Dr. Garth

First, patients, stop bleeding on the furniture. We have an important MSU. Pay attention. It’s from Bryn who’s just done something she feels is spectacular. We agree.

So after following your advice for years, I seem to have somehow saved up enough capital to buy a business. Not a house, a thing that actually pays me to own it. Customers since 1993; I learn every day I sit there, yet the staff already know how to keep it running without me…

I could have bought a bunch of particle board and Elmer’s white glue. The [email protected] would have happily set me up; but by the grace of Garth have I learned what the true meaning of freedom is… BUY STUFF THAT MAKES YOU MONEY!

Anyhow, thanks. Myself and everyone who I can get to listen is ahead in life thanks to your blog.

Atta girl. You get what many people never fathom. Houses don’t make money unless you catch a market wave you neither influence nor control. But they’re guaranteed to suck up cash. Closing costs are obscene in many places. Property taxes and condo fees are rising all over everywhere. Insurance costs are swelling. Realtors Hoover off 5% when you sell. Plus HST. And most people have to use extreme leverage to get a house, mopping up cash flow from the rest of life.

But business owners – those who know what they’re doing – get paid to own things. They have significant tax breaks. They have freedom, choice, independence and, best of all, unlimited potential. Of course they also have pesky, needy employees, government regs up the wazoo, no pensions, economic challenges and competitors just want to eat them. Totally worth it. Yay, Bryn.

Now, as for the rest of you losers…

My partner’s Aunt is retiring this year and is someone who never saved but blew any extra money each year on a trip to Mexico (gaaaawwwdd, shoot me and put me out of my misery now),” says Kathy.

Anyway, she will have a combined income, courtesy of our government, of $1,650 for CPP, OAS and GIS.  The $10,000 she does have in the bank I have talked her into buying ETFs within her TFSA so she can get some sort of monthly dividend payout.  What are your thoughts on that choice?  Or do you have suggestions for a number of ETFs I could get her into so she has diversification, even with her small investment funds?

Give it up, Kath. If the woman’s been so irresponsible that she saved only ten grand after 65 years of life, you’re not going to change much now. If Auntie got a 7% return on her funds it would amount to less than $60 a month. Sure, that helps. But if there’s a temporary market correction and she loses some capital you know damn well she’ll pull it all, go to Puerto Vallarta and buy a sarong.

Hate to say it, but someone like this is best suited for a HISA. Maybe you could also encourage her to move to another city. That would help.

Now, to the other end of the spectrum we go to find Ron, one of those irritating FIRE people who actually wants to retire before he needs knee surgery and a bottle of Tums in the glovebox. He’s aiming to retire at 45.

“Have followed your blog religiously for the past many years,” he says, “currently renting in Cowtown but have a retirement acreage fully paid for in BC.

Countdown clock says 524 days to retirement for me n the misses (me 43, her 45) on appx. $900k (mostly cash (RRSP/TFSA/some gold) investments and acreage as above.  Not much of a market fan and have been pretty conservative for the past 15-20 years.  Just been saving a bunch and avoiding the House Horny ways.  Wondering if I should be concerned at this point to retire at 45 with plans to live off 3-4% of investments/yr expecting minimal gains (would rather not get back in at the top currently but not adverse to dividend performers in the future on a dip).  Plans to enjoy RRSP income at the bare minimum for both of us (avoid income taxes and living costs appx. 20-30k/ytr).  I haven’t yet accounted for CPP/OAS in perhaps 15-20 years (if it still exists), income from the property and part time local employment, inheritances (say $200k) and the likelihood of a UBI at some point.  Is 45 too early?

Of course it is. And you don’t have enough to last 40 years without hunkering down on your acreage like a homesteader, eating roots and burning the furniture. Not without growth. This 4% withdrawal thing is a Mr. Moustache-type joke. Inflation is increasing and will continue to do so. Carbon taxes will make everything energy-related more costly. Saving instead of investing is a one-way ticket to running out of money. And if you’re a conservative person afraid of markets, why do you own one of the most volatile assets? Gold pays no income, is hard to cash when living among the shrubs and moose, and has a dim future. Bad choice.

You need income, growth and asset appreciation. Living on bugs and sap may seem appealing at the moment, but it’ll likely not be the case at 65 – if you have not yet perished from ennui. And what’s the rush? Nine hundred large invested properly for a decade will turn into almost $2 million at age 53, and kick out over $100,000 annually. Now tell me that’s not more appealing. And don’t lie.

Let’s contrast Ron with David, a hard-ass young YVR lawyer facing a big decision. Stay in the government womb, or head out and be manly?

I have been a reader for almost 9 years now and really value your daily advice and dose of humour. I could continue the mandatory suck up but will save you the time. You often go on about how valuable DB pensions are. But how valuable is valuable?

I’m a married 36 year old public sector lawyer who makes 150K. Rent with my 32 YO wife and dog in expensive Vancouver. Total household income is approximately 250K and we have about 150k saved (not enough, I know). Plan to have kids in a few years. There is an opportunity to go back to private practice. Obviously that would mean more money for me. Maybe $50k to begin with and then the potential for much more down the road. But what about the pension I would have to give up? Can you actually put a monetary value on what that is worth each year? I would have usually said who cares and that as an ambitious 36 year old I shouldn’t be making career decisions based on whether or not I get to keep my gov pension, but given how often you emphasize how valuable such things are, I was wondering your thoughts.

The pension is precious. But you’re 36, ambitious and have three decades to build your own pension. Besides, after a few years working in the government job you should be able to invest the commuted value, so nothing earned to date will be lost.

The reality is a good lawyer makes a ridiculous amount more on the street than in the cloister. Pulling down $500,000 plus as a senior associate or partner later in your career is a distinct possibility. Never will you approach that while staying on the public payroll. Depending on the structure of the firm you join, there could also be an equity build-up that will turn into a de facto pension.

The key is to invest, not spend, the additional income. Stuff the TFSAs. Open a spousal RRSP, if your mate continues to earn less or wants to stay home with kids. Eschew lawyerly things, like a crazy YVR house or needlessly expensive private schools for the little lawyers-in-training. If you can, work through a professional corporation for some additional tax relief. Consider setting up a IPP as a supplement to the RRSP. Once you amass capital and have a family, establish a spousal loan to further split investment income and drop taxes.

In retirement, you will be able to control your own income and marginal tax rate. If you stay with a DB pension, every payment will be taxable. Plus you will have become a career civil servant. We’d have to disown you.

110 comments ↓

#1 Bill Grable on 01.31.20 at 3:26 pm

You have to wonder how things are going in Vancouver R/E – when you start getting calls from Realtors…..asking if you are looking for a new home….or would you like to sell.
(*We rent)…..I am polite, and wish them luck. *We have had a few calls in just the last few days.

Our Building’s condos, are mostly foreign owned and they are sitting empty.

I would guess we are about 1/2 full.

The average price of these condos – start about $1.8 million, or so.

Someone is losing a ton.

Average monthly fees are around $900.00 a month.

#2 Bryn on 01.31.20 at 3:31 pm

Ahem… HE… :D

#3 Brian Ripley on 01.31.20 at 3:42 pm

“The key is to invest…” Garth

My last post of January (Jan 31st) is an update on the visualization of global temperature change over the last 2019 years by Ed Hawkins (Climate Lab Book​), climate scientist in the National Centre for Atmospheric Science (NCAS) at the University of Reading:
http://www.chpc.biz/history-readings/global-temperature-change

We as citizens are going to invest in our common future, not just our individual retirement… so prepare for this unknown amount as well. (savings = future investment)

My previous post (Jan 27th):
http://www.chpc.biz/history-readings/deflation-notebook
…was prompted by the big selloff in industrial metals and a sharp slowdown in container shipping which adds colour to the ongoing global economic slowdown.

I included a chart of Canadian Labour Productivity change (Y/Y %) since the 1980’s and it is clear that since the financial crisis of 2007-2009, productivity “un-growth” is accelerating as we move from a global exporter of resources to a nation of condo builders.

If you want to see how that affects your paycheck and value of your real estate holdings at the negative extreme, see my just-updated annual Demographia tables and charts… the most affordable city in Canada is now Fort McMurray:
http://www.chpc.biz/demographia.html

(Median Housing price divided by Median Household Income)

#4 Piano_Man87 on 01.31.20 at 3:42 pm

“This 4% withdrawal thing is a Mr. Moustache-type joke. Inflation is increasing and will continue to do so.”

Shots fired. Personal finance blog wars 2020!

Kidding aside, I agree… the scariest thing about the prospect of retiring early is if you miss something in your grand plan. Mr. M got divorced recently. He and his squeeze had about 600k and a kid. No idea how they’ll split stuff, but the self imposed poverty looks a lot more like poverty than prosperity when you factor in life’s inevitable curve balls. Being employed/employable is a huge risk mitigator to your finances.

#5 IHCTD9 on 01.31.20 at 3:46 pm

Dave, I have a bil who will get about 50k/yr from his automotive career pension. I tell him that is like having saved a million by 65, because you’d need that much minimum to draw 50k while maintaining the principal

Another thing to consider if you did not commute is survivor benefits (she’ll probably outlive you).

Is the wife pushing for you to stay in your current position? How are the hours now compared to striking out on your own? You’ll probably work a lot of hours in the private sector. I know one guy who got napalmed in divorce court right around 60 years old – 90% of the problem was him working day and night and never seeing his kids. Moms don’t like that.

#6 Oakville Rocks! on 01.31.20 at 4:04 pm

“Living on bugs and sap may seem appealing at the moment, but it’ll likely not be the case at 65 – if you have not yet perished from ennui.”

This is hysterical. I will be chuckling for the rest of the evening.

#7 The Wet One on 01.31.20 at 4:13 pm

Hmm…

Considering how few lawyers make $500K a year, I guess not very many lawyers are good. According to the Robert Half Lawyer Salary Guide for 2020 (get yours here: https://www.roberthalf.ca/en/salary-guide/legal ), for lawyers with 10+ years of experience, only 5% make more than $233K in Canada (+ or – about 5% depending on location).

Which means a fraction of lawyers make $500K.

I’ve worked with one such fellow quite closely. Damned good lawyer. I’ve worked many lawyers who made $200K+. Good lawyers.

Those were a small circle of top tier lawyer in my town. The rest of the legal profession (like myself) do ok and are decent lawyers. But we don’t make that much money as a rule. As one lawyer said, there’s lots of lawyers in this town making $90K a year (which is true, I’m one of them).

My health gave up on me so I left and make my $90K with a pension (DB). I did ok.

The big money in private practice has a big cost. Be certain that you’re able and willing to pay that cost. You might give up more than you want to get it. And your clients will always have more than you and likes as not work less than you for it. That said, the things you’ll see and learn about what really goes on out there will be priceless. Do it for a few years if only to learn what’s out there.

That said, doing it the reverse is easier. I imagine private practice after being in government will be a bit of a shock to the system. Be prepared to kiss your weekends goodbye!

Good luck and godspeed!

#8 IHCTD9 on 01.31.20 at 4:19 pm

Ron. I’m torn, Mr. T is right, you’re not comfy yet. But I visualize myself trying to do do what you hope to, and I think I could make it work.

I’d be busy though. If I had all day every day to work on cutting costs, this is what I would do:

Heat with wood
Build a wood powered truck (google Wayne Keith)
Build a grid tied solar array, you will still have a small bill
Grow your own veggies, and raise chickens. Learn food preservation, canning, mason jar, moonshine, beer.
Get PAL buy guns, learn to hunt and fish if you don’t already know.
Come up with some shtick you can sell on youtube like every other dude on the planet has done where homesteading is concerned. Some make hundreds of thousands off it, worth an honest shot.

The above will murder your energy and food costs, and maybe you’ll make some money. At the very least it’ll keep you in good physical condition :D

You’ll not want to draw down your 900k, you’ll be ready to kick up your feet a couple decades from now and it’ll grow to enough if you leave it alone. In the meantime you’ll have to scratch out a living, and you’ll have to love doing it.

#9 Mr Fundamental on 01.31.20 at 4:22 pm

I think you guys might be missing the point on the whole FIRE thing. Once you have ENOUGH money to live off of your investments, why not stop working and do something else (if that’s what you want to do)? 25x your yearly living expenses invested in a nice index-fund ETF will do the trick. CPP + OAS kicking in once you’re older gives an even larger margin of safety.

Cheers!

The Poverty Portfolio. Enjoy your retirement. – Garth

#10 Man, I like ... on 01.31.20 at 4:37 pm

living on moosemeat and home grown veggies. Certainly don’t have to. Much cheaper just to buy beef as a rule. Just don’t shoot any old moose. Choose wisely and enjoy.
Haven’t tried “bugs and sap” yet. Have burnt some furniture though.

#11 Leslie Warren on 01.31.20 at 4:42 pm

Kathy partner aunt . . . . haha ha if she is living in Ontario her income is $501 too high to qualify for free dental care which could easily end up being a lot more than $501 this year . . . she would be best to relocate to a non-tourist part of Mexico. Permanently.

#12 Shirl Clarts on 01.31.20 at 4:48 pm

Regarding Mr. FIRE (Ron), I can’t stand people that include future inheritance into their own portfolios. Greedy. The respectful thing to do is act like you are not getting one.

#13 NoName on 01.31.20 at 4:50 pm

Best brake job i’ve even seen.

https://www.youtube.com/watch?v=lqx4PW4l9iY

#14 Cristian on 01.31.20 at 4:52 pm

“Is 45 too early?”

Retire at 45 with less than one mil????
Haven’t these people heard about retirement calculators? The internet is full of them.
Unless they plan to live on dog and cat food and live in a tent for the next 40 years…

#15 Paddy on 01.31.20 at 4:53 pm

Just realized all the bikini XL sizes are empty in the photo above….must be at a Walton Mart in ‘Merica

#16 Treasure Island CEO - 134,945,435.88 Offshore on 01.31.20 at 4:56 pm

“Houses don’t make money unless you catch a market wave you neither influence nor control?”

Notorious North Vancouver illegal hostel owner states otherwise: nice 150K income per year. How is AirBnB not a business, making homes a business? The business of turning your home into a business by just having people pay you to sleep there has never been better. You can chose whether or not to pay taxes on it.

The meteoric rise in price is just icing on the cake for when bylaw catches your illegal AirBnB and has you running to sell for a principal gains exempt profit after selling the locally busted property and claiming it as a principal residence for the Fed reporting, which is completely disconnected and non-communicating with local municipalities.

#17 The Wet One on 01.31.20 at 4:56 pm

Further to my earlier post you also generally have to work for two or maybe 3 decades before you make that $500K+ a year.

You might get there earlier, but most likely not. You’ll be comfortable the whole way through, but that’s 20 years of being the best, staying the best and practicing law 24/7/365 at the expense of almost everything else in life.

For just $500K / year (inflation adjusted of course).

It looks like it’s worth it, but based on what I’ve seen of it from inside the law firm, it’s probably not worth it.

The lowliest NHL hockey player makes a minimum of $700K a year: http://www.puckreport.com/2009/07/nhl-minimum-wage-maximum-wage-by-year.html

It’s about as hard to simply be in the NHL as it is to be among the top 5% (more like top 1%) of lawyers to make $500K/year.

Furthermore, I think being in the NHL is more fun (seriously, you get to fist pump your goals. That’s bad mojo in law. The courts do not look kindly on such behaviour) and doesn’t completely dominate your life. You get 4 month off a year (or so). Law never stops. You might work 18 hours on Christmas day if the client demands it.

Plus hockey is fun and people will, unless you’re a jerk, like you. Lawyers? Eh, not so much.

It’s an honourable profession and you do important work, but there’s better businesses to get into if you’re looking to make a buck.

Especially since the finest lawyer (like Omar Khadr’s lawyer) are very much unloved and don’t necessarily make all that much. It’s a matter of a passionate love of the law that makes you the best and not simple love of money. If it was love of money above all, you wouldn’t be a full time lawyer for long (as the wealthiest lawyers I know do). You do something else, like start up Boardwalk Real Estate Investment Trust or something like that. Then you make the real money, not the chump change (which is what it is) that the overwhelming majority of lawyers make.

A very tiny handful of lawyers make millions actually practicing law (I worked with one of those too. He’s a rarity). But seriously, if you go into law expecting to make $500K a year regularly (you might luck into it a few years in your career), you’re going to be sorely disappointed. Especially given the tremendous amount of work that you will have to do.

A better bet, quite honestly, is to start a blog (like Garth and others have done). Less work. Less certain pay too. But, if you’re lucky or good, it can also net you millions. It’s probably more fun and less costly in terms of opportunity costs for other things as well than law.

That said, if you’ve got the bug, you get to do super cool, Atticus Finch like stuff and be a bona fide hero like Omar Khadr’s lawyer.

No hockey player (or anyone else outside of a war) gets to be that kind of hero, where they stare down the overwhelming power of the state and say (in effect):

“NO! YOU SHALL NOT VIOLATE MY CLIENT AND THEIR RIGHTS AND SHALL COMPENSATE MY CLIENT FOR THE HARMS YOU’VE DONE TO HIM!”

in the face of all the hate, opprobrium and disagreement of the entirety of society.

So there’s also that.

Me, after seeing it up close for a few years, chose to do something else about 1/3 less demanding, 1/2 as much remuneration and that has a DB pension (which you don’t get as a lawyer, you’re 100% on your own). I’m satisfied with my choice and glad I had the chance to swing for the fences.

I hope this helped someone in their decision making about life.

#18 Christy Clark to Run For Conservative Party Leadership on 01.31.20 at 5:00 pm

Claims Garth and Peter can’t grow house prices as efficiently as herself and that BC and Ontario Casinos have not reached their full potential yet.

#19 Skylark on 01.31.20 at 5:01 pm

lol lol love this blog!!!

#20 Pandemic-onium Sparks Global Market Meltdown on 01.31.20 at 5:08 pm

Inverted Yield Curve is back.

Who saw a write-down in the markets coming from black swan Coronavirus?

People are so dumb that google searches for Corona Beer Virus are trending.

Don’t worry though. The US is holding a meeting this afternoon to figure out how much QE needed to stem write-down and get the markets back in the green for Monday. Just add it to the deficit.

Speaking of deficit – The Canadian Federal Government ran a deficit of $11.8 billion over seven months of its 2019-20 fiscal year compared with a deficit of $2.1 billion in the same period last year.

#21 Chuck Norris on 01.31.20 at 5:19 pm

I’m as bold as Chuck Norris doc.

I am going to buy the dip of Exxon-Mobil because I’ve heard that the oil company has taken 50% ownership with Hess and the Chinese National Oil Company on an oil block that has 8 billion barrels of oil and counting. Exxon might have an oil block that has almost 100 billion barrels of oil in the tiny South American country. I’m buying the dip. Wish me luck!

#22 Living the FIRE Dream on 01.31.20 at 5:21 pm

Garth Garth Garth, You don’t like the FIRE lifestyle, don’t knock it till you try it. I’m 43 and retired July 2019. It’s been great to get out of the corporate rat race. Wife and I have about 3M invested, plus 3 properties, conservatively worth another 3M. The properties are really a bit of a hedge for us, considering our portfolio has been doing very well and really don’t factor into our income requirements. We are taking 9k per month and took our first draw of quarterly income this month to coincide with our largest dividends paying out. Currently our 9k per month, will come from a percentage of dividends and capital withdrawal. We are drawing from the non-registered accounts over the next 5-10 years, since just over half of our portfolio is tied up in RRSPs. Our TFSAs will be left untouched until the very end. Assuming all goes well the TFSA will end up forming a rather large inheritance to the nieces and nephews. Yep no kids helps the lifestyle. We have planned carefully for this and ran the numbers through a comprehensive Financial plan with numerous scenarios. Also doesn’t include emergency funds set aside in case of a disaster in the markets. All Systems Go for Freedom 42. Why wouldn’t we do this? Garth over to you.

#23 Sail away on 01.31.20 at 5:24 pm

For the lawyer (and actually anyone), the real money is almost always to be made owning a business. You’ll never own a business working for gov’t… and you have all those goofy union-specified break times, non-scented hygiene products, work hours, overtime rules, etc..

With your own shop, you can build a team that does the grinding while you scheme and plot. That might be the best part. Play lots of golf with clients, take long lunches with clients, knock off early on nice days… and always say, “Things are crazy busy these days!”

#24 YouKnowWho on 01.31.20 at 5:24 pm

Farley Mowat talked often about risks of cities, disease spread being main.

I guess we’re going to have more and more of these examples going forward.

#25 IHCTD9 on 01.31.20 at 5:27 pm

Good Posts “The Wet One”, nice to hear it from the inside.

Maybe WUL will chime in too.

#26 Change my bikini on 01.31.20 at 5:39 pm

These Mills earn too much. I watched them for years loafing around the office getting nothing done and just wanting to participate. They loved the job, but didn’t want to work. They would come in after 9 and go stand outside Chipotle at 11am and eat lunch to 1pm. That would be followed by happy hour at 4pm. Ground the company to a stand still.

Anyway, it is what it is. If you can’t beat them, then join them. Dining out, vacations, lattes and more. The prices will keep going up as long as they are willing to spend. It’s definitely a generation oblivious to paying for value; they simply pay the price and keep rolling. I hope to capitalize on that soon enough!

#27 espressobob on 01.31.20 at 5:43 pm

Self employment should be kept a secret. Why work for one boss when one can answer to a hundred or more? Don’t recommend this lifestyle by the way simply because no one could ever go back to being a drone after being bit by the bug.

Being in the driver’s seat somehow doesn’t allow an individual to ever be a passenger ever again.

Be carefully what you wish for.

#28 Doug t on 01.31.20 at 6:11 pm

Retirement? But we are all gonna die from CORONA VIRUS

#29 Linda on 01.31.20 at 6:13 pm

About retirement. I have to presume FIRE folks really would rather do just about anything else but work a 9-5 job for 40+ years. I don’t think that excludes their working, just that the kind of work they would rather do isn’t the kind that traditionally pays a living wage.

Thing about how much one need to retire on, it depends a great deal on what lifestyle the potential retiree is aiming for. Oddly enough, being able to afford stuff really makes one question whether one actually wants it. Or one discovers that a hobby or activity they enjoy doing on occasion isn’t something they want to do a lot more of once they have the time to do just that. Which can really impact annual expenditures. As an example, let us say the plan is to purchase a holiday getaway. Upon retiring, the retiree(s) decide to rent a place – try before buy – to see if the desired object lives up to reality. Surprise, they discover that the answer is ‘no’. Obviously a decision not to purchase will have a budgetary impact, especially if they had set aside funds to do just that.

I get that planning for the worst is the financially prudent thing to do. I just think that a balance needs to be struck between caution & taking risks. I worked with too many folks over the years who could have retired but were worried they wouldn’t have enough. At least there was always enough money to pay for the funeral.

#30 Michael S Lavoie on 01.31.20 at 6:16 pm

#4 you should up date your self on Mr MM HE owns at least 2 400,000.00 homes debt free. blog income over 400,000.00 ann.and much more travel etc!

#31 Yes, we not too on 01.31.20 at 6:23 pm

#22 Living the FIRE Dream

Pretty necessarily conservative on that second $3M to get the point across. I feel most people on this blog have $6M to retire on in their 40s. Or perhaps not. Thanks for sharing your not so normal retirement scenario which is very distant to the dandelion eating $1M scenario in the blog today.

#32 Kona on 01.31.20 at 6:26 pm

To the public service lawyer, it’s very easy to estimate your future pension amount. If you assume that you stay in your current job and never take another promotion, just add a conservative 1.5% annual increase to it from now until the age you retire. Then simply apply the approximate pension service formula to the numbers to find your estimated pension amount. hint: I estimate that if you are able to work 35 years and receive 2% per year, your pension amount will be about $160k a year.

Lots of assumptions though so I suggest you pull out your pension docs and run the numbers yourself.

#33 espressobob on 01.31.20 at 6:31 pm

#21 Chuck Norris

It seems you’ve done your homework on an individual stock. Not bad, but. Global index investors own all asset classes and have no need for market timing including unsystemic risk which is the most damaging to ones portfolio if the bet goes south.

Think about that.

#34 WEXIT! on 01.31.20 at 6:36 pm

Brexit is HERE!

https://www.bbc.com/news

35 minutes later, and the UK is FREE!

Albertans, we can do it too!

#35 J man on 01.31.20 at 6:39 pm

This virus is a much bigger deal then Canadians are being lead to believe. Global markets and our health is at much bigger risk than most realize. People don’t spend a lot when they are scared and holed up. Garth I don’t envy your position at this point. Me thinks you are about to have some very panicked clients. Stay healthy everyone.

The virus is hardly a health issue at this point. It’s an economic one, and markets are risk-off because of the impact on Chinese Q1 GDP. My clients are apparently more confident than you. – Garth

#36 Bytor the Snow Dog on 01.31.20 at 6:44 pm

WTF is up with Millennials like David and squeeze about their denial of basic biology? Dave, the optimum time to have kids with your wife has passed. Time to hurry and squeeze out a couple before the wife turns 35. Pregnancies after 35 are medically termed as high risk.

Sorry, feminists. Mother nature cannot be denied.

#37 Darren on 01.31.20 at 6:44 pm

How come know one is talking about the 600 point loss in the dow today. Silenceeee.

You mean the 2% drop after a gain of 30%? – Garth

#38 oh bouy on 01.31.20 at 6:46 pm

Dave, if spending time with your wife and future kids isn’t something you’re interested in, then by all means go private sector lol.

#39 Stone on 01.31.20 at 6:52 pm

#9 Mr Fundamental on 01.31.20 at 4:22 pm
I think you guys might be missing the point on the whole FIRE thing. Once you have ENOUGH money to live off of your investments, why not stop working and do something else (if that’s what you want to do)? 25x your yearly living expenses invested in a nice index-fund ETF will do the trick. CPP + OAS kicking in once you’re older gives an even larger margin of safety.

Cheers!

The Poverty Portfolio. Enjoy your retirement. – Garth

———

Garth, your own dude, manly and chiseled Sinan, advises 30x expenses as a good place to start. That’s not that far off of 25x. And in all seriousness, how many actually achieve that? I can, but then I’m special (in a chiseled abs, glistening hair, most amazing man on the planet/universe kind of way).

https://www.greaterfool.ca/2020/01/26/investing-in-a-world-like-this/

Sometimes, enough is enough, isn’t it? Not everyone is interested in driving a useless Mercedes, Lambo or Porsche and showing off useless junk they own to people who don’t actually care (trust me, they may be a bit envious but they don’t actually care). And to put the icing on the cake, mandatory suck ups are free! Isn’t that what you really live for? And dog walks?

So seriously, how many times expenses should you put aside in a nice balanced, low volatility, and globally diversified ETF portfolio to earn your seal of approval?

#40 Camille on 01.31.20 at 6:53 pm

The message I’m sure is you’re rich, then good for you, you dont have to work should you choose. The others, including myself, are not rich, and you know who you are. Then you better save, for now and later. And, no one should be berated for not saving, if they can’t, and encouraged when they can. Poverty exist and always will. This blog knows that.
And back to today, 10 year US bond close to sub 1.4%. I get the bond point though, there to smooth out stock drawdowns.
Garth, please provide a solution for the risk averse, who will certainly scare and sell in a major stock correction? What to do, is there a cognitive theory, or simply lost, my money manager friend would say ” I don’t want your mother loving money”.

#41 Stone on 01.31.20 at 7:02 pm

#38 oh bouy on 01.31.20 at 6:46 pm
Dave, if spending time with your wife and future kids isn’t something you’re interested in, then by all means go private sector lol.

———

That’s a fair statement. Include divorce, heart attack, and blood pressure medication to the mix just to round things out.

Peachy!

#42 Sail Away on 01.31.20 at 7:04 pm

#37 Darren on 01.31.20 at 6:44 pm
How come know one is talking about the 600 point loss in the dow today. Silenceeee.

——————

It will fluctuate, yes

#43 Technical Analist on 01.31.20 at 7:23 pm

The kiss of death for stocks.

S&P 500 just formed a gravestone doji on its monthly candle.

Technicals, fundamentals & macro.

A bearish alignment after the longest bull market in history.

#44 Blackdog on 01.31.20 at 7:25 pm

“The Poverty Portfolio. Enjoy your retirement. – Garth”

Ouch. That was mean.

#45 NoName on 01.31.20 at 7:28 pm

Zero dudes twitter account suspended…

https://twitter.com/zerohedge

#46 IHCTD9 on 01.31.20 at 7:30 pm

#22 Living the FIRE Dream on 01.31.20 at 5:21 pm
Garth Garth Garth, You don’t like the FIRE lifestyle, don’t knock it till you try it. I’m 43 and retired July 2019. It’s been great to get out of the corporate rat race. Wife and I have about 3M invested, plus 3 properties, conservatively worth another 3M.
——- –

Ya, I think Mr. T would have had different advice for a 43 year old worth 6 mil no? You got enough, congrats (seriously, you must have saved like Vladislav Tretiak), but you are less than 1% of the general population.

If I had that kind of bank, I’d quit tomorrow!

#47 Darren on 01.31.20 at 7:32 pm

#37 Darren on 01.31.20 at 6:44 pm
How come know one is talking about the 600 point loss in the dow today. Silenceeee.

——————

#42 It will fluctuate, yes
===========
Yes I did read that in Stocks for Dummies thanks.

#48 Blackdog on 01.31.20 at 7:33 pm

@Darren, #37,

My thought as well. May I suggest watching “Pandemic” on Netflix.

#49 Smoker and Drinker or something like that on 01.31.20 at 7:35 pm

XL wardrobe sold out, lol!

What do dawgs think of this?

https://www.huffingtonpost.ca/entry/liberals-mastercard-cybersecurity_ca_5e3349afc5b69a19a4ac5b24

#50 LH on 01.31.20 at 7:38 pm

Up to 5MM usd in stocks now (a few single names)
And several SFHs in C01, C02
Five kids ages 0 to 10
Wifey and I are 35
Bytor the Snow Dog is right… biology won’t wait so get busy under the sheets while you’re young!

But FIRE / early retirement? Overrated. I’ll retire when I die. A long time ago, fecklessness was called acedia and was one of the deadly sins!

“Sloth, like rust, consumes faster than labor wears, while the used key is always bright.”

#51 Yukon Elvis on 01.31.20 at 7:41 pm

DELETED

#52 Mr Canada on 01.31.20 at 7:43 pm

Market is down today..Corona is not something you drink, so I go to this pathetic blog, and its the first blog without a dog — the world is ending…

#53 Nonplused on 01.31.20 at 7:47 pm

I don’t think $900,000 is enough for 2 people to retire on at 45. Too many things will need replacing over the next 40 years. Cars, furnaces, knees, teeth, the roof, the hot water tank, furniture, clothes, the tractor, everything really. Then there is the property tax, utilities, food, booze, you know, the essentials. But that’s my opinion.

When you have $900,000 in the bank and a paid for property it seems like a lot but if you need a new car what can you get for less than $15,000? And since Ron has an acreage he probably needs a truck. Sure, you can buy used, but unfortunately the planned obsolescence built into anything made in the last 15 years makes them more expensive to maintain than they were in the 70’s. You can’t just adjust the carburetor and the timing yourself anymore. Today just changing the spark plugs can be a $1000 ordeal. That’s the price we pay for “fuel efficiency” and “emissions”.

And sure, when you replace your furnace, which you will eventually have to because even if it’s just the control unit that needs replacing there will be cracks in the heat exchanger and by law the furnace guy cannot return it to service until that is replaced even though you don’t have a CO problem, well sure the new furnace is more efficient but holy cricky is it expensive! And it’s all computers and multiple fans now so guess what? That will be a lot more money to maintain going forward too. Same with these HE appliances. They are all controlled by computer cards now that are made in mexico or China and last about 7 years. No more of these mechanical appliances that never need servicing are allowed. I have a 24 year old Norge fridge in the basement and it keeps the beer cold even though it has never been serviced. I bought a fancy digital Kenmore HE and it needed a new control card 6 months out of warranty. Is the digital fridge really that much more efficient that it makes up for all the repairs and replacements? I don’t think so. It takes a long time to spend $500 on electricity for even an old fridge. And my contention would be that the clearest measure of the environmental impact of something is what you pay for it. The card was $350 and that represents all the labor, materials, and energy that went into making it, and then I got dinged $150 in labor and that mostly represents the cost of manufacturing and fueling the van and some left over for the technician.

And don’t get me started on computers. This laptop that I am currently typing on has an i5 dual core processor, 2.3 GHz, 4 GB of memory, and a 500 GB hard drive, so it is not a shabby machine. Heck even the batteries are still good. Every few days I get a screen that says “Windows 7 is no longer supported, buy a new computer with Windows 10”. Oh and there is an option on this machine to get Windows 10 but it is $189. What kind of crap is this? The computer probably isn’t worth $189 dollars and this is what I have to pay to repair a problem that doesn’t exist? Microsoft should have to by law support their products until the machines go away on their own, they shouldn’t be allowed to force retirement.

Since I did get going on computers, printers are another problem. Ink jets in particular. How can an all in one printer that can scan, copy, print 2 sides in color, and connect to your phone and has a touch screen cost $130 but it costs $140 to put itty bitty ink cartridges in it? So we all resorted to getting the cartridges refilled at Costco. Turns out you can do that. So what did HP do? Well they put electronic serial numbers on their cartridges so that your printer would only accept them once or your warranty was void. And I bought the printer at Costco! And then it got even worse when they stopped selling new cartridges for this printer and then later stopped supporting it altogether. And then it stopped printing in black. I am sure they bricked it. All those gears and wheels and plastic bits are now in the recycling. Why??!!!

So I bought a new Epson printer with ink tanks that you fill up with bottles to replace the no longer functioning or supported HP printer and it came in the box with more ink than I think I will use in the next 30 years. But guess what will happen with that one? The ink will dry out and I’ll be recycling that one in about 5 years too. Oh well at least I won’t be paying for cartridges.

Some people call it “the landfill economy”. It is really true. The business model is to build a lot of crap and then bury it within 10 years, even if it still works. The model is that even when you buy you are really still only renting. I’d like to calculate out what the actual cost of owning the HP printer was per page. I am thinking it was about $2. And there were times I used it a lot for business. And I used a lot of Costco refills.

#54 Linda on 01.31.20 at 8:00 pm

#32 ‘Kona’ – I think you may be smoking whacky tabaccy. Or be wildly optimistic, whichever. Let us just say that as per numbers available for public pension plans the average paid is about 47% of the gross salary earned upon retiring for those who worked 35+ years. It is of course lower than that for those whose years of service is less than 35 years. So if someone was earning $90K upon retirement & worked for 35 years, they could expect an annual pension of about $42K per annum. Some plans might go as high as 50% of earned gross upon retirement, but most are lower than that.

#55 Dirty debtor on 01.31.20 at 8:08 pm

#39 stone

30x expenses is exactly that. 30x expenses for a 60 year old. When you’re 30 you don’t mind living in hostels, drinking 2$ beers and taking night trains to save on accomodation.

When you’re 60, you want to live normally without roommates. The vacations you want to take will be expensive. And when you hit 80 it’s gonna cost you 9 grand a month for an assisted care facility where you have to call a nurse every time you go to the toilet.

Expenses go up as you get older

#56 DON on 01.31.20 at 8:09 pm

Australia lowered interest rates in an attempt to regenerate sales and turn the tide of price declines. It seemed to work temporarily two big cities but not soo much in the rest of Australia. Now they are worried about a slowing economy, slowing foreign buyers and job losses due to a decrease in building. Not to mention we are in a new paradigm of affordability. Even if interest rates are low only so many people can AFFORD to carry the monthly payments.

In BC the Provincial government is slowing down on hiring. CIBC is laying off folks for cost cutting – people with mortgages no doubt.

PRICE CEILING – prices are no longer 300-600k now more like 700 – 1 million in the urban areas. What/Who will propel the future home sales?

#57 Linda on 01.31.20 at 8:15 pm

#32 ‘Kona’ – I forgot to mention that the figures provided are for those who have a pension partner. Those who have no pension partner usually receive more pension income. For the hypothetical case of 35 years of service, 90K annual earnings, a single pension member could receive as much as $51K annually (rounded up) as per the PSPP pension service estimator online.

#58 Blackdog on 01.31.20 at 8:15 pm

@Darren, #47

Lol. Ignore SailAway. He is a bored successful business owner, who has too much time to spend critiquing the comments here.

#59 Snowbird1 on 01.31.20 at 8:17 pm

Garth, as a pragmatic, data-driven, unemotional investor, I’m always shocked at how you respond to any mention of Gold. Please take a look and write an entire post on this:

https://pbs.twimg.com/media/EPX9f9LUUAE3sa2?format=jpg&name=large

PMs are volatile and capricious. They pay no interest or dividends and are relatively costly to turn into actual money. They are not a medium of exchange, buy nothing and are liquid only in limited circumstances (you need a physical dealer). They are wholly inappropriate for 99% of investors, many of whom are suckered in by charts showing 50-year returns, by doomers and gamblers. Owning an ETF holding the biggest TSX companies, which includes metals producers, is plenty of exposure. – Garth

#60 WUL on 01.31.20 at 8:20 pm

#25 IHCTD9 on 01.31.20 at 5:27 pm

Good Posts “The Wet One”, nice to hear it from the inside.

Maybe WUL will chime in too.

law…law…law…

Hey Catskinner,

“The Wet One” got it right. I can’t add anything to improve his take on the honourable profession.

Over the last 36 years I’ve practised with a big league mega firm, a medium sized firm, as a sole practitioner, govvy positions and with a charity.

All have pros and cons. I thought the best lawyers I worked with were with the charity. Driven by passion. Had to be. There was no money in it.

With the private firms you typically bill in 1/10th hour increments. I ran into an old pal on the street and asked how he was faring. He said “Living the dream in six minute increments.”

I’ll leave you with a point I made here a few years ago. There is a survey in MacLeans from about six years ago. The average salary of a lawyer in Ontario at the time was the same as a teacher in Ontario. $83K.

WUL

#61 Katherine on 01.31.20 at 8:25 pm

#54 Linda
I am a retired Ontario high school teacher. Retired after 32.5 years. Pension % is 2x number years of service based on average best 5 years. So if best 5 years average is $90000 and my years service, pension is 64% of $90000 = $57600. Not a bad deal. No more pension deductions, union dues, cpp, ei, ltd. love retirement. But also loved my time in the classroom. Am a new grandparent now so lots of time to help daughter with my grandson, volunteer at local hospital and have lots of time to exercise and help family and friends.

For all those teacher haters…you could have chosen the same career path. I am proud to have helped educate many business students.

#62 Upenuff on 01.31.20 at 8:33 pm

#15 Paddy on 01.31.20 at 4:53 pm
bikini XL sizes are empty in the photo above….must be at a Walton Mart in ‘Merica

Easy on Merica, our cousins to the south have done an excellent job of making some of our own Walmarts just as non attractive as theirs…. We have slowly been swallowed up by their mindset that has done zero to help us keep a strong Canadian identity…..

#63 Meanwhile Putin Laughs on 01.31.20 at 8:40 pm

https://www.zerohedge.com/geopolitical/germany-military-begins-war-drill-ill-prepared-troops

I was once asked by the construction firm I worked for to use my own truck for an extra $50 a day, which was way more than it was worth. However I don’t think I would have taken that piece of crap into a war zone. It was good for hauling the total station around though. (For those that don’t know a total station is a computerize transit. For those who don’t know even that a transit is a kind of telescope with gauges used to do surveying, with accuracy better than a gun site. For those who don’t know even that survey instruments are used to figure out where things are or should be.)

But anyway my point would be that Russia has nothing to fear if Europe plans to invade in VW’s.

#64 Dr V on 01.31.20 at 8:44 pm

“Consider setting up a IPP as a supplement to the RRSP”

My accountant used to talk about this all the time 20 odd years ago, but hasn’t brought it up in years. Any reason? Have they fallen out of favour??

#65 Shawn Allen on 01.31.20 at 8:51 pm

Inheritance?

#12 Shirl Clarts on 01.31.20 at 4:48 pm

Regarding Mr. FIRE (Ron), I can’t stand people that include future inheritance into their own portfolios. Greedy. The respectful thing to do is act like you are not getting one.

**********************
I tend to agree. Older people may need a LOT of money in their final years. It’s their money.

Counting on an inheritance seems like a fail.

At best in most cases inheritance should usually be for grandkids.

#66 Nonplused on 01.31.20 at 8:59 pm

#17 The Wet One

Only about 1 in 10,000 hockey players get to play one game in the NHL. It is a lottery ticket of extremely low odds, but very expensive to buy. Lawyers on average do much better. So do dentists. So do carpenters and auto-mechanics actually, on average. And the big problem is for most people, is that after you have spent $100,000 on your son’s hockey career and he doesn’t make the big game, he has no other useful skills other than coaching kids. Assuming he doesn’t have brain damage that prevents him from controlling his temper.

Your son probably isn’t Sidney Crosby. Stop wasting money.

#67 BlogDog123 on 01.31.20 at 9:02 pm

#53 NonPlused,,

there’s a way to still upgrade that Windows7 machine to Win10. Google it, I just upgraded a machine 2 weeks ago… Might be this article below, not sure…

https://www.zdnet.com/article/heres-how-you-can-still-get-a-free-windows-10-upgrade/

#68 MF on 01.31.20 at 9:04 pm

#50 LH on 01.31.20 at 7:38

This is in stark contrast to what we hear endlessly about with regards to canadian’s debt levels and overall vulnerability.

5mm in stocks plus houses? At 35? 5 young kids?

Maybe they won the 6/49, or had an inheritance.

I guess it is the online world so we should take everything with a grain of salt (except Garth’s writing, of course).

MF

#69 45north on 01.31.20 at 9:22 pm

I’m a married 36 year old public sector lawyer who makes 150K. Rent with my 32 YO wife and dog in expensive Vancouver. Total household income is approximately 250K and we have about 150k saved (not enough, I know). Plan to have kids in a few years. There is an opportunity to go back to private practice. Obviously that would mean more money for me. Maybe $50k to begin with and then the potential for much more down the road. But what about the pension I would have to give up? Can you actually put a monetary value on what that is worth each year? I would have usually said who cares and that as an ambitious 36 year old I shouldn’t be making career decisions based on whether or not I get to keep my gov pension, but given how often you emphasize how valuable such things are, I was wondering your thoughts.

I worked in the federal public service for 40 years. I didn’t stay for the pension. I went in with the idea of public service. And I did perform a public service. Stats Can for 10 years. They were the early years, just getting started with computers. I’m proud of my work with the Census of Housing and Population. Agriculture Canada for 30 years. I was one of the early adopters of GIS (Geographic Information Systems). I’m proud of my work with the Canadian Soil Information Service. Even the last 10 years, I was able to preserve the work that had been done.

So David at 36, I’ll give you some advice. Don’t stay for the pension.

#70 Alberta Boy on 01.31.20 at 9:22 pm

I had a similar public sector professional job (health care). I made $180k with generous benefits/vacation/pension, etc. I went private for the big bucks. I now make around $300k. However, there is no pension plan, no benefits and no paid vacation. I make 66% more but have 500% more stress and can rarely take a day off. To be honest, I would take the old job back but it would require a move and my family is settled.

#71 Emma Zaun - GreaterFool Unpaid Intern #007 on 01.31.20 at 9:26 pm

Any kind of pension for us, DB or other, would be swell, Garth.

Any chance of you treating us any better than Uber drivers?

Emma Zaun
Shop Steward

#72 ShopStewardAssistantLevel3 on 01.31.20 at 9:46 pm

@#70 thanks for the laugh.

#73 Wuhan we y'all in check on 01.31.20 at 10:40 pm

be careful who you rent to mes amis

https://www.journaldemontreal.com/2020/01/30/une-autre-histoire-de-logement-saccage-par-son-locataire-1

#74 G on 01.31.20 at 10:45 pm

I hope to GOD the USA & Canadian military and Health official HERE are paying close attention so if it’s still not to late to contain this thing!!!! Send them this if you know anyone that needs to know that this CV looks to be an engineered virus and may also have some HIV added that got lose some how. See links

Coronavirus (proof of a bio-weapon?) by Dr. Paul Cottrell 31min
https://www.youtube.com/watch?v=nrxoyQyYxmg

Coronavirus and HIV / AIDS treatment by Dr. Paul
Cottrell 9min
https://www.youtube.com/watch?v=1VYTrklS48g

Coronavirus – Doctors Arrested for revealing the truth
12min
https://www.youtube.com/watch?v=HE7Iz7HLpYg

Coronavirus crematorium (with Ms. Taiwan) by Dr. Paul Cottrell 2min
https://www.youtube.com/watch?v=KjhOD2TecAY

Coronavirus Epidemic Update 7: Global Health Emergency Declared, Viral Shedding 12min
https://www.youtube.com/watch?v=nW3xqcGidpQ

Coronavirus Chaos in China (with Ms. Taiwan) by Dr. Paul Cottrell 14min
https://www.youtube.com/watch?v=umUQxtLrgX4

#75 Sail Away on 01.31.20 at 10:50 pm

#61 Upenuff on 01.31.20 at 8:33 pm
#15 Paddy on 01.31.20 at 4:53 pm

bikini XL sizes are empty in the photo above….must be at a Walton Mart in ‘Merica

——————————-

Easy on Merica, our cousins to the south have done an excellent job of making some of our own Walmarts just as non attractive as theirs…. We have slowly been swallowed up by their mindset that has done zero to help us keep a strong Canadian identity…

——————————-

Oh yeah, it’s America’s fault [eyeroll]

#76 Westcdn on 01.31.20 at 11:22 pm

For me investing is a staircase up and an elevator ride down. It seems people want to put me down but I survive (women can be particularly cruel, men just kill you – so has been my experience). I don’t forget.

I fought hard to learn – like my grandfathers. I was lucky my grandmothers were tough and American. There is nothing like American pie if they want to cook. We are talking about women that had 12 and 10 children.

My father was a rebel. His mother would make him sit beside her at church so she pinch his thigh if she thought he was behaving. He said it hurt like hell. He was the also seventh son, so in French Catholic religion he was promised to the Church. That did not sit well with him particularly when he realized the Father was a POS.

That explains a lot why a 17 year old Sask boy ends up fighting an American Naval detail in a Halifax bar in 1945 – he escaped in good health – the story was funny.

#77 LP on 01.31.20 at 11:22 pm

OPINION
Ten things that would guarantee the new CPC leader is a winner
Scott Gilmore:

Yeah…what he said!

#78 Lead Paint on 01.31.20 at 11:25 pm

#5 IHCTD9 on 01.31.20 at 3:46 pm
Dave, I have a bil who will get about 50k/yr from his automotive career pension. I tell him that is like having saved a million by 65, because you’d need that much minimum to draw 50k while maintaining the principal

——————————

That is an incomplete comparison. If the pension is indexed to inflation they would need more than 5% average annual return, or draw down the principal to have the same income.

But the bigger point is that yes, they would roughly have the same amount in their pocket each year, put up their death (and possibly their spouse) their heirs will be left with nothing. Most people would rather leave their kids a million $ as opposed to nothing.

I would say closer to $700 k. Below shows it growing at 5% a year, withdrawing $50k and ending up at zero after 25 years.

Of course worrying about living too long makes the pension seem attractive, look how quickly it dwindles at the end.

yr. remaining principal

1 $700,000.00
2 $685,000.000
3 $669,250.000
4 $652,712.500
5 $635,348.125
6 $617,115.531
7 $597,971.308
8 $577,869.873
9 $556,763.367
10 $534,601.535
11 $511,331.612
12 $486,898.193
13 $461,243.102
14 $434,305.257
15 $406,020.520
16 $376,321.546
17 $345,137.623
18 $312,394.505
19 $278,014.230
20 $241,914.941
21 $204,010.688
22 $164,211.223
23 $122,421.784
24 $78,542.873
25 $32,470.017

So the question is, do you feel lucky, punk?

#79 Midnights on 01.31.20 at 11:27 pm

Interesting that everyone includes there second half on the way up. But don’t 50 percent of marriages end in divorce? So, where is this group on the way down?

#80 Figure it Out on 01.31.20 at 11:29 pm

“When you’re 30 you don’t mind living in hostels, drinking 2$ beers and taking night trains to save on accomodation. When you’re 60, […] the vacations you want to take will be expensive.”

When I was 20 and touring Europe in hostels and on night trains, I met a handful of 60-75 year olds doing the same. Thinking back, they seemed happier than most of the 60-75 year olds I’ve met since, at home OR on expensive vacations.

Hostels aren’t full of people bellyaching about taxes and comparing medical issues.

Food for thought.

#81 Figure it Out on 01.31.20 at 11:31 pm

“I thought the best lawyers I worked with were with the charity. Driven by passion. Had to be. There was no money in it.”

They was doing it wrong.
https://apnews.com/9d2ed80ca912d18abd6650f55d2db935

#82 Lead Paint on 01.31.20 at 11:33 pm

So for fun, here are the charts if you DID have $1,000,000 and then $ 2,000,000, how much your heirs would get after 25 years of living off of $50 k.

1 $1,000,000.00
2 $1,000,000.00
3 $1,000,000.00
4 $1,000,000.00
5 $1,000,000.00
6 $1,000,000.00
7 $1,000,000.00
8 $1,000,000.00
9 $1,000,000.00
10 $1,000,000.00
11 $1,000,000.00
12 $1,000,000.00
13 $1,000,000.00
14 $1,000,000.00
15 $1,000,000.00
16 $1,000,000.00
17 $1,000,000.00
18 $1,000,000.00
19 $1,000,000.00
20 $1,000,000.00
21 $1,000,000.00
22 $1,000,000.00
23 $1,000,000.00
24 $1,000,000.00
25 $1,000,000.00

1 $2,000,000.00
2 $2,050,000.00
3 $2,102,500.00
4 $2,157,625.00
5 $2,215,506.25
6 $2,276,281.56
7 $2,340,095.64
8 $2,407,100.42
9 $2,477,455.44
10 $2,551,328.22
11 $2,628,894.63
12 $2,710,339.36
13 $2,795,856.33
14 $2,885,649.14
15 $2,979,931.60
16 $3,078,928.18
17 $3,182,874.59
18 $3,292,018.32
19 $3,406,619.23
20 $3,526,950.20
21 $3,653,297.71
22 $3,785,962.59
23 $3,925,260.72
24 $4,071,523.76
25 $4,225,099.94

This is fun! Garth can I have a job?

#83 Barb on 01.31.20 at 11:42 pm

#36 Bytor the Snow Dog on 01.31.20 at 6:44 pm

“Pregnancies after 35 are medically termed as high risk.”

——————————————————–
Our daughter chose to have a child as she approached 38. On learning she was pregnant, an $800 medical test determined the fetus was fine.

Money well spent.

#84 G on 02.01.20 at 12:03 am

Great Not.
Be careful just hear that pets like dogs many be able to get the virus from infected people to, when out walking and need to be isolated then. WHO said it’s still just theoretical for know. But why wait for WHO to worn you. WHO seems to love the way china is responding. Does he mean when they jailing Doctor that tried to ask the world for help months ago.
Maybe dog boots and nose guard on and when out, if you don’t have your own yard? Will infected dog shield the virus before showing symptoms, if they even do? Maybe it’s just they can contact it on the ground or an infected person and track it around. I guess we will find out in about 14 days maybe.

Get your immune system ready now, Multi-vitamins, C, D3, K2, B’s, folic acid, iodine other anti oxidants. Up the D & C lots if you start feeling sick. Wash your hands well, short finger nails too, and don’t touch your face. How much TP paper do you have And caned food just in case? Good luck all. Just started to pray, never did before. I pray I’m wrong.

#85 Tony on 02.01.20 at 12:10 am

Re: #43 Technical Analist on 01.31.20 at 7:23 pm

None of that matters unless Trump gets impeached. 2020 is an election year. The indexes should gain more than they did in 2019 or at least up to the end of September 2020.

#86 Steven Rowlandson on 02.01.20 at 12:17 am

“Plus you will have become a career civil servant. ”

If that is the only path to getting enough income then me and my ilk are in trouble……

#87 Linda on 02.01.20 at 12:18 am

#60 ‘Katherine’ – As I said to Kona, some public pension plans may do better than others. Your 64% is a superior deal compared to most. I pulled up the PSPP pension estimator online to see what it would calculate using the 35 year/$90K scenario & those are the figures I cited in my reply to Kona. If you read Kona’s post you will notice that the pension amount you quoted – just under $58K per annum – is still one heck of a lot less than Kona’s estimate of $160K per annum.

One other thing regarding the pension figure you quoted. Would that sum include any bridging to age 65? If it does it might explain why your figure is so much higher than what the PSPP pension calculator showed.

Glad to hear you are enjoying retirement. Congrats on the grandchild too:)

#88 Sask to AB on 02.01.20 at 12:42 am

re #53 Nonplused on 01.31.20 at 7:47 pm

Great comment, appreciate your post.

F56AB

#89 Shirl Clarts on 02.01.20 at 1:35 am

#46 IHCTD9 on 01.31.20 at 7:30 pm
#22 Living the FIRE Dream on 01.31.20 at 5:21 pm
^^^^^^^^^^^^^^
22 is just that same gloating troll pretending again.

#90 under the radar on 02.01.20 at 5:35 am

Someone accurately portrayed the reality of law at a large firm- not easy, constant pressure .
Small lawyers or sole , make a living .
Getting rich as a lawyer requires investing early, being street smart, cultivating and maintaining clients, taking risk and living below your means .
Easy to say , hard to do. Most lawyers are trained to be risk averse and afraid of oppurtunity , assuming they even see it and when the money does flows, live large.

#91 T. on 02.01.20 at 7:32 am

I refuse to pay attention to flakes who uses the word “partner” to describe their significant other.

#92 Wiggleroom on 02.01.20 at 7:42 am

“Nine hundred large invested properly for a decade will turn into almost $2 million at age 53, and kick out over $100,000 annually.”

Question about your advice to Ron – why is a Mr Moustache’s 4% withdrawal rate “a joke”, but a 6% WR you suggest above is fine and dandy?

The 6% rate is a conservative estimate of growth based on a balanced and diversified, routinely-rebalanced portfolio performance over decades. The MM number is a withdrawal rate based on a wimpy, static investment profile and the premise people like to live on day-old bread, wood heat and munch on things that appear in the garden. – Garth

#93 crowdedelevatorfartz on 02.01.20 at 7:55 am

@#34 Wexit
“Brexit is HERE!”
+++++

Your ignorance is amusing.
Brexit in name only.
Perhaps a bit of political and economic reality for my uneducated Albertan.
Have a seat, take off your baseball cap, pay attention.

Boris Johnson and his idiots have merely pulled the pin.
The hand grenade is still firmly in their British lap.
And Europe doesnt want it until after it explodes.
New borders after 50 years, customs duties, tariffs, passports, etc etc etc.
NONE of this has been negotiated. They tried over the past 3 years. Nothing. And they expect to get it done in 12 months. With Europe holding all the cards?
A complete economic disaster for Limeyland.

I cant wait for the resurgance of Scotland and Irelands seperatist Party’s to perform the final Coup de grace on the once mighty ‘United Kingdom”.
England will be an economic backwater , a pimple on the rump of the EU.
The only one’s that should be celebrating Brexit are Russia and China.
Divide and conquer the beer swilling , pub crawling ignorant louts.
Keep waving that ridiculous Wexit flag…… the US wants your Tar sands…

#94 crowdedelevatorfartz on 02.01.20 at 8:12 am

@#64 katherine
“For all those teacher haters…you could have chosen the same career path. I am proud to have helped educate many business students.”
+++++

We dont hate teachers.
Just the endless stikes, whining and the insistance that the $90,000 per year isnt enough.
Oh right.
“Its about the kids.”
The $58,000 per year GARANTEED pension is also a nice perk.

My observation.
The unpensioned, unprotected, non union majority of taxpayers have had it with the endless govt employee mewling for more more more.
You all have a good gig.
Perform half the work of the private sector in the same line of work for more money.
Good pay.
Excellent medical, dental, eyewear benefits.
Oh almost forgot. the gold plated, garanteed pensions.

You unions do a horrible job of selling your reasons for endlessly striking.
And if I’m a Boomer telling you this…..do you really think Millenials enjoy their ever rising taxes paying for things they will never hope to get?
Perhaps its time to tell them you need to hire better PR companies….because the “its about the kids” is getting rather threadbare.
Or get ready for the fiscal hammer to come down.

#95 Katherine on 02.01.20 at 9:03 am

#86 Linda
Thanks for your good wishes. Yes my pension is bridged until age 65. At that time, OAS kicks in which more than makes up for the loss of bridge payments.
For sure Kona’s quoted pension doesn’t make sense.

As for lawyers, more to life than making tons of money. A good friend of mine is a partner in a big Toronto firm. Works all the time. She had wanted to get married and have a family but career got in the way.

Got in the way of what? If she enjoys the career success who are you to stand in judgment of her choices? – Garth

#96 Log in pants on 02.01.20 at 9:12 am

US bans all Chinese and Foreign nationals, including Canadians from entering the USA.

Does anyone remember SARS? Because of Canada’s “Liberal” SJW health and political crazies, Singapore banned flights from Canada. China is saying the ban isn’t a friendly gesture. Canada is still wide open. Only places like Cambodia are taking similar measures of total denial.

#97 MF on 02.01.20 at 9:14 am

#94 crowdedelevatorfartz on 02.01.20 at

Half the work of the private sector? What planet do you live on? I work in the private sector and you must be in denial if you think everyone “works hard”. Get real.

The truth is people like you are green with envy. It’s not a good look, your whining and complaining. More like a personal gripe than anything based on fact or reality.

You had a chance to choose teaching as a career path. Why didn’t you? Seriously fartz. Why are you not a teacher?

MF

#98 Lead Paint on 02.01.20 at 10:04 am

#94 crowdedelevatorfartz on 02.01.20 at 8:12 am
#97 MF on 02.01.20 at 9:14 am

In public sector your peers turn on you if you work to hard – it makes them look bad.

If teachers unions got rid of bad teachers they might get some sympathy.

MF all you’ve done is attack CEF, you made no legitimate points.

#99 Dharma Bum on 02.01.20 at 10:11 am

#62 Upenuff

We have slowly been swallowed up by their mindset that has done zero to help us keep a strong Canadian identity…..
——————————————————————–

And what would that look like, exactly?

Plaid shirts?

Ball caps?

Stubby beer in hand?

Back bacon and long underwear?

Canadian identity? Hahahahahahahahahaha!

https://www.youtube.com/watch?v=0pPRaD6TKLc

#100 Phylis on 02.01.20 at 10:17 am

Maybe we should individually direct our taxes on a percentage basis to the causes we think the government should handle. The messaging would be incredible. Would need some long, med and short term categories amongst others . Allow gov recommended default allocations. Finally some real voting.

#101 NoName on 02.01.20 at 11:11 am

Here is essential book for FIRE people with less that 2M now days. (lot of pictures in colour, ezy to understand and read)

https://imgur.com/a/swnRQyC

#102 TurnerNation on 02.01.20 at 11:17 am

Well folks I’ve been suggesting to Watchout, that 2020-2021 they will be ramping up world chaos like crazy.

First month only, January and Canada has been assaulted with:
– Pickering nuke plant false alert. It was just a mistake!
– Iran’s act of war downing a passenger jet. It was just a mistake!
– Corona virus. It was just a….

Actor Trump has been given center stage this week; grizzled T2’s job is done he exited the lime light.
Un-free Land soon to appear. With intended results.

Our elite rules have now cracked down on our travel, freedom of movement; what they do best.
Say why are they still pushing us to send them their DNA (Ancestry – fun!) It’s not like they are giving us any real cures, none in my lifetime. So what’s up.
Maybe it’s just easier if you stick to believing that bats give people the flu, and monkey give people aids.
Netflix aids in pushing out movies on this very subject. Hey it’s just entertainment right.

I called this pandemic it’s just a great system of control for our elites With the stroke of a pen…:


The stampede — Greater Fool – Authored by Garth Turner …
Dec 30, 2019 – #9 TurnerNation on 12.30.19 at 4:56 pm … Maybe the WHO declares global pandemic, maybe the correct Carbon Permit was not obtained.


By the dawn’s early light — Greater Fool – Authored by Garth …
Oct 4, 2019 – I’ve said it many time, we will see soon armed government men destroying perfectly good foodstuffs. We’ll be told it;s a WHO directive to keep …


Dr Garth — Greater Fool – Authored by Garth Turner – The …
Dec 1, 2019 – I always said a day will come here whereby armed government men destroy foodstuffs or kick people out of perfectly good homes. Maybe they …

#103 Wiggleroom on 02.01.20 at 11:18 am

“The 6% rate is a conservative estimate of growth based on a balanced and diversified, routinely-rebalanced portfolio performance over decades. The MM number is a withdrawal rate based on a wimpy, static investment profile and the premise people like to live on day-old bread, wood heat and munch on things that appear in the garden.” – Garth

But the MM 4% SWR is based on the Trinity Study. The asset allocation for that study was (if I recall correctly) 60% stocks, 40% fixed income. How is that so different from what you recommend?

The Trinity study has been widely debunked. Moreover the 40% of a balanced portfolio that’s FI should never be all bonds. – Garth

#104 Or ... on 02.01.20 at 11:30 am

#67 BlogDog123 on 01.31.20 at 9:02 pm

#53 NonPlused,,

there’s a way to still upgrade that Windows7 machine to Win10. Google it, I just upgraded a machine 2 weeks ago… Might be this article below, not sure…

https://www.zdnet.com/article/heres-how-you-can-still-get-a-free-windows-10-upgrade/
—————————————————
download windows 10 from MS and buy an activation number on Ebay for a couple of bucks … done.

#105 G on 02.01.20 at 12:31 pm

For the people that need to know to make the best calls for everyone on the bigger questions of the actions to be taken sooner than later. And also possible lines of research and treatments that may help sick people. I hope they are aware of this and can find something to help. Hopefully. Cross my fingers.

Coronavirus and HIV research paper review by Dr. Paul Cottrell 34min
https://www.youtube.com/watch?v=zgR18GtO_1Y

#106 tbone on 02.01.20 at 12:44 pm

Regarding ink jet printers , why not consider a laser printer. They don’t dry up and print all the time .
Cheap to purchase too . Get them on sale at BB.
I rarely print anything anymore and this brother printer
fires up every time , like 5 years with the same cartridge.

#107 oh bouy on 02.01.20 at 1:03 pm

@#95 Katherine on 02.01.20 at 9:03 am
#86 Linda
Thanks for your good wishes. Yes my pension is bridged until age 65. At that time, OAS kicks in which more than makes up for the loss of bridge payments.
For sure Kona’s quoted pension doesn’t make sense.

As for lawyers, more to life than making tons of money. A good friend of mine is a partner in a big Toronto firm. Works all the time. She had wanted to get married and have a family but career got in the way.
——
Got in the way of what? If she enjoys the career success who are you to stand in judgment of her choices? – Garth
__________________________________

‘if’ she enjoys it.
I have sympathy for folks who neglect their family for a career. there aren’t to many things folks regret more than being an absentee spouse/parent their whole life.

Irrelevant comment as the person in question did not marry. Therefore family was not a priority. Don’t cast your own emotional needs upon others. Having a spouse or offspring is not the goal of life for many. – Garth

#108 oh bouy on 02.01.20 at 1:08 pm

@#89 Shirl Clarts on 02.01.20 at 1:35 am
#46 IHCTD9 on 01.31.20 at 7:30 pm
#22 Living the FIRE Dream on 01.31.20 at 5:21 pm
^^^^^^^^^^^^^^
22 is just that same gloating troll pretending again.
_______________________________

lol, so’s #46.

#109 Left GTA on 02.01.20 at 2:01 pm

This is just crazy! I just left the GTA to move to the Tricities only to see this just now:

https://www.realtor.ca/real-estate/21515475/148-pinewood-avenue-cambridge

Maybe I will be leaving the tricities next and join Garth in Lunenburg.

#110 crazyfox on 02.01.20 at 2:16 pm

This virus is a much bigger deal then Canadians are being lead to believe. Global markets and our health is at much bigger risk than most realize. People don’t spend a lot when they are scared and holed up. Garth I don’t envy your position at this point. Me thinks you are about to have some very panicked clients. Stay healthy everyone.

The virus is hardly a health issue at this point. It’s an economic one, and markets are risk-off because of the impact on Chinese Q1 GDP. My clients are apparently more confident than you. – Garth

People can basically see it for themselves, the level of risk posed by Corona. We’ve got 4 cases here in Canada, nothing to be alarmed about. China is another story altogether. Quarantines didn’t go up in the province of Hubei (ground zero Wuhan) until January 23rd, the beginning of NY holidays there (NY is Jan 25th). People don’t go back to work until tomorrow so domestically speaking there is a service industry hit but it hasn’t hit industry. Yet. At that point, the Chinese people and government will have to decide whether to go back to work or stay home. If they stay home, for how much longer? If they go back to work the virus will proliferate (spread faster). I can only hazard a guess that it will be a hybrid reaction as fear and paranoia is very real and yet, people need to make money so it comes down to risk…. the risk of going to work, vs the risk of staying home to wit, I’ll leave the risk for the money managers to decide the risks to the Chinese economy. If the streets stay quiet and that won’t be hard to find out in the age of social media, the conclusions won’t be hard to draw from there.

My big interest is the virus itself and what the world should prepare for going forward. if we look at this map of contagion spread:

https://gisanddata.maps.arcgis.com/apps/opsdashboard/index.html#/bda7594740fd40299423467b48e9ecf6

Two sets of numbers are of great interest to me. The first set is 12,024 confirmed cases and 259 deaths. The second set is 7153 confirmed deaths from the province of Hubei and 249 deaths.

The death overall is 2.15% but when one considers the death rate out of Hubei where the cases are older and the virus is in later stages as is the case of ground zero province of Hubei, this number jumps to 3.48%. These numbers suggest two things:

– Death rate will be at least as high as 3.48%. (expect these numbers to climb from what they are now and if health care systems become overwhelmed, expect the death rate to continue to climb as the sick and elderly are refused treatment like ventilator and rotating beds in ICU)

– The quarantine of the province of Hubei has failed to contain Corona within the province. Corona has now proliferated into Guangdong (535 confirmed), Henan 422 confirmed, just click onto the cities on the interactive map above and we’ll see that Corona has spread throughout the rest of China with at least another 4,000 confirmed cases. It’s still premature to say but I think with these numbers it will go global.

At some point China will have go back to work, its just a question of when. Can China take the next 8 to 10 weeks off? Doubtful but who is to say, it depends on government and economic response. Will Corona be a big problem in this flu season for North America? Doubtful, international response is good, flights have been cancelled and quarantines of arrivals from China are in effect but the winter of 2020/21 is another story.

Corona presents unique problems to control in that the virus can survive dormant wrapped up in a protein coating in enclosed areas for up to 5 days on hard contact surfaces such as door nobs, countertops, elevator buttons, toilet handles etc. It’s passed on through droplets (human breath, coughs, people cough in their hands and touch their face and through touch pass it on to hard surfaces) and people can be infectious for up to 14 days before developing symptoms. Also, people that are healthy can be mildly effected by Corona and feel flu like symptoms, fever, maybe a cough and get better, maybe go back to work but are still highly contagious.

The Corona virus is a virus that is easy on the young and healthy and hard on the sick and old. The healthier the immune system, the better the odds of getting through it. It’s still premature to say, but those with preexisting conditions, people with another disease are most at risk. Corona is mother nature’s culling. It’s going to thin out the herd of the sick and lame and the young and healthy will be it’s natural carriers at least, in how its shaping up to be so far. If anything, its the death rate and rate of spread that we need to watch.

3.48% death rate out of the older cases (7153 from province of Hubei where city of Wuhan is) with a decent enough sample sizing is enough to generate concern. Novel Corona is similar to SARS, most likely a lower mortality rate but far more contagious and the health threat is not immediate as its still mainly localized to China and international response is good, but that will probably change over time. There are 19 cases in Thailand, 18 in Singapore, 17 in Japan… the world needs to brace for the reality of this thing going global in serious numbers. Its the timeline of disruption that remains a mystery. I should not have to tell readers what this will mean to economics over time if or when it does.