Hope

When I awoke today, Ben had sent me this:

You seem fond of helping folks who don’t understand money. I’m a guy who could use some wisdom…

I took most of the last decade off fulltime work for health reasons, because sometimes shit happens. For the last year I’ve been mostly healthy and trying to rebuild. I don’t dream about a life of opulence, but I’d like to be able to stop staying up late every night stressed out over money.

I’m in my mid-thirties with an embarrassingly measly sum in the bank (around $8K) – the last vestiges of RRSP that I didn’t cash in at 10% penalty just to pay the bills – socked up in money market funds gaining their couple dollars a month. I have about a thousand dollars worth of silver that was left to me by way of inheritance. That’s the sum of my life right now. However, having found the gumption for full-time work about a year ago and grist to the mill determination I’ve managed to pay off $11,000 debt that I had looming and growing. I didn’t know what else to do! Today, after rent, expenses, and the occasional pint, I have about $500 a month to make something of myself.

I realise that you probably spend most of your day giving advice on hundreds of thousands of dollars, not hundreds. I’m not looking to complain here. Ten years of tough go has made me resilient. My gut can handle stale bread and the 50% bin from the grocery store even after the forty minute walk to get there. I just don’t know who to trust with money and don’t know what to research to learn myself. I realise that I’ll have to work for the rest of my life. But if you have any ideas how a guy who will spend the rest of his life flirting with poverty can take ease some of the stress, I’d love to hear them.

It’s heartening to hear about your health, Ben. Feeling well is the only thing on earth a rich, sick person wants, yet cannot buy. Never discount how much a good day’s worth. This itself, is wealth.

Now, how do we deal with this stress?

Start with a dose of reality. You have a job, extra cash flow, some money in the bank, and no debt. Compare that with the guy who came to see me on Friday about his financial situation. He lives in a house for which he paid $1.4 million, now worth $1.3 (maybe), with a $1.25 million mortgage. Two babies. Wife not working. A leased BMW and a four-year-old Lexus wagon. He makes $205,000 a year and has a negative monthly cash flow, we figured out, of $2,800. No savings or investments. He owes $50,000 to the CRA in April for the taxable portion of an interest-free loan his company gave him four years ago. He has no idea where it will come from.

Society would look at him – the house, the cars, the job – and call him rich. But he has nothing. If he sold the real estate and gave back the cars, zero. And likely no wife. Defeated by his own consumption.

In comparison, you’re a success. No matter how society sees you. It matters only how you view yourself. And you should see a guy who is liquid, mobile, free, tough, realistic and able to make constructive choices. Thus, you start from a position of strength and clarity. It only gets better from here.

So, you have eight grand in an RRSP, a thousand in metals and five hundred a month to grow. Plus a job. You’re self-supporting and motivated. How is any of this bad?

Let’s start with the thousand. Sell the silver, since the last thing you need is a volatile commodity that pays no interest or dividends. Take the $1,000 and put it in a self-directed tax-free savings account (you can do this yourself, but not at the bank – open an online discount brokerage account). If you then add in the $500 a month, and invest it to achieve an average return of 7%, you’ll have $410,761 about the time you hit sixty. Assuming TFSA contribution limits are increased modestly over the years, this money will be yours 100% tax-free. It’s a damn good start.

Ditto for the $8,000 in your RRSP. Even if you don’t contribute any more, and achieve the same kind of return, then in 25 years it will swell to $50,000 – but be taxable when withdrawn. Now you have assets of almost half a million.

How do you get this kind of return? Consistency, more than anything. Forget about trying to time the market, or buying covered calls, synthetic ETFs or shorting stocks. For example, someone with a balanced, conservative portfolio (40% bond ETFs and preferreds, 60% growth assets, including REITs and equity index ETFs) earned about 6.5% over the past eight years – which included the financial crisis of 2008-9. Given the fact the GFC was a once-in-a-lifetime (at least) event, getting 7% over the next eight or beyond should not be a stretch.

The people who get creamed are those who try to time markets, or buy on greed and sell on fear. These folks piled into equity mutual funds and stocks when markets were climbing, then bailed as the bottom fell out, and have been quivering in cash ever since. I suggest you take your money and divide it as mentioned above, achieving this balance with exchange-traded funds pacing corporate and government bonds, preferreds, the real estate trust index, plus the TSX and S&P. As you get more cash, add in some emerging market and Euro exposure, since over the next decade global growth will re-emerge.

If you need specific help, reach out again. I’m here.

Your enemies are not lack of knowledge or assets. It’s stress and despair which will defeat you. Hope is the answer.

249 comments ↓

#1 Derek R on 09.09.12 at 9:18 pm

Early tonight, Garth

#2 Nodebt on 09.09.12 at 9:18 pm

Firsttttttttttt!!!!!!

#3 East Van on 09.09.12 at 9:29 pm

Ben:

The Arctic and Greenland ice sheets are melting. You won’t need money when you are 60. Live for today.

#4 TurnerNation on 09.09.12 at 9:30 pm

Or…today’s subject could join the Smoking Man investment plan:

50% poker
10% blackjack
25% booze
15% escorts

Seems like a reasonable balance of risk?

#5 JayBe on 09.09.12 at 9:33 pm

Exactly why I keep voting against Kyoto! My man East Van bringing the wisdom!

#6 A Fan in Van on 09.09.12 at 9:34 pm

You’re a good man, Garth. Despite the Hummer. ;)

#7 Toronto_CA on 09.09.12 at 9:37 pm

Nice post tonight Garth, good on you for helping out this guy. I normally don’t like the “Millionaire Next Door” bashing of the poor rich guy set, but it is important every once in a while to point out that appearances can be deceiving.

On the S&P500 and rebalancing, I decided today I was overweighted in it with the recent run up, so hard as it was, I sold a good chunk of my S&P500 ETFs and eFunds. I just had to take some profit after the run up the last month. I’ll take the proceeds and diversify again. Felt like a good time to rebalance (1 year return approaching 25%).

#8 vinny on 09.09.12 at 9:38 pm

Society would look at him – the house, the cars, the job – and call him rich. But he has nothing. If he sold the real estate and gave back the cars, zero. And likely no wife. Defeated by his own consumption.

powerful and terrific phrases and as always thanks for this wonderful post Garth….

#9 Derek R on 09.09.12 at 9:38 pm

Ben,

Garth’s advice on investing is stellar and you definitely want to follow it. He will keep you right. The flip side is learning to live reasonably happily on next to nothing. I guess that you’ve already had a lot of practice with that going by your message to Garth. That being so you might find it interesting to check out this guy, Mr Money Moustache. He’s not in the same position as you but he’s got the same interest in not spending anything that he doesn’t have to. He writes for the rich and the poor. But even if you don’t learn anything, he’s an entertaining and positive writer who loves to hear tips from people who know how to make a penny stretch. So, even the comments to his posts are excellent.

Definitely worth a look.

#10 Renter in van on 09.09.12 at 9:38 pm

This post devoted to Ben is why I love you Garth.

#11 Ex-Cowtown on 09.09.12 at 9:38 pm

It’s a strange world we live in, where down is up, and debt is viewed as wealth.

#12 ClaudiusEmperor on 09.09.12 at 9:39 pm

Average return 7 % being the dividends only or that includes the capital appreciation as well?

Currently the best paying corporate and bank bonds in Canada yield around 4-5 % on yearly bases (no capital appreciation in this case).

#13 Tanya on 09.09.12 at 9:40 pm

That was a really lovely post, Mr. Turner. Between the photo and the kindness of your tone, you could move a girl to tears.

#14 Mister Obvious on 09.09.12 at 9:42 pm

One of your very best tonight.

#15 Barry on 09.09.12 at 9:43 pm

I was very touched by your generosity of spirit, and your graceful supportive response to Ben’s query. Absolutely brilliant reply in my humble opinion. Ben, you are so much further ahead than you realize… it’s all a matter of perspective.

#16 Dan from Richmond Hill on 09.09.12 at 9:43 pm

Garth,

could it be that much of the wealth I see in Canada is fake?

#17 tony b on 09.09.12 at 9:43 pm

Garth

I’ve been reading this blog for about 3 years now and lets be honest. If you say the sky is falling often enough– well sometimes parts do.

In my opinion,
1-condos everwhere have been overbuilt and prices basically fixed upwards by the bunch selling them. Now that there is a glut they will melt for a few years–some greedy people left holding the bag
2- Things that go up too fast must come back—so if we have had 20% jumps year on year these houses will see a dip as well but a place like Toronto has an immigration of about 100K per year and this keeps the market from tanking too quickly–percent wise this is the same for Calgary and Edmonto but NOT for all of the Van area including the island–that area is going to go thru a correction but that happened before–86to 88–96 to 2000
3. Real estate is still the dream of everyone—no one wants to rent to wait it out like you advise—where is the exact bottom–a BEAR like you would say never—if you rent you have to ask to paint a bedroom–or make any improvements–live like a peon and on the whim of the land lord–anyone with a down payment wants to own
4-Don’t shoot too high on mortgage and payments–I’m with you on that one–but I’m 62 and have been buying and flipping house since university–and I have always made good coin–and stayed away from condos
4-

#18 Shane on 09.09.12 at 9:44 pm

Garth, there are still houses selling in Markham over asking what’s going on with the HAM???

#19 Oasis on 09.09.12 at 9:46 pm

For example, someone with a balanced, conservative portfolio (40% bond ETFs and preferreds, 60% growth assets, including REITs and equity index ETFs) earned about 6.5% over the past eight years – which included the financial crisis of 2008-9.
__________________________________________

i suppose that’s not bad, but if you had your money in gold, you’d have made 18% pa compounded for the same period, with no down years …

#20 Yellow Helicopter on 09.09.12 at 9:48 pm

Garth,
This may just be the best post of yours that I’ve ever read.
Great advice, and Ben, believe Garth- you’re doing better than a whole lot of other folks out there.

Garth, you’re not only a very smart guy- you’re also kind. And compassionate. Don’t worry, I won’t tell anyone. ;-)

#21 Signpost in the bushes on 09.09.12 at 9:48 pm

“Hope is the answer.” Garth.

Heartwarming post. Sincere thanks.

#22 Mike as in Mike on 09.09.12 at 9:48 pm

Wonderful advice Garth. Brains and empathy. Oh my.

#23 KLIP on 09.09.12 at 9:50 pm

Nice comments Garth. Nice to see that the fake 205K a year rent-a-lifestyel guy is worse off than someone that can look in the mirror and actually account for what they own.

But my advice: DO NOT SELL THE SILVER, dude.

Watch this first, and follow other links on the subject. Big upward move coming.

http://www.youtube.com/watch?v=_SwTN8PBMTE&feature=player_embedded

That is the most dumbass video anyone has ever posted here. — Garth

#24 FTP - First Time Poster on 09.09.12 at 9:50 pm

I’d like to know if Ben has ever considered moving overseas. Job sites like Bayt.com show jobs in the M/E for example that pay well and cover cost of living either partially or fully. Dubai has no income tax, putting an extra 20% in your pocket. Several asian countries have a low cost of living. Westerners are locked into the idea that they need to stay in Canada, US, etc. Our forefathers didnt do it & many expats are happy living abroad.

#25 Barry Lainof on 09.09.12 at 9:51 pm

Once again you surprise me. A wonderful and compassionate response to someone needing direction and understanding. It’s posts like this that keep me coming back.

#26 Devore on 09.09.12 at 10:00 pm

Hear hear on the “balance and no timing” thing.

By “no timing” I don’t mean to just blindly throw money into the market, I just mean to not day trade or speculate with your entire portfolio.

My company pension, which only gives us a limited selection of mutual funds, has done about 7% annually over the last 6 or so years, with a somewhat different allocation, but also including the 2008 period. That’s with less than 0.5% management fees. Just some periodic reviews and semi-annual rebalancing. Like recently reducing allocation to bonds and bumping up Canadian and US equities. Turned out to be a very timely move.

My other portfolios have done equally well, but mostly due to luck I have to admit, they are much less diversified and I used to be more prone to trading regularly. Learned some lessons, on the positive side, and they weren’t even that expensive.

#27 Seven Stars and Orion on 09.09.12 at 10:01 pm

Been reading here for years, and the entry tonight is certainly one of the very best. Notwithstanding all the hope-bashers out there, hope remains a good thing, and maybe the best of all good things.

#28 Toronto_CA on 09.09.12 at 10:02 pm

http://www.theglobeandmail.com/report-on-business/rob-commentary/in-canada-legacy-of-lehmans-collapse-lives-on-in-ultra-low-interest-rates/article4530911/

Good article that says what a bunch of us have been saying for a long time. Just misses the emotional aspect of buying houses above all else in Canada right now as another driver to the irrational house price increases.

#29 Raj on 09.09.12 at 10:06 pm

“In comparison, you’re a success. No matter how society sees you. It matters only how you view yourself. And you should see a guy who is liquid, mobile, free, tough, realistic and able to make constructive choices.”

This is your best ever Garth!

#30 Dubai on 09.09.12 at 10:06 pm

@Dan from Richmond Hill:

That is and has been the gist. The whole economy has been growing on debt activity.

@Oasis

Gee thanks. Any other hindsight investment tips?

#31 Lee on 09.09.12 at 10:06 pm

Absolutely loved this.

#32 Ayn Rand Army on 09.09.12 at 10:06 pm

Sell the silver only if you’re buying another precious metal asset, like a mining company. Some good ones pay dividends. I like IAMGOLD.

Sorry, i can’t comment of the rest of the advice but I couldn’t read any further after the bad silver call.

GL

#33 adam on 09.09.12 at 10:08 pm

Ben, stop walking 40 minutes to get groceries, buy a bike for a couple hundred bucks and put a milk basket on the back and get a backpack!

#34 pathcontrolmonk on 09.09.12 at 10:11 pm

Thanks for the uplifting post, respect to the guy who wrote in.

#35 karl hungus on 09.09.12 at 10:13 pm

good advice i guess. But which guys quality of life is better? Ben is still having sleepless nights. If you gonna have sleepless nights, you might as well live in a 1.3million dollar place and wake up to your bmw.

I guess the difference is that the guy making 200k a year at least has the chance to wake up one day and say enough of this and cut back big time on his expenses. Would only take him a couple years to create a nice pile of cash.

#36 Plain guy on 09.09.12 at 10:14 pm

Wow..you are simply great Mr. G.

#37 Soylent Green is People on 09.09.12 at 10:15 pm

More more poverty posts pls

#38 Min in Mission on 09.09.12 at 10:18 pm

Evening Garth and the “Hounds”

Excellent post Garth, Before we met, both my “Awesome Lady” ( I only have one Amazon, but, that is more than enough!), and I both had experiences similar to Ben.

Ten years ago we had nearly nothing. Now we have all the same problems as everyone else. But, we are thrifty and have kept ourselves in check regarding so-called “discretionary spending”!

I move a lot slower than most, but, I have finally opened an oline brokerage account/TFSA. I keep gathering bits and pieces of info from here and will be be taking the plunge. Just scared right now.

#39 steve on 09.09.12 at 10:19 pm

blessings …you my friend made me feel better about me …..

#40 james on 09.09.12 at 10:20 pm

good idea about the online discount brokerage account. that said, anybody know of how you do this and where?

#41 Hope | The Retiring Boomer™ on 09.09.12 at 10:24 pm

[…] As published in The Greater Fool […]

#42 young & foolish on 09.09.12 at 10:31 pm

Great post! Hopeful and strong …. thanks Garth!

#43 SkipinFl on 09.09.12 at 10:33 pm

I came across your blog accidentally last night and thought it and your website were interesting but not exceptional.
However, your advice to Ben tonight is excellent and compassionate and deserves to be shared.
Thanks.

#44 turning turner on 09.09.12 at 10:34 pm

This is your best entry ever! I would love to read more similar advice in the future (for those who aren’t starting off with much).

#45 John in Mtl on 09.09.12 at 10:36 pm

Thank you, Garth, for sharing your financial wisdom with us.

I’m now maxed out on TFSA’s but in a bank; only 1 of my 2 portfolios are doing OK because of my “investor profile”. I will look into more “risky” behaviour, a self-directed TFSA & online discount brokerage to increase return.

John

#46 KG on 09.09.12 at 10:39 pm

thanks for dropping good change.

#47 HDJ on 09.09.12 at 10:40 pm

Garth, That was admirable and touching.

#48 Retired Boomer - WI on 09.09.12 at 10:44 pm

Good post, and GREAT advice tonight Garth.
Success to the young guy, with no debt, a job, and a desire for a better tomorrow.
Wow, much better than a lot of the losers who wine here about their condo, or house, or metal losing value.
I was about his age (36) when I woke up, saw my wife, kid, 2 car payments and a mortgage on a house in Buffalo.
Whoops, part of that is a good plan, but we can lose the car payments, and pay off the house in 5 years. Stop being a slave to the dam BANK, if I work at it.
That was back in 1989. It CAN be sone. Persistence, and cleaning up one’s own dung pile is all it takes, along with a little bit of time, decent luck, and living long enough to enjoy one’s own fruit of their labor. By the way, NONE of this is guaranteed by anybody!!
We can all sit and bitch, or make plans for later. Voting preserves your right to bitch, now go make some plans.

#49 Toronto_CA on 09.09.12 at 10:45 pm

#35 karl hungus on 09.09.12 at 10:13 pm

I think you’re very wrong if you believe the all hat no cattle guy in Garth’s post today sleeps well with -$2800 in cash flow a month. I bet he’s just as stressed as Ben.

#50 tfresh on 09.09.12 at 10:45 pm

Great story today. Thanks Ben for sharing with us and thanks Garth for your kind wisdom. Good luck Ben, you’re richer than you think, and I mean that.

#51 westcanguy on 09.09.12 at 10:51 pm

There has been a lot of helpful articles on this site since I started reading about 3 years ago but tonight’s was the best.
I think there are a lot more people who read this blog and are closer to Ben’s position(savings and investment wise) than to those who come on here and brag about how great and well they are doing.
I think you helped a lot more people than you thought tonight.

Thanks for the article and your response.

#52 Shy Blawg Dawg on 09.09.12 at 10:51 pm

Garth,

Thanks for assisting Ben …. keep up the good work.

#53 Snowboid on 09.09.12 at 10:55 pm

Great post, but the pic – is that a young Smoking Man?

BTW, speaking of smoke, big fire at Peachland – hopefully won’t be as bad as 2003.

#54 SEAN on 09.09.12 at 10:56 pm

A damn fine post, Garth. I am considering going gay for you.

#55 Gordeaux on 09.09.12 at 11:00 pm

Thanks Garth, this is excellent, and saves me the trouble of writing in myself. I’m a few years older than Ben, and may make a few more bucks, but not much. I’ve also had the pain and financial mayhem of a marriage and then sudden and unexpected divorce from a spendthrift who engineered the process to hang me with her debt and suck a bunch of equity out of me. Your message of hope really resonated with me, and I’d like to thank you for that. I’d also like to thank you for the simple and pragmatic advice. I’m going to follow it, continue on my quest for financial discipline, and get just a little bit further ahead each month. The more I get into it, the more I realize that I’m actually sacrificing very little, except stress, and meaningless consumption that was designed to fill a hole in my soul. You’re a good fellow, if occasionally somewhat cranky. If you ever find yourself in the ‘Peg, I’d love to stand you a pint.

#56 Thank You! on 09.09.12 at 11:01 pm

Been reading for the last couple of years but this post really hit home. Thanks.

#57 dd on 09.09.12 at 11:03 pm

#4 TurnerNation on 09.09.12 at 9:30 pm
Or…today’s subject could join the Smoking Man investment plan:

50% poker
10% blackjack
25% booze
15% escorts

Seems like a reasonable balance of risk?
————————————————————-
at least he will have fun unlike your daily drivel.

#58 Hugh Jasz on 09.09.12 at 11:04 pm

#16 Dan from Richmond Hill on 09.09.12 at 9:43 pm
“Garth,

could it be that much of the wealth I see in Canada is fake?”

I used to concern myself about how person XYZ could afford the big dream house, the BMW, the blahblahblah etc. ad nauseum.

In many cases, I could “afford” it the same way, and it’d be a dumb idea.

Great post. Other than that not-working-through my 20s stuff, I was in a similar spot a few years ago, and adopting a Garth-esque plan got me onto a good track where I might actually be able to fund comfortable retirement and the rest of real life.

#59 MarcFromOttawa on 09.09.12 at 11:07 pm

#4 TurnerNation

I spent half my money on gambling, alcohol and wild women. The other half I wasted.”

WC Fields

#60 Wofenstein on 09.09.12 at 11:15 pm

Wow, today’s post made me feel warm and fuzzy all over. Great motivational speech – career change when Canada is at the point in the RE cycle that the US is in now? About the silver though. I’m not disagreeing with the logic of volatility and no returns being negatives… but I bought a week ago for $33 (retail) and now it’s near $34 (market). If you buy at the low point in the cycle, it appears to be inflation-proof cash. http://www.theglobeandmail.com/globe-investor/markets/indexes/summary/?q=SI-FT

#61 Smoking Man on 09.09.12 at 11:16 pm

54 comments. I saw Cra. The day wen that littlE man comes toi my house is thE day when when he she says is it woreth this. My son Kyle. Who did the bouncers in ottawa for sport figues out cRa is going to fk with his life stylE. Well I can say its the last day that cfa has on this eaRth. Ya past 4
Winees

#62 Jon B on 09.09.12 at 11:17 pm

I like the comparison with the guy who lives the million dollar lifestyle all built on debts. Really makes you think about the definition of wealth.

#63 phinny on 09.09.12 at 11:18 pm

Ben, you got ‘er sorted out.

Best post, ever, Garth.

#64 JR on 09.09.12 at 11:18 pm

The richest man has the cheapest pleasures.

#65 Delta Neutral on 09.09.12 at 11:19 pm

That post was indeed one of your best, if not the best – heartfelt, compassionate and the hope you filled me tonight completely erased my economic nihilism. You’re a good man, keep up the great work!

#66 VT on 09.09.12 at 11:23 pm

#40 james on 09.09.12 at 10:20 pm

good idea about the online discount brokerage account. that said, anybody know of how you do this and where?

========================

All the major banks have discount brokerages — do some shopping around to see suits you best. I use TD Waterhouse for my TFSA and my wife uses BMO Investorline.

#67 Nodebt on 09.09.12 at 11:32 pm

Hi fellow posters!! Been trying to find a good fee based advisor in British columbia! Asked gartho a few times and never got a response, he’s a busy man I assume. Anyone out there know of anybody they would recommend ? Thanks

#68 stage1dave on 09.09.12 at 11:33 pm

Wow, you is preachin’ to da choir tonite!

When this post showed up, the Wife & I were right in the middle of a tedious discussion about casual spending money (or more appropriately, a lack thereoff) & how it relates to our moribund social life lately…we unfortunately spend most of our cash paying rent, (shop & home) paying bills, & buying our toys.

How is this bad? Hmmm…let me think…oh wait, there’s no money TO BLOW on…um, well…having fun? Looking good? Or, gasp, using as a down payment on something…I’ll come back to this in a minute…

Anyway, neither of us is comfortable with a traditional investment approach (as you describe above) but not because we disagree with it; our income simply fluctuates too much month to month. We’ve generated most of our current wealth by expending our own labour, & exploiting our skills & knowledge, to turn a few sows’ ears into silk purses…which then get sold, a portion socked away…that’s what will form (is forming, actually) the basis of “something to invest” in a traditional manner. At a later date…

The scenario you describe in tonites post (or rather, the extremes) is interesting because of what it shows about a society’s PERCEPTION of these two lifestyles…One is perceived to live opulently, one marginally; the first is passing the tests, the second struggling.

The reality as you’ve pointed out is quite the opposite. As people do, a society or community will show what it truly values by what it does with what it has…which just brings out the cynic within me.

Why is being able to borrow vast sums of money (mortgages) viewed as success? Why is spending someone else’s money (CC’s) smiled upon while spending your own money is frowned at? And why does an admission of carrying no debt whatsoever cause such a stiffening amongst the sandwiches over business lunches?

As apparent as the answer to all these questions is, it’s pretty damned obvious very few of us want to bell the cat…debt is how most people survive, & very few of ’em want that pointed out. (I’m convinced there’s also a further sociological angle to this, but it’s not relevant here)

It’s want, not need; perception is what’s important, not reality; & as this blog continually points out, the chickens will come home to roost. Mortgage debt may be walking point, but CCs, HELOCS, LoC, Auto loans, & dept store credit (Don’t pay for 15 months!) are all flanking or bringing up the rear.

This invading army of debt may seem to most people as benevolent, but the potential defenses against it make the Maginot Line look like military genius. Once the public runs out of ammunition (credit) the size or strength of the invasion force will be irrelevant.

My end point is that Ben is in great shape…far better than A LOT OF PEOPLE I deal with on a monthly basis with 80K SUV’s, McMansions, & the like…subtracting the debts from the assets puts most of them on the street…this subject comes up a lot lately, as I’ve previously alluded to.

Happiness comes in a lot of forms, & one of the most important IMHO is not having to worry about money or payments. That generates freedom, & from there you can do what you wish.

So, in conclusion; I mentioned to my wife that we ordered in pizza last nite…& we’re going to the premier of Resident Evil 5 next week…just how much happiness can we stand?

And hey, if I sell another silk purse by the end of the month, we might even get to see Rush!

Hope springs eternal…

#69 Old Man on 09.09.12 at 11:33 pm

#54 SEAN – John Baird might be interested in you.

#70 vangrrl on 09.09.12 at 11:35 pm

Well you had me at the pic Garth, but the advice was great too.
#24: Couldn’t agree more!

#71 Sweet & Spiritual on 09.09.12 at 11:38 pm

Great blog, Garth.

Sincere.
Compassionate.
Fatherly.

#72 Ravishing Rick on 09.09.12 at 11:38 pm

God bless you Ben, and that’s coming from an atheist!

We need more people like you, you’re going to do just fine

#73 james on 09.09.12 at 11:42 pm

thanks 66

#74 TRT on 09.09.12 at 11:48 pm

Some advice man,

You’re going to feel pressure to ‘catch up’ to others your age so this is what you can do.

1) Minimize interest paid to anybody. That means moving to a small town and renting. Staying in the big city means eventually getting a house with a huge mortgage and paying interest on it until retirement. That alone will help you catch up, eventually.

2) Buy a Toyota Corolla/Matrix…used. A car is a necessity (no matter what the brainwashed ‘eco’ guys say). This choice will last you a log time.

3) Be mobile.

#75 TRT on 09.09.12 at 11:49 pm

and…

ask Garth about retroactive RDSP benefits.

#76 Freedom First on 09.09.12 at 11:52 pm

Ben. I don’t know you, but I really admire your tenacity in the face of the adversity you were dealt by life. I wish you the best, and I agree with Garth, you are starting from a good place. You are liquid, young, and courageous!

Really enjoyed your post today Garth. Very special. Thank you.

#77 Max Torque on 09.09.12 at 11:56 pm

Re: post #61. Can anyone translate that?

#78 new-era on 09.10.12 at 12:05 am

Living is dying
But Death 0, 1
I wouldn’t like death

(by ee cummings)

You only live once in this world, and believe me its a short period of time.

Many, don’t realize with the huge debt, they have also found death. If your young and you commit your entire life servicing this huge debt you have acquired, you are aready dying!!!

#79 Grim Reaper/Crypt Speculator on 09.10.12 at 12:12 am

Y’know…I’m starting to like that Smoking Man dude.

PS shooting me won’t work !!!!

#80 Boomer21 on 09.10.12 at 12:15 am

Great post Garth but I thought you were taking a week off? Not complaining but you probably do need to take some time off. Go out and have some fun, buy more flowers for Dorthy and have a good old fashion date night! Cheers

#81 new-era on 09.10.12 at 12:27 am

Canada Part II of the lehman saga

http://www.theglobeandmail.com/report-on-business/rob-commentary/in-canada-legacy-of-lehmans-collapse-lives-on-in-ultra-low-interest-rates/article4530911/

#82 tundrapete on 09.10.12 at 12:29 am

Refreshing gman thanks good on you.

#83 Hoof-Hearted on 09.10.12 at 12:33 am

B.C. Real Estate: ‘You can’t burst a bubble that wasn’t there’

http://www.theprovince.com/mobile/business/local/Vancouver+housing+bubble+doesn+exist+real+estate+expert+says/7208209/story.html

Sagging home sales and flat ­prices have prompted speculation that the “housing bubble” might be about to burst — a prospect that immediately catches the attention of British Columbians.

But there is no housing bubble, according to Tsur Somerville, director of the University of B.C.’s Centre for Urban Economics in the Sauder School of Business.

“You can’t burst a bubble that wasn’t there,” said Somerville. “But you can have prices above where they should be and it not be a ­bubble.

“A bubble isn’t just defined by high prices,” he said.

Somerville identified a housing “bubble” as conditions akin to what was happening in 2007.

“It didn’t matter what the condo looked like or what it’s going to look like or who was building it, people were lined up around the block and snapping it up,” he said. “They were saying, ‘I’ll take 12, please.’ That’s more of a bubble environment.”

While it might not be a bursting bubble, what is going on in the Vancouver area right now is not exactly normal, either.

Greater Vancouver home sales in August were the second lowest since 1998 and represented a drop of 30.7 per cent compared to August of last year, and were 21.4 per cent lower than in July of this year.

The 1,649 sales of detached, attached and apartment homes were also 39.2 per cent below the 10-year August average of 2,711.

But prices were relatively flat. The Real Estate Board of Greater Vancouver composite benchmark of $609,500 for residential properties in August was down only 1.1 per cent from July, and just 0.5 per cent down from this time last year — despite 2011 being a busy year for high-end property sales.

If there was a large number of unsold units coming onto the market or a huge change in the economic environment, Somerville said, “that would really cause prices to tank.”

“Most people don’t have to sell their house,” he said. “You bought it for $200,000. The price is now $150,000. Unless you have to, why would you sell it?”

For prices to go down ­significantly, contended Somerville, “You need people who have to sell, either because the economy has collapsed and they don’t have any income or developers have built a whole bunch of units that are unsold and the bank is screaming at them or foreclosing or something like that.”

None of those conditions appears imminent.

Somerville said it would take “some negative shock,” such as an ­economic meltdown or mortgage interest rates jumping from four per cent to nine or 10 per cent, to trigger lower prices.

“The euro melting down would cause one of those [shocks],” he said. “If the Canadian government changes its immigration policy and slammed the door on wealthy Asian immigrants, that would affect ­[prices].

“I don’t have a crystal ball but if I had to guess I would be more likely to guess this kind of lower sales/flat prices is more likely to continue.”

The B.C. Real Estate Association is more optimistic. Chief economist Cameron Muir is predicting increased sales in 2013 because of continuing low interest rates, population growth and more full-time jobs.

Employment growth in the ­Greater Vancouver area in the first ­seven months of the year, according to Muir, has been 3.5 to 4 per cent ­higher than the same period last year.

“I would expect to see sales pick up before the end of the year, at least on a seasonally adjusted basis,” Muir said.

Adding to his optimism is increased consumer demand for housing in the Okanagan and in B.C.’s North, where resource extraction continues but where there has also been more economic diversification.

The BCREA is forecasting Multiple Listing Service sales to go down by four per cent this year compared to last year but to go up by 7.5 per cent in 2013.

===================================

So..the moral of the story is…….._________________________________________________________________________________________________________________________________________________________________????

#84 Mithan on 09.10.12 at 12:34 am

Good blog post. You need to do more of these, as people can learn. We know Canada’s real estate market is going to shit the bed, but what we need more info on is actual investment strategies and such.

One thing I wish you would address more are the idiot doomers. Clearly you think they are delusional, but they represent half the people here and IMO, buying guns, ammo and gold is equally as bad as housing, and worse mentally.

Why not make a post explaining why specifically you think they are wrong…

#85 TakingResponsibility on 09.10.12 at 12:39 am

Garth Turner – you rock!!

And, Ben, your honesty and capacity for learning is very inspiring.

Best Post Ever.

#86 ozy - secsi on 09.10.12 at 12:40 am

If the pseudo upper-class window-dressed faker, has to bail-out, sell to the devil, do we get a chance to save the unsuspecting secsi wife? Pussateri’s anyone?

#87 Tron on 09.10.12 at 12:42 am

A little too much hero worship for a guy who has a job where people ask him where to put their money. Had Garth told this guy to pound sand then he’d be an asshole. Instead he gave him positive feedback ’cause he’s a decent guy.

The lovefest just feels a little too Oprah for me…just saying.

#88 Ronaldo on 09.10.12 at 12:42 am

Garth, a very wonderful post.

Ben, the following link may be of some assistance to you in getting started.

http://canadiancouchpotato.com/2010/10/01/a-helping-hand-for-canadian-investors/

As with another poster, I too use TD Waterhouse. They have a great platform and tonnes of learning tools as well. In addition they offer a batch of Exchange Traded Funds (Efunds) with no fees for purchase or sale…there is a slight holding period though. Hope this helps.

#89 Dr. WAYNE on 09.10.12 at 12:49 am

#2 Nodebt … asshole …

#90 Dr. WAYNE on 09.10.12 at 12:50 am

Humour, compassion, intelligent, and a psychologist … not bad, Garth … keep it up …

#91 Ronaldo on 09.10.12 at 12:51 am

Ben, another link that you may find useful.

http://independentinvestor.info/content/view/936/1/

#92 ozy - the crazy show on 09.10.12 at 12:51 am

When is the damn crash coming, the sellers are more greedy and irrational as ever, inferior properties are listed 10% more tha superior ones 6 months ago.

Damn puppet-masters, you have to shake the boat harder, capsize it, sell your bank shares and change the mortgage rules again, do (not talk) something like 10% deposit! It is crazy, the stuffed puppets are running the show by themselves, lying to themselves like Pinocchio that suburbs have anything to do with 800000-1million dollar mc-mansion dream. It is a crazy show, I name it “kanatian super-dumber poker-domino”, a castle of fake cards that cheats real-people of theier real life given by God.
Someone sane in the insanity hospital, make it stop, before the stage catches fire.

#93 meslippery on 09.10.12 at 12:54 am

Nice dog
Love Sheppard’s Have one.
Roof over our head and the rest of our family.
Take your dog for a walk. Save money.

#94 T.C. on 09.10.12 at 12:57 am

Next most valuable piece of advice – look after your teeth! Don’t want to be gumming that stale bread.

#95 syd on 09.10.12 at 12:57 am

best post ever. I am proud of you Mr. G.

#96 Nostradamus Le Mad Vlad on 09.10.12 at 1:06 am


Kudos to Ben and you.

Ben for asking (if no one asked questions, the answers, although available, would not be forthcoming).

To you for taking the time and trouble to answer, and letting us know how we can improve on what we already have.

Similar to Ben’s story.
*
Currencies, here and here. It would be an excellent moment for China to bring in a new gold-backed currency, other countries to drop the Petro-dollar and switch to China’s; 1:06 clip Mitt Romney. Listen to the answers; British Mansion RE has turned into a sick joke; John Mauldin Food for thought; New Bookstores from abandoned Walmart and other big box stores; Casino Capitalism Betting your life away; Keepng Brits. off the road; Phoney Tony, the war criminal. Still raking it in; Japan Would you like the top or bottom half? Mike the Engineer If you’re still reading, this one’s 4 U; Trade Wars US starting them with countries opposed to Monsanto; Five Long Years No growth, no deleveraging; Real Unemployment Numbers a lot different than reported; Sweden — Cashless Society; Pipe Dream Not if RE is avoided; Take it or Leave it? Up the workers (UK) and Up the workers (US); OECD World Outlook; Breaking Up ECB?

Freedom 55? Get real; Massive Cyclicals Euphoria? Sweating Charts on global economy; IMF’s Lagarde We’ve never had this situation before. There’s a first time for everything; Morgan Stanley Stock fall?
*
Cold busting curry Accompanied with a healthy dose of Jack or Jim to wash it down with; Birds on a feather-wire? Brits. and EU 60% want out; 11:32 clip Pakistan is the centre of the chess board; Nobody Expects The American Inquisition; 0:54 clip Betcha never seen a guitar played like this before; Af’stan Splitting into eight pieces? Only the desperate west could come up with such a cockeyed idea like this; 2016 The CFRS Amerika; Facebook We know where you are; Movie Gadgets for sale.

#97 condo hangover on 09.10.12 at 1:27 am

Excellent post!

#98 Capilano on 09.10.12 at 1:30 am

Thank you for a great post Garth.

The greatest good you can do for another is not just to share your riches but to reveal to him his own. ~Benjamin Disraeli

#99 $$$BPOE#1 on 09.10.12 at 1:34 am

Previous returns are not indicative of the future. Expect around a 3% return in future years with a balanced portfolio. Buy Vancouver on the dips and no tax worries. The true fools followed Shiller and missed out on the biggest rip roaring Bull market in history which is only in the third inning. Now Shiller says “I REALLY DON’T KNOW” . Finally admits it after almost 10 years of denial. The travesty is people who listened to “the expert” and got kicked to the curb forever to be renters. Save for a downpayment. BPOE takes care of the rest. Shiller, please just go away. You can’t afford BPOE thats why you can’t buy. You were wrong and wrecked many people’s financial lives with your completely wrong analysis of BPOE. On a side note lots of building on West 6th and West 2nd around the Premiere Olympic Village. New townhouses on West 6th going to be snapped up fast at bargain rates of only $989000. Hurry, they will go quickly. Check out West 6th. It’s the next BIG THING
Robert Shiller – “People get excited about housing. They get excited about Vancouver. You’ve got to get it straight. Just because Vancouver is a nice place to live, doesn’t mean that prices are going to go up there forever.”
Posted on 7 September 2012 | 25 Comments
“It’s looking like the bubble is still alive in Canada.” …
“It looks like Vancouver is San Francisco lagged some three years… San Francisco is a bubble city, it’s one of the main boom cities in the US… Californians are known for that, they’re emotional people (laughs)… But they’re no different in Vancouver.. in fact it’s worse in Vancouver… I have Vancouver doubling, even correcting for inflation, in 22 years.. that’s bigger than San Francisco. So it makes you wonder.. where is Vancouver going now? I’ll tell you one thing, I’m not investing in Vancouver real estate (laughs), not me!” …
[Interviewer: Is the issue the prices, or is the issue the affordability?]
“I’d say the issue was sociology. Economists are getting back to that very belatedly. It’s about how culture changes and how people get excited about housing. They get excited about Vancouver, it’s a beautiful city, by the way… it’s a nice place to live. But you’ve got to get it straight: Just because it’s a nice place to live, doesn’t mean that prices are just going to go up there forever…. when they get sufficiently high, people are going to say: You know, I’m not going to do it… and that’s when it breaks.” …
“Glamour cities are more bubble prone than run of the mill cities… if you have celebrities living there.. if people go there on vacation tours… that’s where the psychology brings on bubbles.” …
“I’m not giving you a strong forecast… I don’t know what these cities could do… they could keep going up. I really don’t know.”

#100 Zoronqueen on 09.10.12 at 1:35 am

Derek R #9 took a look at MMM.

I definitely agree that living in a 1000sq ft condo is more practical than a 3500 sq ft home. However in Vancouver that 1000sq ft home will cost you 800k.

Also I don’t see how not participating in sports, dance is good for your kids future…..

#101 cj on 09.10.12 at 1:58 am

Great post, Garth. It is a moving story with concrete support for Ben. It had me stop and think about my definition of wealth. I know some friends in the 1.5 mil and BMW who aren’t sleeping at night. Now to go to sleep and be filled with hope. One of your best yet.

#102 DON on 09.10.12 at 1:58 am

Bravo Garth…. Bravo

Good luck Ben

#103 Rob now in Nova Scotia on 09.10.12 at 2:05 am

Sell your silver? OMG, NO !!

Volatile? Yes, but that just means silver goes UP and DOWN a lot. Right now, it is in an UPswing. Silver was $26 a month ago but it is $34 an ounce now. That’s a lot more capital gain than 6.5% in a balanced portfolio will get you.

If you must sell your silver, then at least wait until next February. The precious metals tend to bottom in summer and peak in spring. Google “Alf Fields gold” and remember that silver follows gold. We are in a very powerful up move right now and by hanging on just a few more months, you can double that $1,000 to $2,000. Mark my words.

Personally, I would feel naked with only $1,000 worth of silver and as soon as I start working again, I’m going to buy more.

Garth gives great advice but he’s dead wrong on silver. At least he lets dissenters post, though.

#104 Dr.NickRiviera on 09.10.12 at 2:09 am

Keep the silver! Why on earth would you sell it now? Hold it for a few years… see what happens. It’s only 1K and if the price shoots up – sell. If it drops to 20.. 10/oz… Then hold onto it longer still.

#105 Rob the Dividend Trader on 09.10.12 at 2:26 am

Excellent column Garth, I think the best one you’ve done!

@ derek, I love Mr Money Mustache Man as well, great writting.

Ben, if you read this far there are loads of PF and investing blogs out there for Canadians, they are an absolute god send for someone like you, many others have been through the exact same thing.

Good luck

#106 NewInCalgary on 09.10.12 at 2:29 am

Garth,
Really really good post.

This is one of those posts that we all should bookmark, and read again and again every now and then.

#107 Bobby on 09.10.12 at 2:43 am

Garth,

A great post, one of your best. Sadly, we seem to define people by what they have rather than who they are. Eventually, we all realize it is just stuff and seek simplicity in our lives.
The bottom is falling out of the market here in Victoria and a lot of stuff is now for sale. Got a great deal on a condo, maybe it is time to get that new SUV. Regards!

#108 Jack on 09.10.12 at 2:54 am

Anyone try Questrade for an online brokerage?

#109 kevsta on 09.10.12 at 3:14 am

“Sell your silver” should be taken in the context of these snippets of previous advice

“10 years from now you should expect stock values to have at least doubled, if not quadrupled.”

“Financial markets in North America, Europe, Japan, and other places are headed vastly higher. The Dow at 10,000 is just a stepping stone to a market that could achieve 30,000 or even 50,000 by 2015.”

“The Canadian Peso: A steady slide over the last 15 years. There is little reason to believe this trend will stop, increasing the argument for putting more of your wealth into something more stable, like the U.S. dollar.”

“Stocks will be higher in a decade than they are today. Between 1990 and 2000 the Dow went up 500%. Do you really think that between 2000 and 2010 it will go down?”

Eric Sprott is a billionaire, look back at what he was saying (and doing with HIS money) a decade ago, and who was correct.

Sprott is absolutely confident that Silver is a 30-bagger over the next decade, so swapping it for a load of dodgy imaginary paper value just might not turn out to be the cleverest thing you ever did.

#110 gokou3 on 09.10.12 at 3:17 am

Speaking of TFSA that’s supposed to be indexed to inflation – how come it has remained $5k per year for the past few?

#111 Chris on 09.10.12 at 3:20 am

Like many others have commented, its posts like these that keep me coming back every day. Thanks Garth, yours is the ONLY blog that I follow religiously. I especially liked this piece of advice: “It’s heartening to hear about your health, Ben. Feeling well is the only thing on earth a rich, sick person wants, yet cannot buy. Never discount how much a good day’s worth. This itself, is wealth.” Love your work.

#112 Superman on 09.10.12 at 4:29 am

Garth – In your opinion, is QE3 coming this week?

#113 mark on 09.10.12 at 5:03 am

No disrespect to anything else I’ve read here, but this is probably the best post I’ve ever read.

#114 Aussie Roy on 09.10.12 at 5:11 am

Aussie Update

Investors flee the housing market

A steep drop in finance to housing investors and a fall in loans to owner-occupiers indicate the housing market is far from health.

The Bureau of Statistics figures show the value of new loans to housing investors fell 2.7 per cent in July to $6.67 billion.

The value of loans to owner-occupiers was down 1.4 per cent to $13.4 billion, while the number of loans to this group was down 1 per cent.

http://www.abc.net.au/news/2012-09-10/housing-finance-falls-in-july/4252714
http://www.smh.com.au/business/the-economy/housing-finance-drops-pointing-to-markets-weakness-20120910-25nhf.html

Mining boom is turning to bust

TWO of the world’s biggest miners have slashed close to 1000 local jobs today in response to falling coal prices and the high Australian dollar.

http://www.smh.com.au/business/the-economy/housing-finance-drops-pointing-to-markets-weakness-20120910-25nhf.html

#115 Aussie Roy on 09.10.12 at 5:13 am

Correction

Mining boom is turning to bust

TWO of the world’s biggest miners have slashed close to 1000 local jobs today in response to falling coal prices and the high Australian dollar.

Link should read

http://www.news.com.au/business/companies/mining-trouble-as-900-jobs-slashed/story-fnda1bsz-1226471085799

First time house buyers BRIBE gets slashed

The late-1990s and early-2000s were full of housing policy blunders, which helped fuel the explosion of Australian home prices.

In 1999, the Federal Government halved the rate of Capital Gains Tax, which encouraged (in concert with negative gearing) a surge of negatively geared property investment. This blunder was followed by the introduction of the $7,000 first home owners’ grant (FHOG) in the early 2000s, which similarly helped to push-up prices by boosting demand.

http://www.macrobusiness.com.au/2012/09/first-home-buyers-grants-bite-the-dust/

#116 Buy? Curious? on 09.10.12 at 5:20 am

Garth, you’re like the guy from Breaking Bad but instead of cooking Meth, you’re creating wealth for these cats, for free, out of the goodness of your heart. Shave your head and get yourself a handlebar moustache.

#117 live within your means on 09.10.12 at 5:36 am

Agree with Tanya that your post Garth could bring a gal to tears. I just had to read it to DH and my voice was quivering as I did so. Very compassionate of you to offer further advice.

All the best Ben with your financial future & your health.

#118 espressobob on 09.10.12 at 6:15 am

Great post Garth. People like Ben are quite commonplace. Hope things work out for him. If he reads this blog he should do OK.

#119 Tim on 09.10.12 at 6:16 am

I’ve got to say, having a mere thousand bucks as a hedge against inflation in spite of its volatility is not a bad thing, I don’t really see why you would want zero gold or silver when in fact 5% of your portfolio consists of metals Garth?
Furthermore, as things like gas and the canadian dollar increase in value, gold and silver are sure to follow, why not at least sell during a high in the market? We are just leaving a market low now as the dollar reaches new highs even as of this writing?

#120 disciple on 09.10.12 at 6:43 am

This IS a great day… (Garth uttered “dumbass” and it had nothing to do with me)

I got rear-ended at a red light. My vehicle totaled. Force of impact so intense that my seat twisted permanently to one side. I walked away without a scratch, I’m glad nobody else was in the vehicle with me at the time. The young “dumbass” dude learned a valuble lesson and will slow down from now on I hope.

But that is not the most interesting part of the story. You see, during impact, somehow something pulled up on the seat reclining lever just as I needed to break my backward momentum recoil, thereby transferring all of the stress of impact onto the seat, causing it to twist and not my neck or back. Stupid air bag was MIA.

My life has been mysteriously saved too many times to be accounted for by chance. Almost makes me believe in a higher power…

#121 Moose_N.I on 09.10.12 at 7:04 am

Thanks Garth, I needed this!

#122 TO Virgin Couple on 09.10.12 at 7:19 am

Great post Garth. Ben, you can travel far taking small steps. Good luck, and keep going!

#123 ts harpoon on 09.10.12 at 7:34 am

Garth.

Best post, ever. Thank you.

#124 FTP - First Time Poster on 09.10.12 at 8:13 am

#108 – Anyone try Questrade for an online brokerage?

I haven’t tried Questrade, but there is an excellent Canadian brokerage I’ve been using for the past 3 years that you might not know about.

Have a look at http://www.qtrade.ca

#125 Victor on 09.10.12 at 8:13 am

“…hope is a good thing, maybe the best of things, and no good thing ever dies.” – Andy Dufresne

http://www.youtube.com/watch?v=9K30e9O3Nng

Ben, this is the clip from my favourite film…on this day, it’s dedicated to you and I hope it finds you and finds you well.

#126 Tom from Mississauga on 09.10.12 at 8:53 am

Nice comparison between how first observations can be deceiving, and whats really important.

The best start however for our friend here is TD’s e-series US and Canadian index funds. Super cheap and broad based. The discount brokerage I use is really only good for over 50,000 CAD to trade. Below link designed for somebody I believe getting started and has a regular monthly contribution

https://www.tdassetmanagement.com/Content/Products/MutualFunds/Funds/p_FundCard.asp?FID=3270&TAB=OVERVIEW&PID=10&SI=4

#127 fancy_pants on 09.10.12 at 8:58 am

great post Garth, great story and advice. thanks for sharing. I’m sure you have provided hope to many folks today w/ this post

#128 fancy_pants on 09.10.12 at 9:00 am

#108 Jack on 09.10.12 at 2:54 am

I used questrade like a madman about 5 years ago to the pint it got out of hand/addictive. No qualms with them though

#129 Jamaican_Gal on 09.10.12 at 9:01 am

Your best post ever! Now this reflects the situation of the average Canadian. Thank you for including us…finally…:)

#130 Susan London Area on 09.10.12 at 9:24 am

Funny how appearances can be deceiving. I have been driving a practical vehicle for 30 years. A Safari Van for the past 10 years because it doubles as a work van and a passenger vehicle love it. A couple of weeks ago I bought a 2007 sporty Honda S2000, 2 seater convertable. The reaction from the people on the road, walking on the street, at the gas station, at open houses is quite differant than the van. Before I was invisable now I get anywhere from people wanting to race me to people wanting to look under the hood everyone seems alot more friendly. I’m the sexy chick driving the sexy car. I pulled up to an open house on the weekend and my co-pilot said to me people will probably take me more seriouse now than when I was driving my van. I laughed and said yes but I have less money now than when I’m was driving the van. It’s stick your nose to the grindstone time Ben stay focused I too was in a similar situation over the past 12 years worked pretty much 7 days a week, and raised 2 kids on my own I just kept repeating the famouse words of those in defeat, but arose in victory. The “I will never give up, I will never surrender” Winston Churchill. John Paul Jones (very cool)” I have only just begun to fight” words when asked if he was ready to surrender. Then of course we have our wonderful Web Host Garth who is here daily keeping us in tune, occassionally needing the odd stroke not to give up on us. Nice post today Garth you showed a little tenderness :).

#131 Dupcheck on 09.10.12 at 9:35 am

No wonder why BMW drivers are assholes. They must be pissed off of their negative income flow and fake unsustainable lifestyle. Posers.

#132 Ralph Cramdown on 09.10.12 at 9:38 am

could it be that much of the wealth I see in Canada is fake?

Heck no! If you see someone carrying a fake designer handbag or timepiece but assume that it’s real, that’s fake wealth. Somebody driving a Mercedes represents real wealth, it just might not be the driver’s.

#133 Daisy Mae on 09.10.12 at 9:54 am

“You seem fond of helping folks who don’t understand money….”

******************

THAT’S an understatement! LOL

#134 kreditanstalt on 09.10.12 at 10:03 am

#32, #103 & #104 were the only commenters who questioned your short-sighted advice to “sell the silver”.

Of course it shouldI too would be more inclined to take the $8,000 and put it into precious metals stocks.

But remember: there is no longer such a thing as “investing”. You are NOT buying stocks for yield. We are all speculators now, so watch those stocks daily.

Silver “volatile”? The “silver bubble”, I guess?

The very fact that only three (now four) have said to save the family silver is nicely contrarian.

Obv

#135 Regan on 09.10.12 at 10:16 am

Can I just say I think this issue is really timely – not everyone is wondering how to best invest their millions, we’re just trying to figure out where to get started. When I was younger I figured that wealth was like filling a bucket and so you plug the leaks of needless purchases, try to turn on the taps of cash coming in and also prevent anyone upsetting it as it fills (i.e. risk management). So yeah, the first steps to wealth can be brushing and flossing your teeth every day (risk management), buying a bicycle (health management, cheap transportation), moving to a cheaper home and getting rid of expensive cars. This is all focused on how to save money. Then I redirected how I spend it – got a popcorn air popper so I wouldn’t waste money on chips and I stopped drinking pop and bottled water etc.. I learned to cook better and stop eating out. Then I figured out how to make more money – switch jobs, do odd jobs on the side, relearn skills. I learned to weigh my decisions, like don’t cheap out on nice work clothes if you can use them to get a big raise or new job. And yeah, once you’ve actually got cash THEN you start asking questions about how to manage it, but even those choices will depend on how much you’ve got in terms of fees and risks. Anyway, it’s great to hear from someone who’s fighting back from illness. Health and knowledge are truly the riches we live on.

#136 Smoking Man on 09.10.12 at 10:18 am

In 2008-2009 H1N1 Vaccine panic I was a Vocal Critic of the Vaccine. At all costs don’t take the shot.

Well fast forward today the Vancouver sun in health section reasurchers find that people who got the shot seemed more likely to get infected that those who hadn’t.

Remember it was the height of gloom and doom the only advertizers at this time was big pharma

#137 pbrasseur on 09.10.12 at 10:28 am

The fact that is most striking here is that the person who has little and has’nt been working for much of the past ten years is potentialy in better financial shape than one who makes 200K + a year. A situation probably not that exceptional.

That’s what a real estate bubble does for you, isn’t that amazing?

#138 Linda Pearson on 09.10.12 at 10:31 am

#120disciple on 09.10.12 at 6:43 am
My life has been mysteriously saved too many times to be accounted for by chance. Almost makes me believe in a higher power…

Almost? Good grief man, what’s it gonna take?

#122TO Virgin Couple on 09.10.12 at 7:19 am
Ben, you can travel far taking small steps. Good luck, and keep going!

“It does not matter how slowly you go so long as you do not stop.” Confucius

#139 Tony on 09.10.12 at 10:32 am

Buy the TVIX one month before election day in America. This should be when wave 5 completes the end of the grand super cycle and an 80 percent decline will be eminent. Put in a sell order at one hundred dollars or sell half when it hits 100 dollars without any reverse stock splits.

#140 Smoking Man on 09.10.12 at 10:51 am

Ben I don’t mean to be insensitive but think of the bright side.

Say next week you go to dr and u find out you have 3 months to live. Ok it suck but if you were a Zillionair it would realy suck.

Get some vitamin D naturaly. Sunshine

Then associate pleasure with inslaving people who work for you. After that sit back and enojoy the loot.

If that’s not posable develop a false ego and imagination to keep your self entertained while bouncing on rock bottom.

I have done all of the above

#141 willworkforpickles on 09.10.12 at 10:53 am

You really should take off the rose colored glasses garth.

#142 IN Garth not God we Trust on 09.10.12 at 10:56 am

In addition to being the bearded mystic oracle, all knowing, all wise, financial tea leaf reader extraordinaire, crystal ball gazing (without it shattering)oracle, denouncer of parliamentarian peckerheads and peckerettes, former minister of all revenues in this fair land, lone voice of financial reason crying out in the HELOC infested wasteland of Canada, Harley riding, Amazon bathed and protected, we can now add, compassionate, caring, kind and sympathetic. Truly a Buddha is amongst us mere mortals…

#143 John on 09.10.12 at 10:57 am

Buy? Curious? wrote:

“Garth, you’re like the guy from Breaking Bad but instead of cooking Meth, you’re creating wealth for these cats, for free, out of the goodness of your heart. Shave your head and get yourself a handlebar moustache.”
——–

I catch some of this vibe too. Very positive.

#144 james on 09.10.12 at 10:58 am

7% average annual return appears to me slightly overly-optimistic; silver is quite a safe value-investment, so there is no reason to trash it.

the name of the game these days, ain’t about
the return ON investments, but rather the return OF your investments.

but then, who am I to say otherwise?

cheers,
-james

#145 Tony from Calgary on 09.10.12 at 10:59 am

#84 – “IMO, buying guns, ammo and gold is equally as bad as housing, and worse mentally”

@Mithan – why would owning hard goods be a “bad” idea, especially if it is within moderation compared to your entire portfolio?

Also keep in mind that even Garth owns his own home – but he does so without holding debt.

It is not owning assets (even should a huge spell of asset deflation come along) that is so bad, it is owning things on margin that you can’t afford/sustain which seems to be the problem so few people comprehend.

#146 darcy on 09.10.12 at 11:05 am

I agree. Best post I’ve read in a long time. Not the others weren’t informative, but this one is hopeful!

#147 Daisy Mae on 09.10.12 at 11:06 am

#87 Tron: “A little too much hero worship for a guy who has a job where people ask him where to put their money…. ”

******************

Garth was showing concern…and giving hope and excellent advice to Ben. Beats all the pessimism of late.

#148 Derek R on 09.10.12 at 11:06 am

#100 Zoronqueen on 09.10.12 at 1:35 am wrote:
Also I don’t see how not participating in sports, dance is good for your kids future…..

Agreed that the ordinary person might not want to do everything that Mr Mustache does: he’s pretty hardcore. How many of us would move from Ontario to Colorado just to save money? But there are a bunch of tips there which are usable by everyone. And if you ever find your back against the wall and need to cut your spending seriously, he’s your man.

#105 Rob the Dividend Trader on 09.10.12 at 2:26 am wrote

I love Mr Money Mustache Man as well, great writing.

Absolutely. His readers provide good comments as well. And when his wife contributes the occasional post, she’s pretty entertaining too. Even if you’re not that interested in becoming financially independent, he provides food for thought on why we spend the way we do.

#149 Mixed Bag on 09.10.12 at 11:09 am

What a timely article.

I’ve been waiting for a post advising someone with little to no money, but no debt, on how to get ahead. Thank you. The financial portion mirrors my spouse’s situation, and because I can relate to that, the advice is relevant and is a road map for us to follow to set up my spouse’s investments.

Ben, good luck, sincerely. I had my own rough ten days experiencing my own health issue, and am hopefully out of the woods now. I am back at work, appreciating not being in pain, and I am thankful.

#150 robert on 09.10.12 at 11:21 am

With the onset of fall i can only imagine what the last quarter is going to look like. As inventories stay stubbornly high the laws of supply and demand continue to put pressure on prices. Talked to an appraiser yesterday who told me he was talking to a realtor this week and the realtor suggested prices in the next twelve months are going to drop like a rock. This same realtor told me at an open house about two months ago that prices had bottomed.. The home he was sitting in had been on the market for 239 days and had been reduced from over $50,000 and you guessed it still no buyers in sight. He was not happy when i told him that it would sit until the $270,000 range and even that could be a stretch. The first task of finding a willing buyer is the easy part. Buyers willing to pay the inflated prices are becoming scarce , then comes the home inspection, then comes the mortgage which will include an appraisal, then comes the income verification, then comes the debt service ratios. A well qualified buyer or a cash buyer will in time name his own price and if the seller is unwillingly oh well he will keep looking till he finds one who is willing..

#151 Victoria Tea Party on 09.10.12 at 11:36 am

GOOD LUCK BEN

Please follow St. Garth of Money’s sage advice. The world needs more sage!

You’re at an amazing juncture of the financial fiddle-faddle that’s been ongoing now for quite some time and which has been driving me slightly nuts.

I’m supposed to be sitting in my backyard sipping tea and munching cookies, but oh no, I’m deep into the study of economics/geopolitics.

It’s like trying to determine exactly into which ditch this train wreck of an economic system will finally subside and how many of God’s little insects will be crushed in the crunch!

Markets seem to be awfully high and skittish given the waiting game going on: upcoming US elections; fiscal cliffies; EU nonsense; China’s bull in their shop; Aussies not having a particularly good time; our real estate; Iran.

In other words, some investments are better left until later, particularly commodities, while the banksters are always a good bet; they really DO know how to make a buck or two.

For instance on the weekend our friendly local bank lady persuaded kith and kin to move banking from paper to bits and bites thus saving trees and expanding profits!

Given that we are substantive shareholders of said bank we said, “Go for it!”

Happy Days! You’ll be fine, Ben.

#152 Van guy on 09.10.12 at 11:47 am

Mmmm, my last post didn’t make the board eh? Im a follower of yours and I do take your advice seriously. I held off not buying etf bonds and REITs because you said not to. Now you say it’s all good to buy them when they cost more?

#153 Julia on 09.10.12 at 11:49 am

At the office this morning a colleague shared that she just took out a mortgage for her existing house from her RRSP and she was thrilled to be able to be paying herself the interest instead of the bank. To me it sounds like she would be losing investment potential when bank interest rates are so low, plus it’s a threat to diversification of assets/investments.

I don’t know what this kind of loan is called and I don’t think I knew about this option — I only knew that you could borrow from your RRSP for education or a new house. Maybe it’s one of the acronyms that has been discussed (it’s not a HELOC)?

#154 Andreea on 09.10.12 at 11:59 am

That is simply one of the most touching displays of affection ever imaginable. Thank you for this poignant reminder of what wealth really is.

#155 Suede on 09.10.12 at 12:02 pm

#144 James

Lots of investments will pay you 7% or more.

BBO – pays 10% dividend and holds the top 6 banks (RBC, TD, etc..) and top 10 oil/energy companies in Canada

XPF is paying just shy of 6%

CHB – US High Yield Bonds CDN $ hedged, is paying 7%

Find your local ETF or preferred share screener and you’ll find a lot of these. Yes your investment capital will fluctuate but like Ron Popeil says, “Set it and forget it”

You don’t have a ticker on the side of your house or car that tells it’s hourly or daily value. You check once a year when your assessment comes. If you watch your investments daily, you may go nuts at the volatility.

#156 Derek R on 09.10.12 at 12:13 pm

#120 disciple on 09.10.12 at 6:43 am wrote:
This IS a great day… (Garth uttered “dumbass” and it had nothing to do with me)

I got rear-ended at a red light. My vehicle totaled. Force of impact so intense that my seat twisted permanently to one side. I walked away without a scratch.

Looking at it with my pessimist’s hat, I’m really sorry for the loss of your car. Looking at it with my optimist’s hat on, I’m extremely pleased that you got through the experience injury-free.

I hope that you get a nice new car out of it!

#157 spaceman on 09.10.12 at 12:24 pm

23 KLIP on 09.09.12 at 9:50 pm

A fool and his money.

I, like many have played the market, the Nasdaq, gold ETFS, only to be squashed. It takes too much time to time the markets. Lost on Nortel, lost on .com crash. lost on HNU, etc.

The only thing that has saved me is balancing between a Dividend fund, and 3 bond funds, these for short term savings. 90% of my RRSP is there, TFSA is also balanced. As per my bank statement, I average about 7% over the last 5 years. @ 7% your money doubles every 10 years. ( confirm this with many different online calculators)

I have yet to get into Preffered shares, but definately thing its the way to go. I am thinking preferred bank shares are pretty stable and spin off a good dividend.

Oh ya, buy a lottery ticket every week… I met a guy won the big one, and 4 10,000 prizes. Turned him into an old coot, but hes rich.

#158 House Horny Housewife on 09.10.12 at 12:29 pm

Garth,

Great post today. I totally second everything you said, especially about having your health.

Ben sounds like he has both feet firmly planted on the ground and although his experience sounds like it was harrowing, I am sure that it has made him that much stronger for the future.

Now all he needs to learn is that appearances are extremely deceiving and that most of the people living around him actually have less money than he does.

However, you are forgetting that there is one way to get rich quick, although it will complicate Ben’s life a bit. He can do what mothers have been telling their daughters to do for eons … marry rich !

Ha ha ha ha, just kidding, Ben. Nothing beats living clean, free and simple. Just get a plan together, as Garth suggests, and then stick to it. This should take care of the anxiety about finances.

Cheers.

HHHW

#159 InvestX on 09.10.12 at 12:31 pm

139Tony:
Buy the TVIX one month before election day in America. This should be when wave 5 completes the end of the grand super cycle and an 80 percent decline will be eminent. Put in a sell order at one hundred dollars or sell half when it hits 100 dollars without any reverse stock splits.
———————————-

Gee, right after Garth advises Ben not to time the market. Nice.

#160 syfon on 09.10.12 at 12:35 pm

Hi Garth
Men comes for advise and only asset that will protect him in coming months he is advise to sell.
What about 10% in precious metals allocation.
By the way that sucker that bought silver at 43$ is down 9 today.
Will continue

#161 John on 09.10.12 at 12:35 pm

Thank you for keeping the blog running and educating us on money issues. You are doing a great job, I wish more people read it though.
We are a couple in late twenties who have a 2 year kid, no debt and about $35 k in savings. We currently rent and after all of the expenses we have about $1000 a month on average that we can save and invest. Within next say 2-4 years, we would like to buy a house or a condo (if we can’t afford a house).
With that goal in mind should we invest at all? If so, how should we allocate money?

#162 gladiator on 09.10.12 at 12:36 pm

Your health is your true wealth, and blessed are those who realize this, for they will inherit the most (literally).

#163 GLK on 09.10.12 at 12:44 pm

Hi Ben

With your health back, you are way richer than you thin.

I came to Canada as an immigrant 7 years ago at about your age with about 3K in my pockets.
Today my income and saving are quite above average.

Here are a few things I would suggest you do.

1) Open a self-directed TFSA account with ScotiaItrade from ScotiaBank (I also have a TD Waterhouse
account from TD Bank, I think ScotiaItrade gives you more value because of the possibility of buying
ETFs with no transaction fees. So you can invest as few as 50$ evermonth without a transaction fee.
This is great for small investors. In addition, they have no administration fee for investors with low total assets).

2) In your self-directed account, buy only ETFs, and only those that pay dividends.

3) Invest in TFSA first to the maximum, before considering any other option (RRSP or non-registered account)

4) Below is my portfolio. I would recommend it to you for your TFSA. Invest abour 400$ a month, that is about 50$ monthly
in each of the following ETFs. At ScotiaItrade, you will pay 0 transaction fee.

CHB (US High yield bonds), 6.9% yield
CBO (Corporate bonds) 5.2% yield
FIE (Canadian banks and Preferred), 7.5% yield
CIE (48% Europe, 30% Asia, 16% UK, 6% Canada), 2.6% yield
CYH (42% US, 23% Europe, 13% Emerging markets, 9% Asia, 8% UK, 5% Canada) 5% yield
CRQ (Canadian Fundamental index) 3.3% yield
CWO (Emerging Markets) 3.6 yield
XUT (Canadian utilities) 5.2% yield.
Get less aggressive by increasing the fixed income portion (CHB, CBO) of this portfolio as you age.
After 10 years, you won’t believe how much you have saved.

6) Many of the above ETFS pay their dividends monthly. Sign up for automatic dividend re-investment,
that way dividend paid to you is used to buy more shares, instead of sitting in cash (i.e.
you money works harder for you).

7) Open a self-directed RRSP at ScotiaItrade and invest the extra 100 per month. Every year when you get your tax return, put some of
that money in your RRSP.

8) Invest religiously everymonth regardless of how the market goes, this automatically dollar cost-averages your investment.

9) Subscribe to Moneysense Magazine (about 30$ per year), that will give you more education about investing and saving. It would
be smarter to just walk into your neighborhood public library and read it.

10) Close your checking acount with big banks and open a NO FEE checking account (ING direct bank, President Choise bank, …)

11) For god’s sake do not buy a house (if you haven’t already) and rent.

13) Never buy a new car, always buy used, (4 to 5 years old). Never fly anywhere for vacation unless it is cheaper than driving there, you are on
vacation, take you time, drive, and while driving think and reflect on your life.

14) Whatever field you are working in, do not hesitate to go back to school or get a training to upgrade your skills.

15) Only marry a penny pinching chick.

16) Keep reading Garth’s blog.

GLK

#164 Victor on 09.10.12 at 12:46 pm

http://ca.finance.yahoo.com/news/rbc-predicts-better-economic-growth-rate-hikes-2013-050959789.html

TORONTO – The Royal Bank of Canada predicts the Canadian economy will grow by 2.1 per cent this year, and that the central bank will gradually raise interest rates next year.

RBC’s latest Economic and Financial Market Outlook says accommodative monetary policy, continued business spending, supportive labour market conditions and an improving trade balance will lay the foundation for the growth.

The forecast, released early Monday, says lingering downside risks will diminish in the months ahead and clear the way for the Bank of Canada to gradually begin raising interest rates next year.

#165 Bill Gable on 09.10.12 at 12:49 pm

I read today’s post and was taken by your kindness and empathy for the gentleman that wrote for help.

It’s one thing to advise people – but it’s a whole new game when you betray HEART and COMPASSION.

If we had more people around, living by these kind of principles, we’d have a society where I would see fewer poor people and their starving dogs, huddled on our streets in Vancouver.

In Paris – it is JUST as bad – if not worse. North Paris – looked like a burned part of Brooklyn.

Mr. Turner – you are a mensch.

Thank you for your compassion and your endless patience, with those with less, and the rest of blog dawgs.

My admiration for you is boundless.

#166 TRT on 09.10.12 at 12:50 pm

Dollar approaching 1.03.

US officially stating they are not raising rates until 2014 until the earliest. QE3 may be coming.

Now, tell me why Canada would raise their rates before the USA does?

Way off on the predictions Garth. Low rates for a long time to come. When USA does raise their rates, we won’t. We will let our currency suffer.

Care to bet? — Garth

#167 Jesslyn on 09.10.12 at 12:57 pm

Most people in my experience don’t start seriously saving money and thus investing it until their early to mid thirties anyway.

I don’t think that people should feel shame or guilt over not having large amounts of money saved by the time they are in their thirties. Realistically in your twenties you are just building a workable salary and making many mistakes (and learning from them).

In my opinion if you make it out of your twenties with no debt, a salary you can save money on and the understanding of what is really important in life then you are doing great and you should be very proud of yourself!

#168 Bob on 09.10.12 at 1:21 pm

Great post Garth, keep up the good blog.

#169 Frank le Skank on 09.10.12 at 1:21 pm

Its very easy to see why most people are not in agreement (not including this blog) with Garths point of view regarding housing in Canada. I have come across the same type, and I’m sure most of you have. Typically, if someone owns a house and especially if its highly leveraged, will not see eye to eye with an opinion that states housing prices will decrease because they have a lot to lose. The same applies to someone who has a majority of their retirement savings in real estate. It happens to me on a daily basis, even people who have been through real estate crashes before and are very intelligent still suffer from denial to the point where they get offended when you mention a real estate crash.

I am young, have never bought a house or studied the RE market (until recently) and sometimes have doubts when confronting these people as to whether or not RE will correct. In the end, people will be scratching their heads asking themselves how they could be so blind, especially since the US RE crash preceded ours. Consequently, in 20 years they will forget that they were brainwashed and manipulated into thinking this and will probably repeat the same mistakes.

#170 Old Man on 09.10.12 at 1:32 pm

Julia agree with your observations, and believe this can be done with a self-administered RRSP – not sure, but it is my best guess. It all depends on the capital ratio that is involved; the investments that were cashed in, but she might have been further ahead to just lock in a 5 year term with low bank rates outside of the RRSP; time will tell. Julia – #152

#171 TRT on 09.10.12 at 1:34 pm

More fraud:

http://www.theglobeandmail.com/news/politics/ottawa-revoking-citizenship-of-more-than-3000-after-fraud-investigation/article4532222/

Hahaha. Revoking citizenship is nothing. They will still have permanent residency — so free education, healthcare, right to work somewhere else, etc…

Oh, for those doomers hoping for a collapse in other parts of the world: There are 300,000 Canadian Citizen holders in Hong Kong!!! There are 42,000 in Lebanon. there are 3,000,000 living overseas. If they ever come back, Vancouver and Toronto prices will hit the moon!

#172 truth hammer on 09.10.12 at 1:38 pm

Market bets on depression until at least 2015.

http://www.bloomberg.com/news/2012-09-10/fed-stuck-at-zero-into-2015-seen-in-swaps-qe-odds-reach-99-1-.html

Your advice to the gentleman is not wrong…..but geez Garth…….a little well placed speculation can go a long way. It is not all one way or the other……..it’s called as you know ‘diversification’. This risk adverse mentality is really a Canadian disease. Maybe instead of telling the guy to stick his head in the sand you might recommend that he fight back against the force of nature that has wrecked his life to this point. Tell him he should get angry and get going….not just stick his head in the sand for the next twenty years and watch his meagre pile get eaten away by inflation. Its a fact that even his stale bread is costing him more than 7% more every year. I feel for people like this…..but complacency isn’t the answer.

As the article indicates…there will be no noticeable recovery on Mainstreet for many years…….this is a ‘self help’ market. Dare to be a pirate….Arrrrghhhhhh !!

#173 Old Man on 09.10.12 at 1:53 pm

#166 Frank – I have seen many crashes before, and the end is always near when the bidding wars begin, as the herd runs on emotion to buy a home because they will be going higher, so let the auction sale begin. This is the time to SELL NOT BUY. Garth being the wise old man has seen it too, and it will all end badly, as history has this way of repeating itself.

#174 45north on 09.10.12 at 1:56 pm

Dan from Richmond Hill: could it be that much of the wealth I see in Canada is fake?

much of the wealth you see in Richmond Hill is fake

#175 $$$BPOE#1 on 09.10.12 at 2:17 pm

The genius of Canadian Real Estate. The highest Authority on the matter has spoken. Truer words were never spoken on this earth. Irrefutable truth. Even Shiller now says Vancouver can keep going up
But there is no housing bubble, according to Tsur Somerville, director of the University of B.C.’s Centre for Urban Economics in the Sauder School of Business.
“You can’t burst a bubble that wasn’t there,” said Somerville.

#176 $$$BPOE#1 on 09.10.12 at 2:20 pm

Exactly. 40% price reductions? Total ridiculous speculation by jealous people across the border. Rates are going down folks. Remember Carney said he MAY read it folks, read it again MAY have to remove stimulus. It’s just a word and he is never ever going to do it.
*****************************************
Somerville said it would take “some negative shock,” such as an ­economic meltdown or mortgage interest rates jumping from four per cent to nine or 10 per cent, to trigger lower prices.

#177 eagle eyes on 09.10.12 at 2:23 pm

TRT #168

It is true that there are many people living overseas who hold Canadian Citizenship. The reason they do so is obviously for the safety net that this provides. Holding Canadian citizenship is seen as an unrevokable right. Now this has changed. The Canadian government is revoking 600 citizenships. How will this be viewed by the rest of the world? Canada will no longer be considered a safe harbor, but instead similar to the policies of a country they may flee from. Combine this with Revenue Canada’s plegde to rigorously pursue hidden overseas income and you’ve got a mass exodus.

#178 Spiltbongwater on 09.10.12 at 2:25 pm

I like many was too busy keeping up with the Khardasians, and have only learned that Johnnie Cochrane died in 2005.

#179 SRV on 09.10.12 at 2:26 pm

Well said Garth!

Ben, you have your health… you are a lucky man and the rest will surely fall into place as you seem to be a good man as well.

Wishing you the very best Ben… but don’t sell the silver (Garth doesn’t really hate silver or gold… just has problems with basement dwelling “whack jobs”… lol)!

#180 john on 09.10.12 at 2:32 pm

Great post, Garth. You nailed it on the head that ‘health is wealth’. Your comparison between someone who most would consider ‘poor’ is actually rich (and someone who looks rich but is really poor) is staggering. Thanks!!

#181 torontorocks on 09.10.12 at 2:33 pm

Garth, if you were just down in Scotia Plaza today, around 2:15pm heading out the Adelaide St doors, I was busy talking to my brother and was hoping you were just heading out to make a quick call. Missed saying hi to you, you country-fied $hitkicker, you!

That, of course, was my body double. You can never be too careful. — Garth

#182 Aleksey on 09.10.12 at 2:34 pm

The best advice has been given on this blog.

#183 Smoking Man on 09.10.12 at 2:34 pm

Anyone check out finacial post today. Canadian banks adding thousands of jobs. Why where the head offices. Why in the 416. I called this awhile ago while being abused by bubble heads calling a collapse in our banks.

As always the true orical of this pathetic blog knocks another one out of the park.

Nyc london. Get out of the way TO the next world banking centre

#184 jess on 09.10.12 at 2:59 pm

…addicts should be in 24hr medical facilities until they are cured not subsidized buildings .

Public housing in Vancouver called ‘crack shacks and brothels’

CBC.ca‎ – 9 hours ago
Feces on floors and walls, underage drug use, asbestos — provincially owned public housing in the Downtown Eastside is disgusting and

#185 CalgaryRocks on 09.10.12 at 3:09 pm

#160 GLK on 09.10.12 at 12:44 pm

1) Open a self-directed TFSA account with ScotiaItrade from ScotiaBank (I also have a TD Waterhouse
account from TD Bank, I think ScotiaItrade gives you more value because of the possibility of buying
ETFs with no transaction fees. So you can invest as few as 50$ evermonth without a transaction fee.

Good find on those. Do you know if this will be an ongoing feature or a time-limited special. Also, are you allowed limit orders (Good-Till-Cancelled) or just market on these commission free ETFs?

C

#186 IN Garth not God we Trust on 09.10.12 at 3:10 pm

#180 Smoking Man

“As always the true orical of this pathetic blog knocks another one out of the park.”

Excuuuuuuse me cowboy! The true blue, one and only oracle, all knowing, all seeing, gifted prognosticator without equal, financial tea leafing reading sage, mystic discerner of financial futures, crystal ball gazing bearded sagacious one is Captain Garth and Captain Garth only!! You are a mere guest on this pathetic blog Smoking Man. Sheeesh!

#187 Angela on 09.10.12 at 3:10 pm

Great post Garth! Ben, I recommend you get the book ‘Millionaire Teacher’ from your library. It has great, detailed advise on how to set up the type of investments Garth recommends. He also describes why and how this investment strategy works. The author simplifies the investing by using TD e-series funds. Setting up an online brokerage requires more sophistication, and I would think more investing experience and education would be in order first.
Personally, I use the e-series funds for my bond and equities exposure and have a questrade account where I am learning to trade with some exposure to REITs.

#188 jess on 09.10.12 at 3:13 pm

smoking man …I wonder how long it will take to phase out atm’s ?

jc penny giving free haircuts every sunday…
chain’s free haircut program offer for children in August _1.6 million haircuts, to be exact – Penney will be making it a permanent offer every Sunday, starting Nov. 4.

#189 AprilNewwest on 09.10.12 at 3:27 pm

#172/173 You can’t be that naive to believe everything that comes out of their mouths. Some of them talk complete rubbish [including Carney] and all are afraid to commit themselves.

#190 Canadian Watchdog on 09.10.12 at 3:29 pm

#180 Smoking Man

“Canadian banks adding thousands of jobs.”

They’re adding jobs abroad, which doesn’t help Canada’s employment rate.

#191 Old Man on 09.10.12 at 3:35 pm

#178 torontorocks – It was indeed his body double, as if you did not see a young knockout blonde on his arm; it was not him. Garth buys lots of flowers for too many babes, and the special ones get a box of chocolates as well. :)

#192 Deb on 09.10.12 at 3:39 pm

#110 gokou3

Speaking of TFSA that’s supposed to be indexed to inflation – how come it has remained $5k per year for the past few?

—————————————————————-

Yes, when the TFSA was born, it was stated that the annual contribution limit would be indexed to inflation. However, any resulting increase in contribution room would occur every five years. Given that this will take effect in fifteen weeks, there should be an announcement from Ottawa shortly regarding the specific amount of the increase.
Many happy returns in 2013!

#193 Herb on 09.10.12 at 3:41 pm

#180 Smoked Man,

there you go again, you legend in your own mind!

#194 OlderbutWiser on 09.10.12 at 3:42 pm

Ronaldo – thanks for the links. MrMoneyMustache is an excellent site and very well written. I had a quick look at Canadian couch potato and that site looks very helpful as well. I particularily like the summary of recommended ETF’s. Some good food for thought.

GLK – #160 – your post was Spot-On. I couldn’t agree more with your suggestions, thanks for sharing. Yours is one of the few comments on this blog worth printing off (which I have done). Always looking to learn a few things more!

#195 OlderbutWiser on 09.10.12 at 3:50 pm

#174 – Eagle eyes – Canada does not tax individuals based on citizenship (unlike the US) but rather on place of residence. Therefore, if these individuals with Canadian citzenship are in fact resident overseas, then they will not generally be subject to tax in Canada, and certainly not on overseas income.

#196 torontorocks on 09.10.12 at 3:52 pm

#178 – Garth, I would expect nothing less. Nevertheless, a (one-sided) pleasure – something Smokin, Tokin Man is all about.

#197 Tony on 09.10.12 at 3:54 pm

My advice for this young chap: Save up, and buy a house.

Prices are suppose to falling right?

#198 Ronaldo on 09.10.12 at 4:02 pm

#160 GLK – that is very good advice. TD also has a batch of Efunds with no charges to buy or sell.

#199 live within your means on 09.10.12 at 4:05 pm

Maybe I’ll regret this posting, but maybe it will give people hope. In 2003 I was diagnosed with Stage IV cancer – 12/18 mos. to live. Before I underwent an 8hr operation I did a lot of research & joined a Web cafe group that was highly promoted by specialists in the field. I learned so much – even that I could take my own ‘special pillow’ to the hospital. Seems trite, but it was important to me. My DH & especially my elder sis kept telling me that they couldn’t see me dying – that I would survive. Have gone through lots of trying times since then, but I’m still alive.

Today, I saw my Onc. & results are better than I expected. For the first time I’ll only have to have a CT scan in 9 months instead of 3 or 6 mos.

Love, live & appreciate each day. I know that I try to do so. And, above all, have compassion for those who have less than you.

#200 Oasis on 09.10.12 at 4:16 pm

#30 Dubai on 09.09.12 at 10:06 pm
@Oasis
Gee thanks. Any other hindsight investment tips?
_____________________________________________

plenty. silver did even better. and since i bought plenty of both 8 years ago, i’d say i’ve done quite well thank you.
how about you?

#201 Frank le Skank on 09.10.12 at 4:16 pm

#170 Old Man on 09.10.12 at 1:53 pm
Do you expect that the decline in prices will begin next spring?

#202 Bill Gable on 09.10.12 at 4:26 pm

Finally, an honest CEO.

“Ryanair head Michael O’Leary called his customers “idiots” this week. The chief of the deep-discount, “gotcha”-dependent airline might be the first to say it, but he’s hardly the first to think it”.

http://tinyurl.com/9az6mdb

After flying Air Canada to Europe and back – this guy is talking the same Mantra – and now back to regular programming.

*Think CEO’s better wake up. Mavis Staples sang it, better than I can say it – “Wake up, boy, it’s a brand new day”.

Ask any Amazonian Turnerite.

#203 Old Man on 09.10.12 at 4:59 pm

I see that Caesar wants to throw out all the ‘suspected’ illegals who are bad; they lied; or cheated. Well such might be good, but how does one make a rational type of decision about this all? I will never forget the day when I went back to my hometown, and got a call from Miss Canada, as heard was in town, and asked me for a ride in my car back to Toronto.

I said NO PROBLEM, as she was engaged to be married to a Yankee Boy, and would I drop her off at the US Embassy, and could she stay overnight at my place for a couple of nights, as she would take the train back to Windsor, as had things to do with the US Embassy with paper stuff. She said our two families are tight, and I trust you to be a gentleman with me.

Yes, we went out nightly on the town, and all was well, and she never lived in Windsor, but it was at least an hour drives to this small town, but was a gentleman, it was tuff, but what else could I do? Perhaps should have sent her flowers when she won the crown.

#204 Big Fan of this Pathetic Blog on 09.10.12 at 5:02 pm

Love you Garth

#205 Spiltbongwater on 09.10.12 at 5:04 pm

#199 Bill Gable on 09.10.12 at 4:26 pm

I agree, part of what makes RyanAir so cheap is the fees they charge. A family paying 300 euros for there boarding passes, is there own stupidity. I knew to print my boarding pass when I bought the ticket. I booked a flight from Barcelona to Vanencia for 9 euros,(cheaper then taking the bus for 25 euros). I knew there was a 25 euro cancellation fee, and when I decided to change my plans and instead go to Ibiza, I booked my flight for 15 euros to fly there, and didn’t bother to cancel the first flight as it would be a higher price to cancel then to just take the loss. There were many people in line with bags that were obviously not carry on bags, and were pissed at having to pay 35 euros to have it checked. RyanAir they are selling things non stop through a 1 hour flight. Anything from lottery tickets, sandwichs, drinks duty free, I think if they plane was about to crash, the staff would be selling parachutes and life jackets.

#206 zeeman1 on 09.10.12 at 5:08 pm

#3 East Van.

Those same ice sheets have melted before and will probably melt again.

Why do you think the Vikings named it Greenland a thousand years ago and were able to use it as a base to get to North America?

10,000 years ago the same spot I’m sitting in was covered in 2 km’s of ice.

Climate change has been happening since there was climate on this rock.

Stop letting yourself get so scared over nothing.

#207 Grim Reaper/Crypt Speculator on 09.10.12 at 5:10 pm

#140 Smoking Man on 09.10.12 at 10:51 am

Ben I don’t mean to be insensitive but think of the bright side.

Say next week you go to dr and u find out you have 3 months to live. Ok it suck but if you were a Zillionair it would realy suck.

Get some vitamin D naturaly. Sunshine

Then associate pleasure with inslaving people who work for you. After that sit back and enojoy the loot.

If that’s not posable develop a false ego and imagination to keep your self entertained while bouncing on rock bottom.

I have done all of the above

================================

Smoking Man….tell us when you need a ladder….errr maybe a rope ?

bwhahahahahah

#208 new-era on 09.10.12 at 5:37 pm

Shilling thinks were in a bubble.

http://www.huffingtonpost.ca/2012/09/10/vancouver-housing-bubble-shiller_n_1871140.html#slide=1444634

#209 Puzzled Redneck on 09.10.12 at 5:43 pm

Hi Garth,

What I don’t understand is that I have seen you say several times that self directed investing is very dangerous and usually results in the DIYer losing his shirt, and yet I don’t think many advisors would work for somebody who is investing $500 a month and starting with 8 grand.

This is my problem too. I have been sitting on cash for way too long simply because I don’t know who to trust. I suppose putting it in a bank advised mutual fund would be better than nothing, but it strikes me that to but ETFs, REITs, preferreds and all the other instruments you recommend would require a lot more knowledge than I have. Can you write about this sometime pretty pretty please?

#210 Herb on 09.10.12 at 5:46 pm

#192 OlderbutWiser,

better read the lips of the horse’s mouth (especially the “residential ties”) to ensure that you would not be “deemed” a resident of Canada for tax purposes:

http://www.cra-arc.gc.ca/tx/nnrsdnts/ndvdls/nnrs-eng.html

#211 luc on 09.10.12 at 5:47 pm

That’s why they call Garth, the right honourable ;-) !

Best post ever. Period.

#212 Old Man on 09.10.12 at 5:53 pm

Ok had to check this out from the past and the babe who came to me was a Turner gal; and Garth missed out, as it was a marriage between two families with Turner and Campbell. Her official title was Miss Dominion of Canada; then to Miss Universe, and Miss World.

Garth eat cake as never sent her flowers, but she spent two nights at my residence, but was a gentleman as she was engaged to a yankee, so took care of her, and she was a Turner too, sorry that you got passed over.

#213 Paul on 09.10.12 at 5:56 pm

#154 Suede on 09.10.12 at 12:02 pm

And there lies the problem many have. What to do with your money while you wait to buy in a year or two and be able to get the capital out when the great buy comes along.

#214 Brad in Calgary on 09.10.12 at 6:00 pm

If there was ever a “best of Garth” or “top 10” Garth posts, this one would have to be right up there, no?
Terrific blog tonight.

#215 Old Man on 09.10.12 at 6:01 pm

Frank # 198 – this has already started, but this is going to be a big one, as the factors are too huge to even think about, and say could be the biggest bust in all of history. Of course prices will collapse in 2013, but do not get sucked into a false bottom, as might take a few years to get it right for a buy.

#216 IM in C on 09.10.12 at 6:29 pm

@192 older but wiser

Therefore, if these individuals with Canadian citzenship are in fact resident overseas, then they will not generally be subject to tax in Canada, and certainly not on overseas income.

Are you sure about that?

#217 Peter on 09.10.12 at 6:46 pm

Good advice.
—————————–
Silver does not pay dividend or interest, I agree, so you can not invest in silver, but you can speculate, and this is good time to do it, because silver market is manipulated for years. Just search for: Eric Sprott, Marc Faber, Mike Maloney on google and youtube

It is volatile market, that is right, but I would still keep that 1000 in silver (and buy more) …

7% a year is not 7%. Inflation is 4-6%.
So it is 3% and it is HUUUGE diference

—-
I have my savings allocated 1/3 silver, 1/3 gold and 1/3 agricultural land (around 120000 CDN)

After Enron collapse I started to read about economy, and first book was “Economy in one lesson” Henry Hazlitt, and the listen to Kurt Ruchebacher, Peter Schiff, Marc Faber, Eric Sprott … Those people predicted this mess …

Have no intention of buying house in foreseeable future

I started buying gold and silver like 6-7 yr ago

But here is something I want to ask:
I have engineering degree from Eastern Europe, but work as draft person – designer in AutoCAD and earn
25$/hr

I was excellent student back in my country, and here I have couple of friends from same university and they are all registered engineers and earn 30$+/hr and even they have no experience back in our country. They were unemployed for years before they come here!

They told me that reason for it is because I did not buy a house. “You have to buy house to get better job!”

And this could be a base for conspiracy theory, because my wife is master of science in same field, but she work as designer in AutoCad hahaa

What do yoy think guys??

#218 Suede on 09.10.12 at 6:55 pm

#210 Paul

What are you talking about? I just gave a few examples of what to do and GT has provided several vehicles over the course of this blog.

Also, don’t think of houses as the “Great Buy” – It’s the common man’s mistake, which i learned as well. Even in the future when they become cheaper. Brains are wired to think that once you ‘own’ a house, you have it made. You have it made because your friends and parents and kids think you’re cool that you own. You’re held in high regard. Like the hot shot that came to see Garth in the post – he has it made on the outside, but Ben is actually miles ahead of him.

When the “Great Buy” comes, those same people are gonna hold you in low regard for buying and not renting or putting your money in the soaring stock market. Capital moves – and it’s moving from RE to somewhere.

With equities, ETF’s and the like as long as you buy something with good volume (i.e. not the TSX-V, that’s for cowboys), you’ll get your capital in 3 days once you hit the SELL button. If you have a long term horizon, you’ll likely be in the green. Remember, buy on RED days and sell on GREEN days.

No advisor will guarantee you a result over the short term – if they do, you’re a sucker. 5%, 10%, 7% are only achieved in a long window.

#219 Mr Buyer on 09.10.12 at 6:57 pm

#173 $$$BPOE#1 on 09.10.12 at 2:20 pm
Exactly. 40% price reductions? Total ridiculous speculation by jealous people across the border. Rates are going down folks. Remember Carney said he MAY read it folks, read it again MAY have to remove stimulus. It’s just a word and he is never ever going to do it.
*****************************************
Somerville said it would take “some negative shock,” such as an economic meltdown or mortgage interest rates jumping from four per cent to nine or 10 per cent, to trigger lower prices.
………………………………………………….
The negative shock is sales falling off a cliff and prices are falling now

#220 John of C on 09.10.12 at 7:04 pm

Garth one of your best post ever. perseptive!

#221 JustTryingToProtectEquity on 09.10.12 at 7:26 pm

Without question, your very best entry since Day 1.

#222 Nostradamus Le Mad Vlad on 09.10.12 at 7:39 pm


#185 jess — “smoking man …I wonder how long it will take to phase out atm’s ?” — Sweden is pondering a cash-free society. It only takes one to start, then others adapt, adopt and change.
*
First, China. Now Russia “A state-controlled bank and now hard gold. Putin has just committed the same “crime” that Qaddafi did. Count on the US to try to destroy Russia the way they did Libya.” wrh.com and Golden Spain and 11:26 clip Jim Grant says gold standard is necessary; GM Bailout Raw deal? Plus — Chevy Volt; 19,000 children in New York homeless shelters; Economic Recovery? Right here; Lunatic Fringe Not Ron Paul or Tom Cochrane; 4:52 clip Fraud — the 16th Amendment (income tax); 6:51 clip Banks and schools only benefit from student loans; Iran – Egypt Stuff sanctions; UK Getting work done on the cheap; China turns away from EU business; Facebook blame game; HP expanding job cuts; Gunsmiths Which industry is going hell for leather? EZone Z = py 8; South Africa Miners’ strike.
*
John Baird Canada’s diplomatic disaster, or The Mouth That Roared; Iran The General who said no; Iran grandstanding “The IAEA has already been allowed to examine the Parchin facility. This is just grandstanding by Amano to justify an Iranian attack. There is no “reactor” at Parchin. It’s an explosives test facility making nano-diamonds for industry, a proprietary technology Iran does not want stolen by Israel.” wrh.com; US – Israel Possible FF? Ballooning Santorini Magma levels expanding quickly; The Declining West; New wind turbines More efficient; GoDaddy “And JUST in time to bolster public support for Obama’s Cybersecurity Executive Order!” wrh.com; NAFTA on steroids ‘Net censorship; Wind Provides enough energy and it’s free; Hubble discovers new galaxy which shouldn’t exist.

#223 Jamaican_Gal on 09.10.12 at 7:53 pm

#196 live within your means

Bless your heart and thanks for sharing. Every now and then we need to be reminded about the fragility of life and what really counts.

All the very best to you.

#224 Toronto Bubble on 09.10.12 at 8:04 pm

Garth,

Can you clarify more on what is an online discount brokerage account?
Is there any online place that you recommend?
I was searching for “online discount brokerage account” and there are some 103,000,000 results.

Thank you.

PS. I really enjoy your post today.

#225 An Importation in Quebec on 09.10.12 at 8:07 pm

Garth, today you got my profound esteem.

#226 Freedom85 on 09.10.12 at 8:07 pm

#196, live within your means,

My dad was recently diagnosed with Stage 4 cancer. If you don’t mind sharing, what was the name of the web cafe you joined? Its nice to know that people do thrive many years later. Congrats!

#227 jess on 09.10.12 at 8:13 pm

co -mingled

Accolade Equities is a subsidiary of Platinum Equities Inc. By clicking the “Enter Site” button you will be directed to Platinum

Press Release relating to Platinum Equities Class Action Lawsuit – Link Here
http://mnllp.ca/main.jsp?p2=fullnews.jsp&new=1346960040000&tofu=n

THOUSANDS OF INVESTORS ONCE AGAIN LOSE IN A PROPERTY INVESTMENT SCHEME

Class action suit filed against Platinum Equities, involving key figure from Concrete Equities
The players involved include Dave Humeniuk, who has been sanctioned by the Alberta Securities Commission, and carries a life time ban for offences related to the Real Estate Commission of Alberta. Mr. Humeniuk was sanctioned by Alberta Securities Commission (ASC) in January 2012, for not disclosing this ban in Offering Memorandums prepared while he was involved with Concrete Equities, Shariff H. Chandran, who has been convicted for misrepresenting himself as a realtor, and Riaz Mamdani.

#228 Hoof - Hearted on 09.10.12 at 8:32 pm

#196 live within your means on 09.10.12 at 4:05 pm

Wishing you all the best, but I am increasingly cynical about Western Medicine.

May suggest viewing the video “Cut Poison Burn” re cancer and other non mainstream views about health and disease.

You have heard of the Flexner Report and its consequences?

#229 EIT on 09.10.12 at 8:35 pm

Garth I just lost all my money in real estate. Can you give me a job? Perhaps grooming those amazons of yours.

#230 Doug in London on 09.10.12 at 8:41 pm

Wow, this topic really sets the record straight. The person who doesn’t have a lot of stuff but has positive cash flow and equity really is better off than one who has more stuff than they know what to do with, but is in debt and with negative equity. Ben has it right while a large part of Western society has it wrong.

#231 Weedeater on 09.10.12 at 8:48 pm

Good advice Garth. Only one thing about opening a trading account with such a small sum. Make sure the brokerage doesn’t charge admin fees for balances less than (for instance) $25,000. Might be better initially to use something like TD Bank’s Mutual Fund E-Series. You have to open a MF account first and then convert to an online E-Series account, but then one can buy ver low MER funds. Build this up until there’s enough to dump over to a discount broker. (note: I have no affiliation with TD but use the E-Series for RESPs for grandkids, and also use TDWaterhouse discount brokerage). The transaction fees on a trade in a brokerge account, along with admin fees may wipe out any returns so read carefully about whatever broker, fund, or service you decide to use.

Someone asked what is a discount broker; you definitely aren’t ready for this until you educate yourself. Start here http://canadiancouchpotato.com/ which is a good blog and this survey is informative http://www.theglobeandmail.com/globe-investor/qtrade-keeps-its-lock-on-no-1-in-globes-annual-survey/article554611/

I think Scotia is the only broker that has free ETFs but I could be wrong. Do your own research and make decisions suitable for your own circumstances.

And agree: Sell the silver. Adjusted for inflation, gold & silver have never been good investments.

#232 jess on 09.10.12 at 9:03 pm

.SEC Clears Hedge Funds to Advertise
“knowledge” or misleading information …

Rigged as ms. warren was saying
====================
private arbitration contracts.

How neutral are the arbitrators?

…’Today, the fine print in Wall Street brokerage accounts, employment contracts, credit cards, mortgages, even cell phone contracts have routinely removed the individual’s constitutional right to file a claim in court to seek redress of a grievance or fraudulent action. …”

http://www.alternet.org/how-big-banks-are-trying-destroy-our-justice-system?page=0%2C3

In September 2007, Public Citizen published a comprehensive 74-page study of mandatory arbitration with a sharp focus on the National Arbitration Forum. The report is titled “ The Arbitration Trap .”

28 arbitrators handled 17,265 cases – accounting for a whopping 89.5 percent of cases in which an arbitrator was appointed.” (Think robo-signing.) The arbitrators ruled for the corporation and against the consumer nearly 95 percent of the time.

#233 Ronaldo on 09.10.12 at 9:13 pm

#191 OlderbutWiser – your welcome on that. Here is a link to the TSX site which I have been using for a few years now and find it very useful. You can set up your portfolio/s and track your stocks. It is in real time and updates every 15 minutes. You can search stocks, learn about the various etf’s and much much more.

http://tmxmoney.com/

#234 Dorf on 09.10.12 at 9:14 pm

Ben…….buy the book…….Money Road.
It answers all the questions you now have, I had the same questions.

-A Fellow Lifer

#235 Smoking Man on 09.10.12 at 9:17 pm

Vlad the Hubble find re galaxy. More evidancea of shrinkage

#236 Markymark on 09.10.12 at 9:18 pm

#206 Puzzled Redneck on 09.10.12 at 5:43 pm

Check out The Canadian Couch Potato for index portfolio ideas: http://canadiancouchpotato.com/model-portfolios/ This is all you need to know to get started.

#237 Dorf on 09.10.12 at 9:21 pm

An aside, I am debt free and working at a well paying job.

I wanted to find a girl who would not put me back where I used to be. I just found a real doll who owns a very modest house, a very modest car, works a steady real job, no debt, saves her money, doesn’t have expensive tastes. Bingo !

She thinks its really cool that I didnt go buy a fancy vehicle, even though I can have anything on the lot. Just a used pickup.

#238 Chris on 09.10.12 at 9:24 pm

Hey Garth,

wouldn’t Ben be better off starting with a TSFA of TD E-series funds until he accumulates a certain amount (say $50k+)? The slightly higher MER of the e-series funds would end up costing less than the trading fees in a brokerage account (eg. $25/trade at scotia)

#239 Hugh Jasz on 09.10.12 at 9:42 pm

#206 Puzzled Redneck on 09.10.12 at 5:43 pm
“…………..but ETFs, REITs, preferreds and all the other instruments you recommend would require a lot more knowledge than I have. Can you write about this sometime pretty pretty please?”

Lots of good info offered here, whenever the daily dear Garth column is not about housing.

If you search the back catalogue, you’ll find the G-man has posted extensively on

-how to allocate a portfolio between asset classes (at the highest level, he preaches 40% fixed income and 60% growth. ),
-Which asset classes to hold in which part of your portfolio (i.e. TFSA vs. RRSP vs. unregistered investment account)

He stops short of telling you what to buy and at what price because that’s the hard part!

The advice isn’t bad for free!

#240 Old Man on 09.10.12 at 9:42 pm

#221 Toronto Bubble – I stay away with all online trading because all can be hacked, and use RBC as a discount broker, and use the phone all the time, and they laugh at me, as it costs more. I pay a bit more, but all phone discussion is recorded, and is it better for me, as will not be hacked online and if a trader screws up my order has been recorded, and this has indeed happened on occassion, so they had to pay up.

#241 OlderbutWiser on 09.10.12 at 11:09 pm

IM in C #214 – Canada most certainly taxes individuals based on being resident in Canada and not on citizenship. This is very different from the US where they taxed based on citizenship so if you have not lived in the US for many years and have effectively severed all ties with the US, you still need to file US tax returns and report your income in the US. The rules for determining if you are resident in Canada for tax purposes are complicated and are dependent on your own fact situation. As another blogger pointed out, you can be deemed to be resident in Canada (and therefore subject to tax in Canada) but there are tie breaker rules in certain Tax Treaties that will override that.

The main takeaway is that the system of taxation between the US and Canada is very different and that Canadian citizens living abroad, who do not report “offshore” income or pay taxes in Canada, are generally not doing anything “illegal”.

#242 M on 09.10.12 at 11:31 pm

Bravo Garth !
This post and the babes (that you used to put up) are the best of best.

I am all with you mano, though I think the kid should’ve kept half the silverado.

bet you a fifty for silver 100 next year ? I can take Finlandia if I win :). Always loved the finns. Especially the chicks after a sauna and snow .

#243 disciple on 09.10.12 at 11:45 pm

#156 Derek R… thanks, brother. It was an older model rustbucket, and now I have a reason to replace it…
New revelations: John Stossel is Freddy Mercury. Barbara Bush is Doris Singleton. David Cameron is Matthew Perry. JK Rowling is Natasha McElhone. River Phoenix is Brad Pitt. Ben Stiller and Steve Carrell are the same person. There’s too many more, and I’m tired, so maybe tomorrow…

#244 nathan on 09.11.12 at 12:08 am

A great resource for folks looking to set up a simple, low-cost investment portfolio similar to what Garth describes is the Canadian Couch Potato blog: http://www.canadiancouchpotato.com. See the links along the top of the site for all the key info.

(I have no affiliation – just think it’s a fantastic site for Canadian DIY investors.)

#245 Throwstone on 09.11.12 at 9:41 am

Garth,

Just want to say thank-you.

#246 Ronaldo on 09.11.12 at 9:59 am

#229 – Weedeater -”And agree: Sell the silver. Adjusted for inflation, gold & silver have never been good investments.”

You gotta be kidding.

#247 Ezra M. on 09.11.12 at 1:49 pm

To Ben and Garth: thank you both. To Ben for giving me perspective in realizing I’m not alone. And to Garth, for providing to me a sense of hope; something most of us seem to have forgotten about.

#248 Jamie Groulx on 09.11.12 at 1:54 pm

Awesome article! Keep fighting the good fight Ben, best of luck to you!

#249 Toronto Bubble on 09.11.12 at 9:01 pm

Red Alert in the Great White North

http://www.counterpunch.org/2012/09/11/canadas-housing-bubble-set-to-burst/