Bill and Evelyn are just rounding sixty and still look juiced. He paddleboards. She runs. Statistically they’ll be 25 years in retirement, if it happens next year. Bill, anyway. Ev can add five more to her column. It’s the price men pay for guts and glory.
She freelances, he sells for a dental supply company. Combined income is $150,000. RRSPs and TFSAs total $115,000. The house is worth five hundred, with eighty grand left to pay. Car loan, too. No pension or CPP for her. Bill will collect fifteen hundred a month from his corporate pension. They both want to finally travel, maybe sail. The retriever’s called Rufus.
“So,” he said, tentatively, without looking up, “how we doing?”
And I explained how they’ll be going from $150,000 a year working to $39,000 retired, all-in with government pensions and OAS. “Can you live on a hundred grand less,” I asked? Evelyn blanched. They save nothing now. And they both realize they’d burn through the (taxable) retirement savings in a couple of years. “This sucks,” Bill said.
Most people think there’s a social contract that more or less guarantees a comfortable retirement, so you can stop working and still enjoy the decades left. After all, this couple raised two kids, put them through hockey and piano and college, forked over their taxes and paid off the house. They feel entitled. But CPP and OAS provide only a subsistence existence for anyone living in a city – no travel, and a downgrade to that Wal-Mart dog food.
Truth be told, this couple’s actually doing better than most Boomers. A recent bank survey shows 51% of this miserable mass of people plan to retire with a mortgage (60% in delusional BC), with seven in ten not having any corporate pension money to rely on. As I recently mentioned, another bank found half of Canadians couldn’t lay their hands on ten grand if an emergency hit and 40% live paycheque-to-paycheque.
In the US, Boomer retirement is an unmitigated disaster. The typical household there – thanks in part to the real estate meltdown that ate the middle class – will retire with only $18,000 saved, and be looking to government for 70% of their income. (By the way, Canada Pension pays a max of $1,012 a month (after thirty years of contributing) and everyone gets $542 in OAS. In the States, full social security payments amount to about $2,500 monthly.)
It gets worse. Today more than 50% of all US couples will fail in maintaining their standard of living after quitting, and 59% of all households made up of people 60 or older have no retirement assets. In Canada, contributions to RRSPs have fallen off a cliff in the past decade, just as more and more employers punt their pension plans or convert them to matched employee contributions.
About 93% of us are eligible to put money into an RRSP, but now fewer than 25% actually do. And the average contribution is weensy – in total we contribute about 5% of what we’re allowed. TFSAs? Yep, they’re popular. But 80% of people use them like a glorified bank savings account – earning peanuts in low-yield vehicles, and taking money out every time there’s a shoe sale.
In short, most are simply not serious about financing their lives. Until it’s too late. And we know why.
Phil Soper’s the boss of Royal LePage, and he thinks wrinklies with mortgages are cool. “People are more sophisticated in their approach to personal finance today than the previous generation,” he recently said of retired, indebted Boomers. “People are living longer, working longer and making real estate plans longer or further into their lives.”
In fact houses have turned into financial strategies for a vast portion of the population. Cheap interest rates have made borrowing easy and saving hard. Most people get advice at the bank – where they sell mortgages, low-return GICs and high-cost mutual funds. Financial illiteracy is rampant, and 99% of the population wouldn’t have a clue how to buy a preferred, a bond, an ETF or a REIT.
Meanwhile cut-rate mortgages and house porn have inflated real estate, ballooned home ownership levels, lured many into fat, unrepayable loans, sucked off cash that might have gone into a retirement fund and created a false sense of wealth. After all, Bill and Ev paid $350,000 for their place eight years ago, and now it’s worth half a million. How can that be bad?
It’s not. But earning that equity cost a bundle in bank interest, property taxes, insurance, maintenance and foregone higher returns on liquid assets. While you gotta live someplace, you also have three decades of retirement to finance. So what happens if real estate stops going up? Or flatlines for a few years? Or goes down? Aren’t 40-year-olds now shoveling all their cash flow into mortgages on inflated houses traveling the same path as the asset-starved Boomers?
Actually, worse. At least Bill and Ev can bail now at the top of the market. And so they should.
Selling will clear them about $400,000. Added to the existing savings and invested for a conservative yield of 6%, that generates almost $37,000. Now the annual income bumps to around $76,000. If they rent a house or a condo for two grand a month, that leaves fifty thousand to mess around with. They have an income which is a third higher, a nice place to hang out, fewer surprise expenses and over six hundred grand in a stable and diversified portfolio.
So you another reason to hate Boomers. They saved little and spent much. Their profligate, wasted lives were swept along on the endless waves of inflation and mindless growth. They stumbled into real estate, then saw it soar. For those smart enough to exit now, the undeserved gains can wipe away years of dippy self-indulgence.
The legacy? Debt and a dead market. Plus kids they taught to buy houses. Suckers.
166 comments ↓
Funny, I was watching a show about that beefcake geezer last night.
Don’t mess with Boomers is this message…
la premiere?
http://useconomy.about.com/od/glossary/g/Market_Correcti.htm
#106 Canadian Watchdog
If buying condos made clear economic sense with acceptable levels of risk, REITs would be all over them. Why are REITs not buying new condos? Because they are interested in cashflow and making money.
Good thing the “Retail Matrix” has created goliath parking lot malls filled with Home Depot and LoofaXpress outlets to allow Wrinkles to compete with Hipster for a position monitoring the “Self” checKout
I can’t wait to look down on wrinkles when I go purchase my next bath mat for my rented apartment down at Home Depot.
“hey Wrinkles..is this a good bath mat?… speaking of BATH…did ya Throw out the baby with the bath water?”
Orange Smocks are the New Black –
Why Young People Are Stuck
http://ca.finance.yahoo.com/news/nowhere-generation-why-young-people-174826314.html
Nice pic. Too bad the dude is 42.
The juice will do that to ya.
Damn, I’m half if that guy’s age and I wish I looked that fit.
On the bright side, statistically speaking, my investments are more than half of his…
no stats on immigration smart guy? i guess peopke coming into toronto in the thousands means nothing over long term?
Immigration has not increased. — Garth
Old Man are you showing off again, How did Garth get your pic :)
But of course! Paying off debt while on reduced pension income is sophisticated.
Beware of salesmen complimenting you. It’s an appeal to your ego. If you have to be told you’re a “sophisticated” buyer or investor, you’re not. You’re about to be separated from a lot of your money.
I am just going to live it up and when the money runs out, hook a hose from my car to my tailpipe, put Leonard Cohen Who By Fire on replay and enjoy until I fall asleep. Should be in my mid 70s by then, although I do hope to live long enough to shoot my age on the golf course which should be 95. Perhaps would be easier to shoot myself on the golf course?
#12 Rexx Rock on 09.24.13 at 8:07 pm
Those lucky Americans get an extra $1000 a month more than Canadians for their pensions.We got shafted here in Canada.Oh well I guess the smart ones will live in Thailand or Mexico on our measely pensions.
//////////////////////////////////////////
They also pay less in… taxes, housing, food, clothing and beer.
Isn’t it great up here!!
Ah…the POOR BOOMERS. I’m one of them. I see too many that have had:
1. Bad Luck
2. Bad Choices
3. Bad Jobs
Some spent every last dollar, plus all the credit they could get their hands upon. Truth be told, that is NOT the majority. Most frankly, just earned too dam little to save very much.
The no pension 401K slave trade off has left a lot with more than a brick shy when it’s geezer time.
That same 401K idea worked VERY WELL if you earned 50% more than the average income, and didn’t trade in a spouse, had no big job loss, had no BAD luck over a 35-40 year earning history. Oh did I mention, you started saving at a pretty tender age.
Oh, in the US we will assume you HAVE health coverage, ore you’re just plain screwed! One health problem, and you might into six figure debt really FAST.
So, considering all the BS stacked against the Boomers, who saw the job market melt, saw prices zoom up in the 70’s just when they started the family & buying crap. If they have a paid for house they’re doing pretty good.
Saved more than 250K? Well done!
Want to go early with 700K?
Get out enjoy it before you croak. Hey than 76 thing, it’s just an average -you might be well below average. BUT Don’t pee it all away in case you hit that 76 thing, then you likely get 8 more years.
Drink Well. Eat Well. Enjoy the Music.
Never Regret living your best!
The future for Boomers involves living in trailer park.
Garth, would you agree that there is a diminishing marginal utility of cheap money, and shouldn’t the chief economists be aware of this concept?
The government will bail out the Boomers by transferring wealth from the Gen Xers and Millennials. Isn’t democracy great?
The funny thing is, if one does a search for annuity type tools on the net most of what one finds are mortgage payment calculators. The question one needs to ask is “if I want an annual income of X, how much to I need to save per month until I retire assuming some reasonable rate of return (net of inflation)”. It’s shockingly higher than most people think.
It also makes me very much against RRSP contribution limits but I suppose politically removing those is a non-starter.
I tried really hard to shed a tear after reading this article, but couldn’t.
This couple has one choice…Costa Rica baby!!!
I quit my job 2 years ago and am now living a comfy life in south america on $700 a month. That includes the rent on a nice apartment, most meals at local restaurants (lunch for $2-$3), drinks at the local bars featuring live music. And spanish classes at the local university. Everything I need is within a 10 minute walk from the apartment.
If one is willing and capable of looking outside the mainstream, one can live quite nicely on little money.
In the last few years I have known several people in the greater Vancouver area who have put their major asset up for sale. In all cases, that was a free titled single family home.
Three gave up trying to sell after long listing periods because they ‘could not get their price’. Two sold and bought down (slightly) by moving to more rural areas.
And one sold, invested the cash and now is happily renting. He is by far the happiest and most self satisfied. (Not me, by the way… another guy)
The ‘no-sales’ remain anxious about the future and the ‘buy-downs’ have arrived at the homes that will in all likelihood be their last, for better or worse.
Only the renter has truly cashed out and taken full financial advantage of his ‘once-in-every-third-generation’ tax-free windfall.
One in six. That’s probably an accurate ratio of those whose only asset is a home who will escape an austere retirement.
“She freelances, he sells for a dental supply company. Combined income is $150,000. ”
====================================
They should easily be able to save 50K annually. No excuse not to.
http://www.testosteronepit.com/home/2013/9/23/whose-capital-will-get-destroyed-wall-street-tries-to-cash-o.html
Interesting article on who bought up real estate in the U.S. recovery and there attempt to exit.
#19 Sucker
There is no free lunch. Literally. All these retirees will have to eat, live somewhere, and get healthcare. This will cost money. Government can either go to heroic efforts of questionable efficacy to keep the inflated housing market afloat another 2 decades, and let boomers harvest their real estate gains, or, future generations will pay higher taxes and enjoy a lower standard of living to pay the difference.
When it comes to this kind of tradeoff, political expediency will prevail, and it has always, ALWAYS been politically expedient to shift costs and responsibility into the future.
Best thing we can do for our health care system and economy is to encourage broke boomers to go full ex-pat somewhere else.
If only he worked on his abs as much as he did on his balanced portfolio…
Life expectancy have improved over the last couple of decades. Perhaps the older generation as a whole has to work longer now to save for their retirement. Most people who bought a home in their 30s or 40s should be able to pay it off by the time leave the workforce.
“To enjoy a long, comfortable retirement, save more today.”
~Suze Orman
Someone wrote last week that the reason Toronto will likely see little in downward pressure on home prices was that home ownership has become the new found religion. There will be nothing that stands in the way of owning a home, at any cost. I thought the statement was odd – but I am believing that for many – this is their worship, the home is their temple – fight at all cost to keep it.
My idiot BIL purchased a new home for a cool $500K in godless Georgetown. How does a 28 year old know it all lose all common senses – and the family just cheered him on – not a word of caution. I spoke up about the dangers of an overheated market and some actually looked at me like I just turned into Satan.
Lets hope the slide down isn’t to catastrophic, or we all will be sinking with the ship.
#10 Immigration to Toronto is Declining
Graph here
http://3.bp.blogspot.com/-0zsb8wPiR4k/Uh_FxlGaRzI/AAAAAAAACLs/r2dOP2ihQX8/s1600/immigrants+to+toronto+every+year.jpg
An observation from Winnipeg this weekend. I went to the “parade of homes” to snoop around and found out that a custom home builder with a great reputation had to drop the price of a show home from $500K (price this spring) to $450K recently to move it. This NEVER would have happened 12 months ago. If a new build was completed and ready to move it…people were tripping over each other to buy it. The realtor in another home admitted the resale market is definitely slowing. Also, a friend selling a small home in the $325k range in the desirable St Vital area cannot understand why he didn’t get multiple offers after a week on the market…this is what people expect. In fact, there was not a single offer. It is a nice home in a price range that has typically been insane.
Hmmmmm…
Now – how to make money off of the old, wrinkley boomers that need work!!???
Future news headline: “Generation Y Turning the Baby Boomers Into Slaves – Paying Low Wages for Long Hours. Boomers Taking a Stand With Their Canes”
Followed most likely by: “Gregor Robertson To Open North America’s First Designated Wheelchair and Old People Lane in Vancouver – Beside Existing Bike Lanes”
Not only does Mr. Juiced have a ‘SixPack’…
So do his GirlFriends!
http://youtu.be/6kOewRGhtx8
Read it yesterday: “Canadians are the 4th happiest people in the world”
Americans came way down on the list. Denmark No.1.
Well, I did read it on the internet, therefore it must be true.
If you don’t control money, it will control you.
As a teacher, nurse, school janitor, para-medic. police services worker etc., you work with a large group of similarly paid workers for 30-35 years. Your lives are different but not really greatly different from an income perspective.
Come retirement day, many of those workers that you have hired on with are financially set for whatever joys/challenges retirement will bring.
Many others, who earned the similar income, are still strapped with HELOCs, credit card debt, car loans and yes, a mortgage. They don’t even know where the money went and they can’t even say that they had a great time spending it all.
I’m sure that the same thing happens as well in large private sector companies such as auto plants, tele-communications, etc.
I once advised a 50 yo. worker, (single, $50,000 /year) who will get a limited ($20,000 all in) pension at 65, to start to put away just $100 a week for the next 15 years to give himself an extra $100 a week for the first 15 years after he retired. Easily do-able. He is now 56 yo. and still hasn’t saved anything and probably never will.
That extra $100 a week after 65, may be the difference between enough for a little enjoyment once a month and being a TV shut-in.
#31 Post Haste on 09.24.13 at 9:17 pm
You caution folks before they do something foolish.
Once your brother in law closed the deal, it’s too late.
So the trick is what not to say.
You can say things like “you bought a house”, or “Georgetown” or any other statement of fact. You could even say that with excitement (or shock).
What you don’t say is “congratulations” or “I’m happy for you”…
There’s just no sense talking sense to a fool…
Another great post Garth. Thanks for what you do every week.
But – the TV just told me that millionaires walk among us!
oh… wait… that was an ad for Lotto 6/49.
I’d like to say I feel sorry for Boomers, or Zoomers if they prefer that cutesy name they’ve invented for themselves. However, I feel that there’s still a lot of suckers out there they can pawn their houses off to at maximum value and enjoy their windfalls.
By the time this ball really starts rolling, I feel that the younger generations will be the ones who really suffer. I’ve come across a few idiots lately who are not only buying their primary properties at the top, but they are looking at second properties to become landlords. Apparently their realtor friends (…unbelievable) have convinced them that owning rental properties is a ‘can’t miss’ opportunity, and they should jump at the chance soonest before prices and rentals skyrocket out of sight. Cue the facepalm.
Yesterdays (Monday) graph ended with July sales. The stats are in for August GTA. 633 new condos sold in august. Six Hundred and Thirty Three. 50,000 in the pipeline at 633 per month is going to take a while. That is all. record prices of course…
What is amazing in the comments section of the pathetic blog is all the heart felt humanity on here, the dogs un wavering concern with the fate of there fellow man venturing into the real estate world.
Let call a spade a spade, you guys are rolling on the floor pissed and mad as hell, you know that if the idiots you so claim to care about would just stop buying, it would put you in the crouch position ready to pounce as the market softens.
Home owners are winners , renters are losers, everybody knows that, even if the math don’t make sense.
Learn to sell so you can buy…..
BOOMERS Part Two…
Ok, so some of us didn’t trade in Spouses, had a decent job history (it wasn’t ALL pretty), and DID try to save up a wad, and paid off the house, and cars. So, how are WE doing?
I like it that way. Got to quit the rat race on MY terms.
No debt, don’t need much to survive on. Don’t live in a big metro area, but a wee small town with taxes to match.
Car insurance is a song, same for homeowners. Need the big town it’s two hours to Madison, if you must.
Even the Cat Food Lady would like it here, and you can SAVE money as the rents are dirt cheap! Friendly farmers.
So, the social security, small pension, and 401K will provide more than enough for these Boomers. Could I spend MORE? Sure, but why? If I need something I can buy it, no pressure, no Jones to keep up with -they’re broke you know.
Emergency fund is in place. Long term & healthcare are in place. Balanced (more or less) investments doing good.
So, what’s not to like, and be thankful for the good fortune?
About our couple in tonights story. They have a few years left to work. On $150K they could pay off the house in less than 2 years. and save up another 300 GRAND by age 66. It’s not a matter of CAN they, but a matter of WILL they.
I never met them, but what do they value?
#34 Suede on 09.24.13 at 9:21 pm
rotflmao
WHAT WILL BOOMERS DO?
So in the face of an impoverished retirement what will the Boomers do to get by?
Many are delaying RETIREMENT and continuing to work longer than what they ever thought they would.
Many are taking low paying SERVICE jobs – “welcome to Walmart”.
Boomers will be cashing out on their biggest asset (house) to DOWNSIZE to a condo or apartment. Another nasty drag on RE for the next couple of decades. Those that delay too long will see diminished prices for their house – but then their condos may cost less.
SHARE a house a la “Golden Girls”.
Move in with their KIDS. It will be even easier living once the kids get divorced from the stress of having dear old ma and pa living with them.
Sell their liquid INVESTMENTS – although there sounds like may not be a lot of assets to sell.
Agitate for more government HANDOUTS. But politically handouts will get tougher to get since post-Boomers will soon outnumber Boomers. Post-Boomer will eventually just say NO to more transfers to Boomers – especially having been screwed over by the Boomer cohort for the last couple decades. Luckily for Boomers, post-Boomers are too disconnected to vote right now (that will change when they start paying massive taxes).
DELETED
Buddy, shud-up. The boomers get wind of this, consider it another lost opportunity. ¿Comprende Usted? Nos vemos en Uruguay en diez años.
++++++++++
#22 asp on 09.24.13 at 8:42 pm
I quit my job 2 years ago and am now living a comfy life in south america on $700 a month. That includes the rent on a nice apartment, most meals at local restaurants (lunch for $2-$3), drinks at the local bars featuring live music. And spanish classes at the local university. Everything I need is within a 10 minute walk from the apartment.
If one is willing and capable of looking outside the mainstream, one can live quite nicely on little money.
Ah Garth what would I do with out an editor
Would be hard to walk around with out a head
“…and invested for a conservative yield of 6%…”
Make that 4% and it’s conservative. For 6% you’d have to have a lot of equities in it, which does not make it conservative.
Bank preferreds alone pay 5 per cent, plus offer a dividend tax credit for a higher effective yield. Learn more. — Garth
Garth, maybe you should delete all of Smoking Man’s posts, they are so illiterate that there is a misspelled word practically on every line. “With out”???… “There” instead of “their”?… “Don’t” instead of “doesn’t”?… and so on and so forth.
True the maximum Social Security benefit is $2,533 but the average is $1,230.
The average monthly Social Security benefit for a retired worker was about $1,230 at the beginning of 2012. This amount changes monthly based upon the total amount of all benefits paid and the total number of people receiving benefits.
You can look it up for yourself here.
http://ssacusthelp.ssa.gov/app/answers/detail/a_id/13/~/average-monthly-social-security-benefit-for-a-retired-worker
I know that. And the average CPP payment is $596. — Garth
When poster /poseur # 50 takes Viagra….he can get an NBA contract
#41 Mr. Monday Night on 09.24.13 at 9:44 pm – “…or Zoomers if they prefer…”
Who’s Zoomin’ Who? Remember that Aretha Franklin song from the 80’s? In the West Indies, zoomin means to fool or mislead someone. In that context, I think zoomers is a pretty good description.
#15 ripped on 09.24.13 at 8:18 pm
I just returned from a vacation and was thinking the same thing.
As long as you can fund your health care either on your own or on your employer’s back, you’re probably better off under many quality of life criteria.
illiterate should not be a problem one’s bad intentions should
Bank preferreds alone pay 5 per cent, plus offer a dividend tax credit for a higher effective yield. Learn more. — Garth, @ No. 51
Garth, sold. I wonder if you could dedicate a blog entry to purchase of preferreds.
I know you do not advocate market timing, but, there comes a time when you’re building or re-balancing when you have to pick a “buy”, and then figure out the price at which to place the order.
What do the pros look at when sifting through the candidates?
Once they have the one (or more) they think is best value, how do they estimate a bid price that will fill the order and get slightly better yield?
Look for a nice retrace of the 10 year. 2ish would be about right to satisfy the fib guys. That may be the historic turn in rates.
Investment plans by corps in the US are underway but it takes time to roll out. Rate scare may cause them to move quicker and lock up cheap debt. Another turn.
Metals seem to have found their sea legs. Oil just won’t go down. Possible turn.
Piles of money being, yes printed all over the world. It will cause what all CBs and governments need. The final turn.
I’ve heard tales of 18% on money and sectors of the market that can double yearly.
Housing is old news. Let over leveraged 25 year olds play the “we’re building” game. (That’s what they say when they buy a subdivision house. Heard 3 people say it this week. It’s very cute). How should we position for the type of wealth gains the boomers squandered?
Tech and resource plays seem to be the easy bets to overweight. What about banks?
Noticed XLU down with 10 year plunging today. XFN has been weak too.
The complexion of the market just seems different.
I love this blog.
All good info and guidance.
I am a Gen-x dude that seems I’m doing better than most Boomers. I also rent where the top 5% live and from what I can see, renting is much better than owing. Hell, I almost bought the place my neighbor bought …. from his reno-bills, I’m glad I did not!
But my post is not about this.
It is about aging parents.
I have aging parents.
They still rock at +75.
My dad looks 63. My mom has a punk style!
They divorced a long time ago.
They want me to manage their affairs if they cannot.
In a way, I’m grateful they believe their last born is best to take care of their affairs.
But do I really have time for this x 2?
Thank God they planned right, saved and invested wisely!
This old man puts a lot of people to shame…
#14 Spiltbongwater,
Put down that bon and quit being so depressing. Why don’t you just get a job at the golf course and die naturally, of old age, while playing golf.
Or better yet, save up some money and buy some land somewhere where owning a golf course would be a good financial plan in the years to come? Farm it until you can develop it, or do something else with it to make cash in the meantime…
#14 Spiltbongwater,
Bong, not “bon,” in case you didn’t figure it out. Sorry, I need a coffee, but it’s bedtime.
#19 Sucker
I think that’s what’s going on with the housing market. Too many boomers, not enough government money to bail them out. Policymakers find the solution by hanging it on Gen Xers, and their young. But what becomes of us at retirement? Oh yeah, we either leave our debt to our children (a lovely inheritance, eh?), or to the bank, who cashes out on the foreclosure and/or gets bailed by CMHC. Or they manufacture another housing boom, in which case the current one will probably need to crash and burn at some point.
Great profile pic Mr Turner!
Good to see you have been taking care of yourself ;)
#22 asp
That’s awesome; good for you! And you are supporting the colourful local economy, not a bunch of pricky sharks gouging you on real estate.
#58
Just pick up an ETF like CPD and be done with it. Safest route for DIYers.
First, Trump Tower goes down the tubes and next up is the 5 Star Shangri-La (Where or where is HAM?)
http://themashcanada.blogspot.ca/2013/09/10-of-shangri-la-residences-for-sale.html
In January, I posted a 2 bedroom, 3 bathroom unit that was for sale in the Shangri-La Residences at 180 University Avenue.
It wasn’t the only unit available at the time, but I think it was only about 1 of 5 (maybe a bit more). So if you were looking, there wasn’t a lot of choice.
It’s now nine months later and things have changed.
There are currently 36 units of the 353 total units for sale in the Shangri-La!!!
Yup, THIRTY SIX!
Or 10% of the condo units!
That’s up by 5 units even from just 6 days ago when there were only 31 for sale!!!!!
The 36 units range in price from $710,000 to $4,395,600.
So, what gives? Is it the falling glass?
Let me guess, you’re going to delete this post too:
http://www.thestarphoenix.com/business/five+households+live+homes+they+cant+afford/8950830/story.html
Vancouver women ranked pickiest daters in Canada
http://globalnews.ca/news/858361/vancouver-women-ranked-as-the-pickiest-daters-in-canada/
Are Vancouver women too picky when it comes to dating?
A new survey from an online dating site has ranked Vancouver women as the pickiest in Canada and the least likely to respond to a man’s message online.
According to AYI.com, Vancouver men have the hardest time getting a date through online dating sites than any other city in Canada.
Montreal women were ranked second and Ottawa came in third.
The dating site reports that Calgary women are the least picky, followed by women in Edmonton and Toronto
==================================
As can see….the gene pool and condo lust has a _____ correlation.
Drones , barbed wired fences, pit bulls and guard towers at the Rockies.
know that. And the average CPP payment is $596. — Garth
But with the OAS & GIS it is very close to the same, average that is, there is no way to get to $2,500 on Canadian government pensions alone. ($1,192 for my mom after thinking she was rich enough to call it a day at 62, eleven years ago) Don’t get me wrong I’m not saying it is good, I have a few relatives living it, one is my mother who I subsidize. Still it is not all sunshine and lolipops in the states either I have realtives of that age there too and like the ones here they didn’t do anything for themselves before retiring. Both sides of the border they aren’t in good shape now.
Personally I agree with all of the advice you give. I was just pointing out that 2,500 is not the norm. Also you have to take healthcare into the equation, even with medicare it is not as free as here and as one ages healthcare costs rise.
Much like people like to say how much less tax they pay in the states than we do here but that really depends on which state you live in some are quite similar to Canadian taxes.
For all of the similarities between the two countries comparisons are not exactly apples to apples. One thing that is completely the same is that just like you are constantly saying one must provide for their own retirement above what the government will provide.
Garth,
I’ve been reading of yet another budget battle in Washington, again the debt ceiling and if they should pay their massive bills by Oct 1.
Should they not come to an agreement, as in the 28-day US government shutdown of 1995 and 1996, could one forsee a very rapid sovereign debt crisis, with very little federal reserve control over scared bond markets? Especially under current artificial credit conditions?
Often in history, events on the periphery of empires cause eventual turmoil and decline of those powers. I suggest here, our local experience could be the opposite, with the risk rapid interest rate growth and yet another credit crisis, one which could effect the far away Canadian housing credit market.
I don’t want to be ‘negative nancy’, or a ‘ debbie downer’
Retirement crisis in America: 77-year-old flips burgers to earn in a week what he used to make in an hour
http://business.financialpost.com/2013/09/23/retirement-crisis-in-america-77-year-old-flips-burgers-to-earn-in-a-week-what-he-used-to-make-in-an-hour/
This is how the US looks out the other side of a housing correction…..
You how to save the Boomers? Two Words: Boomer Porn!
Don’t look at the link.
http://www.youtube.com/watch?v=1Pfa07ijUCE
New look, Garth? Nice selfie.
re: #41 Mr. Monday Night, and #55 Stupesing in Cabbagetown:
As someone who currently resides in the 1940s, please don’t call me a ‘zoomer’ (even though I was born at the tail end of the baby boom). In 40’s slang, zoomer is another word for a chronic moocher.
The term is referenced in the lesser-known Duke Ellington title ‘Let The Zoomers Drool’. An AFRS recording of the tune, from December 31 1945, can be heard on this page, which has it mislabelled as ‘Let The Zoomers Groove’:
http://archive.org/details/DukeEllington-LetTheZoomersGroove1945
Is the more recent definition apropos? You decide, but keep it to yourself.
P.S. Does the term ‘zoomer’ for ‘boomer’ really exist, outside of Moses Znaimer’s website and magazine?
re: #14 Spiltbongwater:
Your method was popular up until the sixties or seventies, but catalytic converters have cut the carbon monoxide in exhaust emissions by over 99%, so besides your Leonard Cohen CD, you may want to pack a lunch.
re: yesterday’s discussion of altering the comment section format:
When I want to see monkeys flinging poop, I go to the zoo.
When I want to get smarter, I come to Greater Fool.
Please don’t alter your comments section to facilitate the poo-flinging.
Thank you, Mr. Turner; sorry for straying so far off-topic.
A backyard barbecue horror story from the world of backyard barbecue horror story’s…………………….
I still remember the story of the guy who bought a house on Pape Ave in 89 at the top of the market and fell victim to power of sale after losing his job 18 months later. Being a landed immigrant from Greece he decided to go out swingin …so…. he sealed up all the doors, windows and drains in his house , then opened up a few taps , sealed the back door on the way out and caught a taxi to the airport and a flight back to Greece. 3days later when the house filled to the roof boards in the attic with tap water…. it exploded … blowing out the basement windows in the adjoining houses and swamping their basements to the rafters. In the fulcrum of rushing water so intense through a neighboring basement apartment window engulfing the unit in seconds , a (stunned and near drowned) tenant laying on his couch watching tv was picked up and sucked back out the window and ended up in the middle of the street in his underwear dazed and confused.
And……now for the moral of the story?
Always wear underwear if you live in a basement apartment lying on the couch while watching tv next to a house less than a meter from the one you are in…. and especially if it was recently purchased by a newbie owner who paid twice what its really worth.
I guess
Speaking of dental supplies and money for retirement
how is a former retired vice president of Oral-B doing?
http://www.zerohedge.com/news/2013-09-23/making-100000-then-flipping-burgers-may-be-your-future
Wow! Way to go, Billy “Buff.”
Is Evelyn nervous?
I suggest you watch one of Elizabeth Warren’s talks about the boomer myth, the one about them being profligate wastrels. I think these stories are being spread to prepare for all the required cutbacks in senior entitlements, you need to vilify a demographic through misinformation first to make it politically palatable.
I earned 100K for quite a few years before being downsized and never netted more than 4K a month after paying huge taxes and maxing out my retirement savings so guess what, 40K a year TAXFREE through the miracle of income splitting being a poor pensioner and all that good stuff, and having NO mortgage leaves you with plenty of spending money. Keep the cat food myth going but with that income you would still have enough to travel and pay all your house expenses.
I have tracked all my spending on spreadsheets for the last 5 years and on 40K I would have 2K a month disposable spending money after fixed expenses, that’s not Friskies, that’s more than minimum wage people earn gross. The so-called poor pensioners get all the sympathy not the working poor.
@not 1st
I used to live in Vancouver and sold my business for a lot in 2010. I immediately moved to Southeast Asia.
One of my clients in Vancouver was a Canadian-educated doctor practicing in California. (I met his sister first, who was in the same position: Canadian-educated MD practicing in the States.)
When the sister returned for a visit later, she told me her brother had to return to Canada. I met him in a few days later upon his return.
“Well, I have been diagnosed with cancer. You know what it would cost me for treatment in the states? Two million dollars!” He said.
I figure he is not the only one returning for cheaper medical care in Canada.
I would do the same but like “Buff Billy” staying in shape is an invaluable investment in yourself.
@Cristian:
I just skip them all.
#43 Smoking Man
Your statement is entirely false. Biggest falsehood is, you are a home owner, and yet you are the biggest loser I have ever seen.
Of course Smoking Man, I know that your character “Smoking Man” is a fictional character of your own imagination, as you have told us this yourself on this blog. I know you are a normal family man. So, take this comment of mine as a compliment. You have indeed created a real #1 fictional a$$hole.
It’s hard to feel sorry for the boomers, raided the cupboard bare for the next generation, who will most likely be more financial prudent and see the big picture, sure they buy expensive Iphones and fashion, but really big purchases like cars (thanks to ridiculously high insurance rates), and homes (they don’t have the downpayment anyways), are being delayed or not purchased at all. Why do you think car makers and property developers are marketing to the next generation? The Boomers are clearly maxed out and have very little to show for it. Considering they will be all retired eventually, this will be a big problem for all of us.
Interestingly, I just heard Michael Hlinka, a regular business talking head on CBC radio on Toronto real estate.
Asked about where condos will go now, he said “it’s too late”.
He gave his own number: condo prices in Toronto down “25-30% within a year”
He also spoke of the people he knows in the financial services sector here in Toronto, and how grim it is looking for them as reported by colleagues about their behind-closed-door meetings, how mortgage lending standards have had to be tightened up incredibly.
A big rock is about to be dropped in the pool. The wave will wash over all real estate. We are seeing SFH starting to languish around us too, many now on sale for months in a good part of Toronto.
A good post today Garth . However
It is not forthcoming of you ,to imply like you have in many previous posts ,that a balanced portfolio of equity to fixed income at a 60/40 split will deliver the often quoted average return of 7% you continually mention, in the future. Simply, the fixed income portion will not act like the ‘ballast’ it has past 30 years. In fact, it will act as a drag.
This of course means that the equity portion will have to deliver a heck of a lot more than it has over past 13 years or so. Equity markets will have to deliver, period. Your guess is as good as mine , or anyone else, on that.
All the more reason , why bricks will continued to be licked and copper eave sthrophes stroked mighty heartily, in the good ole GTA, among the 99% of financial illiterates you mention today.
Maybe that very heavy Italiano lady at the bakery last month( one of the 99% for certain) was right when she told the young girl getting married to `hurry upa and buya a house because`da price shesa only gonna go a one way, shesa only gonna go`, uppa Uppa UPPA !!!
Don’t blame me if your mutual fund portfolio is raped by fees. I’d be bitter, too. — Garth
Hey – few observations of late. 1) if you’re a pensioner, good luck. It used to pi$$ me right off at tax time when I sued to do the taxes for my parents who were both retired. Despite their limited income, they still had a relatively decent tax bill to pay. Now, my Mom is a widow and her Survivor pension or peanuts or whatever insult it is is pathetic. Despite paying into a system for 50 years. How people haven’t revolted against their Ministers and politiicans despite having to swallow that filthy load called the Sunshine List ever single year is beyond me. You’re eating tinned fish while they eat filet. How is there justice? 2). Toronto’s rental market, despite the 2mm units or whatever coming on-line is a model in collusion. How these guys don’t move from their steady eddie 2500 two bedroom, 1800 one bedroom fized rate deals is beyond me. I guess its a wait game – cash is king an once you’re tired of the negative flows you’ll be renting for a reasonable rate.
3). I think the mindset right now is that monthly P+I is like paying rent – I rent a 2 bedroom for 2500, I ‘buy’ a house for 5000gmonth…and one day, maybe own instead of perpetual rent. Its them putting 2500 to own squat versus hopefully riding it out for 25 years until the mortgage is done. If prices rose by 5pc per year for the last 9 years, I can’t see how prices will come to soe reasonable level. There’s a new floor now.
Impact of demographics seems to be bubbling up in conversations more and more on those Wall Street CNBC talking head shows.
Cycling the heard into bonds, then out of bonds and into equities …and then…?
If the younger generations figure out that boomer houses prices are too high and stop buying……….who will buy boomer stocks and bonds when these too become too expensive?
What are the contrarians thinking now?
#87 Garth to Bigrider.
I’m guessing to early in the morning for you to give a response that is on topic and coherent with the point made.
Keep up the good fight against mutual funds then. I’m with you on that…LOL
#51 Cristian.
“…and invested for a conservative yield of 6%…”
Make that 4% and it’s conservative. For 6% you’d have to have a lot of equities in it, which does not make it conservative.
Bank preferreds alone pay 5 per cent, plus offer a dividend tax credit for a higher effective yield. Learn more. — Garth
—————————————————————–
Garth. Here is a challenge.
Post details on that mythical conservative portfolio that you keep referring to which will earn 6-7% yield. Kind of like the Unicorn, we keep hearing about it but never see it.
Assume $1 million of investible assets free and clear. Moderate risk appetite. Properly diversified for an older client. And give some specifics. Otherwise some might conclude as an investment advisor your similar to RE agents. Long on promises but short on facts.
Up for the challenge?
Of course not. There is no one portfolio suitable for everyone, and no ethical advisor would accede to such a request. Even an index investor last year (60% growth, 40% fixed) made a little over 9%. Daily here I mention asset classes that can easily accomplish the goal, so long as they are held in the right weightings and rebalanced as necessary. Suggest you go and talk to somebody who knows, instead of baiting me. Way more worthwhile. — Garth
Any comment on this article Garth?:
http://www.torontolife.com/informer/toronto-real-estate/2013/09/24/smart-buyers-guide-toronto/
Sales support, of course. — Garth
I make 60 K after taxes and manage to put away half of it each year. It’s called living below your mean.
Garth, you said 99% of people don’t know how to buy prefferds, REits, ETFs, etc. Unfortunately I’m one of them. I tried learning quest trad but found it complicated. Any advice what platform is easier or where I can learn to trade?
#87 Big Rider
“hurry upa and buya a house because`da price shesa only gonna go a one way, shesa only gonna go`, uppa Uppa UPPA !!!”
Precisely what my Nonno has told you on several posts Big Rider! You are starting to see the light. If you had bought property in the GTA since this blog began you would have made muchos moneta on your real estate. As Nonno always says, “dese young fellas, dey tink dat dey gonna maka moneta wid da crooks on Bay Strada while Nonno justa go to da banca every montha and deposita wheelbarrows fulla of moneta from his real estata!”
Is the Government gag order and war against telecoms (see today G&M) an effort to divert attention away from government blindness (or collusion) for house price manipulation?
#47 Shawn
“And not sure if AK has experience with making that kind of money.” Cute. $150 gross (for the household) is very fortunate, but hardly rare. I’m sure a lot of posters here are at or near (or above) that. It is not even close to being in the top percentile, as you say.
It’s a solid upper middle-class household income. Not enough to buy Gucci shoes, as you say, and not enough for “expensive” cars. Not enough to “belong to things like golf clubs,” and not enough to take “expensive vacations.” It’s possible that you and I have different definitions of “expensive.” “Domestic help”? Really?
Oh, and you max out CPP and EI well before $75K as an individual. And, if their incomes are roughly equal, they’re in a pretty sweet spot in terms of income taxation.
It’s clearly wrong to suggest that someone save a third of gross income. But they probably ought to have put away more than 80% of gross annual income over the course of an entire career.
‘Plus kids they taught to buy houses. Suckers.’
You have drank too much of your own Kool-Aid, Garth.
Yes, the housing market in Canada will flatten and people will be in trouble. But, from 2005-2011, buying a house in most cities in Canada with 20% down within your means in an improving/gentrifying location was one of the best investments you could have made.
The Suckers are not those that buy/bought real estate but are those with little financial investing skills that sat on their wallets during buying season and now pray for a US-style implosion. Mainly, your beloved basement-dwellers.
Your anti-real estate rants get clicks, but don’t make it seem like investing in real estate has always been a bad decision if done correctly.
I am not against real estate ownership, but putting the bulk of your net worth here – or in any one single asset class, is dumb and risky. Furthermore, I am not addressing the past, but the future. It’s where we’re going, after all. — Garth
#133 Devore on 09.24.13 at 7:33 pm
#77 Holy Crap Wheres The Tylenol
I am a very Tech Savvy Person as I create complicated electronics that utilizes machine language, HEXADECIMAL, interfacing with HMI’s that communicate via Ethernet IP.
Then surely you know that all electronics use “machine language” and there is no such thing as “ethernet IP”.
*********************************************
I’m sorry Devore you where saying……………..what????
EtherNet/IP is an application layer protocol similar to SNMP, treating devices on the network as a series of “objects”. It is an implementation of the Common Industrial Protocol (CIP) over TCP/IP, compatible with ControlNet (CIP over a dedicated network) and DeviceNet (CIP over CAN bus) control systems.
EtherNet/IP uses Ethernet physical layer network infrastructure. It is built on the TCP/IP protocols, but the “IP” in EtherNet/IP stands for “Industrial Protocol”, it is not an abbreviation for “Internet Protocol”.
EtherNet/IP can be used in automation networks which can tolerate some amount of non-determinism. This is because Ethernet physical media might not have deterministic delays.
EtherNet/IP can be easily confused as a simple combination of Ethernet and the Internet Protocol. Instead, it is an industrial application layer protocol used for communication between industrial control systems and their components, such as a programmable automation controller, programmable logic controller or an I/O system.
#87 bigrider — “Simply, the fixed income portion will not act like the ‘ballast’ it has past 30 years. In fact, it will act as a drag.”
I agree with that forecast. Unless people are willing to play with emerging market debt, junk bonds, convertible debs and the like, it may be an ugly few years. Of course, to say a portfolio is likely to average 7% over the long term isn’t to say it’ll even make money over the next year.
There was an interesting column in the weekend Globe. An advisor was saying that he was moving his clients weightings more toward equities, say moving 10% of the portfolio from fixed income. But in addition, he was recommending clients buy index linked GICs for the fixed income side. “Most people see these as a dumb way to play the stock market, but I think they’re a smart way to play the bond market.”
#93 David W
I don’t have experience with Questrade but have used rbc direct for many years. They have a ‘practice account’. Its free, and can help. Other banks may offer this service?
http://www.rbcdirectinvesting.com/practice-accounts.html
#91 Castaway4 — “Post details on that mythical conservative portfolio that you keep referring to which will earn 6-7% yield. Assume $1 million of investible assets free and clear. Moderate risk appetite. Properly diversified for an older client.”
You should have asked last year. Unfortunately, all the best investments have now already been bought and the stock and bond markets are now full. Just buy GICs at the bank.
“A big rock is about to be dropped in the pool. The wave will wash over all real estate.” -Hogtownindebted
Well said.
@ #47 Shawn on 09.24.13 at 10:23 pm
TELLING OTHERS WHAT THEY SHOULD BE ABLE TO SAVE
AK at 24 noted the income and said:
“She freelances, he sells for a dental supply company. Combined income is $150,000. ”
====================================
They should easily be able to save 50K annually. No excuse not to.
*****************************************
Well I KNEW someone would say something like that.
But we don’t know how long they have been making $150 k
And not sure if AK has experience with making that kind of money.
It’s easy to suggest what others should save. But basically NOBODY saves one third of their gross income.
People who make bigger incomes have big expenses ya know. First comes income tax and CPP and EI which can easily chew up a third. Not to mention pension contributions if applicable.
So now you would like them to save over 50% of take-home. Get real.
People with bigger incomes have bigger houses and more expensive cars. And they belong to things like golf clubs. They take expensive vacations. Their kids take part in expensive sports.
And have you checked the price of domestic help? It’s outrageous. And their parties are not BYOB!
Before you cavalierly suggest that a 1%ter should easily save a third of gross income, you first need to have walked in their (Gucci) shoes.
————————————–
Looks like someone touched a nerve!
Some of these points are pretty minor, and should not be a factor in saving:
>> The extra EI/CPP is capped at a relatively low level. It’s not like the 1%-ers are paying in tens of thousands in witholdings there.
>> Pension contributions are also often capped. It isn’t typically a linear calculation where a $50k earner pays in 10% and a $500k earner also pays in 10%. Also, pension contributions are typically considered savings, so this should in fact make it easier to save 1/3 of gross income.
>> Many of the “expensive parties” are paid for as business expenses, and shouldn’t factor into the individual’s income. Yes, the neighbourhood party would be paid for by the individual, but work events come out of the company’s funds.
>> The point about vacations/cars/sports/etc. applies to everyone. That should be a part of the household budget, and shouldn’t be putting a dent in savings. Also, if you are truly a 1%-er (making say $200k+), you have tends of thousands of dollars a year to pay for these things ($200k = say $120k after tax = $50k-$60k to pay for cars/sports/vacations before getting below the 1/3 savings goal).
I agree that many of the 1%-ers do spend spend spend like you are describing… so, that is reality for many “wealthy” Canadians. However, I disagree that it would somehow be difficult for a family with high incomes to save 1/3 of gross each year.
@ #91 Castaway4 on 09.25.13 at 8:20 am
#51 Cristian.
“…and invested for a conservative yield of 6%…”
Make that 4% and it’s conservative. For 6% you’d have to have a lot of equities in it, which does not make it conservative.
Bank preferreds alone pay 5 per cent, plus offer a dividend tax credit for a higher effective yield. Learn more. — Garth
—————————————————————–
Garth. Here is a challenge.
Post details on that mythical conservative portfolio that you keep referring to which will earn 6-7% yield. Kind of like the Unicorn, we keep hearing about it but never see it.
——————–
Here are some sample returns for a “couch potato” ETF-based balanced portfolio:
2012 (8% to 9%):
http://canadiancouchpotato.com/2013/01/11/couch-potato-portfolio-returns-for-2012/
And, here are returns over 1,3,5,10,15 years (between 2.6% and 9%, depending on the type of portfolio and the timeline):
http://canadiancouchpotato.com/2013/01/16/updated-couch-potato-report-card/
I believe that these are pre-tax, so drop off say 20% for capital gains (if anything was sold), income, and dividends… then you end up right in the 6%-7% range Garth describes. The Global portfolio is the worst performer overall in most of the timelines… which could mean it will lead over the next 5- 10- 15-year span.
#78 willworkforpickles on 09.25.13 at 3:01 am
The moral of the story is:
Beware of Greeks bearing grudges !
Another brilliant post Garth!
Most people definitely need to improve their investing skills. But they also need to learn to be frugal. You have to save money first before you can invest it. This means living below your means – not above them. It’s all about learning what is important and what is not. We all have choices to make – like whether to go on a cruise or contribute to your kids RESP. Seems pretty simple doesn’t it!
Above someone (thanks!) posted this link:
http://www.rbcdirectinvesting.com/practice-accounts.html
Why don’t you take a particular case, define the profile of a potential client/investor and direct him on how to make those 8% return. This will not be free advice to everybody since you say that everybody’s situation is different!
I have voiced my skepticism here (Financial assets are not reliable these days) and instead of examples and explanations I was given (by some readers) attacks to my own ignorance :-) (attacking the windmills, nobody care).
In my books the lack of concrete examples and evidences is the first red flag when it comes to doing business with someone. Usually “Pay if you want advice” comes next and it is the second red flag that rise the alert level to “Scam”
I don’t see why people with clear receipts for making such solid returns don’t borrow money from investors promising 4% and invest that money so that in the end they can keep the difference!
Your skepticism is rooted in ignorance. There’s a easy fix. Learn more. — Garth
Your skepticism is rooted in ignorance. There’s a easy fix. Learn more. — Garth
I don’t have time to waste just to learn that that 8% is not possible.
Evidences do not need fact checking …
Ignorance is bliss. I am happy for you. — Garth
That is the straight answer that I expected from Garth
Garth, I don’t see why the author(s?) of the the canadiancouchpotato can do that and you can not
Damn! I wish I had the time to read that CSC material …
The Potato is not licensed nor does the veggie have a fiduciary duty to those taking its generic advice. I think more of you than that. Yes, even you. — Garth
#106 M on 09.25.13 at 10:53 am
I don’t have time to waste just to learn that that 8% is not possible.
Evidences do not need fact checking …
===================================
This line of thinking is a major contributor to the housing bubble.
“Most people get advice at the bank – where they sell mortgages, low-return GICs and high-cost mutual funds. Financial illiteracy is rampant, and 99% of the population wouldn’t have a clue how to buy a preferred, a bond, an ETF or a REIT.”
This dearth of independent and/or critical thinking is a tragedy of epic proportions.
A huge number of Canadians spend more time following rather than observing and avoiding/mitigating the pronunciations of the manipulati.
People’s lives would improve beyond recognition with the development of a healthy margin of skepticism.
A bad experience with a corporate investment in my teens proved to be my most valuable lesson vis-a-vis how to care for and grow hard-earned money. It taught me the impermanence of even the largest of corporations- especially today and with pensions at risk at the dawn of boomer retirement.
MSM, the RE cartel, Big Finance and those meant to oversee, regulate and intervene for the long-term health of our real economy have much to answer for.
For those of you wondering who this person is, he is Dr. Jeff Life. The guy is 72 yrs old and is kinda a legend in the bodybuilding community.
Long story short, he was having all sort of health problems at 65 and that’s when he realized he needed to do something about it. He started to live health eat healthy and doing all sort of exercise including weight training. All clean all natural no juice no roids no nothing.
He is such an inspirational figure and is the living proof that nothing is impossible when it comes to healthy living. Age is just a number, not an excuse. People who are constantly exhausted from their annual visit to the gym at the beginning of the year should look at him and feel ashamed.
Come on Turner, you’re taking a conservative couple and pretending there won’t be the bad years where they see their principal dwindle and completely freak out. Then there are their steady yearly increases to their rent and them projecting that out into their dotage.
Very few people who almost own their home outright would follow this kind of advice. They can live small, take in a border, homeswap when the travel and ask the kids for money if desperate.
That was funny. — Garth
#105 — “I have voiced my skepticism here (Financial assets are not reliable these days) and instead of examples and explanations I was given”
I don’t know what gave you the impression that this was a walk-in charity clinic. Your role is that of the straight man; the tortured inner dialogue between fear and greed on display for all to see (don’t think we didn’t notice your expectations going from 7% to 8% in a few short hours…)
There’s thousands of investing blogs with examples, tens of thousands of academic papers on strategies, volatility and return, and hundreds of books at your local library and thousands more at Amazon on the topic, so go get educated at the places that offer it rather than demanding one here.
N.B. When Garth says everyone’s situation is different, he means it. Age, assets, hoped-for retirement date, future money needs, pension and government income and risk tolerance are ALL factored into planning a comfortable, tax efficient portfolio. You look suspiciously like an older person with a million in GICs and a strong desire for free investment advice. Now you’ve got mine.
Garth always talks about opportunity loss of money, but he has never addressed the opportunity loss of the 25-40% taxes most people will pay first in order to get their money behind a TFSA or into equities. The govt doesn’t care if your TFSA grows tax free, they have already taxed the initial deposit.
This is the real reason people don’t have much for investments is because there is nothing left to invest after inflation and the govt get their hands on it first.
mud volcano
drilling cause
lusi – Lusi is still flowing at 100,000 cubic metres per day, enough to fill 53 Olympic swimming pools.
https://www.dur.ac.uk/news/?itemno=7136
…The Durham team asked the question: how long will it take for the volcano’s mud flow to fall to 10% of its initial flow rate? The team calculated the flow based on observations of pressure of the source of water from a nearby borehole, the properties of the rocks supplying the water to the volcano, and the volumes of mud that had already erupted over the first 3 years. These probability calculations ignore the effect of gas in the mud at Lusi, which presents further complications for the people living nearby as it can ignite and could keep the volcano going for even longer.
Subsidence is causing 166 new vents and this, according to Professor Davies, is likely to be caused by the rupturing of shallow aquifers. Professor Davies’ team is now looking at where these vents are likely to form. He believes these additional vents will cause further damage to homes, roads and the railway line.
Professor Davies said: “The world demand for oil and gas has inherent risks and while exploration may reap dividends, it can also cause problems. Drilling disasters are more common than people generally appreciate. Drilling is driven by our demand for oil and gas.”
#97 Ralph Cramdown to bigrider.
Well, I thank you for actually addressing the comment I made. It would not have mattered to me whether you agreed or not as others seem to have gone off on tangents and diatribes of their own.
The index linked GIC as a smart way to play the bond market ,given the fact that we both think bonds are essentially dead money for years to come, may be ok. However, I still think that a guaranteed return of, say 2% or so, for that portion of a fixed income portfolio that would have been in bonds ,now in a regular GIC moving forward, is probably best.
Of course, getting 7% moving forward , on average, is going to require a lot of heavy lifting from the equity portion of an account, more so than ever.
This very elitist attitude is the reason why you see people going away from this form of investment.
And as I said since the entire economy is not advancing with 8% so we can all profit by investing in indexes or any other safer form of investment, this must be a poker game, some will lose money, some will make. I do not see progress here, just a big betting table.
When the economy will be in a better shape then I might believe that this will be possible (8%) for most of us.
As said before, guarantee me a 4% return and you will have my money to make 8% so you can keep 4% for you.
I wonder how come that you missed that part of my post.
#106
“Usually “Pay if you want advice” comes next and it is the second red flag that rise the alert level to “Scam””
—————————-
Very much to the contrary, the claim “free of charge” is the usual harbinger of a scam.
#91 castaway4
#93 David W
#105 avoiding a straight answer(BEYOND RUDE)
#106 M
Read:
Millionaire Teacher by Andrew Hallam
Pages 108-114 will walk you through everything you need to know to get started; where, how, what etf’s specifically.
Garths blogs:
Non cowboy portfolio oct 15 2012
Also:
Canadiancouchpotatoe model portfolios
#120 Thanks, I will add it to my To do list.
No, not rude. A test drive is pretty much standard when you buy a car. Home inspection why you buy a house.
I don’t see why asking for evidences is rude.
#106
Who said free of charge ?
#97 Huuk
” buying a house in most cities in Canada with 20% down within your means in an improving/gentrifying location was one of the best investments you could have made. “
—————————–
Provided that you crystallize those gains while they still exist. Otherwise, you have no extra liquid wealth. Just ongoing carrying costs. You need to ‘rebalance’ some day or you’ll slip into ever increasing risk.
You should read some Garth Turner to get a better idea of how this works.
Heres a great article for the smoking idiot
http://www.theglobeandmail.com/report-on-business/economy/housing/toronto-new-condo-sales-see-worst-august-showing-in-a-decade/article14464065/
#26 Devore “When it comes to this kind of tradeoff, political expediency will prevail, and it has always, ALWAYS been politically expedient to shift costs and responsibility into the future.”
Care to guess who shoulders the burden today? None of the whiners suggest that Boomer taxes, currently entering the top of their career earning curves, be diverted to cover the retirement shortfall. They’re all too happy drawing from the Boomer tax teat for themselves.
Wake me when someone stops acting like an entire generation are their parents.
#118 M — “As said before, guarantee me a 4% return and you will have my money to make 8% so you can keep 4% for you.”
Currently the blended APR on money I’ve borrowed to invest is 2.89%, and my broker will lend me more at less than 4% at the click of a mouse. But I’ll pay 4% if you’ll lend me money for a minimum of 10 years. Interest paid semiannually in arrears just like a bond. Minimum $100,000. Contact Garth for my email if you’re interested.
This couple makes $150K per year and are struggling to save? I make about 80K per year and still have enough to save 20% and buy the odd $500 escort services from time to time. I drive a 2008 purple Honda Fit and want to trade it in for a Kia. God I never realized how pathetic my life is until I write it down.
@112 Randis WRT the picture attached to todays blog:
You are too old NOT to start weight lifting says Arnold Schwarzenegger
“But I’ll pay 4% if you’ll lend me money for a minimum of 10 years. Interest paid semiannually in arrears just like a bond. Minimum $100,000. Contact Garth for my email if you’re interested.”
Confidence in that offer … a kind of carry trade. Yes, assets will continue to go up (despite weak growth on main street) since the Fed will likely not taper. Perhaps QE will become the new normal.
Garth – I was not trying to “bait you”. Appologies if that’s how you read it. In fact I like your blog, told you that on a previous post and read it regularly.
The point I wanted to make was that it simply isn’t that easy to make 6-7% returns without taking on (knowingly or otherwise) a commensurate level of risk.
See a lot of follow up comments with people quoting if you had bought this or that you would have returned x%. Always easy to do looking back. Let’s see some prospective portfolios and re-vist them preriodically and see the results. And yes you can rebalance. That would I think legitimize my position.
Thanks
#126 Spiltbongwater on 09.25.13 at 12:33 pm
This couple makes $150K per year and are struggling to save? I make about 80K per year and still have enough to save 20% and buy the odd $500 escort services from time to time. I drive a 2008 purple Honda Fit and want to trade it in for a Kia. God I never realized how pathetic my life is until I write it down.
==================================
In Surrey…you would be the equivalent of moi..a real catch.
For those who think that some investors are too elitist, the aforementioned Toronto Life article is the perfect antidote…
A 1,532-square-foot, three-bedroom Riverdale semi. [T]hey got it for $778,000—almost $100,000 under budget. Then came the hitch: they couldn’t sell their condo, even after lowering the price from $564,500 to $509,000. The couple panicked: they couldn’t afford to carry two mortgages, but they didn’t want to undersell their condo because of a temporary blip in the market. They decided to keep the unit and rent it out for $2,250 a month, which covered their mortgage payments.
THE FINANCIALS
Meloche and Attridge took out a home equity line of credit against the value of the apartment for a down payment, then secured a $622,000 mortgage. They got a five-year fixed rate of 2.99 per cent on a 30-year amortization schedule, setting their monthly payments at $2,800. They welcomed their first child, Spencer, in August 2012 and moved into their new house three months later. They don’t plan to leave for a very long time.
WHAT HE LEARNED
Sometimes it’s okay to take a risk. At the beginning of their search, Meloche and Attridge ruled out the idea of keeping their condo and renting it out. They didn’t want to take care of two properties, nor did they want to carry two mortgages. But when they couldn’t sell their condo, they realized the benefits of the situation. By building up equity in two properties at once, they may be setting themselves up for a lucrative payout, especially if the condo market heats up and the housing market continues to appreciate.
Beauty. 80% LTV on the new house, but the DP comes from a HELOC on the condo. It’s unclear whether the tenant’s rent covers taxes, maintenance and paying down the HELOC, or just their original mortgage. The HELOC’s interest rate isn’t mentioned, but it ain’t the 2.99% that their mortgage is. See? No condescending attitude from your local realtor. You can do it! Just sign here, here and here.
#130 Donald Trump on 09.25.13 at 1:45 pm
#126 Spiltbongwater on 09.25.13 at 12:33 pm
This couple makes $150K per year and are struggling to save? I make about 80K per year and still have enough to save 20% and buy the odd $500 escort services from time to time. I drive a 2008 purple Honda Fit and want to trade it in for a Kia. God I never realized how pathetic my life is until I write it down.
==================================
In Surrey…you would be the equivalent of moi..a real catch.
=========================
Man this blogs comment section is the best entertainment going. I take back what I said about most of our comments being a waste of time to read.
I don’t know, maybe you have to be a former Surrey resident to appreciate the last part. lol.
131 Ralph Cramdown on 09.25.13 at 1:46 pm
Brutal. Why didn’t it mention anything about making that interest tax-deductible? About the dumbest thing in the world is to borrow against a rental property for the down payment on a personal residence, so that NONE of your interest payments can be deducted.
Probably negative equity (borrowing against an asset whose value you know is in decline is a bad idea), and maybe close to a million dollars in debt.
Poor Spencer.
43 Smoking Man
Home owners are winners , renters are losers, everybody knows that, even if the math don’t make sense.
BRAVO!!!
Reality check.
OK back over to the renters….
#52 Cristian on 09.24.13 at 10:44 pm
Garth, maybe you should delete all of Smoking Man’s posts, they are so illiterate that there is a misspelled word practically on every line. “With out”???… “There” instead of “their”?… “Don’t” instead of “doesn’t”?… and so on and so forth.
+++++++++++++++++++++++++++++++++
If he write their or there and you’re incapable of figuring out his point, then perhaps its YOU that is illiterate.
In Surrey…you would be the equivalent of moi..a real catch.
#130 Donald Trump on 09.25.13 at 1:45 pm
I live in Langley tho, but work in Bridgeview.
You people are financial idiots. I am in a fund that has consistently put out an annual dividend of 6.5% per year with very little price fluctuation for years now.
GIC’s Garth, they pollute peoples’ minds! lol
Mr. R.
On the subject much discussed today, namely seniors, as far back as the late 1990’s I heard and read all these dire predictions about how by 2010 there would be severe labour shortages when “all those Boomers” retired. I never bought into it, figuring with technology and outsourcing to Mexico, China, India, and other cheaper labour countries more jobs would vanish and thus less labour would be required. I didn’t even think of the possible long term effects of a financial crisis. Fast forward to the present, a lot of older Boomers are still working as they’ve saved little for retirement, and will for many years to come. That’s created a real problem for younger people looking for jobs, and not just higher paying professional type jobs. Even a lot of lower paying service sector jobs, traditionally taken by younger people, have more older workers now who can’t afford to retire.
Now let’s look ahead to the future. If so many Boomers are in such bad financial shape going into retirement, they won’t have much disposable income so that means they will buy less goods and services, and far fewer luxuries. Just think of what that will do to the economy, or job prospects. It’s definitely bad news for companies like Carnival Cruise Lines (as if they don’t have enough trouble now) that depend on high disposable income from people free to travel when they please. It may, however, be good news for discount retailers like Dollarama. So where’s this phantom labour shortage? Maybe in some Emerging Markets countries, but definitely not here in Canada now or for many years to come, if ever.
#52 Cristian on 09.24.13 at 10:44 pm
Garth, maybe you should delete all of Smoking Man’s posts, they are so illiterate that there is a misspelled word practically on every line. “With out”???… “There” instead of “their”?… “Don’t” instead of “doesn’t”?… and so on and so forth.
……..
As far as I’m concerned, you got those words wrong, my words are corrcorrectly spelled.
See its all about freedom, you go with the consensus view, the tribes rules, you believe in them, you come out swing hard. No different than a dude that wraps dynamite to his body and screams ala akbar. He is as sure as you he’s got it right., virgins waiting.
What is the prize for being a super speller. Praise by the community, pat on the head by your teacher.
See freedom is about not giving a crap about what others think.
The whole point of my lessons…..
Now get me an apple……
Small cities like Kelowna or Victoria that are known as being favorite retirement desitinations – how will they hold up?
1) They’ll do fine, because all the retirement age boomers are moving there soon? Maybe because many homes there are second homes for the well heeled.
2) Or poorly, because many of the seniors or soon to be seniors (like Bill & Ev) are cashing out?
Opinions….
I have previously posted the origin of buyers in Victoria. The retirement influx is a myth. — Garth
#115 not 1st on 09.25.13 at 11:24 am
Really wobbly thinking there. If taxes up front are a problem, use an RRSP. Here is an even crazier idea: use the RRSP tax rebate to fund a TFSA.
I am not sure what your point is regarding “the 25-40% taxes most people will pay first in order to get their money behind a TFSA or into equities”. Those taxes apply to all money, not just money that gets invested in financial assets.
You also seem to think that a TFSA and equities are distinct products- they aren’t. One is an account, another is an asset class.
TEMPLE
Since when a crooked industry is an excuse for the other?
#131 Ralph Cramdown.
The couple in the example cited is wholly insane.
They are also indicative of the vast majority of Torontonions and their respective perceptions towards risks ( or the lack thereof) in real estate ‘long term’.
The fact that such an example of over exposure to one asset class can be easily facilitated speaks volumes about the industry housing has become.
Garth – I was not trying to “bait you”. Apologies if that’s how you read it. In fact I like your blog, told you that on a previous post and read it regularly.
So ..if in good faith and not knowing details about one thing or another you ask a question on a blog that is supposed to educate people on financial matters then that is impolite and rude.
Man where is this country going? The author of this blog what man enough to stand up for his opinions against bigger guys… Can’t you just learned that?
You asked something, you were wrong, you admit it.
By why are you getting apologetic and why do you have to slap yourself for something which is just the natural course of any discussion when you learn something?
If the guy took your question on the wrong side then you can explain him by why excusing yourself because …you exist ?
Truly canadian. I think we lost the spirit of the man who “civilized” this country. :-)
That was interesting. — Garth
*WAL-MART CUTTING ORDERS (In Q3 & Q4) AS UNSOLD MERCHANDISE PILES UP IN U.S.
The USA economic renaissance that never was. Meanwhile as bad as this is, the fed still reigns as the biggest and most successful hedge fund in world history.
So sell your house and put the proceeds into digital assets controlled by the historically correct and predictably safe fed.
http://www.theglobeandmail.com/globe-investor/personal-finance/mortgages/selling-your-home-how-biases-like-the-ikea-effect-can-impact-that-decision/article14221299/?page=all
Homeowners may be even more susceptible to loss aversion than other property investors due to an emotional attachment to their homes. Research on the Boston condo market by economists David Genesove, of Hebrew University of Jerusalem, and Christopher Mayer of the University, of Pennsylvania ‘s Wharton School, found that that homeowners are likely to suffer much sharper losses than investors who own but do not occupy a property… often twice as large.
While there are many reasons why a homeowner would be resistant to sell, such as cash concerns or the work required for a household move, Genesove and Mayer speculated that the psychological pain of selling one’s own home at a loss is greater than that of selling a pure investment property. This is what behavioural economists’ refer to as “the endowment effect.” Essentially, people are strongly inclined to assign a higher value to things that they themselves own than they would to identical items in the market.
what man enough =was manenough
by why =But why
explain him by =explain him but
lost the spirit of the man=lost the spirit of the men
Damn!
The Smoking man disease is spreading
JPMorgan Chase & Co is in talks with government officials to settle federal and state mortgage probes for $11 billion
http://www.bnn.ca/News/2013/09/25/JPMorgan-in-talks-to-settle-government-probes-for-11B-Reports.aspx
#147 This is really lame and truly canadian on 09.25.13 at 3:54 pmwhat man enough =was manenoughby why =But whyexplain him by =explain him butlost the spirit of the man=lost the spirit of the menDamn!The Smoking man disease is spreading
…………
Let’s hope so
#140 uwinsome
Kelowna housing market prices have dropped considerably since the 2008 peak. SFH 20% and more. Condos 50%, waterfront 30%. And the realtors told us ‘everyone wants to live here ‘………………
#108 M
Instead of spewing illiterate remarks, why not spend some quality time learning the subject of investing first?
http://www.amazon.ca/Investing-Canadians-Dummies-Third-Martin/dp/0470160292/ref=sr_1_1?ie=UTF8&qid=1380146664&sr=8-1&keywords=investing+for+canadians+for+dummies
Re: Garth’s comment to #109: Dan Bortolotti is the “Canadian Couch Potato”. I’m the Potato. Got to keep the branding straight ;)
Castaway: “comensurate risk” — yes, there will be that. But too many people are too risk averse, and asymmetrically so. The disclosure rules daily volatility for equities (and ETFs containing them) mean that most people know that there is risk assumed when seeking those investment returns. Yet people don’t think about the risk of running out of money with GICs or the risk of (leveraged) real estate. Equities involve certain risks, but that does not mean they’re some crazy gamble appropriate for only a minority of people with steel in their somachs. Most people should have equity exposure — as part of an overall balance.
6-7% returns are not that hard to achieve. The recency of the dual crashes (tech wreck, GFC) make it seem less likely than we might expect. There was a recent article in the Financial Post by an actuary supporting an expectation of 6% returns for a balanced portfolio.
Wow, this guy really does still looked juiced! That’s crazy that they haven’t been saving anything…its like someone had to slap them after all these years to let them know retirement is coming!
“#12 Rexx Rock on 09.24.13 at 8:07 pm
Those lucky Americans get an extra $1000 a month more than Canadians for their pensions.We got shafted here in Canada.Oh well I guess the smart ones will live in Thailand or Mexico on our measely pensions.
//////////////////////////////////////////
They also pay less in… taxes, housing, food, clothing and beer.
Isn’t it great up here!!”
** So…is the solution to live in the US ( file a 1040 and a Form 8840 as a non immigrant alien with no intention of citizenship) and go back to Canada every six months to re-up you medical insurance availability in case you get sick later on?
You’re so right regarding the cost of living…..but by using a AeroGold card for all expenses you can collect enough points to get free flights back ( you only have to stay 24 hrs to keep your medical active). It’s much cheaper to live here…..big steaks and swimming pools are had for next to nothing ( seriously …huge T-Bones for around $4 a pop) groceries are a fifth what I would pay in Canada. A nice average rancher is around $159,000 in Dallas….and the sun shines 300 days a year.
Do what the immigrants have learned to do…..stick it to Canada for all the free stuff……but get the hell out and live better elsewhere.
#134 The Big M on 09.25.13 at 2:31 pm
43 Smoking Man
Home owners are winners , renters are losers, everybody knows that, even if the math don’t make sense.
BRAVO!!!
Reality check.
OK back over to the renters….
Let me think about this for a minuite? I give my cash to someone else to live in their property while at te same time I am paying off their home. If I purchase my own home I get to live in it and sell it later for whatever profit, even or loss I desire.
Ya renting makes so much sense to me now! Epic Fail!
#144 This is really lame and truly canadian on 09.25.13 at 3:50 pm
Other than posting a truly useless string of crap, what exactly is your point. Or are you just killing time at the trailer in between reruns of Price is Right waiting for your welfare cheque to arrive.
Assume this is more your style of post (:
#152 potato
Bortolotti provides excellent ‘info’ on ETF products and I respect that! When it comes to his ‘model portfolios’ I beg to differ! Somethings missing, could be ‘stradegy’ i’m thinking.
No ‘dry powder’ for instance when considering the opportunities with regard to pref’s, REIT’s, and bonds a short while ago! Thats my point! Hope i’m wrong.
#150 Form Man In regards to buying a house in Kelowna , I have two friends that have bought in the last 10 years and they were both told by their realtors to buy the biggest and most expensive house that they can afford because that house will be their retirement fund.. Not sure if realtors are still telling people that.. Another good one is ” the Okanagan is a special niche market and prices will not go down here”.. And of course lets not forget,,” you are buying more than just a house,you are buying the Okanagan Lifestyle.” From what I can see the the Okanagan lifestyle is trying to look like a millionaire on 20 bucks an hour.. LOL Sadly, there are people that believed these clowns and took their idiotic advice..
@#105 The Donald
Nah, the moral of the story is…They run from their debts…….
Creative writing is bloody hard…
Doing a book is the last thing on my to-do list before my mind starts to go.
Gartho no Idea how you do it, day in day out.
Now I have had some spectacular themes and posts on here, yet stuff going into the book has no flow, doesn’t have the same feel. It’s actuality mean spirited in spots.
I’m trying to do comedy with truth buried in lies.
Perhaps I’m too consumed with getting the spelling and grammar right that I can’t start the imagination engine, it’s becoming a job. I hate working.
Got nothing done today. Hate that
Got to figure out why blogging is so much easier than writing a shit book.
put the two of them in a golf cart and point it towards Florida
Excuses, self-pity, blame and criticism are dangerous things to entertain as a part of ones thought process. I know these traits would have destroyed me if I stayed there for long. I have been self-supporting since I was 17, as were my siblings, both within 1.5 years of my age older and younger, as a result of circumstances beyond our control. I feel blessed I was able to work and study while renting a room in a house.
The 3 of us have done well, my 2 siblings exceptionally well, and me, quite well, compared to the average for our age, I feel very very fortunate. For a number of years now, one of my favorite thoughts from my own mind, is: “I take full responsibility for everything I say, and everything I do, and all of the following consequences, gladly”. Is it always easy in a life where we all will have some difficult challenges? No. Does it work? Yes, absolutely. Thank you for your free, informative, sane, & delightfully witty blog Garth.
Also Garth, your restraint, patience, and tolerance in dealing with others has taught me a lot, and helped me in my business and personal life, as I really do, in all areas of my life only wish to help others, not harm them. Sometimes this is way more difficult than pi$$ing into the wind, as people’s fixed ideas, even as self-destructive as they are, can be near impossible to break through. My best results have come more through my actions and how my life is, than from what I say. I know that from the thanks I sometimes get.
#43 Smoking Man on 09.24.13 at 9:53 pm
#134 The Big M on 09.25.13 at 2:31 pm
#155 :):( Ying Yang on 09.25.13 at 6:51 pm
“Home owners are winners , renters are losers, everybody knows that, even if the math don’t make sense.”
———————————————
Nope, we’re both losers.
You’re a loser because you bought at the top and you can’t get anyone to rent at full price, so you take a hit each and every month.
I’m a loser because I have to rent because I refuse to buy at the top, so every month my money gets thrown away on apparently nothing except a place to live, and making my landlord slightly richer. However, I get to live better every month because I have better cash flow than the virgins.
Oh right, forgot that the landlord can kick me out anytime they want to, because that’s just what they do when they receive steady rental income from a good tenant.
:):( Ying Yang on 09.25.13 at 6:51 pm wrote
OK back over to the renters….
Let me think about this for a minute? I give my cash to someone else to live in their property while at te same time I am paying off their home. If I purchase my own home I get to live in it and sell it later for whatever profit, even or loss I desire.
Ya renting makes so much sense to me now!
Maybe this’ll help. Think about farmers growing food and shoppers buying it.
OK back over to the shoppers….
Let me think about this for a minute? I give my cash to someone else to buy food from them while at the same time I am paying for their farm. If I grow food on my own farm I get to eat it and sell the farm later for whatever profit, even or loss I desire.
Ya shopping makes so much sense to me now!
#91 Castaway4: “Garth. Here is a challenge. Post details on that mythical conservative portfolio that you keep referring to which will earn 6-7% yield. Kind of like the Unicorn, we keep hearing about it but never see it.”
******************
Wow! You’re waaaay out of line.
“In the States, full social security payments amount to about $2,500 monthly.”
Yes but:
The average monthly Social Security benefit for a retired U.S. worker was about $1,230 at the beginning of 2012 as per Social Security Web page.
I know. And the average CPP payment is $596. — Garth
@Vlad, post #166:
Wow, $1230 a month for Social Security you say? I read somewhere that a big part of the U.S. deficit is due to paying entitlements, and now I understand why the deficit is so large.
Garth,
I’m an avid follower of your blog. My partner and I are in our mid-late 20’s. I am a firefighter and she is in her last year of law school with a future position at a local firm where we live.
Where would you recommend we go to get unbiased [if it exists] and experienced direction on our financial planning.
Best blog on the internet; keep it coming!
Arlin
As a late 50’s boomer, I am often times envious of those who are 60 & 70+ who are retired comfortably. But I look at where they have been and their struggles to get there – and yes, they deserve it. Granted many were lucky to work at the same jobs for their entire life earning a pension – something few today can brag about. Most sacrificed a lot while raising children – many who now believe they deserve to have everything their parents had NOW! Young people today want it all, new or fully renovated homes, designer clothes, expensive cars, the latest electronic gadgets, annual vacations, etc. . . Many of the younger generations don’t want to sacrifice anything to reduce their debt load. Give up the latte, the exercise class (walking is free), the 2nd car (take the bus), cable/satellite, internet, etc. Need I say more?
Can’t get by on 30K? Sure you can!
The secret is to start dialling back expectations 30 years prior to retirement.
Then when you do retire you’ll be comfortably getting by on much less, in part because your wife and kids left eons ago, meaning there’s now more room aboard your sailboat for you and your hot new deckhand!
With 30K/ yr.. you’re in Fat city and on your way to the caribbean.