the worst though, absolutely clueless. I met many who made around $200k and all but one had absolutely nothing to show for it after 25 years in the field.

Theoretically they should be great stock investors.

Lots of generalizations of course, but it’s also generally true that white guys can’t dance and asians are pretty good at math.

#97 traderJim on 12.29.16 at 11:39 am

Forgot to mention the biggest factor when you make $300k a year. You pay a #$% load of taxes.

Doctors may get some breaks, but any salaried person making that much probably works 6 months of the year to pay for bureaucrats to tell him what to do.

#98 };-) aka Devil's Advocate on 12.29.16 at 11:40 am

We’ll our daughter and her family bought, well within their means, and are wayyyyy happier in their new to them abode than the, reasonable rent, shot hole they were renting. And able to decorate to their whim and desire.

#99 TurnerNation on 12.29.16 at 11:43 am

Context no not UofT Mba.
I didn’t have the marks. Started undergrad late, aced first two years then flunked out last two.

Hopefully I’m qualified to say (having spent 50% of my waking life under control of re-education system – from JK to Gr 13 then lots of Uni) that schools are babysitters.

To any young person I’d say get a job then go to Uni part time. Opportunity costing. Not one employer gave a hoot about my major or marks.

#100 traderJim on 12.29.16 at 11:45 am

#95 SWL

And I’m still waiting for the climate doomsters to 1) give a REALISTIC scenario for what the results of climate change will be and more importantly 2) A plan of action that will make a meaningful change that does not involve destroying Western economies while leaving China and India alone to continue their destructive ways.

Let me guess: Tax the rich, tax corporations, and give the money to bureaucrats to ‘fix’ things. Give me a break.

#101 NoName on 12.29.16 at 11:50 am

#95 SWL1976 on 12.29.16 at 11:16 am

now that you mention new trupms cabinet…
https://youtu.be/_SvBKNeAFMo

#102 45north on 12.29.16 at 11:56 am

Wonder Woman: Wonder Woman, as you may know, was recently in the news when the United Nations dumped her as UN Honorary Ambassador for the Empowerment of Women and Girls.

http://ottawacitizen.com/opinion/columnists/spencer-the-force-was-strong-in-these-characters-whatever-your-politically-correct-view-may-be

that’s the final straw! the United Nations is a bunch of posers

#103 westcoaster on 12.29.16 at 11:58 am

#37 Metaxa – FYI re: ER doc’s income. Almost all ER docs in Canada at this point do not work fee-for-service. The most common payment arrangement is essentially an hourly rate – most commonly weighted towards nights as these shifts tend to be more “challenging” in terms of acuity as well as the doc’s own personal life/health costs.
ER docs have overhead of less than 5% including CMPA insurance, provincial/national membership fees, annual college dues, etc. Administration costs are not the same as for, say, a family doctor, for whom o/h is more in the 30-35% range as a rule.
As for #79 Crowdedelevatorfarts while I agree that any use of the moniker “Dr.” so-and-so is a bit pretentious and ego-serving I would suggest that a total of 10-15 years post-secondary education is somewhat deserving of society’s respect (not to mention the debt load that accrues before making any income). I would also suggest that it is much more pretentious for optometrists, chiropractors and other health practitioners who quite readily volunteer that they’re “Dr” so-and-so.
Physicians as a group struggle to live within their means – just like any other human (perhaps more so, actually). Many physicians think that, having suffered through med school and residency programs (and believe me it’s no picnic) they deserve the pot of gold and head off the day after getting their ticket to buy the luxury import they’ve lusted after for so many years – and so it begins…. and often after the penny stock investment goes south, the wife packs up with the kids and the disillusionment of “money makes you happy” comes home to roost it ends in tears.
The advice I was given when I was a resident by a number of preceptors was consistent:
1) pay your taxes
2) get an accountant
3) don’t buy MURBS (Garth will remember these)
4) stay married to one person for the duration
To these, when asked for advice from the young docs I’ve worked with, I’ve added a fifth – “live within your means”.

#104 Darryl on 12.29.16 at 12:05 pm

#55 Smoking Man on 12.28.16 at 11:33 pm
A padded billionaire bank account, a homeless prick begging for money to eat something in the dead of winter.
The difference. The fork in the road.
One when right, one went left.
Same biology, one had luck, one did not.
———————————————————-
Don’t forget what family they may have been born into .
In my life I see so many family money people who didn’t need to work hard . Only buy hard and brag hard .
Brains, the same.

#105 oncebitten on 12.29.16 at 12:17 pm

FWIW I am friends with 2 doctors. One of whom is an e.r. doc. They are both very good with money. Doctors finish school in their late 20’s early 30’s with a pile of debt. Living as starving students for a long period of time and then having a load of debt to pay off isn’t conducive to saving piles of money as some of you may think. They have good lifestyles now, but I know that the discipline that was required to make it through med school was applied to their financial lives afterwards to achieve what they have now. We even joke around with one of them about how cheap he can be. Old habits die hard.

#106 Fish on 12.29.16 at 12:22 pm

#36 Smoking Man on 12.28.16 at 9:46 pm
Debbie Reynolds only survives her daughters death Cary Fisher by one day.

That day was a entire life time of pain… It killed her dead.

Rip Debbie

Yes that,true
Rip

#107 SWL1976 on 12.29.16 at 12:24 pm

Perhaps Trumps number one fan Smoking Man can explain how the swamp is being drained???

Doing so without saying lefty might make his head explode though

I look forward to the explaination

#108 IHCTD9 on 12.29.16 at 12:49 pm

#48 45north on 12.28.16 at 11:10 pm

http://www.financialsense.com/charles-hugh-smith/when-assets-become-liabilities

It’s my impression that property taxes in smaller rural places are more likely to rise. First of all because services are now required where before they weren’t. For example cottages are occupied year round and now require school buses and snow ploughing. Second, the councils are more influenced by family contracts. This is just an impression without any specific examples.

Another factor is geographic information systems: new builds and major renovations can now be detected from air photos. There’s no more back-40.
—-

That’s my impression too, because I’m already living it. Tax increases in my neck of the woods are levied by a city hall far from my house, and are never less than double the rate of inflation. Services are reduced or fee’d but taxes still go up. Small towns are hard hit by factory closures, jobs leave, wages stagnate, population declines. Meanwhile the city officials approve construction of new public buildings like a new city hall and fire station that are totally over the top costing tens of millions located amongst the decaying core of a dying town.

That article was a view to rural Ontario’s future, and I am already weighing the wisdom of selling out asap before high taxes drive values lower, and heading out far from any revenue starved cities soon to be expanding “borders”.

Taxation without the opportunity to mitigate or escape is the new prime directive: property taxes, gasoline, and electricity. If you look around, you can see it’s already been going on for a while, at least in Ontario.

#109 Stanley on 12.29.16 at 12:51 pm

The global warming crowd do not know the difference between temperature and heat. The most CO2 is over the rainforests. Not much CO2 over north america.

#110 NoName on 12.29.16 at 1:05 pm

Can you guys plz stop beating er doc down to a pulp, i think he had enough. Go and read this it’s interesting.

Ambassador Yalowitz agrees: “My guess is that Mr. Trump is going to have to learn a lot about reality and about what’s going on in the world, that you simply can’t make deals like this is real estate. Diplomacy and international relations are a lot more complicated, and he’s got a big learning curve ahead of him.”

https://goo.gl/toLX5d

#111 Bdwy sktn now Puerto morelos on 12.29.16 at 1:09 pm

#95 SWL1976 on 12.29.16 at 11:16 am?

………………
You pushed chemtrails here.

You are banned from any scientific discussion.

#112 Context on 12.29.16 at 1:44 pm

John Tuzo Wilson was the greatest geophysicist in the world at the University of Toronto who explained decades ago why the oceans would be warming up. It was all about plate techonics and volcanically active volcanoes with active hotspots along the major ocean ridges which were seismically active that were well documented. Tuzo was the first scientist in the world to explain the creation of the Hawaiian Islands for example. He was world famous which is why the first moon rocks were delivered to Canada for a showing at the University of Toronto.

#113 tkid on 12.29.16 at 1:52 pm

Been mucking around with Ben Barkow’s Retirement Cashflow Calculator. It helped me determine that the rate of return on my portfolio matters more than my contributions.

#114 jess on 12.29.16 at 2:09 pm

Tax office to crack down on gold scam costing taxpayers $610m

Criminal syndicates operating ‘carousel’ scam are defrauding GST payments by breaking up gold bullion and reselling as jewellery or scrap

https://www.theguardian.com/australia-news/2016/dec/27/tax-office-to-crack-down-on-gold-scam-costing-taxpayers-610m

========
Law Firms’ Accounts Pose Money-Laundering Risk
Hundreds of millions of dollars allegedly siphoned from Malaysian state fund 1MDB passed through firms’ pooled accounts in U.S., prosecutors say (wsj)
===========================
Luxembourg on Tuesday said it would sharpen its corporate tax rules, making it more difficult for large corporations to avoid tax by channelling funds through the small European country, a practice exposed in media reports known as “LuxLeaks”.

http://uk.reuters.com/article/uk-eu-taxavoidance-luxembourg-idUKKBN14G0XL

#115 mark on 12.29.16 at 2:37 pm

Garth why dont you start printing some real life examples not the ones from the stratosphere!
Seriously, if thats what a millionaire is worrying about, please give me a break. Too bad you dont do a break down how a meat and potato “waiter” for example can aggressively save tax and save money for the future.
You think most here give a shit about someone who has a million dollars?

Such advice is dished out here daily. For free. — Garth

#116 Euro observer on 12.29.16 at 2:44 pm

I personally know several doctors who can not afford to retire due to:
1. Cost of living
2. Need to support kids in university and sometimes after that
3. losses on investments, one of them lost 25 % in 10 years in mutual funds due to excessive fees and mall-investments.

Life is expensive in Canada these days. Doctors can’t retire any more. As for the plebs: suck it up and move on, work in diapers till the day we die.

#117 jess on 12.29.16 at 2:46 pm

BREAKING: US Treasury: Pres. Obama issues new sanctions against Russia over election-related hacking; names specific individuals, entities.

also given the boot

Today the State Department declared 35 Russian government officials from the Russian Embassy in Washington and the Russian Consulate in San Francisco “persona non grata.” They were acting in a manner inconsistent with their diplomatic status. Those individuals and their families were given 72 hours to leave the United States.
In addition to this action, the Department of State has provided notice that as of noon on Friday, December 30, Russian access will be denied to two Russian government-owned compounds, one in Maryland and one in New York.

https://www.whitehouse.gov/the-press-office/2016/12/29/fact-sheet-actions-response-russian-malicious-cyber-activity-and

#118 Ace Goodheart on 12.29.16 at 3:39 pm

This is yet another of Garth’s Van posts.

As usual I have no idea what is going on in Vancouver.

If you happen to be in Toronto and happen to own your house, I would continue to suggest that you keep it, regardless of any “rules of 90” or whatnot.

People who don’t own their houses in Toronto (ie mortgaged people) are playing a game, which they may well win but also may lose.

If you really want to speculate on real estate in Toronto and you actually care about doing it properly, Mount Dennis continues to await you. From the period 2012 to 2016 the values here have increased by just over 100%, from an average of about 300K to an average of about 700K. The reason of course is the new transit hub being built down the street (the largest transit project currently under construction in North America). With it will come condos by the thousands, and their associated service businesses (cafes, restaurants, independent breweries, specialty food stores, flower shops, coffee houses, etc). They are already selling the “air rights” over the various stations. Master plans call for massive condo development around the terminal transit hub at Eglinton and Weston Roads. Anyone who owns the grossly under priced commercial real estate on this corner (ie, me) is about to own some of the most expensive property in the City. Not in recent memory will a “dead” neighbourhood morph into a desirable location so quickly. One of the best real estate plays of the 20th Century is currently happening.

RE: Smoking Man:

“The global warming continues as the snow falls in Greece. The lefty socialists are going deeper and deeper into the hole everyday. Soon the world will come out of their trance.
…………..”

Global warming is about global cooling. It is an odd thing. The poles get warmer, and the temperate zones get cooler and get less predictable seasons.

This is due to the fact that the temperate zones do not have their own climate. They “import” climate from either the South or the North depending on which way the wind is blowing (or the Ocean is circulating).

Temperate climate zones never experience enough direct heating of the Earth’s surface to create their own warmth (all source heating of air on the Earth’s surface comes from warming of the Earth’s surface from the sun, transferred to the air).

Temperate zones are heated by either winds or by ocean currents. In Ontario we get all of our warm weather from wind patterns (our weather usually comes from the South West United States according to long established air movement patterns).

Seasons are determined by seasonal shifting of air masses, which are separated at their boundaries by jet streams. In the summer we get warm, southern air masses moving up to Ontario, creating “hot” weather. We are protected from cold northern air masses by the location of the jet stream, which retreats northward in the summer. In the winter, cold northern air masses move down and cover us, creating prolonged periods of sub zero weather. This is the usual seasonal situation that occurs in temperate climates. We “import” our climate from either the south or the north. It is important to remember this when considering the hazards of global warming.

Global warming warms the poles. It does so by trapping warm air under a blanket of carbon dioxide which sits at the polar regions. This has the effect of destabilising our jet streams, which rely on the difference in temperature between warm and cold air masses to remain strong. It results in a wavy temperate zone climate, with incursions of both warm and cold air into seasonal patterns in a random manner (hence snow in Southern Greece).

At its worst, the movement of Ocean currents and seasonal warm air masses is disrupted, resulting in prolonged cold periods for temperate climates (we can’t get the warm southern air anymore as the “drivers” of the movement of air masses and ocean currents are shut down, meaning we must rely on only warming of the Earth’s surface by the sun, which is never enough to warm us up).

So in the above weird way, global warming creates local cooling. It basically destabilises the climate and the seasons.

#119 When Will They Raise Rates? on 12.29.16 at 3:40 pm

#96 traderJim on 12.29.16 at 11:35 am

When you make $300k a year and are married with kids your lifestyle rises up to your salary.

Private school for the kids, Audi, Lexus, BMW’s for all, and updated frequently, italian clothes, expensive restaurants.

Vacations to Switzerland and Anguilla.
—————————

lol He only makes $300,000. Not $3,000,000.

#120 Context on 12.29.16 at 3:57 pm

You can’t even trust a 6 year old girl anymore. While her mom was sleeping she hacked her phone using mom’s thump print. Then went unto Amazon to buy herself a bunch of toys to be delivered and they are interviewed on CTV news. Can you imagine what would happen if she hacked your stock trading account?

#121 SWL1976 on 12.29.16 at 4:18 pm

#111 Bdwy sktn

#95 SWL1976 on 12.29.16 at 11:16 am?

………………
You pushed chemtrails here.

You are banned from any scientific discussion.

———-

Actually barfway skytrain the chemtrails are still happening with plenty of scientific data. In fact we are not far off full on disclosure to just how badly the public has been duped

@ traderJim – So cliche and typical your response. There are solutions, but first one has to recongize the problems.

Ignorance is bliss, but it’s still ignorant

#122 Wrk.dover on 12.29.16 at 4:20 pm

In response to the nameless individual screaming at me at #63 :

I am not a sharp knife, slicing my money into little bits blown at the spur of the moment for short term amusement.

I am not a bright shining knife, dazzling others with an Audi or a four door truck for driving to the corner store.

I am a butter knife that spreads my money carefully while adding value to most purchases by enhancing them with my added labour input.

You seem to be a tempered knife, ready to snap. ( yeast infection?)

Keep in mind the good Doc did not pay that much for his house…the value has increased.

The value of his portfolio has grown compounding inside of it’s self too.

So this guy that makes 15 times minimum wage has saved a lot less in proportion to reality at that income than you want to credit him for.

While sitting at his bar in his home, my own GP Doc has often told me that Emerg Docs think they are God because they can diagnose a bullet hole or a broken face, but outside of the ER they are just another loser. Hence the apparent lack of awe and respect from me.

To the other guy that has a hate on me for today, asking what I myself have accomplished, well, I have alienated you unintentionally, how’s that?

#123 isuckless on 12.29.16 at 4:51 pm

To SWL1976:
quoting “ocean buoy” somewhere in the Arctic is great! No data who owns this device and the RAW data from it.
No other station reported this HUGE rise in temperature.
Yes, very credible blog you are quoting.

Do you mind looking at these (NASA), just look for the RAW data. Very few in the Arctic (?) and with missing data (?).
lots of stations in Antarctic.
http://data.giss.nasa.gov/gistemp/stdata/

#124 nubbers on 12.29.16 at 4:52 pm

I am a bit concerned that every time someone follows Garth’s advice and sells their over inflated property to someone else, then that someone else is probably going to be taking on life altering, crippling debt. They will have to spend their life paying for the seller’s windfall and putting off their own aspirations, family etc.

Is this a bad thing? Or are we just parting fools from their money and breeding opportunities, and thereby reducing numbers of fools in the next generation? A sort of financial eugenics, if you will.

#125 Polls R Phake on 12.29.16 at 4:59 pm

#95 SWL1976 on 12.29.16 at 11:16 am
#77 Polls R Phake

What trance???

Some of us are still waiting on your explanation to record shattering temperatures in the arctic this year

Feel free to ignore the data though and carry on with your meme.

__________________________________________

Record temperatures in the arctic? HAHAHAHAHHAHAHA From who? The PHAKE NEWS Govt and their socialist minions?

I am not going to be your encyclopedia. I know its around 0 degrees Celsius on 50% of the land mass of the world and All Gores hockey stick has been smashed to splinters.

Show us credible science, not junk GOVT SOCIALIST PHAKE NEWS science and maybe some of us people that live in the real world of below zero temperatures will believe you.

#126 Ace Goodheart on 12.29.16 at 5:18 pm

RE:
#96 traderJim on 12.29.16 at 11:35 am

When you make $300k a year and are married with kids your lifestyle rises up to your salary.

Private school for the kids, Audi, Lexus, BMW’s for all, and updated frequently, italian clothes, expensive restaurants.

Vacations to Switzerland and Anguilla.
—————————

Yeah right. Me and the wife make combined 320K. We live in a small house in Mount Dennis and both drive base model Volkswagens. Haven’t had a vacation in years. I wish. I really wish…..

#127 Dan from Richmond Hill on 12.29.16 at 6:21 pm

#126 Ace Goodheart

Yeah right. Me and the wife make combined 320K. We live in a small house in Mount Dennis and both drive base model Volkswagens. Haven’t had a vacation in years. I wish. I really wish…..
—————————————–
Why not ?

#128 cramar on 12.29.16 at 6:22 pm

#96 traderJim on 12.29.16 at 11:35 am

When you make $300k a year and are married with kids your lifestyle rises up to your salary.

Private school for the kids, Audi, Lexus, BMW’s for all, and updated frequently, italian clothes, expensive restaurants.

Vacations to Switzerland and Anguilla.

——————

Sadly true. . .for the majority! But there are some pretty smart people around who do not live like this. For example one of my sons.

He makes that kind of income (plus it’s in U.S. dollars), yet owns an 18-yr old Civic with stick shift. He does have a few expensive toys (which were actually bought discounted used on EBAY). Custom suits and shirts made dirt cheap in India, during his many trips there. Since he spends half his life flying, any vacation trips can be covered by 7-digit accumulated Air Miles, or tacked on to the end of a business trip.

It is inspiring to see someone who knows how to handle money well. His MBA has served him well!

#129 crowdedelevatorfartz on 12.29.16 at 8:40 pm

Ya wanna TRUE stupid story about the Canadian govt funded health care system.

A guy I know. His kid is wicked smart. Makes it into med school on a scholarship….his marks are off the chart. Provincial govt promises to pay most of his tuition is he agrees to stay in the Province and work in a rural area for 5 years after graduating. Signs on the dotted line.
Graduates with flying colors…govt cutbacks mean the Province cant hire him.
So they cut him loose. No debt but…. no work.
He decides to go back to school and specialize in cardiology. Gets another “scholarship and a signed contract from ANOTHER Province that will hire him immediately upon graduation.
Graduates with flying colors….govt cutbacks. No work.
Cuts him loose from his debt and contract.
No one in Canada was hiring at that time.

Where is this brilliant , highly trained cardiologist now?

The US……….. making TONS of money.

Ya gotta luv govt. beaureaucrats