Spooky

On Halloween it’s okay to pretend you’re someone else. What a relief that must be to most little beavers whose real lives are pooched. Tell me, how did we get to be so educated, and still be so dumb?

“My sister and new husband, 28 and 31 years years old, are both full time teachers,” says Angelo. “They just bought a townhouse a month ago against my best efforts to educate them. My question is, should they still be putting aside money every month (firstly in their TFSA’s obviously), instead of putting all their extra money towards extra mortgage payments?

“Let’s face it, they are both going to be retiring with a pretty sweet pension, and the chances of it not being there for them are pretty slim.  My argument for putting some savings elsewhere was just so they didn’t have all of their money in one asset, even if it means they didn’t pay off the house as quickly.  Does a couple in their situation really need to be saving for the future outside their pension though? I can’t even seem to convince them to start with one of their TFSA’s to put some money aside.  It’s absurd to them.  What are some reasons I can use to convince them this is something that would be smart to do, even for people in their situation (sweet government pensions)? Feel free to discuss in a future blog post, I’m guessing some others might be in the same boat.”

Yes, Angelo, teachers are among the worst offenders for spending 100% of what they earn, saving nothing, being financially illiterate, and (most heinous of all) acting smug. In reality, many of them grossly underestimate the money they’ll need to live in a long, long retirement (many teachers check out in their 50s) and overestimate pensions. They also forget 100% of their defined benefit pension payments will be taxable.

So while it makes less sense for a career teacher to have a whack of money in an RRSP (at age 71 it could boost you into a higher tax bracket), TFSAs should be totally loaded for bear. The reasons are simple, spelled out here with robotic regularity. Put $5,500 in there every year from age 28 to 65, invested in a balanced account producing 7%, and end up with $949,000, of which $740,000 is compound (tax-free) growth. That will produce $4,700 a month in retirement (preserving the principal) which won’t be counted as income, won’t push sis into a higher tax bracket nor reduce her government pogey.

If they eschew this $100-per-week investment in favour of paying off a 3% loan on a shoddy townhouse, you have my permission to disown them.

Now, let’s do Becky.

“I am 29, married plus 1 child. Discovered your blog sometime in the summer, and have since been obsessed with it.  My husband and I sold our house in suburban GTA back in March (thank god) and moved to rent even though everyone we know thought we are crazy. Of course they think otherwise now. We are well on our way to our first 1 million in savings. Here’s the problem. My parents. They have a nice townhouse and I advised them to sell it ASAP before the stress test comes out and move to rent until the market bottoms. (They didn’t listen to me back in March but now their ears are wide open.) I am second guessing myself though because perhaps the stress test will push many buyers to the townhouse sector as detached will become unattainable for many next year. This could result in TH values going up. I would be devastated to have given them the wrong advice and hurt them financially. The last thing I want is to gain while my parents loose. I wouldn’t even be able to celebrate my success. Can’t live with that. Desperate to hear your thoughts about this.”

Let’s recap. You told the wrinklies to sell last spring when prices were insane. They didn’t. Ignored you. Missed the peak. Lost a wad of potential tax-free capital gains. And now you’d be ‘devastated’ if they sold at the wrong moment, when prices might be squeezed up?

Sheesh. They’ve done a number on your head, haven’t they? When the world runs out of weapons of mass destruction, there will always be parental guilt.

The best advice is to stop giving it to people who already know everything, and focus on your own family. Yes, you did the right thing with your house. But don’t be too anxious to get back into the market – things could take several years to find a bottom. As for the stress test pushing low-end real estate higher, this will probably happen, newbie buyers being as demented as they are. But it won’t last too long. It’s impossible for price levels to stay elevated when credit is being restricted. The parents should sell, rent and shuddup.

So here’s Linda, in Squamish, which is actually better looking than it sounds.

“First a huge thanks for keeping up your witty entertaining daily blog! It has become part of my morning routine for a few years now! I’m 30, own a cute little condo in the heavily inflated Squamish market and today I could more than double my money on this shoe box… I’d be sitting pretty with a total profit of over 300k

“The problem is rent in this town is close to double my mortgage; unless I’d be willing to rent a room in a shared house. Our town has been directly affected by the YVR market. In response to that there is a huge boom in the condo/townhouse construction, it worries me that soon my market will be oversaturated! Could the new mortgage rules make my condo even more desirable? I’m also worried that with the new mortgage rules buying in again will become more of a fairytale. I understand your strategy and love the thought of living off the interest but most banks nowadays can barely guarantee a 2% how and where could I be achieving these 7% returns you talk about?”

First, Linda, don’t fib. You can rent a 3-bedroom townhouse in Squamish with a double garage for $2,200. Condos are less – around $1,700. This is the amount your $300,000 profit would generate if invested to give you a 6.5% return. In other words, you’d live for free. No mortgage payment. No strata fee. No homeowner’s insurance. And you would have doubled your money, tax-free. How many times in your life is that going to happen?

If you sold and invested you’d have a diversified portfolio instead of all your net worth stuffed in one thing. You’d eliminate the inherent market risk with that stress test about to hit – with unknown effects. You would escape interest rate risk since it’s assured your next renewal will be at a higher rate. And you’d realize a major capital gain, instead of leaving it exposed. Besides, who wants to live in a shoebox in Squamish as a long-term strategy? Yuck.

Finally, if you read this site every morning, how could you even consider giving the bank your condo proceeds in return for 2% of pitiful, fully-taxable interest? Have you learned nothing? Is this blog just a collection of dog pictures and deplorables for you?

Linda, I’m crushed.

174 comments ↓

#1 mitzerboy aka queencitykidd on 10.31.17 at 6:10 pm

happy Halloween – all u dogs out there.

#2 paracho on 10.31.17 at 6:10 pm

I think I am first !
Great advice again .
No need to feel guilty if you already provided good sound advice and they did not listen !

#3 Bitcoinnaire on 10.31.17 at 6:11 pm

@Becky

29 and a liquid million dollars.. Impressive.

Sounds like you got there via Bitcoin?

#4 Planning on Going Senile on 10.31.17 at 6:12 pm

I plan on taking my CPP at 70. Drawdown strategy’s in retirement seem like a lot of hard work. Deciding annually which investment pot you should draw from and what taxes will result, is probably not a game for the elderly. In my 80’s I’d like as much as possible of my income to be, regular, indexed and guaranteed to last as long as I do.

But each to their own. I’m not sure that old size fits all.

It seems like it’s a pretty complex decision – not to be taken lightly https://moneycoachescanada.ca/blog/take-cpp-age-60/

#5 Mike McWilliams on 10.31.17 at 6:15 pm

My niece purchased a 2 bdrm dump in Langley 7 years ago with say a 25k down payment. They put it on the market 3 weeks ago and just sold it for $815k.
Now, imcant complain about how my RBC Global funds have been doing in the last couple of years, for for a couple of 35 years olds to be giving 1/2 million in their pockets after dropping down 25k 7 years ago, other than buying google or Amazon stock, I can’t see how they could’ve done better. Ummmm… I don’t remember what your advice was 7 years ago about guys Vancouver realestate. Could you remind me?

#6 Royal City Dweller on 10.31.17 at 6:18 pm

FURST? Maybe. Hey Adrewski, we will see soon.
ANyways: excellent post! How about more of these Q&A posts? It’s delightful to read them. I’m so addicted.

#7 The real Kip on 10.31.17 at 6:20 pm

The people who own the roof over their heads will always do better in life than the ones that don’t. Always!

#8 Lost...but not leased on 10.31.17 at 6:22 pm

Hey hey hey Phyrzzt

and BOOOOOOO

#9 Andrewski on 10.31.17 at 6:22 pm

2 things to love about Squamish: 1) Only 30 minutes drive to Whistler Mtn. 2) Mags 99 Cantina!

#10 Nonplused on 10.31.17 at 6:24 pm

Now this is scary:

https://wolfstreet.com/2017/10/26/the-most-unaffordable-housing-markets-in-north-america/

#11 Michael King on 10.31.17 at 6:25 pm

This is the best writing I’ve come across regarding the Vancouver housing crisis/RE market. The city is losing many young people even though they have well paying (for Vancouver) full time jobs. This town is becoming more dead and boring with every passing year. These days, the climate is the best thing it has going for it. Pathetic. Me: 64, retired, mortgage & debt free, lucky

https://thetyee.ca/Opinion/2017/10/30/I-Left-Vancouver/

#12 Doghouse Dweller on 10.31.17 at 6:25 pm

Damn, my Bloomberg Deplorables Tv feed went dark. So much for my fully integrated world-class execution capabilities.
“Bloomberg TV Canada is eliminating its two original in-house Canadian business programs, including its marquee evening interview show, in a move that sees more than 20 people lose their jobs.
The about-turn for Bloomberg TV Canada comes roughly 19 months after the station’s high-profile roll-out that saw it snag anchors such as Amanda Lang, formerly of the CBC, and Pat Kiernan, a well-known Canadian-born but New York-based TV personality.
Twenty-two people involved in making two in-house shows will lose their jobs as a result.”
I feel bad about all these people loosing their jobs left right and center. A Pink Slip for Amanda Lang
imagine that. The economic recovery lift off narrative is fading fast.

#13 Widening Gyre on 10.31.17 at 6:27 pm

I kid you not – Once when discussing financing options with a US teacher, she insisted that I convert the interest rate to US. It took me about 10 minutes to convince her that while the Canadian Dollar price would be numerically lower when converted to US dollars, the interest rate would remain the same. 10% Canadian is 10% US – She was quite put out.

I sincerely hope she was not a math teacher!

#14 According to Zolo on 10.31.17 at 6:32 pm

Not sure where you are getting your data stating Vancouver detached homes have flat-lined Garth.

Zolo is showing the avg selling price dropping to $2.3M in July and then rapidly swinging back up to just under $3.1M today – an all time record high.

It’s hardly a dead cat bounce, when the cat bounces higher than where it fell from.

Must be the rising interest rates making all the $70K/yr local families jump into buying these multi-million homes… That makes sense, right?

#15 Penny Henny on 10.31.17 at 6:34 pm

In reality, many of them grossly underestimate the money they’ll need to live in a long, long retirement (many teachers check out in their 50s) and overestimate pensions.-GT
////////////////

Check out…… like… die?

Like…retire. — Garth

#16 BMan on 10.31.17 at 6:35 pm

oh dear Linda!!!….how did you miss ETFs, balanced portfolio et al….

#17 binky barnes on 10.31.17 at 6:37 pm

First?? And let the teacher bashing commence.

#18 gfd on 10.31.17 at 6:37 pm

DELETED

#19 Happy Halloween on 10.31.17 at 6:37 pm

http://www.cbc.ca/news/politics/clark-kent-justin-trudeau-1.4380716

#20 I’m stupid on 10.31.17 at 6:39 pm

My wife is a teacher and I agree, they spend every penny they make. Teachers say the cheque is always in the mail. Complete job security and great pension. It’s like cash for life. It wasn’t until we met that she changed her attitude. After we got married she felt embarrassed because of size of my portfolio. It was like showing her my penis lol.

#21 Stone on 10.31.17 at 6:47 pm

Another great blog post today. They just help reinforce that I made the right decision to sell my house just before the peak and invest the money so that it can hang out with its new buddies, RRSP and TFSA. Now, with just under $1,000,000, I’m loving the flexibilty and freedom.

I heard through the grape vine there’ll be the annual job cuts at my company coming over the next few weeks. I know I’m not among them after a discussion with the executives since they’re very happy with my performance. On the other hand, even if it did happen, it wouldn’t be so bad. Current YTD return on my portfolio as of today is 8.51%. In other words, about $80,000ish. The best part is how tax efficient that $80,000 is.

Also, renting is good. Based on the returns on my balanced and diversified ETF portfolio directly attributed to the house sale, I live for free with about $15,000 left over. That’s what I call casflow positive! If anyone says owning is more cost effective, I’d want them to take breathalyzer and a lie detector.

Big, big pat on the back. You did good buddy. For those who have gotten to this stage or beyond, I don’t think I need to say how much of a relief it is to be in this situation. For those getting here, it’s all worth it. Keep going.

#22 Rodney Mallaley on 10.31.17 at 6:51 pm

Hi, living in Montreal, Married 51,wife 41 adult kids,debt free next year, renting 900/month, government defined benefit pension at 60 53% salary plus q.p.p. Thinking of buying condo under 200,000. Any advice will be very much appreciated. Thanks,
Loyal reader!

#23 Stone on 10.31.17 at 6:58 pm

#3 Bitcoinnaire on 10.31.17 at 6:11 pm
@Becky

29 and a liquid million dollars.. Impressive.

Sounds like you got there via Bitcoin?

——

Sounds like someone needs to brush up on their reading and comprehension skills. They said they sold their house. How does that relate to bitcoin?

#24 Linda on 10.31.17 at 6:58 pm

The teacher pension. Yes, it ‘should’ be safe – yes, it ‘should’ be there to dole out a nice monthly sum come the day of retirement. But this depends on that pension remaining fully funded & it also depends on that pension not being meddled with. Also, what if those teachers decide to change careers or lose their jobs? Never happen? Given the cost of education, why wouldn’t cash strapped school boards not explore the viability of education via the Internet? Imagine the implications…..

#25 TnT on 10.31.17 at 7:02 pm

#20 I’m stupid on 10.31.17 at 6:39 pm

Was her’s bigger?

#26 Penny Henny on 10.31.17 at 7:10 pm

#15 Penny Henny on 10.31.17 at 6:34 pm
In reality, many of them grossly underestimate the money they’ll need to live in a long, long retirement (many teachers check out in their 50s) and overestimate pensions.-GT
////////////////

Check out…… like… die?

Like…retire. — Garth
///////////////

All good then. I thought it was part of the Halloween theme

#27 crowdedelevatorfartz on 10.31.17 at 7:10 pm

@#20 Im Stupid
“After we got married she felt embarrassed because of size of my portfolio…”
+++++

Its not the size of the portfolio that’s important.
Its the adviser who ……..
never mind.

#28 TheDood on 10.31.17 at 7:11 pm

#21 Stone on 10.31.17 at 6:47 pm

I am in same position and echo your thoughts. It is a huge relief to have zero debt and a growing portfolio.

This blog is a gold-mine of info.

#29 Habbit on 10.31.17 at 7:11 pm

Another great post Garth. We have lost respect for others who help out everyone including average working slobs like me. Thank you sir for all you do.

#30 AGuyInVancouver on 10.31.17 at 7:15 pm

#5 Mike McWilliams on 10.31.17 at 6:15 pm
My niece purchased a 2 bdrm dump in Langley 7 years ago with say a 25k down payment. They put it on the market 3 weeks ago and just sold it for $815k.
Now, imcant complain about how my RBC Global funds have been doing in the last couple of years, for for a couple of 35 years olds to be giving 1/2 million in their pockets after dropping down 25k 7 years ago, other than buying google or Amazon stock, I can’t see how they could’ve done better. Ummmm… I don’t remember what your advice was 7 years ago about guys Vancouver realestate. Could you remind me?
_ _ _
In a normal world where housing is dependent on local incomes Vancouver’s market should have corrected long ago. What Garth and any other commentators could not have foreseen is how much money from mainland China would distort the market (sorry Garth but it’s true). There are basically only three types of buyers left buying single family houses in Vancouver:
1) Those bankrolled with money from China (foreign or PR)
2) Builders, who will build houses for 1)
3) Investment syndicates (local or foreign) looking for a place to park cash and generate rental income while waiting for the inevitable land lift.

That’s it. The middle class is no longer a factor in Vancouver house sales. Period. They’re fighting it out for the last affordable condos, and even those 2 bedrooms are quickly rocketing over $1 million. A sad state of affairs.

#31 akashic record on 10.31.17 at 7:15 pm

RIP

#32 Gentle ,Loving Kindness on 10.31.17 at 7:16 pm

I think teachers will become obsolete by way of technology. They could be going the way of taxi drivers by Uber, unskilled manufacturing labourers by robots, and retail sales people by online commerce. Why do we need physical teachers anymore? Why do we need to bring the pupil to the teacher anymore? Lesson plans can standardized, using real science based facts, and dispersed via the internet. They will be made way more interesting with augmented reality and / or Virtual Reality. This would break the practice of indoctrinating the students with local political biases, and provide the same high quality education to all students. This can be s a very democratic process. Students of all races and economic backgrounds can receive the same high quality education. This won’t happen over- night, but as internet learning becomes more acceptable, the political power of teachers unions will decline.

#33 Unumizer on 10.31.17 at 7:21 pm

Garth, I am confused. $300,000does dish off $1,700/mo but that’s taxable so you’re not living for free depending on your bracket. What am I missing?

Taxes on dividends and capital gains are peanuts for most people. — Garth

#34 Tony on 10.31.17 at 7:23 pm

WAIT! If people buy lower prices homes and drive up those values won’t that allow move up sellers to buy detached at a better price pushing those prices up? I’ve totally given up assuming prices will go down. It’s been 20 years and still have to wait up to 5 more for a bottom? That’s almost half a lifetime.

#35 rainclouds on 10.31.17 at 7:24 pm

Neil .u nailed it

http://www.cbc.ca/beta/news/opinion/canada-tax-fairness-1.4378810

#36 jess on 10.31.17 at 7:28 pm

how that merger going?

Airbus corruption scandal widens as firm admits US arms trafficking filing ‘inaccuracies’

Aerospace giant warned of material impact from potential fines over existing bribery probes in UK and France surrounding use of middlemen

Tim Hepher, Cyril Altmeyer
Tuesday 31 October 2017 08:59 GM

http://www.independent.co.uk/news/business/news/airbus-corruption-arms-trafficking-inaccuracies-us-filing-itar-a8028741.html

=
the stones are a flyin’
awkward!
http://www.cbc.ca/news/politics/morneau-shepell-scheer-speech-sponsorship-1.4380757

http://www.cbc.ca/news/politics/andrew-scheer-rrsp-for-rich-people-hypocritical-1.4375171

DODGY
What does Paul Manafort’s indictment mean for US tax reform?
https://qz.com/1116126/what-does-paul-manaforts-indictment-mean-for-the-donald-trumps-tax-reform-plan/

#37 Gregor Samsa on 10.31.17 at 7:30 pm

“balanced account producing 7%”

Garth can you do a blog post on how people who don’t have the time/skills/stomach to do their own investing can obtain a 7% portfolio?

There are many options out there such as Mutual Funds, Robo-Advisors, the guys at the bank, DIY schemes like couch-potato, etc. None of these seem to produce 7%.

Balanced 60/40 portfolio return so far in 2017: 9/7%. Get some help. — Garth

#38 Renter's Revenge! on 10.31.17 at 7:31 pm

#25 TnT on 10.31.17 at 7:02 pm
#20 I’m stupid on 10.31.17 at 6:39 pm

Was her’s bigger?

===

I was wondering the same thing. Awkward!

#39 Rainman on 10.31.17 at 7:31 pm

Garth – you are so wrong on Squamish. Firstly you’d be lucky to find a half decent town home, actually one at all for that matter. Hard to find anything to rent, basement suites are going for $1700 plus. Not that I’d want to live in a shoebox, but if I had to it would be in Squamish. Best place around, you should visit.

Check out current rentals. I did. — Garth

#40 Stone on 10.31.17 at 7:39 pm

#28 TheDood on 10.31.17 at 7:11 pm
#21 Stone on 10.31.17 at 6:47 pm

I am in same position and echo your thoughts. It is a huge relief to have zero debt and a growing portfolio.

This blog is a gold-mine of info.

——

And the comic relief on here is priceless. LOL

#41 crowdedelevatorfartz on 10.31.17 at 7:43 pm

@#177 Lost but not Least
“Freedom 55 Civil Servants…
Another issue is when they retire and collect their pension…many will then take on other jobs and deprive a job from another person. ”

Total Agreement.

My personal pet peeve is civil servants retiring and then IMMEDIATELY stepping into the opposing side private sector company that they used to work with.
For example.
Civil servant working at Canada Post then retires full pension.
Starts working the next week for …lets say for a hypothetical example ….SNC Lavalin….. as the new private sector contractor person that now reports to….. Canada Post( possibly to their former subordinate).
Now, insert any other senior position with Public Works Canada ( Health Canada, Military, RCMP, etc etc etc) and assume , hypothetically, that SNC Lavalin snaps them up to cross over the floor to work on the same portfolio only now…….as SNC’s advocate.
One wonders…how long before other civil servants nearing retirement see this ( lucrative, totally legal , morally reprehensible, double dipping) and decide to ease off on the contractor so that they may get a kick at the “double dipping” can.
Its a HUGE conflict of interest and there should be a minimum two year BAN of govt workers crossing over to the very same companies that they either awarded or oversaw govt contracts for.

I personally have seen this happen 6 times in the past two years

#42 oncebittwiceshy on 10.31.17 at 7:49 pm

#5 Mike McWilliams: “My niece purchased a 2 bdrm dump in Langley 7 years ago with say a 25k down payment. They put it on the market 3 weeks ago and just sold it for $815k.”

<<<<<<<<<<<<<<<<<<<<<<<<
Well, congratulate her on her timing then, Mikey, because there are currently half a dozen dumps (single family homes) in langley under $700,000.

Oh yes, it is great timing when you look at myrealtycheck.ca in Langley.

Average Change: -4.16% Up:16 Down:88
Overall $ Change: -8813226.00 Average Change Amount:-84742.56

Thank god she got one of those buyers that just spots it on the road and buys it without question. Lololol.

#43 Doghouse Dweller on 10.31.17 at 7:51 pm

#24 Linda
Education via the Internet? Imagine the implications…..
—————————————————————-
A lot of political lobbying to insure it never happens. McGuinty/Wynne

#26 Penny Henny
Like…retire.
————————————-
Big time stress, not the nirvana people assume and not the Brady Bunch schools of yesteryear.

#44 LivinLarge on 10.31.17 at 7:53 pm

Just for my future reference, when you say: “Balanced 60/40 portfolio return so far in 2017: 9/7%. Get some help. — Garth” is that 7% an annualized rate or actual year to date rate?

YTD. — Garth

#45 Stone on 10.31.17 at 8:07 pm

#37 Gregor Samsa on 10.31.17 at 7:30 pm
“balanced account producing 7%”

Garth can you do a blog post on how people who don’t have the time/skills/stomach to do their own investing can obtain a 7% portfolio?

——

They can’t. Not on their own for exactly the reasons you just illustrated. You do realize that the guy who writes this blog is a financial advisor. Step 1: have a chat with a financial advisor. I wonder who? Step 2: that’s up to you. Step 3: that’s also up to you…

It’s all up to you. Stay poor and afraid of your own shadow or get rich and have your money work you.

This blog is not intended to solicit any business for my evil twin brother who is an advisor. I’m the poet-biker. — Garth

#46 Rainman on 10.31.17 at 8:14 pm

Garth – you are so wrong on Squamish. Firstly you’d be lucky to find a half decent town home, actually one at all for that matter. Hard to find anything to rent, basement suites are going for $1700 plus. Not that I’d want to live in a shoebox, but if I had to it would be in Squamish. Best place around, you should visit.

Check out current rentals. I did. — Garth

Cookie cutter townhome for $2875 – 1600sf. A few condos in the $2200 range.

https://whistler.craigslist.ca/apa/d/3-bdrm-townhouse-squamish-bc/6367599450.html

You have to dig deeper. Slim pickings in actuality.
Every market is different. Hard to know what to do here for sure. I myself was also booted out twice because of the owner selling. There is that too.

#47 crowdedelevatorfartz on 10.31.17 at 8:21 pm

@#198 Overheardyou
“The reason I am not thinking about switching all is due to my lack of knowledge. I was told that Mutual funds are less volatile. Having just learned about ETF’s, I am not sure if it would be wise to switch all my investments them.
******

My previous “investment” advisor said the same thing.
Due to this and several other extremely crappy investments……I dumped them.

Best thing I ever did.

Your mutual fund manager is all about his commissioned fee and HIS financial well being not yours….

As I said to a mutual fund flogger who was bragging in the bar one night about “retiring before he was 50!”
I asked him, ” How many of your clients will retire before they’re 50?”

Crickets.

#48 Squamtonian on 10.31.17 at 8:22 pm

Are you serious…. squamish is as bad as it sounds…. not at first but after a while you see that this place has the worst city planning ever. And if you don’t work in squamish(which is probably 95% of the people living there), u just made you daily commute 40 mins minimum either way.

#49 DON on 10.31.17 at 8:24 pm

“Tell me, how did we get to be so educated, and still be so dumb?”

!) Lack of critical thinking in educational programs.

2) Having to tow the line in the workplace in both private and public sector.

3) The ability to readily challenge your grade (no matter the merit) with your professor or just let mom and dad deal with it.

4) Politicians having to tow the party line.

5) Group think and marketing.

I am sure there are more. A correction in thinking seems to be needed.

Inflated egos due to rising equity in real estate…nah!

#50 Rainman on 10.31.17 at 8:39 pm

@ #45 Squamtonian
You should move then, you sound bitter?

#51 I’m stupid on 10.31.17 at 8:42 pm

DELETED

#52 Smoking Man on 10.31.17 at 8:42 pm

Teachers really bug me.

Go down this path im trachibg for success. Total bull shit.

Look in the mirror and and say to yourself my shit don’t stink. Im super thing.

Ego and alpha chic or dude is all that’s required for benefits.

#53 acdel on 10.31.17 at 8:42 pm

#7 The real Kip

Since it is Halloween; I am wearing a Garth costume this evening; response, whatever, good-luck!

Just switched costumes to the late Ralph Klein (this should be good); loved what he told that smug Paul Martin “What goes up, will come down; guess what, it did!

Your choice, hope it is a good one. Spooky!

#54 Al on 10.31.17 at 8:51 pm

I like these posts Garth when you take readers questions.

Do more.

The best part is hen you slam them ofcourse.

#55 Long Branch Apprentice on 10.31.17 at 8:52 pm

Who gives a shit about teachers? Most can’t do math, or write for shit. Bunch of losers who brag about their pension while mailing in a lukewarm effort. Let’s see how many can take early retirement from my generation, where many struggle just to make the substitute list. Too many double dippers, and everyone knows it.

Trudeau is such a loser, copying his hero Obama’s Superman shtick.

By the way, anyone who has read The Dark Knight Returns know who bested Supe in combat.

Seriously, many teachers are absolute losers with zero passion besides getting to the cottage early on a Friday night. This college strike ain’t helping either.

My pension supplement involves USDCAD and a big horny bull.

Ask Smoking Man, he always knows what time it is.

Peace out Doom Gloom and Boomers.

#56 JustMe on 10.31.17 at 8:53 pm

#16 I don’t get it on 10.30.17 at 6:47 pm
Prudent advice Garth, but I plan on waiting (to collect CPP) until 70. Will retire at 50. Then draw down my entire RRSP between the ages of 50 and 70 and live the good life.
____________________________________________

The problem with those estimates of how much more CPP you will get if you wait until you are older, they are based on the assumption that you will continue working until you collect. If you retire early, the formula reduces the amount you get for waiting. They don’t tell you about that part.

http://manulifesolutions.ca/docs/en/ws_factsaboutcpp_e/ws_factsaboutcpp_e.pdf

“It generally makes sense to take the CPP/QPP early if you have stopped working. The contributory period continues until you start taking the pension or age 70 whichever is earlier. If you are no longer contributing, the zero earnings during the non contributory period before starting your pension may lower the overall benefit collected even if you waited until age 65 (or 70).”

#57 Stone on 10.31.17 at 8:53 pm

#45 Stone on 10.31.17 at 8:07 pm
#37 Gregor Samsa on 10.31.17 at 7:30 pm
“balanced account producing 7%”

Garth can you do a blog post on how people who don’t have the time/skills/stomach to do their own investing can obtain a 7% portfolio?

——

They can’t. Not on their own for exactly the reasons you just illustrated. You do realize that the guy who writes this blog is a financial advisor. Step 1: have a chat with a financial advisor. I wonder who? Step 2: that’s up to you. Step 3: that’s also up to you…

It’s all up to you. Stay poor and afraid of your own shadow or get rich and have your money work you.

This blog is not intended to solicit any business for my evil twin brother who is an advisor. I’m the poet-biker. — Garth

——

My mistake. If you were fraternal twins, it wouldn’t be so hard to tell the two of you apart. Same rugged good looks. How can I be faulted for that? LOL

#58 For those about to flop... on 10.31.17 at 9:02 pm

10.31.17 at 3:08 pm
#178 TnT on 10.31.17 at 2:57 pm
“Zillow to accept Canadian listings.”

Does this mean Floppy’s out of a job? :)

//////////////////////

I had a premonition that my life as this blogs sump pump was coming to an end and started dreaming of relaxing on a Fijian beach…

M43BC

#59 TnT on 10.31.17 at 9:05 pm

#49 DON on 10.31.17 at 8:24 pm

“Tell me, how did we get to be so educated, and still be so dumb?”

We tend to forget how stupid every generation is when we are purposely being duped by Big Corp or Gov.

Things I think of off the top of my pointy head…

McCarthyism and the “Red” scare (being repeated today)

Smoking does not cause cancer (Smoking Scrub does though)

Nicotine is not addictive

Seat Belts mess your clothes so don’t install them

Lead Paint & Lead Gas

Vietnam War – Gulf of Tonkin incident

DDT and the environment

CFC and the ozone layer

Pet Rocks & Cabbage Patch Kids

Disco

Trans Fat – was the miracle oil solid at room temperature

Cholesterol levels and Lipitor statin drugs

Trump got elected… heh..

I could go on and on about stupid we all are as humans, each generation feels smarter then the next…

#60 mathman on 10.31.17 at 9:06 pm

re: Becky

Kudos for making the wise move.

On your way to a Million in savings at 29, did you buy the house when you were 18? Did the builder include a money tree along with free air conditioning?

While it is possible, seems highly improbable. On the surface does not pass the smell test unless there was a massive downpayment from the bank of Mom and Dad and or you are in the .01% of people your age with an extremely high income. Not hating, just questioning.

Math

#61 Last of the Boomers on 10.31.17 at 9:09 pm

@#44

I am one of Garth, Ryan, Doug and team’s clients and can attest to the fact that as of yesterday, Without today’s gains, and dividends and less investment and MER fees, I am up approximately 7.9% (and likely over 8 %) year to date. Thanks from the family to Garth, Ryan, Doug, Sebastien, Ross and the team at Turner Investments!

#62 Linda on 10.31.17 at 9:15 pm

#41 (Crowded) Your pet peeve regarding government employees is what is called networking. Is prevalent in the private sector too. As for the issue with government workers collecting a pension while working at another job, you may wish to consider the fact that by doing this they are likely to be in a much higher tax bracket. You may also wish to consider that fact that Canadians may now collect CPP while still working. Do you consider that double dipping as well, or are you of the opinion that it is only double dipping when done by a (former) government worker?

#63 Ronaldo on 10.31.17 at 9:25 pm

#32 Gentle ,Loving Kindness on 10.31.17 at 7:16 pm

I think teachers will become obsolete by way of technology.
—————————————————————
Totally agree. Have been saying the same for several years. Technology has been very slow getting into this area as usual. But it will come no doubt about it.

With the knowledge that the preschoolers are gainingr from the internet like my twin 4.5 year old grandchildren is mind boggling. I learn something from them everytime I see them. By the time they get into grade one, they will be far ahead of what is being taught. They will be able to teach the teachers. My own son was programming in Basic at the age of 10 back in 1981 and couldn’t get enough of it. Today, a multi millionaire entrepreneur. And we just hired a slew of teachers here in BC.

#64 FOUR FINGERS WATSON on 10.31.17 at 9:27 pm

#30 A Guy In Vancouver
There are basically only three types of buyers left buying single family houses in Vancouver:
1) Those bankrolled with money from China (foreign or PR)
2) Builders, who will build houses for 1)
3) Investment syndicates (local or foreign) looking for a place to park cash and generate rental income while waiting for the inevitable land lift.
…………………….

Something strange is taking place in Seattle where prices soared by a bubbly 13.2% Y/Y, and which has either become “Vancouver South” when it comes to Chinese hot money laundering, or there is an unprecedented mini housing bubble in the hipster capital of the world.

http://www.zerohedge.com/news/2017-10-31/home-prices-all-us-cities-grow-faster-wages-and-then-theres-seattle

#65 Russ on 10.31.17 at 9:27 pm

Not enough people know people know,
“Duct tape can’t fix stupid. But it will muffle the sound.”

#66 Smoking Man on 10.31.17 at 9:28 pm

Clinate change is bull shit

Bet accordingly.

#67 SpeedWeasel on 10.31.17 at 9:32 pm

Becky:
That’s “while my parents LOSE”. Please learn to spell like a grown-up. Only 1 “o” is needed.

LOOSE is for shoelaces.

#68 TnT on 10.31.17 at 9:34 pm

#55 Long Branch Apprentice on 10.31.17 at 8:52 pm

Who gives a shit about teachers? Most can’t do math,

Idiot comments like this never use to bother me till Trump got elected.

Teaching is a very noble profession that requires 2 University Degrees.

Teachers are part of our community and need our respect and support.

Your comments are obviously ignorant of what it means to be a Teacher & what our school system environment challenges are.

Spend a few days as a Teacher’s Assistant and learn a little bit about what you are so ignorantly commenting on.

It is so common now to just spread hate on Doctors, Lawyers, Teachers, Cops, Judges, Politicians & even Realtors.

“It’s time to shame ignoramuses

~You Sir! are a buffoon!~

Shame!….. Shame!….. Shame!…..”

#69 conan on 10.31.17 at 9:40 pm

A husband and wife situation and they both have sweet government pensions? Seen this before, no desire for a TFSA…….

Its a life insurance solution.

Just kill me now.

https://youtu.be/xW-tcCsP0Zc?t=29

#70 Blutterfy on 10.31.17 at 9:41 pm

I’m always amazed at BC people complaining about rental prices. It’s within a couple hundred dollars difference to live in (rent) downtown Vancouver or downtown Edmonton. I’m gonna move to the coast as soon as I finish paying my student loans. :)

#71 Lost...but not leased on 10.31.17 at 9:43 pm

Teachers obsolete?
……have been for a long time.

Graduates of dreaded “Home Schooling” on average not only exceed graduates of public schools…they also have preference by many Universities re: admission criteria.

I mean……”A”s in W*mens studies VERSUS Calculus has a realistic quota system.

#72 For those about to flop... on 10.31.17 at 9:44 pm

17 at 6:32 pm
Not sure where you are getting your data stating Vancouver detached homes have flat-lined Garth.

Zolo is showing the avg selling price dropping to $2.3M in July and then rapidly swinging back up to just under $3.1M today – an all time record high.

It’s hardly a dead cat bounce, when the cat bounces higher than where it fell from.

Must be the rising interest rates making all the $70K/yr local families jump into buying these multi-million homes… That makes sense, right?

///////////////////////

I already addressed this in a post last week partially.

There has been some distortions in the numbers recently due to so heavy hitters cashing out.

A 2 bedroom knockdown in one of the most prestigious blocks of Vancouver real estate went for 13.5m.

This one sale alone dragged the city average for a 2 bedroom up to 4 million because there were only 5 other sales in that bracket.

Also in the 4-5 million bracket I have seen some sales reported by people doing what they should be doing and cashing out.

My Pink Snow cases in the same bracket have stopped to a crawl because the people that need to get Spring Fling 2016 prices plus 10% are pretty much done and hoping next year is the year of the donkey and it kicks like a mule.

Two options,take a loss or wait and see if Spring 2018 and beyond goes bonkers-I don’t think it will in that bracket,but hey it’s a great spectator sport.

Let’s put it this way, Four Fingers Watson isn’t the only person that had a thumb blown off because the package was too hot…

M43BC

#73 Pete from St. Cesaire on 10.31.17 at 9:47 pm

We tend to forget how stupid every generation is when we are purposely being duped by Big Corp or Gov.
Things I think of off the top of my pointy head…
McCarthyism and the “Red” scare (being repeated today)
————————————————————
The fake scare today is not about ‘Reds’, just Russians, who people believe lost the cold war.
McCarthy was right and we should be so ashamed of ourselves for dismissing him. What we are witnessing happening to our societies right now is proof that he was correct about a communist conspiracy. Many of you can’t see communism for what it is; you’ll say stuff like the ‘US is moving away from socialism at a fast pace’, but you’d be wrong.

#74 akashic record on 10.31.17 at 9:53 pm

#66 Smoking Man on 10.31.17 at 9:28 pm

Clinate change is bull shit

Bet accordingly.

This is what you need to know about climate change, from 13 minutes

https://www.youtube.com/watch?v=GxERTlbAo7g

#75 TheSpangler on 10.31.17 at 9:54 pm

One thing to note that goes with housing mania, is the 3 samples you used above, how did they all make their wealth; a one asset (housing) strategy. That is what all the moisters are still chasing.

5% down and look what they walk away with.

It’s over. — Garth

#76 palebird on 10.31.17 at 9:58 pm

#68 #55 Long Branch Apprentice on 10.31.17 at 8:52 pm

Who gives a shit about teachers? Most can’t do math,

Idiot comments like this never use to bother me till Trump got elected.

In all my years of assorted schooling which adds up to 16 years I ahve only had the pleasure of meeting a couple of genuine teachers. The rest were buffoons. Same with my kids. I met all of their teachers and I can’t say that one of them impressed me. Pretty sad. If you want to learn something do it yourself or put some effort into seeking out a genuine teacher. They are out there. Just have to find them among all of the others who believe because they have a degree they know something.

#77 TnT on 10.31.17 at 9:58 pm

#66 Smoking Man on 10.31.17 at 9:28 pm
Clinate change is bull shit

Bet accordingly.

***

Climate Change is real.

Want Proof – Yesterday was warmer than today, therefore the climate changed.

On a more serious note:

There is no better method of Globalizing the world than to create the ultimate “boogeyman” that transcends boarders and countries.

The Weather… now that transcends boarders and countries which makes it a great “boogeyman”

#78 Bottoms_Up on 10.31.17 at 10:00 pm

Let’s get this straight, one can put aside $450/mo into a TFSA, over the course of a career, and have their own sizeable ‘pension’. Good stuff.

Yet, when a member of the public service does the same (contributing $450/mo of their paycheque into a pension fund, then matched by the employer, and invested by a panel of experts), and receives a decent pension at the end, this is somehow criminal?

#79 akashic record on 10.31.17 at 10:00 pm

Actually, make that from 2 minutes…

#80 I believe everything on television on 10.31.17 at 10:05 pm

the torture never stops-

https://www.thestar.com/news/gta/2017/06/15/to-help-prepare-for-catastrophe-toronto-hires-a-chief-resilience-officer.html

#81 Last of the Boomers on 10.31.17 at 10:06 pm

Just did my calculation as of today. Up 8.3% YTD and that’s with the fees and the MERs already taken out. If you included the financial advisor fees and MERs it is well over 9%. Most are the RJ teams pics, but I have a few of my own picks in there as well. I generally choose the timing for additional deposits and listen to the team and this blog for timing and rebalancing. It works.

#82 WUL on 10.31.17 at 10:11 pm

Life is bueno in the ‘envy of the nation’ (Conference Board) and the Cowtown Real Estate Board reports an ordinary October. New and active listings up. Sales down or flat. Some gains YTD and DOM up.

Post recession. And $54 oil.

http://www.cbc.ca/news/canada/calgary/conference-board-good-signs-future-calgary-1.4378811

#83 Lost...but not leased on 10.31.17 at 10:22 pm

#62 Linda

Clearly you do NOT get it…

(BTW I had a short “contract” stint working in the civil service…thank God it was short…as my then “brothers” told me “we w-a—l—-k ……we don’t run here…..aka don’t make the others look bad with your work ethic)

In the Private Sector nothing is certain.., whereas in Public Sector your job is literally guaranteed ….subject to a few major deferences and genuflections to the Union leaders and fellow union members.

Gov’t workers should wake up and realize their jobs ultimately exist at the discretion of Joe/Jane taxpayers..depending on their vigilance /awareness/tolerance etc. The status quo seems to indicate that “our elected representatives”..the politicians..are often hostage by the “minority” public sector mafia to the detriment of the majority taxpayers.

Animosity is neutralized if they(Civil Servants) do their jobs and don’t squeal, but if their often quasi-Commie leadership demands exceed their grasp of reality, the General Public have every right to not only protest, but seek alternatives…its business is business..cost vs benefit ….there is nothing scared re: public sector and their unions.

IMHO, Double dipping by “Freedom 55” Civil Servants
is epitome of greed …if they feel they have the extra energy after their defined benefits kick in…perhaps look at volunteering.

IMHO, engaging in another career after retirement as a Public Sector employee moving another bureaucracy is despicable..call it JOB THEFT. Clearly we have an “olde boys club” (Networking)that perhaps needs investigation???

Abusing the system simply sets your “brother and sisters” up for major backlash from the increasingly disenfranchised taxpayer, one that they may never recover from.

#84 Bitcoinnaire on 10.31.17 at 10:23 pm

@Stone

>Sounds like someone needs to brush up on their reading and comprehension skills. They said they sold their house. How does that relate to bitcoin?

She paid off her million dollar mortgage in 7 years (assuming she graduated and went straight to work at the age of 22)?

Doesn’t sound very plausible.

There’s a big component missing to this story. I suspect she’s a closeted Bitcoin hoarder.

#85 Josh on 10.31.17 at 10:38 pm

Thank you Garth for all you’ve done. I place you right beside that one-legged guy Canadian’s seem to like. Perhaps it’s time we hear something about sustainable shelter or cheap ways to build a house. I myself intend to to buy a plot of land and erect my own cordwood home. Maybe blog dogs here should do the same: https://lh3.googleusercontent.com/-u9WfT1h_svU/WfkyQNwviDI/AAAAAAAAQ7g/YpiKRWeCN8gxNV6TzIM54YURkndeOFVFQCL0BGAYYCw/h246/2017-10-31.png

#86 TnT on 10.31.17 at 10:41 pm

#73 Pete from St. Cesaire on 10.31.17 at 9:47 pm

The fake scare today is not about ‘Reds’, just Russians, who people believe lost the cold war.
McCarthy was right and we should be so ashamed of ourselves for dismissing him. What we are witnessing happening to our societies right now is proof that he was correct about a communist conspiracy. Many of you can’t see communism for what it is; you’ll say stuff like the ‘US is moving away from socialism at a fast pace’, but you’d be wrong.

***

First.. the Russians did lose the Cold War BUT they were never a threat militarily. The Russian military strength was made up to get congress to pass more laws to fund the Military Industrial Complex.

Lots of money was left on the table when the Cold War ended. That will now be reversed.

McCarthy was wrong. You do not win the ideology war by shutting down debate and that’s exactly what he did, the Gov. over reacted with hysteria.

And on the flip side (funny enough), is what the new Post Modern Movement (new Communists) is all about via Universities.

What we are witnessing is the Post Modern Movement being disguised as Progressive Liberals but they are really Communists. They have debt and lots of time on their hands because thanks to Capitalism that promoted Globalism, there are no jobs to occupy their Academic minds and put them to work.

Russia does punch above their weight when it comes to inserting wedge issue into Western Society (via Social Media and “citizen plants”) but these wedges only work where there are already cracks i.e. race issues, economic gap issues.

If you want to win the ideology war then best to get people back to work (real jobs that works the Academic mind) and show them why Capitalism is best.

No one ever protests when they have food and entertainment or if they have to get up for work the next day.

#87 Lost...but not leased on 10.31.17 at 10:50 pm

“Climate Change” …

………..is a good intellectual exercise
….. regardless of what the average pleb thinks.

I seem to recall in the 1980’s dreaded “acid rain”…what happened….????

Also recall scientists talking about another “Ice Age”…..what happened ?

In the eternal UNholy alliance between Gov’t and Academia, sober objective thought is always at a premium for the general public.

Besides ‘Publish or Perish”, academia is permanently attached to the teats of “Grant$$$”….and do
(i) grants originate from apolitical neutral benevolent groups”foundations”…or
(ii)the more one holds ones noses with one eye 1/2 open…..

Is it clear Grants have various codicils attached to them..that either(i)academia either prostitute itself to the benefactor, or (ii)squat on the outside of the ivory tower looking in.

Yer instatootes of hired yearning are often bought and paid for by THE MAN and their syncophantic acolytes.

#88 conan on 10.31.17 at 11:16 pm

“Yet, when a member of the public service does the same (contributing $450/mo of their paycheque into a pension fund, then matched by the employer,” – Bottoms_Up

Even without the matching it is a great deal. I would be all over it.

#89 Millennial on 10.31.17 at 11:19 pm

Stone , how long did you hold onto your house befor you sold at peak? Sounds like what you did was great but you still had to buy and prices were probably lower and luckily raised a lot. I hope to be in your position one day

#90 Ryan on 10.31.17 at 11:24 pm

Yes technology could replace teaching but you gotta remember the biggest reason for schools in the first place is for someone to look after all those kids while parents are working during the day. So they will be around long time.

#91 LivinLarge on 10.31.17 at 11:24 pm

“They can’t. Not on their own for exactly the reasons you just illustrated.” horse pucks. Just read and understand a few investment vehicles and it’s rather simple actually.

My TFSA earns 8% paid monthly like clockwork. No capital growth but 8% divs. Anyone who has even a modicum of investment types knowledge can, from just the last sentence deduce what my TFSA is sitting in.

And thanks Fearless Leader for that return rate clarification. That 7% to the end of September is sweet. On target at least for 9.3% full year.

#92 Pete from St. Cesaire on 10.31.17 at 11:56 pm

In all my years of assorted schooling which adds up to 16 years I ahve only had the pleasure of meeting a couple of genuine teachers. The rest were buffoons.
—————————————————————–
Absolutely. And on top of that I bet that despite your being in school for 16 years you’ve heard people say “you didn’t go to school”. I went for 16 years too and many times I’ve had people say “you refused to go to school”, as in since I didn’t get a PHD my education is worthless; well they’re correct, it was. I, and the rest of us who had 16 years of our lives wasted by those nincompoops should be suing for breach of contract.

#93 B riding on 11.01.17 at 12:04 am

Squamish don’t sell to rent. If you are not leaving that town relax. Find other ways to make money they down sizing. Rent in ng is shit in this town. Eviction and not feeling at home. You will dress the day you sold everyday. Just be thankful you bought so cheap. Be grateful you own and have affordable place to live. I sold 4 years ago. Thinking you. Boy was I wrong. Renting since. Portfolio up 25 percent. Housing up 100. Rent up 35 percent price….

#94 Pete from St. Cesaire on 11.01.17 at 12:09 am

First.. the Russians did lose the Cold War BUT they were never a threat militarily.
—————————————————————–
The commies won the cold war. They simply declared defeat and went on to take over. For example:
Who leads Germany? Merkel – an East German Stazi officer.
Who runs South Africa? The ANC – commie murderers all
Who runs Namibia? SWAPO – commies
Who runs Canada? Castro was his daddy’s best friend.
And on and on.

#95 Fortune500 on 11.01.17 at 12:25 am

#84 I would suspect parents over Bitcoin. But you never know. 29 with almost a million in hand … clearly I don’t belong here.

#96 Ronaldo on 11.01.17 at 12:27 am

My DIY unloved MF Portfolio (TFSA and Unregistered) is up 6.9% ytd (net of fees) with a 62% Fixed 38% Equity mix. Star performers were Technology at 24.75% ytd and Emerging Mkts. 24.39% which made up 7% of my total portfolio. The gains on that 7% portion gave the portfolio a 1.4% boost. I expect the materials and energy sector to do very well going forward and have moved some of the gains into those areas.

#97 NEVER GIVE UP on 11.01.17 at 12:46 am

Our Government should be lowering taxes on business and backstopping loans to business while taxing the hell out of RE capital gains.

But that is fantasy because the rentier class (our government and friends) would disappear.

Really there is no option but to join them. Business is real work and hard work. Rentiering is easy. Like cashing cheques and deciding which luxury store to visit today, Chanel or Louis Vuitton.

All tax breaks and all loans are geared to help this class of people. If you are not in it you are losing in the long run.

#98 Becky on 11.01.17 at 12:46 am

#3
We have been investing through our ftsa in the past 2 years, and nop, not bitcoins. Not our thing.

#60
I did not buy a house at 18 and the builder did not include a free money tree lol. Also, we never used the bank of mom and dad. As a matter of fact, never got any financial help from anyone post the age of about 18.

#67
Thanks for the spelling lesson ma’am/sir but autocorrect does that sometimes ;) chill out

Garth, thank u. Your advice is appreciated.

Becky.

#99 DON on 11.01.17 at 12:54 am

Nothing to see here.

“The UK’s property market will take this week’s expected rise in interest rates in its stride, according to ratings agency Moody’s, but it warned that the outlook for the buy-to-let market has worsened significantly.

The agency, which along with Standard & Poor’s was widely condemned for awarding triple-A ratings to sub-prime mortgage books before the 2008 financial crisis, said the British property market is more resilient than is widely believed.”

https://www.theguardian.com/business/2017/oct/31/uk-interest-rate-rise-house-prices-moodys-property-market-brexit

Then in the next article the average non-mortgage debt is 16,000 pounds per resident.

It seems the UK is also special. Times are interesting! China’s credit debt…Yikes!

#100 NEVER GIVE UP on 11.01.17 at 1:47 am

#107 Howard on 10.30.17 at 4:28 am
Do you have any ideas for childfree singles?

Or are we the cash cows that keep this tax-avoidance party going for the marrieds?
====================================
I’ve always felt that someone who by choice has not contributed a life to this earth is really cheating their parents who sacrificed and nurtured you into this world.

It is more of a gift than a burden but really as a father of 7 I will honestly say there is never a good time to have kids so now is the time. Anyone can pick apart my choice of family size and probably with good reason but after all the stresses and financial burdens I can balance that with the wildest and richest family dinners and Christmas gatherings you can imagine.

There is always an erudite reason not to have kids. Yes you will be financially ahead and perhaps you can spend more time with friends at the bar but it begs the question as to why are we really here on earth?

If our nation has to import immigrants in large numbers to fill our jobs and care for our sick and elderly then we are like a family name that has come to an end with no heirs to carry on that name.

Many western people look down upon their own culture as if we have no culture and look at other cultures as rich and exotic.

Well the truth is those cultures look upon the West as the richest culture.

Christmas is the biggest and most extreme festival in the world by far! We have Halloween and Easter. Not to mention the greatest film industry in the world. One that the whole world loves to watch and emulate. Western Clothing, Everyone in China and most of the world wears Western clothing, eats KFC and Mcdonalds.

I for one am proud of our heritage and our development of democratic institutions. We have managed to keep our dictators down to a 4 year term and not a lifetime. Our incredible success has made us fat and weak. I am saddened about that.

https://www.youtube.com/watch?v=6SJnReLKQvM

#101 NEVER GIVE UP on 11.01.17 at 1:51 am

Forgot to mention
Rock and Roll! Classical music, Fashion catwalks and POP culture!
The whole world can’t get enough of it!

#102 Ben on 11.01.17 at 2:32 am

Squamish is amazing. I’d take a shoebox there any day.

#103 Money Coach on 11.01.17 at 2:54 am

#56 JustMe on 10.31.17 at 8:53 pm

The Manulife information sheet that you posted is from 2012 when there was significant changes made to CPP

http://www.cbc.ca/news/business/taxes/6-big-canada-pension-plan-changes-arrive-in-2012-1.1167450

Taking CPP at age 60 does freeze your contributory period at age 60. Removing the non contributory years from the calculation however, does not make up for the 36% reduction in benefits due to taking it early.

The contributory period does not go beyond 65 unless you work and voluntarily make CPP contributions.

#104 Where's The Money Guido? on 11.01.17 at 3:08 am

Re: #75 TheSpangler on 10.31.17 at 9:54 pm
One thing to note that goes with housing mania, is the 3 samples you used above, how did they all make their wealth; a one asset (housing) strategy. That is what all the moisters are still chasing.

5% down and look what they walk away with.

It’s over. — Garth

Not so fast Garth, it looks like the company that owns the casinos involved in money laundering in BC are now coming to Ontario. What a coincidence that just as the door slams on BC’s money launderers, the Ontario gov’t is happily allowing them to ply their “trade” at 4 Ontario casinos.
It’ll be uppa uppa uppa when they get those money counters whirring counting all those hockey bags full of $20 bills, all allowed by your gov’t that doesn’t want the bubble to keep deflating.
Just watch, if this goes through.
Our country is ruled by oligarchs and criminal mafiosos which imo includes the gov’ts, federal and provincial.
How could any gov’t touch Great Canadian Casinos with all this hanging over their heads.
I just can’t believe what I’m seeing.

#105 Stone on 11.01.17 at 3:38 am

#84 Bitcoinnaire on 10.31.17 at 10:23 pm
@Stone

>Sounds like someone needs to brush up on their reading and comprehension skills. They said they sold their house. How does that relate to bitcoin?

She paid off her million dollar mortgage in 7 years (assuming she graduated and went straight to work at the age of 22)?

Doesn’t sound very plausible.

There’s a big component missing to this story. I suspect she’s a closeted Bitcoin hoarder.

——

No. You’re still not making the connection. The story is plausible. The missing component isn’t with her story…

Keep working on those deductive reasoning skills. LOL

#106 Big Daddy on 11.01.17 at 4:44 am

#15 Penney H…….indeed….many teachers ( and this applies to the bulk of civil servants) easily and profitably retire in their 50’s…..but they don’t retire….that’s the problem…..they become ‘double dippers’. In every area of the civil service this is common practise from teachers, to forestry, police, civil engineers, admin….you name it.

They have full support from the union. The civil servant takes retirement with full pension and benefits…then ‘contracts back’ into the exact same position…without ever cleaning out a locker’ at a compensation package that is higher then their old salary (because now they’re in the private sector pay grade….what a laugh) .

They collect full and benefits AND A SECOND PENSION CONTRIBUTION FROM THE TAXPAYER. Same time off and all perks remain. Many double their old salaries this way. Someone mentioned retired policemen switching jobs when they age out…..exactly…..going from a city cop to a transit cop near doubles the old salary. Who knew that the Skytrain was so dangerous that it needed armed policemen with $200,000 p/a salaries with full perks and all the extras…..all while collecting the original city police pension…..a civil service miracle.

Are the Millenials striking back with marches and flaming torches up And down Sussex Drive……nope….they like being unemployed, it seems…..made so by the same civil service unions that elected OUR GREAT LEADER JT2. Hundreds of thousands of new grads ain’t going to work because the old guard won’t step down and there’s no way the current govt will put pressure on the union cabal that spends millions on advertising to get them elected. So…..if we want to create a million jobs for all the new grads in teaching, civil engineering and governance of everything……we just have to ask our civil servants to retire with a full pension and not be so damned greedy. There’s a million jobs open the second the Trudeau Liberals stop pandering to the unions.

#107 Dharma Bum on 11.01.17 at 6:28 am

“Tell me, how did we get to be so educated, and still be so dumb?…Have you learned nothing?” – Garth
——————————————————————–
A good person is the bad person’s teacher. A bad person is the good person’s task.
The one who does not honour the teacher and the one who does not honour the task, although ever so knowledgeable, they are confused. – Lao Tzu

My words are very easy to understand and very easy to practice. Still, no one in the world can understand or practice them. – Lao Tzu

Correct becomes defect. Good becomes ominous. People’s delusions have certainly lasted long. – Lao Tzu

Excerpted from: Tao Te Ching

#108 unbalanced on 11.01.17 at 6:46 am

I just LOVE reading the comments here about the b&b’s (braggers and boasters). I shall be respectful and won’t mention any individuals names. Quite a few people have sold their houses, won the lottery and brag about their six figure portfolio. I wonder how big the portfolio was before the windfall? I didn’t buy a house for an investment. I bought it for a place to live! I like not being told when I have to move so the landlord can boot me out. I will just stay in my 3000 k home and gather my proceeds from my investments. Ya won’t here me bragging about being up just over 15% this year. Oh yea, did I mention I retired at 53 !!!!

Tell us again about not bragging and boasting. — Garth

#109 dave in kincardine on 11.01.17 at 7:50 am

Garth, I am reminded that Robert Shiller called the US real estate bubble in 2003. It took 5 more years. But WOW. What a mess. Keep up the insightfulness.

Demand destruction (robots / machines taking jobs) is real and this next recession (late 2018 – early 2019, my guess based on yield curve analysis) will make today seem like paradise.

It is important to be positioned properly for this. Keep writing!

Dave.

#110 Re., Stone on 11.01.17 at 7:52 am

Well done

But the real trick is to Have the 7 figure portfolio AND the house

#111 Stone on 11.01.17 at 8:05 am

#91 LivinLarge on 10.31.17 at 11:24 pm
“They can’t. Not on their own for exactly the reasons you just illustrated.” horse pucks. Just read and understand a few investment vehicles and it’s rather simple actually.

My TFSA earns 8% paid monthly like clockwork. No capital growth but 8% divs. Anyone who has even a modicum of investment types knowledge can, from just the last sentence deduce what my TFSA is sitting in.

And thanks Fearless Leader for that return rate clarification. That 7% to the end of September is sweet. On target at least for 9.3% full year.

——

It’s not horse pucks however I wish it was. You are right though that it’s simple and that you just need to read and honestly, it’s all explained in prior posts and elsewhere as well. Unfortunately, our intrepid hero and the vast majority of the population are so paralyzed by fear and indecision, it doesn’t matter how simple it is. It just can’t enter into their realm of possibilities. Fruit and veggies good for you. Candy and greasy crap bad for you. And yet, what do people gravitate to for the most part? The choice that clogs their bowels and arteries.

Good for you on your return ytd. Hope you get your 9.3% or better. Good that your eyes are open to what’s possible and fear isn’t blinding you or holding you back.

#112 TurnerNation on 11.01.17 at 8:05 am

Fleecing the Lambs 101: you cannot have unlimited ‘public safety’ and ‘anti terror’ budget which cull untold trillions from our money, without regular attacks.

That they can be solved within a 1-hour time frame, replete with social media footage, fits our short attention spans well. Watch, recoil, hashtag and repeat.

That saying, ‘marketing without metrics is madness’. Those hashtags help our elites refine their methods against us. Next time.. stay tuned for an even more horrible story? Social mediums are do much more.

Our actor leaders help play the part.

#113 crowdedelevatorfartz on 11.01.17 at 8:29 am

@#62 Linda
Apparently you’re a govt worker or a former govt worker “double dipping”.
Not to worry.
You “earned” that gold plated, tax payer subsidised, garanteed, obscenely generous pension….so enjoy.
You also have the right to work at a second job if that is your wish.
Double dip away.
What I have a problem with (and you seem not to grasp).
Is the countless govt workers that jump from govt into the company that they were responsible for “overseeing”.
Govt workers setting up new contracts, negotiating contracts and then quitting to go work for the very same companies that are awarded the contracts?
You see no problem with this?

A total conflict of interest with the added “benefit” that you may end up working one week as the govt “guardian” of the taxpayers dollars to the next week on opposite side of the fence as the spender of taxpayers dollars.
If you feel that it’s ok to “career parachute” from one side of the fence to the other after creating, negotiating and then awardiing govt contractwith no time limits and there is no conflict of interest …..then the “entitlement” rot has settled into Public Works Canada deeper than I thought.

This topic is the tip of the iceberg and when more and more people realize how prevalent it is in the Public/private contract sector….there will be hell to pay.

#114 crowdedelevatorfartz on 11.01.17 at 8:43 am

So much for the 15% Foreign Buyers Fee (er sorry Tax)

https://ca.reuters.com/article/domesticNews/idCAKBN1D035S-OCADN

#115 Ronaldo on 11.01.17 at 8:53 am

#71 Lost…but not leased on 10.31.17 at 9:43 pm

Teachers obsolete?
……have been for a long time.

Graduates of dreaded “Home Schooling” on average not only exceed graduates of public schools…they also have preference by many Universities re: admission criteria.

I mean……”A”s in W*mens studies VERSUS Calculus has a realistic quota system.
—————————————————————–
And here is an example of ”dreaded home schooling”. Her mother taught my sons kindergarten to grade 2 in a remote one room school in NW BC back in the mid to late 70s when we lived in the toolies. Her daughter was born and raised there at her parents fishing lodge and home schooled since the school had closed due to the forest industry slump and the logging camp had shut down. Mrs. Berg was an awesome teacher. At times the school only had 5 or 6 students with a maximum of 16 due to the transient nature of the logging industry. She taught kindergarten to grade 8. Miss those days and my sons now 45 and 46 tell me that those were the best days ever growing up in the wilderness with nature as their playground.

http://taklarainbowlodge.ca/stellar-year/

#116 Gonkman on 11.01.17 at 9:07 am

It’s not just Teachers. Fed Public servants are clueless as well.

Not a single person I have spoken to has ANY money in their TFSA. Most don’t even know what the TFSA is.

They all relying on the DB Pension and blow all their money…. and complain they have none as well.

I don’t think I have enough to move over to Garth’s Firm so I just use low MER ETF Based Mutual Funds.

YTD
50%US Index/205 CDN Index/30%Bond = 7.04%
75%US Index/25% CDN Index All Equity = 9.44%

I base my retirement plan on getting a 5.5% return. So anything over that is just gravy.

Don’t bet against the USA. Well.

#117 unbalanced on 11.01.17 at 9:10 am

It’s not bragging or boasting. It’s being confident and knowing I have controll of my own future. That’s why I retired at 53. It’s funny how some state their wealth but get no comment from the blog master.

It was the irony that caught my eye, not your boast. — Garth

#118 crowdedelevatorfartz on 11.01.17 at 9:38 am

@#106 Big Daddy
“Who knew that the Skytrain was so dangerous that it needed armed policemen with $200,000 p/a salaries with full perks and all the extras…..all while collecting the original city police pension…..a civil service miracle…..”
++++++

Yep.
I remember when Skytrain was first opened and they had security. No cops.
There was the odd assault of a security guard but all in all. Pretty safe.
The union was pushing hard for Skytrain Cops because “the Lowermainland doesn’t have a multi jurisdictional police force”
Ummmm what about the RCMP?

Anywho. The Skytrain police of which 75% are retired cops( because according to one wag…the work is so boring the youngsters quits to go to exciting crime work).
We now have a “police force” that will call in a major crime squad from which ever jurisdiction the crime occurs( stabbings, murders, assaults, etc)
They have cameras everywhere, $150k per annum “semi retired rent a cops” and an almost zero major crimes…..
Our GVRD tax dollars (urinated once again) against the wall

#119 Evangeline on 11.01.17 at 9:51 am

I’ve always wondered, would a Liberal financial advisor strategize differently than a Conservative, seeing as they see the world so differently?

Just don’t get an NDP one. — Garth

#120 re., unbalanced on 11.01.17 at 9:53 am

It’s not bragging or boasting. It’s being confident and knowing I have controll of my own future. That’s why I retired at 53. It’s funny how some state their wealth but get no comment from the blog master.

……….

actually, you are wrong. You have little control. You are dependent on your fellow man. At 53, you havent realized that yet.But go ahead and pretend…

#121 Oli Vee on 11.01.17 at 10:05 am

So…

I am putting away money (to the tune of around $250 a month, when possible) while renting an overpriced shoe box in Toronto.

I have a Garth Millenial portfolio, putting my USD ETFs into an RRSP to avoid Uncle Sam taking tax off my dividends and gains.

Is this foolish? Should I have been putting it ALL into my TFSA? My understanding is the CRA does have an agreement with the IRS to NOT tax Canadian investments in the RRSP, whereas TFSA has no such agreement.

#122 Oli Vee on 11.01.17 at 10:10 am

… and by $250 a month, I clearly meant week.

#123 unbalanced on 11.01.17 at 10:14 am

Thank you Garth. You are a scholar and a gentlemen! Not many of us left. ( no suck up here)

#124 Lisa on 11.01.17 at 10:27 am

#11 Michael King:

Great article! Thank you!

I’m glad to see some people are starting to sober up and realize that a mortgage isn’t all it’s cracked up to be.

#125 unbalanced on 11.01.17 at 10:30 am

We are all dependant on our fellow man. Ya just gotta know when and how to bob and weave within our system. I’m 61 now by the way. Thanks in advance! Have a good one

#126 Kevin on 11.01.17 at 10:35 am

@Linda (#24)

Given the cost of education, why wouldn’t cash strapped school boards not explore the viability of education via the Internet? Imagine the implications…..

Because school’s are first and foremost about babysitting, and a school that doesn’t actually get the kids out of the parents’ house so the parents can go to work or get things done around the house is worthless. Taxpayers/parents would never stand for it.

#127 LivinLarge on 11.01.17 at 10:50 am

First, thank you Stone. BTW, I am not on target for 9.3% over all just a total year 8% in my one asset class TFSA.

And while I ‘m on the TFSA…keep in mind folks that the TFSA program was never intended to be principally a retirement savings vehicle. That isn’t to say it isn’t a wonderful retirement savings vehicle, just that it was nefer intended to be one. There isn’t even the word “retirement” in the name.

No, the TFSA was originally conceived of as an economy stimulus vehicle, a way to save for something major without taxes beating the crap out of you while doing it.

I mention this because my 62 years of life experience has taught me that when something becomes too lucrative in diverting future government tax revenues, some government eventually sticks their boots into it.

So, yes, the TFSA when left to grow unchecked, can result in a wonderful tax free source of retirement wonderment and joy but that wonderment and joy is counter to every government’s best interest and will almost certainly become the target of cash hungry future governments.

On the positive side though, with only something like 4% of taxpayers maxing out their TFSAs, it may also remain off the governments’ radar. But if that 4% eventually does rise to some considerably greater proportion then look out,

#128 Penny Henny on 11.01.17 at 10:51 am

#61 Last of the Boomers on 10.31.17 at 9:09 pm
@#44

I am one of Garth, Ryan, Doug and team’s clients and can attest to the fact that as of yesterday, Without today’s gains, and dividends and less investment and MER fees, I am up approximately 7.9% (and likely over 8 %) year to date. Thanks from the family to Garth, Ryan, Doug, Sebastien, Ross and the team at Turner Investments!
??????????????/

You forgot Emma Zaun

#129 huh? on 11.01.17 at 10:55 am

”Not a single person I have spoken to has ANY money in their TFSA. Most don’t even know what the TFSA is.”

so what. Worry about yourself. Your worries are not the same as the worries of others.

#130 Lillooet, BC on 11.01.17 at 11:10 am

Andrewski on 10.31.17 at 6:22 pm
2) Mags 99 Cantina! — what is it?

#131 Huh on 11.01.17 at 11:15 am

Did anyone else just receive their first (illegal) spam email from a real estate agent? Looks like they purchased a list of email addresses.

#132 Chief Remberer on 11.01.17 at 11:16 am

#87 Lost…

The acid rain went away with steel production etc in the mid-Ohio valley. In the late 80s / early 90s, the sky in southern Ontario was orange in the summer – kinda like Beijing-lite.

Some would say coal-fired plants too…

#133 mike from mtl on 11.01.17 at 11:27 am

#121 Oli Vee on 11.01.17 at 10:05 am
….My understanding is the CRA does have an agreement with the IRS to NOT tax Canadian investments in the RRSP, whereas TFSA has no such agreement.
//////////////////////////////////////////////////////////////////////////////////////////////

Correct. LIRA as well is considered a “retirement account” in eyes of IRS and not withheld at source, but that only applies to US dividends. Cap gains are treated same in either. Canadian dividends are treated identically in either account.

For TFSA just get an identical TSE listed e.g. VOO=VFV,VTI=VUN. Unless you really NEED US$ funds in TFSA to transfer to US$ bank accounts, it doesn’t make sense.

#134 IHCTD9 on 11.01.17 at 11:31 am

#113 crowdedelevatorfartz on 11.01.17 at 8:29 am

This topic is the tip of the iceberg and when more and more people realize how prevalent it is in the Public/private contract sector….there will be hell to pay.

_______________________________________

It’s a nice thought that justice and good will prevail, but in the real world I don’t see too many hells being paid. No one from SNC Lavalin, or the Ontario Liberals are in jail right now. Laws don’t mean jack if they’re not being enforced.

IMHO, there is only one realistic shot at fixing stuff like this: broke taxpayers, and broke government. Once the voting public is totally broke and is fending off the governments’ full-time 24/7 advances on their little remaining disposable income, something will give in.

That’s when the public starts to make taxes and corruption their number one issue, and a Harris2 or Trump-like leader will be produced and start gaining popularity – fast. Then we’ll see something happen, but until then, it’s a free for all on the taxpayer (if you aren’t doing something about it on your own).

#135 Stan Brooks on 11.01.17 at 11:33 am

Forgot how nice the traffic in GTA is:

Watchdog raids offices of grocery retailers in price-fixing probe
https://ca.news.yahoo.com/fatal-pileup-closes-highway-400-092113046.html

And how cheap and free of oligopolies the grocery retail market is:

14-vehicle pileup that killed at least 2 on Highway 400 like ‘Armageddon,’ police say
https://ca.finance.yahoo.com/news/newsalert-watchdog-raids-loblaws-metro-223442693.html

I always thought that truck driver is a diagnosis, not a profession in Canada.

#136 Frances on 11.01.17 at 11:33 am

#100 Nevergiveup: I’ve always felt that someone who by choice has not contributed a life to this earth is really cheating their parents who sacrificed and nurtured you into this world….it begs the question as to why are we really here on earth?

====================================
@Nevergiveup, the world population is now 7.5 million people, growing exponentially, and each new life (especially those brought into Western cultures) depletes the earth’s natural resources even more. The future is bleak for younger generations.

That’s great that you have seven kids, but please consider that there are many people who don’t have kids for whatever reason, who are contributing to the good of society as much or even more so than many parents. There are also people whose kids won’t live as long as they will, unfortunately. Additionally, there are adoptive parents who have not technically ‘contributed a life’, but have made a life for a child in need. Surely those parents are paying it forward?

Why are we here on earth? That’s a big existential question and the answer is likely that we are just here randomly, but I like to think that, while we are here, are duty is to be kind to others. If your way of being kind is to raise seven kids, that’s awesome. Another person’s way of being kind might be to build a killer portfolio in their youth (thanks in part to this blog), and spend their 40s and 50s traveling the world and volunteering in disadvantaged communities. And that’s awesome too :)

#137 Stan Brooks on 11.01.17 at 11:34 am

sorry, reversed the titles and the links.

#138 Frances on 11.01.17 at 11:34 am

And of course by 7.5 million I meant 7.5 billion…

#139 Just your friendly neighborhood Dissident on 11.01.17 at 12:06 pm

Ah, now I see why Garth didn’t reply to my question yesterday (re: pay off mortgage in lump sums vs invest the cash instead) – it echoes almost exactly the first story of this post! Deja Vu.

#140 Ronaldo on 11.01.17 at 12:24 pm

#132 Chief Remberer on 11.01.17 at 11:16 am

#87 Lost…

The acid rain went away with steel production etc in the mid-Ohio valley. In the late 80s / early 90s, the sky in southern Ontario was orange in the summer – kinda like Beijing-lite.

Some would say coal-fired plants too…
—————————————————————–
In other words, pollution went away with the industries and jobs to some other country. We exported our pollution.

#141 Victor V on 11.01.17 at 12:31 pm

http://business.financialpost.com/opinion/philip-cross-morneaus-fiscal-update-reveals-ugly-truths-about-the-failure-of-stimulus

We have a generation of young people entering the housing and financial markets with no experience with anything but ultra-easy monetary policy who are in for a shock when interest rates start to normalize.

#142 LivinLarge on 11.01.17 at 12:34 pm

Back to Gregor’s #37 question.

Don’t be fixated on the gross 7% return. Yes, that is a strong number and the safest route to long term capital appreciation is a balanced conservative managed portfolio.

If you are going to fixate on a return rate then fixate on the net net (after tax spendable) return. That is also something that an experienced and knowledgeable fee for service advisor will provide you.

All income and returns are not equal at the net net level. A 5% capital appreciation is the net net equivalent of a 10% interest gain, at least today it is. That is subject to change at the whim of any government. Likewise, a 5% dividend yield is the equivalent of a 7.5% approximately.

In a registered account these are meaningless because the real nature of the return is ignored by the tax folks when you withdraw the money. In a registered account, everything is taxed like wages or interest upon withdrawl so you are hit the hardest with tax regardless of how the wealth was actually accumulated.

So, always look at “how much will I keep” at redemption, rather than how much you will earn prior to redemption.

A qualified fee for service advisor will almost always have a lot more time to acquaint themselves with the intricacies of the tax act and therefor be far more prepared to adequately structure your wealth to maximize “your” net net spendable wealth.

Now back to bed with my cold.

#143 Lost...but not leased on 11.01.17 at 12:36 pm

Civil servants double dipping…

Keep in mind gov’t workers like Fireman that work 4 day shifts and on their days off have 2nd jobs, often in the trades. I wonder how far CRA looks into this.

In addition,I also wonder how many are injured at their 2nd job, but claim it happened in the line of duty of the first job.

Another observation: intriguing when one drives by the parking lots of various gov’t bodies(schools, city halls, firehalls etc.) and the relatively new and often higher end vehicles parked there. Yes, they may be leased, but in the case of teachers,the image does not help support their case during labour disputes that “its for the children”.

#144 IHCTD9 on 11.01.17 at 12:46 pm

#115 Ronaldo on 11.01.17 at 8:53 am

And here is an example of ”dreaded home schooling”. Her mother taught my sons kindergarten to grade 2 in a remote one room school in NW BC back in the mid to late 70s when we lived in the toolies. Her daughter was born and raised there at her parents fishing lodge and home schooled since the school had closed due to the forest industry slump and the logging camp had shut down. Mrs. Berg was an awesome teacher. At times the school only had 5 or 6 students with a maximum of 16 due to the transient nature of the logging industry. She taught kindergarten to grade 8. Miss those days and my sons now 45 and 46 tell me that those were the best days ever growing up in the wilderness with nature as their playground.

____________________________________

That sounds pretty sweet, your kids got a 1 in a million education/experience!

#145 Mattl on 11.01.17 at 12:49 pm

#110 Amen. Our goal is to have both – a stable place to raise my family, a place we can have pets and grow roots. And a fat portfolio.

If you plan on renting for life you better be rich, frugal or single or ideally all three. Because 3-5k a month in rent when your are retired is going to require a large chunk of savings to fund. I can’t imagine being 70 and looking for a new house because my renter is selling his place. Renting is for old rich guys and poor / frugal people. Most middle class folks will not have the savings to support rent costs in retirement…unless they sell a house. And most of us won’t want to wind down our last 20 years in one bedroom condos inMexico, or Winnipeg. We will want to be near family, with pets, in places that we own.

So ya, the bragging about having a big portfolio and presumably bleeding 30-50k a year to rent seems a bit silly to me. Every truly wealthy person I’ve met owns a home. Not as a status symbol, or as a one asset strategy but because it makes sense for 95% of us.

#146 IHCTD9 on 11.01.17 at 12:49 pm

#143 Lost…but not leased on 11.01.17 at 12:36 pm
Civil servants double dipping…

Keep in mind gov’t workers like Fireman that work 4 day shifts and on their days off have 2nd jobs, often in the trades
_______________________________________

Roofing for cash money under the table.

Happens all the time, CRA would rather nail a farmer for selling firewood.

#147 IHCTD9 on 11.01.17 at 1:15 pm

#141 Victor V on 11.01.17 at 12:31 pm
http://business.financialpost.com/opinion/philip-cross-morneaus-fiscal-update-reveals-ugly-truths-about-the-failure-of-stimulus

We have a generation of young people entering the housing and financial markets with no experience with anything but ultra-easy monetary policy who are in for a shock when interest rates start to normalize.
____________________________________________

I think they’ll also be looking at less job security and lower overall compensation for what ever they end up working at. That, and increased taxes to support our Mastodon sized government and swollen public service that youth themselves are largely responsible for voting in.

I’m crossing my fingers that I’ll get another 15-20 years out of my career in heavy industry, but frankly it’s all still dying off slow and steady. No stimulus spending is going to bring back the kind of manufacturing Ontario once had.

I don’t know what’s next, and am too old to need to even care – but something else will need to materialize to keep folks busy, and provide an income. If not, any country that depends on rich Westerners will be SOL trying to sell their goods at top dollar. I think the entire planet depends on rich Westerners and their governments to spend the big dollars and keep the world economy fuelled with demand.

#148 LivinLarge on 11.01.17 at 1:30 pm

Still not sleepy enough to nod off.

On this topic of civil servants double dipping, going over to the darkside and taking a job away from some deserving “Joe Sixpack” who isn’t a former civil servant. Bollocks!!! The new employer is hiring for specific experience and knowledge set and that comes from the civil service experience. Joe Sixpack just isn’t in the running for the job in the first place.

So, all you jealous and envious Joe Sixpack civil servant haters, you didn’t get the advantage or the job because the employer didn’t want what you had to sell.

Oh and you do realize that Fearless Leader is an ex public servant with extensive first hand and invaluable experience, don’t you? At least in my world, Fearless Leader’s value to me as an advisor is incredibly enhanced by his knowing how the sausages are made.

#149 re., 145 on 11.01.17 at 1:36 pm

#110 Amen. Our goal is to have both – a stable place to raise my family, a place we can have pets and grow roots. And a fat portfolio.

If you plan on renting for life you better be rich, frugal or single or ideally all three. Because 3-5k a month in rent when your are retired is going to require a large chunk of savings to fund. I can’t imagine being 70 and looking for a new house because my renter is selling his place. Renting is for old rich guys and poor / frugal people. Most middle class folks will not have the savings to support rent costs in retirement…unless they sell a house. And most of us won’t want to wind down our last 20 years in one bedroom condos inMexico, or Winnipeg. We will want to be near family, with pets, in places that we own.

So ya, the bragging about having a big portfolio and presumably bleeding 30-50k a year to rent seems a bit silly to me. Every truly wealthy person I’ve met owns a home. Not as a status symbol, or as a one asset strategy but because it makes sense for 95% of us.

……………..

yup. and if youre an owner and need to supplement/cover house expenses (property taxes, etc)?– rent the basement…:). easy peasy. And the best part is no one is telling me to move. It’s home

unfortunately, house affordability is off the charts in various areas

#150 Guy in Calgary on 11.01.17 at 1:38 pm

Some ironic posts given that a lot of the young millionaires preaching diversity cashed in on a lotto ticket that came to be from not being diversified. Ya got lucky.

#151 Joe on 11.01.17 at 1:58 pm

This year the markets have done, but we have not seen 7%+ annual market returns over the last ~5 years. I don’t think it necessarily wise to plan for an AVERAGE of 7% long term when we’ve seen relatively low growth in recent years and you take into account househould debt levels which would imply they cannot continue increasing spending indefinitely. Thoughts?

#152 No Fed hike on 11.01.17 at 2:12 pm

For now.

None expected until December. Then 100%. — Garth

#153 IHCTD9 on 11.01.17 at 2:41 pm

#110 Re., Stone on 11.01.17 at 7:52 am
Well done

But the real trick is to Have the 7 figure portfolio AND the house
____________________________________________

That’s a trick I don’t think urban folks consider a reality anymore. It’s possible, but not at median household incomes in the GTA or similar environment.

Totally possible in a smaller town with two decent incomes though. In fact, if you can get a household income of 80+K gross going, it would be fairly easily achieved provided you start saving young (that’s another trick).

#154 IOIO on 11.01.17 at 3:02 pm

What are your thought about investing into Cobalt mining companies? Is this the next big thing?

#155 Overheardyou on 11.01.17 at 3:05 pm

#37 Gregor Samsa on 10.31.17 at 7:30 pm
“balanced account producing 7%”

Garth can you do a blog post on how people who don’t have the time/skills/stomach to do their own investing can obtain a 7% portfolio?

There are many options out there such as Mutual Funds, Robo-Advisors, the guys at the bank, DIY schemes like couch-potato, etc. None of these seem to produce 7%.

Balanced 60/40 portfolio return so far in 2017: 9.7%. Get some help. — Garth

I too am interested in this, where should we start?

#156 Free bird on 11.01.17 at 3:19 pm

Off topic but maybe the GF team could (re)cover the topic of leasing vs buying cars in a future post. Does age and or situation matter i.e, personal/self employed/ inc. etc.?

It seems like a topic of interest for others in terms of cash flow/expenses whether close(er) to retirement or not. We own our car and are pyt free for a few yrs. Expenses are min. but I’m sure there’s benefits to leasing. I could be wrong but I think this blog has encouraged leasing depreciating assets and vice versa.

#157 Free bird on 11.01.17 at 3:31 pm

#155 Overheardyou

Some regular /longtime readers have kept notes from various blog posts (Garth, Ryan and Doug). The weekend posts have some great tips – read the comments as well as both Ryan and Doug do reply to some questions.

You can also search this site for various topics like portfolio weightings, ETFs etc. With some effort you can find out what level of funds qualify you for those like Garth’s team if not do your homework. Not easy but worth it.

Good luck

#158 LivinLarge on 11.01.17 at 3:31 pm

Overheard, one excellent starting point is Fearless Leader’s books, he has like a dozen or more.

Another is reading the books of other qualified Canadian financial planning writers just don’t go to far back in pubshlishing date…markets notoriously change.

Just read for content and what works for me is to read the same book at least twice back to back. Good books have a lot to absorb so reading twice helps drive home the points.

Just because someone found a publisher or even self published doesn’t mean they’re all equally valid in their opinions or knowledge. some are just personalities who attracted a publisher.

I don’t care if you’re a hairstylist or a former Minister of National Revenue, you had better have 10+ years of successful advising under your belt or I won’t let you in the room with my money. That said, character is also incredibly important too but that’s very hard to evaluate. Bernie Madof had the chops but in the end, no character and many lost everything and more by employing him.

It’s your money and your future so get as informed as you possibly can.

#159 Free bird on 11.01.17 at 3:40 pm

#117

Boast (verb)

Talk with excessive pride and self-satisfaction about one’s achievements, possessions, or abilities.

Just sayin’

#160 45north on 11.01.17 at 3:41 pm

Lost but not leased: IMHO, engaging in another career after retirement as a Public Sector employee moving another bureaucracy is despicable..call it JOB THEFT. Clearly we have an “olde boys club” (Networking) that perhaps needs investigation???

Here’s my perspective from working 40 years in the federal civil service:

It’s not job theft. Job theft is a simplistic idea that implies that anybody else could do the “job”. Let’s take two cases: One case is where a contractor works directly in the department. Theoretically, somebody could be hired to do the job but it’s not posted because the hiring process in the civil service is long and arduous. It can take a year – using up the resources of the hiring manager and a grading board – during which time nothing gets done. Or put another way, if the manager was doing the job then he would have to add the hiring activities to his regular duties. The activities include training and supervising. Realistically, the position has to be a departmental priority to justify the time and expense. Often the job just needs to be done, right now. In many cases the decision is to hire a contractor. It’s especially easy, if the contractor is a former civil servant who knows the people and the work.

Another case is where the job is selling to the department. There are a lot of rules on buying in the federal government. There is a whole separate department just to buy stuff:
https://www.tpsgc-pwgsc.gc.ca/comm/index-eng.html

on big purchases there has to be a bidding process which takes a lot of time and resources. There is always politics – who needs to sign off and what will they accept. Suppose someone has spent the last 10 years in the civil service buying stuff. Isn’t he the one you want to hire if you were selling? The answer is yes.

#161 DON on 11.01.17 at 3:59 pm

Garth

FYI – There is a twitter account (reporting Airbnb to City of Vancouver – not sure about CRA). It was feature on CTV BC yesterday/today? A spike in followers now stands at 779. Just heard about the account last week.

Helping the City identify Airbnb’s. I mean it is all online and out in the open. LOL. Airbnb is responding that this is unfair – LMAO!

#162 DON on 11.01.17 at 4:02 pm

Too busy laughing – forgot to include the twitter account ( [email protected]).

Flop: you may want to take to twitter to ask for help with pricing pink unicorns.

#163 IHCTD9 on 11.01.17 at 4:02 pm

#154 IOIO on 11.01.17 at 3:02 pm
What are your thought about investing into Cobalt mining companies? Is this the next big thing?
______________________

Cobalt mining = next big thing?

Is there some new high demand use for it? As far as I know the tailings hauled out of the original mines were mined out and left in a heap well before I was born. That industry is old as dirt.

#164 IHCTD9 on 11.01.17 at 4:13 pm

#156 Free bird on 11.01.17 at 3:19 pm
Off topic but maybe the GF team could (re)cover the topic of leasing vs buying cars in a future post. Does age and or situation matter i.e, personal/self employed/ inc. etc.?

It seems like a topic of interest for others in terms of cash flow/expenses whether close(er) to retirement or not. We own our car and are pyt free for a few yrs. Expenses are min. but I’m sure there’s benefits to leasing. I could be wrong but I think this blog has encouraged leasing depreciating assets and vice versa.
_____________________________________

I’m not a finance guy, but I am a car guy. I’ve always bought old, one foot in the grave cars and drive ’em into the ground. My current beater cost 1300.00 and I am just completing year number 5 driving it. I can get away with this as the internet provides me with dirt cheap new and used parts shipped to my door, and I have the tools and ability to swap the parts myself.

When I envision myself in my 70’s+ and driving, I see driving nearly new 1-2 year old cars, and selling off at year 5-6. If I end up hating this effort, I’d probably lease a basic car as I doubt I’d be putting on many miles. If I wanted to drive a real nice vehicle, I’d probably buy new and warrantee terms would be a big deal.

#165 Overheardyou on 11.01.17 at 4:16 pm

#157 Free bird
#158 LivinLarge

Thank you for your replies and advice! The only investment book I’ve read so far is the intelligent investor. I definitely need to read more before investing on my own. Reading books twice is something I haven’t tried but definitely a good idea. I always read the comments on here cause they are entertaining! Any thoughts on Hilliard Macbeth’s books?

#166 LivinLarge on 11.01.17 at 4:57 pm

Free Bird, you’re deep in the weeds.

First, the controlling issue for a consumer car lease is “How are you earning your income”. If you are classed as an employee earning just wages or salary then there is no numerical benefit to leasing a car other than to drive a more expensive car than you can afford to purchase. Just lower monthly payments and nothing to show for it when the lease is done. I.e. no residual asset to continue driving unless you then finance the thing again at used car loan rates.

Now if you are an employee that earns at least significant commisions per your contract of employment AND your employer confirms that status every year through a T2200 then you can deduct the portion of your lease payment that relates to business use. However, if you compare the tax benefit of buying and depreciating the car plus deduct the interest paid on the loan, then the lease or loan work out to exactly the same financial benefit over say 4 or so years. I’ve done these exact calculations hundreds of times for people and they always turn out the same. The CRA don’t care if you lease or finance the car and they aren’t about to give you any incentive one way or t’other. The one proviso with the numbers is that the CCA + interest deduction route delivers a little larger deduction in the early years of a purchase because the loan interest is front end loaded and therefor greater in the first years where as the lease has the interest blended equally over the term. This is why you can’t get out of a lease without a serious penalty.

If you are truly self employed rather than an employee the numbers still work the same.

If you’re talking a an arm’s length corporation leasing the car then that’s a different fish.

#167 Rainclouds on 11.01.17 at 5:10 pm

# 161 Don “FYI – There is a twitter account (reporting Airbnb to City of Vancouver – not sure about CRA). It was feature on CTV BC yesterday/today? A spike in followers now stands at 779. Just heard about the account last week.”

Of course there is: Pretty Simple, Hire a kid (Dare I say Millennial :-), with a brain and poof! Meanwhile the City, Province, and GOC “are working on it” With our tax $ and nothing to show for it ………. Governed by IDIOTS

#168 Ace Goodheart on 11.01.17 at 5:23 pm

Interesting advice.

Disagree that people who own their houses, and are older, should be selling them to rent. I still like the “bird in the hand is worth two in the bush” theory on housing. You can’t live in an ETF portfolio and if you have income coming in, but for some reason you can’t get a rental, you can’t live in dollar bills or a bank balance.

But I will always disagree with that. I guess at some point you sell the house anyway as you can’t keep up with the maintenance and repairs and you can’t push the lawnmower anymore.

Oh well.

On another note, they really have to get rid of the “numbered company method” of getting around the blind trust requirements for politicians. Really, if a politico puts his/her equity holdings into a numbered company, controlled by another numbered company, controlled by them, and then says “I have no assets that are subject to the rule” that is like tying a string to the asset, tying another string to that string, holding on and saying “there are two strings between me and this thing I am holding, so I don’t control it anymore”.

I call total bull on that. Change the law. Blind trust or sell the asset, period.

One thing I do know about having your money somewhere other than just in a house, is the rather good feeling you get every month when the dividends roll in. It’s free money. It just feels different spending it somehow. Don’t knock it till you try it.

But they will drag me kicking and screaming from my house. Not leaving that willingly. I love my veggie garden and I don’t want to live anywhere else. Hate rentals and always will.

#169 Early CPP on 11.01.17 at 5:26 pm

Sorry for posting after the post Oct 30. I agree with taking the CPP early and Investing the monthly income. I did the same calculation. However, Those in a defined pension Plan should be careful and read the details of their pension benefits. Any Pension plan that was around when they created the CPP back in 1963, has what is called Bridging. Basically you receive a company defined pension plan plus bridging until you turn 65. At 65 the bridging ends which in most cases is the same value as your CPP benefits.
However many people do not realize if they take the reduced CPP at 60 and then at 65 lose the bridging there is a large gap. In my case it was over $300 a month. So this is just to make people aware!!!!! Please read your pension entitlement benefits closely. If you follow Mr. Turners advice and Invest the money, then you’re okay, but If you spend the CPP at 60 you could be looking at a large unexpected shortfall at 65.

#170 MF on 11.01.17 at 5:36 pm

#150 Guy in Calgary on 11.01.17 at 1:38 pm

“Some ironic posts given that a lot of the young millionaires preaching diversity cashed in on a lotto ticket that came to be from not being diversified. Ya got lucky.”

-I agree 100%. A lot of the same people cannot understand why some younger people would rather pay off an asset over 25 years versus paying too much on rent, not having money to invest, and being left with nothing. House prices are not going down either.

#145 Mattl on 11.01.17 at 12:49 pm

“If you plan on renting for life you better be rich, frugal or single or ideally all three. Because 3-5k a month in rent when your are retired is going to require a large chunk of savings to fund.”

-I agree fully.

MF

#171 MF on 11.01.17 at 5:47 pm

#141 Victor V on 11.01.17 at 12:31 pm

“Normalization” may take decades, if you believe it will happen at all.

You might even have your house paid off by the time we hit meaningfully higher rates since our central bankers seem to think interest rates have to rise at a glacial speed -so we don’t accidentally hinder the “strong recovery” they talk about.

#160 45north on 11.01.17 at 3:41 pm

Great post. It looks like there is lots of envy, jealousy and frustration with regards to civil servants here. It seems odd especially since it’s coming from a board that is composed of lots of successful, wealthy people (self described). Is everyone lying?

MF

#172 i guess my point went .. on 11.01.17 at 5:52 pm

nbalanced on 11.01.17 at 10:30 am
We are all dependant on our fellow man. Ya just gotta know when and how to bob and weave within our system. I’m 61 now by the way. Thanks in advance! Have a good one
………..

right over your head. LOL

damn 61, eh?

#173 millmech on 11.01.17 at 6:53 pm

#170 MF
3-5k/mth for rent, that’s hilarious. I rent, all in for 6k/yr and it is not hard to find places in this price range.
Town where I wish to spend my retirement in for 7mths/yr I can rent a one bedroom condo fully furnished for $850/mth on the lake and places in Mexico are going for $600/mth. These are fully furnished places with kitchens and laundry facilities and the yearly rental costs are under $9000 compared to your figures of$36,000-$60,000 yr.
I have researched my retirement budget and to live very well all in should be about $36,000/yr, what you believe you will be paying on low end rent for a year.

#174 Linda on 11.02.17 at 11:01 am

#113 (Crowded) – check your assumptions at the door. My point is that your beef is prevalent in the private industry as well & that your complaint is one sided – if it was a ‘government worker’ it is bad, but it is apparently just sunshine & roses if it is done by a private firm.

As for the pension issue, I will be so fortunate as to have a pension. However, it is definitely not ‘gold-plated’ & nor it is the ‘right’ of yourself or others to demand that I or others forego the pension we paid into. If you want that plan to be wound up (cease to exist), first you must return ALL the employee deductions with interest to each individual employee including the full amount (plus interest) of all the foregone RRSP room that employee did not receive due to having had a pension plan. Otherwise it is theft, pure & simple. Stealing from Peter to pay (or in this case, appease) Paul.

I may be mistaken, but I rather think you would not be on board with doing this. I’m sure you will have all sorts of reasons as to why it would be ‘unfair’. Yet it is fair to attack, denigrate & promote financial harm to others simply because they work for government? Shame on you.