Made your RRSP contribution yet?
Wait, keep reading. This isn’t another tedious piece on tax-free compounding, using a retirement plan to split family income, making a contribution without having any money, how to remove funds without being taxed nor how the entire system is dramatically skewed to benefit high income-earners, medical professionals, lawyers and the self-employed. You already know that stuff.
Instead, let’s revisit a fav topic: how pooched everyone else is.
How much do you need to retire? That depends on when you hang ’em up and how much you spend, of course. Plus if you have kids or wish to leave an estate for others to squander on stuff you’d never buy. There is no static answer. Some people say 30x your annual working income is the right number. Investment giant Schwab suggests $1.7 million is a reasonable goal. Fidelity says you need enough saved/invested to replace 80% of your work salary. Anyway, the Internet teems with financial calculators you can use to come up with your own target.
Then compare your readiness with this dismal set of facts:
- As mentioned before, people retiring without a defined corporate pension have an average of $3,000 saved. Yeah, they probably have a house, too. But you can’t eat that.
- About a third (32%) between 45 and 64 have saved… nothing. Seriously.
- Roughly a fifth (19%) have less than fifty grand. But the average amount Canadians have saved/invested for the future is $184,000. That tells us a small slice of folks have saved a boodle. A giant slice of people are heading for a future of KD and CPP.
Now on that point, we all need to understand clearly the public pension system in Canada will not save you. Not with the recent enhancements, either. If you’re a Millennial, the higher benefits (a max of just over $20,000 a year) don’t click in until the average moister is 76.
Today the max someone can collect in CPP is $1,175 a month, but very few qualify. So the average received is $672, or eight grand a year. Grocery money. Old Age Security goes to everyone at age 65 (for now), and that adds $613. So the total in government pogey the average person receives is $15,420. If that were your only income, then the GIS (Guaranteed Income Supplement) kicks in at a max of $876 per month, bringing the grand total of public assistance to $25,932 – or about two thousand a month.
Married people get less GIS, but it’s still possible for an average household of two to receive a total of about $45,000 annually. Maybe all the people with little or nothing think this is enough to get by on, which is why they don’t save or invest. Given that the median household income in Canada is north of $90,000, this translates into a 50% drop in retirement. So ask yourself, could you suddenly live on half the money you’re getting from employment?
Let’s compare with the deplorables in Trumpland (which some people think may soon be the home of Bernie’s Sandersnistas).
The average monthly Social Security payment in the US is $1,471, or about $1,900 in moose money. Therefore it’s three times more than CPP pays (on average). By the way, the max SS payment of $2,210 at age 62 is about twice as generous as CPP – and it grows from there: $2,900 a month if you wait until 66 and $3,770 monthly ($45,300 US) at 70. So a couple of wrinklie old pensioners who worked all their lives could actually see up to ninety grand a year.
But what about household savings?
A new survey by TD Ameritrade says 50% of Americans have more than $100,000 – way better than us. Most of this is in the hands of people over the age of 40 (no surprise there), yet Millennials in the US are the ones most often stuffing their Roth IRAs (the American equivalent of our TFSA).
Hmm. The average American has saved more money for retirement, and the US system is far more generous with public pensions. So how did we get so smarmy and snooty, believing the States is a land of dumpster-divers, people who spend everything on Glocks and trailer park rednecks where financial illiteracy reigns supreme and society is divided between billionaires and losers?
Beats me. The CBC maybe. Or our political elite. Maybe it’s the whole real estate-government complex.
After all, the US rate of home ownership is lower than in Canada by almost 10%. American households carry far less debt, and actually reduced borrowing a ton after the housing market blew up. Plus the median cost of an American house is just $228,000. The average paid by first-time buyers is $219,000. There are porta-potties in Vancouver worth more.
Thus, when it comes to the financial state of Canadians, this pathetic blog’s thesis stands. It’s suicide by house.
191 comments ↓
$25,932 – or about two thousand a month.
You wish…
“So how did we get so smarmy and snooty, believing the States is a land of dumpster-divers…” The Maestro
Broadcast (Fake) News Admits What We Already Know…
Senior ABC correspondent David Wright:
“Our bosses don’t see an upside to doing the job we’re supposed to do…which is to speak truth to power and hold people to account.”
“We recognize that we’re dinosaurs and we’re in danger of dying.”
https://mobile.twitter.com/JamesOKeefeIII/status/1232666696357437441
Remember: If you want to know what the real story is go to the organ grinder not the monkey
“… it’s the whole real estate-government complex.”
Thanks for all you do Garth
houses houses everywhere but not many homes
Fantastic article about commuting a pension. One needs to be real careful, many pitfalls
https://cutthecrapinvesting.com/2020/02/26/defined-benefit-pension-planning-bad-advice-could-cost-you-your-retirement/amp/?__twitter_impression=true
Quoting RE national averages or median glosses over lots of reality, here or the US.
I have family in flyoverlandia midwest USA, iirc I remember their nothing special 3br homes were around 3-400k US. Yes the same crappy wood & fake brick quality we have here. Though unlike most of Canada there’s towns that are ROUGH, which I can only imagine are not exactly a seller’s market.
So at a state or national level these stats sort of are meaningless.
Would you like me to do a piece on your family? – Garth
A couple of points. First, compare net working income to net retirement income. Second, keep in mind that the USA does not have public health care the way we do in Canada. In the land of the free, health care – isn’t. It is in fact one of the top reasons for bankruptcy. Third, homes do cost much less than in Canada, plus they get to deduct mortgage insurance to boot. However when sold the government gets a cut of the booty should the property have increased in value. I think they get a cut regardless, a universal land transfer tax if you will. Lastly, I see poor old people:( Yes, they should have been able to save & set funds aside for the old age they apparently never thought would be theirs. This tidal wave of the financially pooched is going to be a drag on our economy for decades. Eek!
The majority of Americans are covered by health care plans, plus Medicare and Medicaid. That’s a myth. And the government does not take away people’s profits on houses. There is a $500,000 exemption. – Garth
That’s one handsome dog, I must say.
I think the max GIS is now about $915 a month (Wipee!). Of course, if you collect CPP, you won’t get the max GIS. Most people who get CPP get between $200 to $400 of GIS if they have no other income. This is why having non CPP/non OAS retirement income of $5,000 or so (e.g. RRSP income) is pointless as it just sets off against GIS (although not dollar for dollar). Of course retirement capital can be spent at will without affecting GIS, for now.
When I graduated high school (40 now)…my classmates divided into:
– Post Secondary white collar jobs
– Trades
– Lazy unmotivated became Real Estate agents or Financial Advisers
Today…youth with University degrees or blue collar strive to become the later???
A new survey by TD Ameritrade says 50% of Americans have more than $100,000 – way better than us.
It looks like Canadian families are not too far off that amount according to Statcan. RRSP = 133,900 and non-pension financial assets 93,000 in 2016 $ for all families. 55-64 boomers doing even better
https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1110001601&pickMembers%5B0%5D=1.1&pickMembers%5B1%5D=3.1&pickMembers%5B2%5D=5.6&pickMembers%5B3%5D=4.1
#7 Linda on 02.26.20 at 3:33 pm
A couple of points. First, compare net working income to net retirement income. Second, keep in mind that the USA does not have public health care the way we do in Canada. In the land of the free, health care – isn’t. It is in fact one of the top reasons for bankruptcy. Third, homes do cost much less than in Canada, plus they get to deduct mortgage insurance to boot. However when sold the government gets a cut of the booty should the property have increased in value. I think they get a cut regardless, a universal land transfer tax if you will. Lastly, I see poor old people:( Yes, they should have been able to save & set funds aside for the old age they apparently never thought would be theirs. This tidal wave of the financially pooched is going to be a drag on our economy for decades. Eek!
——————————-
Linda, you’ve got most of that wrong.
Public health care mostly benefits junkies. Productive members of society in the US are mostly covered just fine.
Also, mortgage interest in US is deductible. Huge benefit.
But blocking a railway won’t be benevolently tolerated and allowed to shut down national commerce.
For a toothless, confused and ineffective government, best stay here.
Garth,
Are you building some sort of health care insurance cost into the American $$$ saved algorithm?
Apples and oranges.
Taxes are higher here. However a broken leg, stroke, cancer, or heart attack will not wipe out anyones savings. Save for parking.
Love your blog sir, but we take care of one another up here.
As mentioned before, people retiring without a defined corporate pension have an average of $3,000 saved.
………………………………
Yah. About those defined corporate pensions. How sustainable are they ? The premiums we pay are invested to sustain payments to retirees. In a low interest rate/low return environment how long can they carry on ? Insurance companies had to increase premiums and deductibles to carry on in a low return environment. How long before pension plans have to increase premiums and/or reduce benefits to retirees? Scary thought if you currently receiving a corporate pension. Which I am.
Average house price in Canada is 480k….why? It’s just a bloody house…you know windows, doors, plywood, some 2x4s….
The GIS is reduced as CPP is considered income for the GIS calculation. OAS is not counted as income.
Using your numbers:
If CPP is zero, then GIS+OAS is $872+$613 = $1,485
If CPP is $672/mth, GIS is reduced to $458+$613 OAS
= $1,743
30x your annual working income.
———
Would that be pre or post tax income?
You are part of the property-owner class. How does it feel that small businesses in Toronto are forced to shut down because of the bourgeoisie landlords increasing rents as a method of coercion in a capitalist and neo-feudalist society?
https://www.blogto.com/eat_drink/2020/02/toronto-pub-landlord-rent/
If every small business is forced to shut down, then say goodbye to future tax dollars. Small businesses are more likely to fund taxes while the 1%ers use tax avoidance and offshore bank accounts to shirk their responsibilities.
If push comes to shove, I will join the anti-pipeline protests and inconvenience thousands of the proletariat classes from exchanging their time and labour for capitalist money.
Cue the “yabutt healthcare” arguments. Because apparently having free healthcare excuses every other mediocrity in Canada.
On a side note, has anyone noticed that our population is growing faster than other developed nations, yet we never seem to build new hospitals? Think about that for a minute. Then explain to me how our “universal” healthcare is going to perform 20 or 30 years from now.
I secretly adore kd. Don’t tell anyone. Thx. My shame is my own.
Damn, that was an epic post. This information that the US has a stronger safety net goes against simple plain Canadian assumptions. The average Canadian definitely needs to be a little but less smug about their place in the world.
With a paid off house, you absolutely could live on 45K. Sounds like a nightmare to me, but obviously lots of people are doing it today including both my parents (one has to, the other is dirt cheap) and my wife’s parents.
As a renter? Maybe in Moose Jaw. But for most Canadians buying and paying off a reasonably affordable home will always be a good retirement strategy. Cause if 45K isn’t enough, you can still sell and rent.
And based on your numbers, renters are not having better outcomes then HO. If NO one is saving, I’d bet on the homeowner with the clear paid house having a better time in retirement.
#17 Stone
Does it matter? Even a person who earns $80,000 in their top years, which is about $60,000 after taxes, would still need $1,800,000 if it is 30X. Nobody earning $80,000 is going to save that much, at least not before their 200th birthday. I suspect that when the investment firms realize that scaring people with ads about how little people have saved don’t work in getting people to invest, they will start pushing adds that hype the average amount people have saved for retirement as being quite a bit to make you feel inadequate. The facts don’t matter, and are virtually impossible to disprove. They just need to know what will push your buttons.
Do the math. If that doesn’t scare you, enjoy the KD lifestyle. – Garth
If a person concerns themselves with how much GIS pays out, they have bigger problems. LOL.
#13 SJP on 02.26.20 at 4:13 pm
Love your blog sir, but we take care of one another up here.
—————————-
You bet, yep, we sure took care of the thousands who lost their jobs this month. Maybe we could all bake them a casserole in support.
I have monthly interest paying GIC’s, RRSP’s, LIRA’s now that I am 59 years old and retired after 37 years. They are mature in 5 to 6 years, CDIC, DICO insured, average rate 3.1% without TFSA GIC’s, with those 3.25%.
I get $1,450 a month from regular GIC’s, $800 a month from LIRA GIC’s and $650 a month from RRSP GIC’s. My TFSA’s all maxed out TFSA GIC’s are all compound GIC’s and that is generating, growing $225 a month.
I have a reserve money, cashable GiC’s, savings accounts of 3 years of living expenses, $55,000. All together I am still $15,000 a year ahead currently each year after income taxes and living expenses.
I will take my C.P.P early next year which will bring in another $700 a month which will after income taxes will make me $21,000 to $22,000 a year ahead, have no debts of any type and my modest house is paid, no car loans, nothing in the debt red.
Maximize my TFSA each year and really looking into dividend paying ETF’s, REIT’s dollar cost averaging $400 a month each with 4%+ yields hopefully.
Will build a financial bridge to get OAS in 5.5+ years to at least $100,000 to $120,000 until new income kicks in.
“Some people say 30x your annual working income is the right number. Investment giant Schwab suggests $1.7 million is a reasonable goal. Fidelity says you need enough saved/invested to replace 80% of your work salary.”
All of these phony retirement calculators overestimate how much you actually need to retire. Income and spending rate are two independent things. BUT, it is true that since most Canadians are so spendy, they will need to save a ton. Luckily, Fundamentalists don’t spend much and don’t need to save ridiculous amounts.
Happy Investing!
Is this some kind of Canadian inferiority complex?
US median household income is US$59,039. Canada: C$71,011.
US median home value: US$217,600. And they had a huge housing bust that bankrupted a bunch of people while our home prices continued to rise.
If half of American households had $100k kicking around, Bernie probably wouldn’t be leading the polls. And all those kids driving for Amazon, Grubhub, Uber and every other gigeconomysidehustle? They’re working toward a social security payment of $0.00/month.
As other commenters often point out, travel in the US hinterland is enlightening.
25k/yr? 2k/month?
My expenses are only 800/month.
Sounds pretty sweet to me.
Are you a shrub? – Garth
From just asking around (the most unscientific form of data collection), a decent amount of people don’t plan to retire. Some have income properties they plan to cash out. But most are simply financially illiterate.
Hey guys, anyone else /financially ruined/ with the corona happenings?
just how little it costs to be retired if everything is running well and have a paid off house. Even out here in 604. When I hit 65 last year even my hunt/fish licenses are only $5.oo each. Half price campsites in the off peak days. Cheaper transit passes too. Eating well is cheap and healthy if you cook and travel abroad is very reasonable if you know what to do. It all depends on your health though ….
Are you a shrub? – Garth
================
Ah..now we are getting to something completely different…classic lines from Monty Pythons movie Holy Grail.
Saw an ad the other day for a new condo in downtown Toronto .
parking space 75k extra , locker 7.5 k extra
500 square footer was in the 550k range .
That’s more than 10 % over the cost of the box you get to live in .
Nobody ever factors in the extra cost for what most people would want . Or at least what I would want .
Condo prices are more costly than I considered .
But they are so worth it .
k/yr? 2k/month?
My expenses are only 800/month.
Sounds pretty sweet to me.
Are you a shrub? – Garth
No, I just know how to handle money. Have my own garden. Butcher my own meat. Focus on my needs, not my wants.
I’m surprised you are so cynical.
#23 Lee on 02.26.20 at 5:01 pm
Even a person who earns $80,000 in their top years, which is about $60,000 after taxes, would still need $1,800,000 if it is 30X.
Nobody earning $80,000 is going to save that much, at least not before their 200th birthday.
———————–
Lee, let me turn you on to an obscure concept called ‘the compounding effect’. I read about it on a secret investing blog. Keep it quiet. Here it is:
Investing $10k/year for 38 years at 7% yields $1,837,846.38.
38 years is not 200 years. Hope that helped.
Suicide by House – young couple coming tomorrow to sign closing documents . Their CMHC fee is more than their entire downpayment.
I came across this article about the Japanese solution to the pension problem.
https://getpocket.com/explore/item/why-some-japanese-pensioners-want-to-go-to-jail
Pretty ingenious, eh?
If America were so great, Trump would not have found such an eager audience for his Make America Great Again strategy. And he would not still be trying to MAGA.
#12 Sail away on 02.26.20 at 4:12 pm
“But blocking a railway won’t be benevolently tolerated and allowed to shut down national commerce.
For a toothless, confused and ineffective government, best stay here.”
-I hear the same thing from Americans. Big Yaaawn.
And nothing was benevolently tolerated. It was respected, then dismantled when it became clear the demands weren’t reasonable, and that too many people were being held hostage. Remember the protests were annoying, illegal, but peaceful.
Should we not commend that?
Now contrast that with the Dokota Access Pipeline protests, where some 700 people were either injured or arrested. Plus, you had a sitting president lending support to the protesters.
The US offers extremes. Extreme wealth and extreme poverty. Canada’s extremes are less, with a healthier socierty the result.
MF
Ross Kay on HoweStreet.com Radio:
Deceptive Double Commissions.
CMHC’s 2nd Class Citizens.
https://www.howestreet.com/2020/02/real-estate-commissions-cmhc-ross-kay/
did you not see this Garth?
#16 bullwinkle on 02.26.20 at 4:19 pm
The GIS is reduced as CPP is considered income for the GIS calculation. OAS is not counted as income.
Using your numbers:
If CPP is zero, then GIS+OAS is $872+$613 = $1,485
If CPP is $672/mth, GIS is reduced to $458+$613 OAS
= $1,743
Collect 672 per month at age 64. No other income with no debt.
But now have terminal illness that qualifies as a disability and applying for disability.
Will this disability affect my CPP or any other pay?
President Choice White Macaroni and Cheese(not the orange crap) is way better than KD….just sayin.
Yeah, but look at real estate prices in Canada vs US and the benefits the cult of ownership has in Canada vs that south of the border… If you sell your principal residence in Canada, you will end up with pretty good retirement funding… and why wouldn’t you sell that house, really?
if Ive been contributing the maximum in CPP for 30 years, does that mean I’m guaranteed the max CPP monthly benefit (since I effectively prepaid the darn thing). or is it income tested and clawed back (for eg, if I have other pension income) and I’m lucky to see 75% of the max.
Are you a shrub? – Garth
Nope, just frugal. Live within your means.
90K SS? More reason to get rid of the border.
Electrify our rails. No more sitting.
#10 Dave on 02.26.20 at 4:05 pm
The times, they are a changin’
Kids graduate into a very different world than you did pre-2008.
In the current world, real estate is part of the gig economy, and is a way to earn extra cash on the side. It’s basically a sales job. It’s formulaic: get some fake eyelashes, heavy mascara/foundation, high heels, and tight clothes. Post on social media about your “lavish” lifestyle and boom you are branded.
Plus,
Most people nowadays have 3 or 4 sources of income. Can be either from cobbling a few jobs together, or other things like online selling/rental properties etc. Few have a “career”, and if they do it usually pays paltry and offers no benefits or incentives at all. Most people work 7 days a week.
This is all called the “hustle”, or “grinding”.
It developed after watching boomer parents (not me, others in my generation, my parents did great) work their butts off and give so much to their jobs just so that they could be laid off in 2008 like nothing. Family savings disappeared in the stock crash, especially if they weren’t diversified, and company pensions were raided (Sears anyone).
2008 changed everything.
MF
No one in the USA talks about the Roth IRA as a place to park cash. Yet the majority of people in Canada seem to think a TFSA is a savings account…wonder why that is..OH WAIT THEY NAMED IT A SAVINGS ACCOUNT.
Also when it was introduced you could only put $5k in it and interest rates of 3% on savings accounts were common…which spread the thoughts. Also stock markets were completely pooched from the Financial Crisis so the idea of buying stocks after the greatest stock market hit since the great depression scared people.
I tell you, my fellow Canadians are pooched. But they can all tell you everything you never wanted to know about buying an investment condo.
The houses in Vancouver aren’t worth what they are the government is going to do nothing to help the middle class because it’s a cash cow keep letting them in and screw up the system. Sell Canada to the US make Canada great again.
Hong Kong is giving 7 million people $1,200 in cash to boost its recession-hit economy
CNN Digital Rebranding 2013
By Michelle Toh, CNN Business
The Asian financial hub said Wednesday that the measure — the cornerstone of a 120 billion Hong Kong dollar ($15.4 billion) stimulus package — will involve giving 10,000 Hong Kong dollars (about $1,280) to all permanent residents in the city who are at least 18. About seven million people will benefit from that program.
In addition to the government handout, the government will also slash income tax for some residents, he said, adding that this would impact almost 2 million taxpayers. Authorities also plan to give low-income residents of public housing a month of free rent, as well as provide a one-off allowance to 200,000 underprivileged households.
@#18 Retrograde Marxist wannabe
“….the bourgeoisie landlords increasing rents as a method of coercion in a capitalist and neo-feudalist society?…”
++++++
My Gawd, cant you just say,
“The landlord raised the rent?”
Or does your university degree not allow you that luxury?
Slogan spewing anarchist luddites UNITE!
Different decade, same slogans….yawn.
I have no idea how much I will need when I retire, because I don’t know how much I will spend when I retire, when I will retire, and what inflation or my rates of return will be like in the future.
All I can do is save a good chunk of my income while I’m working, and then when I’m no longer willing or able to work, I’ll manage on what I’ve got then.
A bit useless to try and come up with a figure, if you want a goal, make it to get the full match from your employer retirement plan (or maximum you can contribute to your DB plan with all the extras) and max out your TFSA/Roth/ISA or what have you each year.
If you do that until you’re no longer able or willing to work for a living, you’ll more than likely be just fine.
Much more useful a goal than “save 30 times your income” or “save 1.7million” or “take 80% of your income as your spending amount in retirement”.
Nonsense.
A few resources for the investigators:
FIRECalc – allows for a fair number of variables such as pension and govt benefits as well as variable withdraw amounts.
https://www.firecalc.com/
This blog has done the math (35 articles ) on safe withdraw rates from the stash. The chart sums it up near the bottom of this page:
https://earlyretirementnow.com/2016/12/07/the-ultimate-guide-to-safe-withdrawal-rates-part-1-intro/
The “Firecracker’s” book was really good: Quit Like a Millionaire: No Gimmicks, Luck, or Trust Fund Required
https://www.goodreads.com/en/book/show/43345855
A CPP formula to estimate what you will actually get (takes some math)
https://retirehappy.ca/how-to-calculate-your-cpp-retirement-pension/
Note none of these places has cool Dog Pictures or a littérateur author (be warned).
The fundamental difference between us and the guys down South is that they are putting their cheese in their financial markets and we in our property markets.
So their financial markets are out to lunch and in our case our property markets are in cloud cuckoo land. But it is what it is!
Re: #26 Tom Sanjedo on 02.26.20 at 5:12 pm
Read about OAS clawbacks and the insurability of GIC’s with terms greater than 5 years.
The US is in far worse shape than Canada, epsecially when you factor in healthcare. Many are still hurting from the housing bust and yes, there are many cities where you can buy a home for under $300k, but who would want to live in St Louis? Camden? Flint? Bronx? Kentucky? Gary? I could go on. Maybe you should spend some time there and see for yourself.
We are all fans of GT. Whether we came to know him as a politician in his prior existence or through Ray Jay where Mr. Turner makes his living today. Ultimately he is attempting to save us from ourselves. Human nature after all is all or nothing, fear and or greed.
A close family member moved to the USA with her Canadian spouse decades ago…never worked in the USA. The marriage ended after 10 years and she moved back home to Canada. As a senior, she now receives about 1400 Cdn in US Social security (on top of CPP and OAS). If the situation were reversed (Americans moving to Canada, married 10 years), ex-spouse would get basically nothing.
That is per month.
It blows me away that someone who NEVER worked in the USA, only lived there 10 years, receives more in US Social Security than her CPP (she actually worked for this) and OAS combined.
Re: #55 Toronto_CA on 02.26.20 at 7:03 pm
First and foremost it all comes down to your health in retirement. The stooges who do retirement planning should have this listed first. If your health is shot you can’t work and long term care is expensive. Conversely if your health is intact you can work past 65 and not shell out money for health issues.
#54 crowdedelevatorfartz on 02.26.20 at 7:01 pm
@#18 Retrograde Marxist wannabe
“….the bourgeoisie landlords increasing rents as a method of coercion in a capitalist and neo-feudalist society?…”
—————————
My Gawd, cant you just say,
“The landlord raised the rent?”
—————————
Hahaha
I think they’re writing in retrograde Marxist grammatical style.
“…which some people think may soon be the home of Bernie’s Sandersnistas.”
>That’s Comrade Bernie’s Sandersnistas.
—
Bernie Sanders’ praise of Cuba and Fidel Castro on Sunday is just the tip of the iceberg.
The Democratic front-runner had a romance with the Marxist Sandinista government of Nicaragua in the 1980s and even honeymooned with wife Jane in the Soviet Union in 1988….
https://nypost.com/2020/02/24/bernie-sanders-under-scrutiny-for-backing-sandinistas-in-1980s/
—
Social democracy
WRITTEN BY: The Editors of Encyclopaedia Britannica
Alternative Title: economic democracy
Social democracy, political ideology that originally advocated a peaceful evolutionary transition of society from capitalism to socialism using established political processes. In the second half of the 20th century, there emerged a more moderate version of the doctrine, which generally espoused state regulation, rather than state ownership, of the means of production and extensive social welfare programs. Based on 19th-century socialism and the tenets of Karl Marx and Friedrich Engels, social democracy shares common ideological roots with communism but eschews its militancy and totalitarianism. Social democracy was originally known as revisionism because it represented a change in basic Marxist doctrine, primarily in the former’s repudiation of the use of revolution to establish a socialist society….
https://www.britannica.com/topic/social-democracy
#78 Roman Candlez on 02.25.20 at 8:49 pm
#74 Long-Time Lurker on 02.25.20 at 8:26 pm
>I don’t believe anything coming out of Red China or Iran on Covid-19.
Feb 25, 2020, 08:26am
Iran Health Official Who Claimed Coronavirus Was Under Control Tests Positive For The Illness”
LOL, this guy could be the viral equivalent of Iraq General Chemical Ali from the Gulf War, claiming to have the virus cornered, fiddling while Rome Burns. I hereby dub him, Viral Har-itchy
—
>It’s pretty instructive to watch the videos circulating of him being sick. He’s exhibiting the characteristic symptoms of this Covid-19 virus illness: A high fever and dry coughing.
#142 Doug in London on 02.26.20 at 12:11 pm
@the Jaguar, post #33:
Good points you make. Having been to Calgary, I see a lot of advantages to living there. I don’t know why more companies aren’t taking advantage of Calgary, like the CPR did many years ago. One example that comes to mind in Amazon, that set up shop in Vancouver. Why the hell didn’t they set up shop in much cheaper and more livable Calgary?
>Jeff Bezos is from Seattle. Back in the 90’s I was watching King-5 (Seattle) News and Amazon just opened a warehouse filled with books to sell by mail-order. I was thinking, “Is this business going to fly?”
I think CBC et al have a bad habit of making a big deal of the market corrections. Wow; netted down yesterday over the past 2 months ! Yet they do not seem to talk much about how well equities have done in the last 14 months when it creeps up over time. Must be government interference to help keep our wealth at bay, by scaring us away from the markets… ;)
https://www.cbc.ca/news/business/stock-markets-tuesday-1.5475633
So 70 million dollars won yesterday by a 22 year old IGA worker in Quebec..seems all the huge jackpots are won in Quebec? Handful of Maxmillions were also picked up in this draw. I watch all lottos weekly and can say these lotto winnings are going somewhere? Some peoples bank account? And this has been going on for years no? Am I alone in believing that all those dreamy $2,000,000.00 plus homes are being paid for with cash from this type of $? Please fill me in on the mistery of where all these weekly winnngs $ is going.
#12 Sail away on 02.26.20 at 4:12 pm
A couple of points. First, compare net working income to net retirement income. Second, keep in mind that the USA does not have public health care the way we do in Canada. In the land of the free, health care – isn’t. It is in fact one of the top reasons for bankruptcy. Third, homes do cost much less than in Canada, plus they get to deduct mortgage insurance to boot. However when sold the government gets a cut of the booty should the property have increased in value. I think they get a cut regardless, a universal land transfer tax if you will. Lastly, I see poor old people:( Yes, they should have been able to save & set funds aside for the old age they apparently never thought would be theirs. This tidal wave of the financially pooched is going to be a drag on our economy for decades. Eek!
——————————-
Linda, you’ve got most of that wrong. – Sail Away
She’s got some things right such as her first 2 points. Retirement income has less deductions compared to working income so there’s that. Health care bills are also the #1 leading cause of bankruptcy, an obvious systemic red flag.
https://www.cnbc.com/2019/02/11/this-is-the-real-reason-most-americans-file-for-bankruptcy.html
The average family in the U.S. spends nearly 10 G’s on healthcare only to enjoy the risk of the roulette of denied healthcare when someone gets sick, a major distinction between Canada and the U.S. . Simply put, insurance doesn’t always insure you. “An estimated 530,000 families turn to bankruptcy each year because of medical issues and bills, the research found.” What is that, 1 in 150 families going broke annually because someone in the family gets sick bleeding out finances, does that sound right? 1 in 3 families will go broke over 50 years, does that sound like a stable system?
“Public health care mostly benefits junkies. Productive members of society in the US are mostly covered just fine.” – Sail Away
Did I read that right, are we to believe that public health care in Canada for example, benefits only mostly junkies? Or public health care in any other nation, you have to be doped up to benefit? We need to be addicted to drugs to benefit from universal health care? Are you absolutely sure that productive Americans are mostly covered just fine? Stats aren’t saying that at all. What the stats are saying instead, is that the U.S. isn’t prepared for a pandemic as an example since some people aren’t insured or can’t afford for care.
Discrimination is not only systemic as evidenced with health care being a privilege instead of a right, its in American culture. How’s that going to work when the pale horse of modern day plague rides near if Bernie Sander’s claim of 87 million Americans having no health care or are under insured, holds true?
If a single person is receiving CPP of $672 per month ($8064 per year) GIS would be reduced to $454 per month or $5448 per year for total income of $20,868 of which only $15420 would be taxable since GIS is not considered as income for tax purposes. There would be other means tested benefits that would apply as well like rent subsidies, transit, tax credits, etc. See tables below.
https://www.canada.ca/en/services/benefits/publicpensions/cpp/old-age-security/payments/tab1-26.html
If a person had no other income other than OAS of $7356 per year, they would be entitled to GIS of $916 per month or $10,992 per year for total of $18348 of which only $7356 would be taxable, therefore no tax payable. This person would also be allowed to earn $5000 per year from wages (1 day per week at Wamart) without GIS clawback for a total of $23,348 and no tax payable. Would also be entitled to other means tested benefits.
If a person had save $150,000 for their retirement and received 6% return of $9,000 per year in addition to OAS of $7356 and CPP of $8064, they would be entitled to GIS of $677 per year for a total of $25,097 of which $24420 would be taxable so with tax payable of $2450, total net income would be $22647. That’s only $4300 more than the person receiving full GIS. They have paid near 50% on the income from those hard earned savings. They would also be disqualified from some of the means tested benefits. Not much better off than the person who lived it up and saved nothing. Makes you wonder don’t it?
Protesters have blocked the Pat Bay Highway (Hwy 17) on Vancouver Island, cutting the primary traffic link between Victoria and the B.C. Ferries terminal and airport.
CTV News reports activists walked onto the highway just before 2 p.m. in support of the Wet’suwet’en hereditary chiefs opposition to the Coastal Gaslink Project.
Police advised the public of the planned blockade in advance, which is expecting to run until at least 5 p.m. Commuters were advised to expect and plan for long delays. B.C. Transit said it has plans in place to reroute buses around the protest.
#59 Dave on 02.26.20 at 7:22 pm
The US is in far worse shape than Canada, epsecially when you factor in healthcare. Many are still hurting from the housing bust and yes, there are many cities where you can buy a home for under $300k, but who would want to live in St Louis? Camden? Flint? Bronx? Kentucky? Gary? I could go on. Maybe you should spend some time there and see for yourself.
+======+=======================
Really?
Our healthcare here in Canada is a mess.
On what basis do you say the U.S. is in far worse shape? Their economic opportunities blow Canada’s out of the water and it’s not even close.
Here’s a great example of CDN vs US;
2 cities separated by a 2 hour drive – Seattle vs Vancouver.
Seattle is home to a who’s who of some of the top 10 S&P 500 companies – Microsoft, Boeing, Amazon, T-Mobile, Starbucks, Nordstrom………and on and on.
Vancouver is Canada’s largest port city. Top employers in Vancouver………..the 3 levels of government. No fishing industry to speak of, a lumber industry in the toilet, mining bigs like Teck who can’t invest in projects in their own backyard.
#59 Dave on 02.26.20 at 7:22 pm
The US is in far worse shape than Canada, epsecially when you factor in healthcare. Many are still hurting from the housing bust and yes, there are many cities where you can buy a home for under $300k, but who would want to live in St Louis? Camden? Flint? Bronx? Kentucky? Gary? I could go on. Maybe you should spend some time there and see for yourself.
———————————————-
Ummm you need to do your homework. You can live 40 minutes from Manhattan (Syracuse, Long Island etc) in a fully detached for under $400K USD.
How does less than 40 mins from downtown YYZ and YVR stack up?
Where you getting your info?
#60 David on 02.26.20 at 7:22 pm
We are all fans of GT. Whether we came to know him as a politician in his prior existence or through Ray Jay where Mr. Turner makes his living today. Ultimately he is attempting to save us from ourselves. Human nature after all is all or nothing, fear and or greed.
———
Watching The Last Kingdom on Netflix, I’ve determined human nature is all about humping. Nothing else.
#46 david on 02.26.20 at 6:37 pm
or is it [CPP] income tested and clawed back (for eg, if I have other pension income) and I’m lucky to see 75% of the max.
clawed…clawed…clawed…
CPP is not clawed back. My tent has bear claw scars on it (while camped at Two Jack Lake) but my sorry and bent pensioner’s back doesn’t.
This year my income will be 21% pension monies and the balance earned income. Includes max CPP. No clawback. OAS, a different tale.
WUL
64MThe Mighty but Wounded McMurray
#31 Keyboard Smasher on 02.26.20 at 5:42 pm
Hey guys, anyone else /financially ruined/ with the corona happenings?
———————–
I’m interested to hear more of this “Keyboard smasher ” if you were already financially hit by the current Corona mess.
It appears that my original opinion some weeks back, that it would amount to “a big nothing burger” is vastly inaccurate! My apology to the dogs….
Rather devastating in consequences it appears.
Anyone else got some facts?
Cheers
@#65 Sail away
“I think they’re writing in retrograde Marxist grammatical style.”
++++
And the link that pseudo Marxist provided was a complete repudiation of their arguement.
The landlord was owed MONTHS of back rent, the pub staff were owed MONTHS of back pay, the pub “owner” was an absolute nut job…… nothing bourgeois about it.
slimy pub “owner” slithers out on debts…..
@#74 Yukon Elvis
“Protesters have blocked the Pat Bay Highway (Hwy 17) on Vancouver Island, cutting the primary traffic link between Victoria and the B.C. Ferries terminal and airport….”
++++
Yeah, the protesters like blocking urban streets and highways.
When they tried that up island….their blockades are torn down and 4×4 trucks run them ….the police cant garauntee their safety..
$1000 fines for blocking roads
or Jail.
Very simple solutions the govt seems incapable of doing.
Holy Crikey, 30 times your annual salary???? So a couple earning $150,000 a year needs $4.5 million? I just don’t see it because with a Garth ™ portfolio that $4.5 million should be cranking out $315,000 a year, which is over twice the original income.
If we do need 30 times income we are all well and truly screwed. It is hard to see how a couple making $150,000 a year and saving half of their after tax income can get to $4.5 million even 30 years into a Garth ™ portfolio. Actually I stand corrected, they could get to $4.5 million in 28 years if they saved half their after tax income at 7%, assuming they both make $75,000 a year (tax rate is lower). But I don’t think that is going to happen.
@#79 Spectacle
“Anyone else got some facts?”
+++++
read The Economist last weeks edition and this weeks….well worth the news stand price.
Hey Garth. Anything interesting happening in the markets these last couple of days? You should write about that! Fred
Did yesterday. Gets boring. – Garth
You really can’t compare the Social Security payment in the USA vs CPP in Canada without also comparing healthcare. It is when we get older that we start leaning on the medical system and exactly when you cannot afford huge medical bills.
Americans have health care. Stop listening to Bernie. – Garth
” So ask yourself, could you suddenly live on half the money you’re getting from employment?”
Ya, actually a lot of people can, if we make a few assumptions. 1. House is paid off and could be sold to provide income to pay rent in the seniors complex. 2. Kids have finally moved out of the basement. 3. No new cars or clothes or cruise trips. 4. No renovations or new TV’s. There is a reason Grandma’s house looks like it is straight out of the 90’s. It is. 5. You won’t be eating at The Keg anymore. (Sad, I love The Keg.) 6. No smoking or drinking. (Again, much sadness.) 7. Some of those things you used to spend a bundle on like skiing are out. No worries though your knees are shot anyway. It’s all The Price Is Right from here. 8. Don’t even think about getting divorced. 9. Etc. Being old sucks.
When you actually get old, like 70, I hope you look back on this post and realize how moronic it sounds. – Garth
50 Toronto_CA on 02.26.20 at 6:45 pm
Yet the majority of people in Canada seem to think a TFSA is a savings account…wonder why that is..OH WAIT THEY NAMED IT A SAVINGS ACCOUNT
——
RRSP = registered retirement SAVINGS plan…
75 Thedood on 02.26.20 at 8:15
House prices are a touchy subject. That’s why this guy^ and people like him will resort to posting blatant lies to make themselves feel better I guess..
Vancouver economy. 1 second google search:
Tourism, finance, film, technology, aviation, trade.
https://en.m.wikipedia.org/wiki/Economy_of_Vancouver
Where do you see government? Or, was that idea something you saw on YouTube last week? Convenient scapegoat maybe.
How about we compare Toronto and Detroit. About a 2 hour drive as well. Detroit: gutted factories, high crime, boarded up houses and drug addicts everywhere. Toronto home to the big 5 billion dollar/year profit banks. Jobs everywhere.
See, both can play that game.
MF
>A new survey by TD Ameritrade says 50% of Americans have more than $100,000 – way better than us.
I REST my case. Thx
Awesome and *timely* post.
I made a pdf of today’s blog and printed off 5 copies.
There are 5 people (possibly soon to be ex-friends?) which will receiving a copy next time I see them.
I am so done with people telling me,
(1) “Why save money when there’s cheap interest rates and GIS, if I can’t find a job”
(2) “Canada is superior to the USA in every way; I mean just look at their president” (as if we Beavers did any better)
(3) “We’re urging our kids, (or BIL or cousin, etc.) to buy a house now, because it’s never going to be better for getting a mortgage”
(4) And the worst one? “We’rem not selling the house because it’s the best investment we ever made (this from a Gen Y couple who rented the house out when they took a job in a different city, where they have to rent).
Meanwhile these same folks (and their kids) have car loans, student loans and, like so many others, would be dead in the water if they lose their jobs because of no savings.
Yeah, I get why Garth says “I give up”.
Canada’s economy is being impacted by local FN funded by hidden agenda.
So obvious so sad….hopefully the Police do their JOB…court already has!
Ugh, not looking forward to the day when all these whiny people that bought houses and SUVs instead of saving want retirement handouts, assuming its not here already.
I can’t wrap my head around people that have nothing saved; how is that possible? I’ve never had *nothing* saved, since my first bank account.
#75 Thedood on 02.26.20 at 8:15 pm : Dude you get it. most Canadians will not admit it but they know it very well in their heart. you are honest
#75
Seattle has problems too.
https://www.youtube.com/watch?v=bpAi70WWBlw&has_verified=1
As Sir Garth says: NEVER bet against America.
Coronavirus moving the markets, what a buying opportunity that is.
No brainer.
#15 Paddy on 02.26.20 at 4:18 pm
Average house price in Canada is 480k….why? It’s just a bloody house…you know windows, doors, plywood, some 2x4s….
————————————————————-
It’s the illusionary price of the dirt underneath the house that’s way out of whack Paddy. That is about to change.
The US has no maternity leave benefits.
Surprisingly, they’re still having children…
#87 MF on 02.26.20 at 9:13 pm You drive too fast.
Bernie is going to win.
Be part of the change.
Or be run over by it.
So a lot of seniors who don’t have a pension have little saved and most of their net worth is tied up in their houses. So what happens if a lot of them try to sell and retrieve that house equity at the same time?
#87 MF on 02.26.20 at 9:13 pm
75 Thedood on 02.26.20 at 8:15
House prices are a touchy subject. That’s why this guy^ and people like him will resort to posting blatant lies to make themselves feel better I guess..
Vancouver economy. 1 second google search:
Tourism, finance, film, technology, aviation, trade.
https://en.m.wikipedia.org/wiki/Economy_of_Vancouver
Where do you see government? Or, was that idea something you saw on YouTube last week? Convenient scapegoat maybe.
How about we compare Toronto and Detroit. About a 2 hour drive as well. Detroit: gutted factories, high crime, boarded up houses and drug addicts everywhere. Toronto home to the big 5 billion dollar/year profit banks. Jobs everywhere.
See, both can play that game.
MF
________________________________________
Clap…………Clap………………Clap.
Wow, you sure showed me.
I live here (YVR) so am speaking first hand.
@#89 SusanM on 02.26.20 at 9:18 pm
(3) “We’re urging our kids, (or BIL or cousin, etc.) to buy a house now, because it’s never going to be better for getting a mortgage”
(4) And the worst one? “We’rem not selling the house because it’s the best investment we ever made (this from a Gen Y couple who rented the house out when they took a job in a different city, where they have to rent).
**********
(3) concerns me the most as it has become a catch phrase, they ass…ume prices will rise enough to make it worth your while to put down $500 – 745K for an average particle board house. And of course no mention of the slight possibility that interest rate increases will have on monthly payments over the course of the mortgage. I’m still waiting for the big jump in incomes…
(4) is just a matter of human nature.
Good friends always stay in touch. Mutual respect is a good bond.
#95 espressobob on 02.26.20 at 9:32 pm
Not afraid of a pandemic? What if it turns uglier, like much much uglier?
Maybe the protesters blocking rail and road traffic are doing us all a favour by slowing down the spread of the Coronavirus.
#163 Sail away on 02.26.20 at 4:37 pm
#162 Not So New guy on 02.26.20 at 3:52 pm
Teslas don’t use gas. And they’re awesome. Just sayin’.
===================================
and for the extra you pay for the price of the vehicle, you can get free gas for quite a while
Plus gas vehicles are less flammable than a Tesla and don’t play seek and destroy with firetrucks
——————————
Rent one for a week. Bet you change your mind.
—————
My Neighbor just traded his Tesla for a Kia.
I think he’s ahead of the curve.
TFSA, What’s in a name?
#86 ImGonnaBeSick on 02.26.20 at 9:10 pm
50 Toronto_CA on 02.26.20 at 6:45 pm
Yet the majority of people in Canada seem to think a TFSA is a savings account…wonder why that is..OH WAIT THEY NAMED IT A SAVINGS ACCOUNT
——
RRSP = registered retirement SAVINGS plan…
*************************************
Exactly, if the TFSA is often used as a temporary savings account it is NOT primarily becasue of the name. It is becasue of the feature that you take the money out anytime (unlike RRSP) without penalty.
Its biggest flaw (unlike RRSP too many people don’t leave the money in there basically permanently until retirement) is a feature, not a bug. And not the fault of its name.
I’m sorry Garth but you are wrong about US health care. If you’re retired then you have to pay your own insurance premiums for health care. They can be extremely high as you get older. Also you can be denied coverage. I know this because my parents live in the US and are retired. They are paying close to 20000 per year in premiums. That is significant. Also the US social security comes out of general revenue. It is not out of a dedicated fund like the CPP. This could make it susceptible to reduction as the population ages and you have less working age tax payers. My parents are lucky because they have money but I sure wouldn’t want to be poor or even middle class and retired in the US.
# 15 Paddy , It’s a Hellovalot more than 2×4’s.. That’s the trouble with novis home owners. A house costs money to build.. get over it. The money’s not thrown in a ditch… it’s in your home, furnace.. roof .. appliances .. lifestyle.. there is so much more in house than 2×4’s
It’s a home … and that’s why people want to have one.
It’s not a bad thing to desire a one… the costs are real
#12 Sail away on 02.26.20 at 4:12 pm
#7 Linda on 02.26.20 at 3:33 pm
A couple of points. First, compare net working income to net retirement income. Second, keep in mind that the USA does not have public health care the way we do in Canada. In the land of the free, health care – isn’t. It is in fact one of the top reasons for bankruptcy. Third, homes do cost much less than in Canada, plus they get to deduct mortgage insurance to boot. However when sold the government gets a cut of the booty should the property have increased in value. I think they get a cut regardless, a universal land transfer tax if you will. Lastly, I see poor old people:( Yes, they should have been able to save & set funds aside for the old age they apparently never thought would be theirs. This tidal wave of the financially pooched is going to be a drag on our economy for decades. Eek!
——————————-
Linda, you’ve got most of that wrong.
Public health care mostly benefits junkies. Productive members of society in the US are mostly covered just fine.
Also, mortgage interest in US is deductible. Huge benefit.
But blocking a railway won’t be benevolently tolerated and allowed to shut down national commerce.
For a toothless, confused and ineffective government, best stay here.
————
Time to move back to your land of milk and honey.
Garth,
Is this the Sailor’s blog or yours?
Time to cut him down to size.
#22 Mattl says “With a paid off house, you absolutely could live on 45K. Sounds like a nightmare to me, but obviously lots of people are doing it today including both my parents (one has to, the other is dirt cheap) and my wife’s parents.”
You can live on $30k. You just won’t be doing much living.
#22 Mattl says “As a renter? Maybe in Moose Jaw. But for most Canadians buying and paying off a reasonably affordable home will always be a good retirement strategy. Cause if 45K isn’t enough, you can still sell and rent.”
If you are facing retirement and have $300k in savings, you are *much* better off buying a modest house in an inexpensive place in the country, than renting for the last 20-30 years of your life. Not only will you be living better, but if you encounter expensive health costs in your 70s and 80s, then you can sell the house and pay for them. If you’re renting, you’re just burning through your savings (since you can always live cheaper in a paid off house than you can renting a 2 or 3 bedroom apartment).
#97 Barb on 02.26.20 at 10:04 pm
The US has no maternity leave benefits.
Surprisingly, they’re still having children…
———————–
I know many private companies here that don’t hire women of breeding age for exactly that reason. Who wants an employee who will take off for a year? In the states, the woman would get the job.
Alberta’s Appeal Court says GST is unconstitutional.
Says climate change isn’t a national issue.
https://toronto.citynews.ca/2020/02/24/alberta-federal-carbon-tax/
#40 MF on 02.26.20 at 6:17 pm
#12 Sail away on 02.26.20 at 4:12 pm
“But blocking a railway won’t be benevolently tolerated and allowed to shut down national commerce.
For a toothless, confused and ineffective government, best stay here.”
-I hear the same thing from Americans. Big Yaaawn.
And nothing was benevolently tolerated. It was respected, then dismantled when it became clear the demands weren’t reasonable, and that too many people were being held hostage. Remember the protests were annoying, illegal, but peaceful.
Should we not commend that?
————————————
Oh, you think it’s done? Ok then. Let’s revisit this next week.
My mom lives off a combination of CPP, OAS and GIS. She rents outside of Toronto. She enjoys her church groups, plays Ukulele in a group, and is taking a course through a local university. She visits her Grand kids and manages to use various points and promotions to fly somewhere once a year. She is careful with her money, but is happy.
Yes, it is not what Garth would call a good retirement, or many others on here, but then again, we regular readers are primarily in the top 5% in terms of income/savings. We would be wise to remember that not everyone wants or covets the same things we do. There are many ways to live a life.
As long as you are happy, and financially solvent, and not bothering anyone, I don’t think we have the right to make bold claims about what people ‘need’ to have for retirement. Most of the claims I have seen in regards to what Canadians ‘need’ are not met by the vast majority of the seniors I know and they have been getting on fine for years, if not decades in some cases.
https://openhousing.ca/2020/02/26/mortgage-fraud-amplified-foreign-money-court-case-reveals/
In BC
#40 MF on 02.26.20 at 6:17 pm
Now contrast that with the Dokota Access Pipeline protests, where some 700 people were either injured or arrested.
——————————
….and no trains were disrupted and the pipeline was built.
Dakota was a blueprint for the proper way to deal with protesters but our gov’t still managed to foul things up so completely
#99 Millennial Realist on 02.26.20 at 10:14 pm
Bernie is going to win.
Be part of the change.
Or be run over by it.
————–
If Bernie wins we will all be run over by it.
Please understand, I could be convinced to be even left of Bernie if there was some way to pay for it. But that isn’t how things work. You can’t make the family richer by stealing from dad to give to junior. It doesn’t work.
But anyway we don’t have to worry about it. The chances of Bernie winning the nomination are about 25%, the super delegates will only let him through if they are essentially conceding the election to Trump, and then after that Trump will beat Bernie in a landslide that will make Hilary’s run look pretty respectable.
Nobody who has any sense supports socialism. All it breeds is murder and theft. Or as they used to say of Socialists: “They are the nicest people you will ever meet. They will take the shirt off your back and give it to someone in need.”
#95 espressobob on 02.26.20 at 9:32 pm
Coronavirus moving the markets, what a buying opportunity that is.
No brainer.
—————-
How so, unless you sold earlier and are sitting on a bag of cash? Nope, it’s a stay-the-course moment for most people. I think this concept of “cash on the side” is a myth. Bill gates might have some but most people don’t.
#164 akashic record on 02.26.20 at 7:40 pm
#115 SoggyShorts
The natives I am thinking about live in their entire tradition, culture, that identifies them over the history.
If this recognition makes me racist, so be it, I am comfortable with it.
*****
It’s racist because you are wrong.
They dont exist except in your imagination and haven’t for decades, if they ever did. It’s a fairy tale you’re spouting.
Show us on a map where these imaginary people’s are.
I asked my 100% native father in law whose family is on a reservation and his response:
It’s just as racist as if you insisted that everyone in Africa lived in mud huts and hunted with spears.
#15 Paddy
Average house price in Canada is 480k….why? It’s just a bloody house…you know windows, doors, plywood, some 2x4s….
——————————–
There’s a noodle house on 4th Ave in Kitsilano usually packed with hipsters who are also lined up down the block most times of the day. Other nearby eateries are half full, if they’re lucky.
My politically incorrect buddy walked by there recently. Incredulous, he stopped to query a few folks in the crowd:
“So… this is just… like, noodles… right?”
Lotta blank faces. And no, it wasn’t Mr. Fartz.
#23 Lee on 02.26.20 at 5:01 pm
#17 Stone
Does it matter? Even a person who earns $80,000 in their top years, which is about $60,000 after taxes, would still need $1,800,000 if it is 30X. Nobody earning $80,000 is going to save that much, at least not before their 200th birthday. I suspect that when the investment firms realize that scaring people with ads about how little people have saved don’t work in getting people to invest, they will start pushing adds that hype the average amount people have saved for retirement as being quite a bit to make you feel inadequate. The facts don’t matter, and are virtually impossible to disprove. They just need to know what will push your buttons.
Do the math. If that doesn’t scare you, enjoy the KD lifestyle. – Garth
*********
Failure mentality.
If a couple can eek out survival on 45k per year why can’t a couple where EACH earn 80k save a crap load?
40 working years Saving after tax 40k and spending 80k should give a very nice life and 1.6m cash.
But wait, we didn’t add ANY returns on investment for that 40k annual contribution.
My wife and I went from debt(not RE) to a 7 figure portfolio after
One decade of saving and investing. If someone can’t do it in 4 decades its because of poor choices.
#69 AACI Home-Dog on 02.26.20 at 7:55 pm
I think CBC et al have a bad habit of making a big deal of the market corrections. Wow; netted down yesterday over the past 2 months ! Yet they do not seem to talk much about how well equities have done in the last 14 months when it creeps up over time. Must be government interference to help keep our wealth at bay, by scaring us away from the markets… ;)
https://www.cbc.ca/news/business/stock-markets-tuesday-1.5475633
***************
Media kinda sucks because we the consumers suck. Fear sells.
Having switched to DiY investing just over a year ago this is my first time really seeing any bad returns.
I’d like to think I have a strong stomach for volatility, but even just 2 back to back turd days has annoyed me.
Since January 02 2020
My all equity PF -1.24%
VEQT -2.38%
VGRO-1.42%
VBAL-0.45%
Note: dividends are NOT included in the above because that’s just too hard to do on my phone.
While VEQT is the fairest benchmark since I’m 100/0 the other 2 are important for me as well since my 2 greatest influences are GT (60/40) and EarlyRetirmentNow (80/20)
So overall this year I’m not thrilled. It’s hard not to look at my PF and ask “but what have you done for me lately?” but, if I can add in 2019s +23% returns I’m quite pleased.
If I’m being totally honest, I think I was incredibly lucky to start DiY in a year like 2019 as it gives me such a biased view of my returns that I’m not tempted to panic sell – I have a fat cushion of ” well, I’m still playing with house money” so I can weather corrections. If I didn’t have it I’d probably regret not having GT to hold my hand. Directly I mean. I’m still coming here for some free hand holding.
Thanks Garth!
It seems to be the default Canadian answer when ever anyone points out anything the US does better than Canada. Ya but we have *free* medical care. We don’t.
Our medical care is not free. It is 100% paid for by tax payers. Like saying all inclusive hotels everything is free. It is not. You pay a higher rate and then get rationed sub par food and drinks that the hotel decides to give you. Usually certain restaurants at certain times with cheap liquor. Fine for a week but personally I prefer choice to eat and drink where I want when I travel. But we all have a choice. The government does not tell us which hotel to stay in and then increase our taxes to pay for it.
Everyone in Canada gets sub par medical compared to the US and we pay higher taxes for the medical and have no choice of what level of medical we get. Need hip surgery? Too bad, wait in line. Imagine spending the first 5 years of your retirement immobile and using a walker because you are waiting for hip surgery or knee surgery. Imagine spending your afternoons sitting in the walk in clinic for hours with a bunch of people coughing and then when you see the doctor he tells you sorry only one issue at a time. Come back to discuss that sore elbow because the government will only pay me to discuss one issue per appointment. Can I pay extra to discuss 2 issues? Nope that is illegal. In the US you have abundant family doctors that give you an appointment and will go over all your needs in that one appointment.
This claim medical has to be factored in for retirement costs in the US is bogus. Everyone in the US over 65 gets Medicare. It is the one cohort in the US where medical coverage is guaranteed and everyone has better coverage than in Canada. Yup you get hip surgery when you need it for example. You have access to the best medical system in the world. They have family doctors. Medicare is far better than what a 65 year gets in Canada. After all Bernie uses the slogan Medicare for all for a reason (not Canadian medical for all which would be a downgrade for most Americans).
Canada needs to get over it’s self. It is one thing holding us back from greatness. Acceptance of a sub par medical system and a sub par Prime Minister. It is getting embarrassing.
Retirement is highly over rated. I tried a couple times, fell apart like a cheap suit. I’m resigned to working till my health goes. The only thing I can figure is many self employed can’t retire successfully because they haven’t indoctrinated routine in their working life. You have to have routine in your retirement or you’ll end up in a bad place. Retirement can be easier for employees because they have learned to parcel time for specific activities. Plus, they develop hobbies & interests outside of their work. I met a retired Nortel employee who told me that when he retired he & his wife made a pact. Every weekday he & his wife would leave the front door by 8:30 am & not go back till 4:30 pm. They filled that time with activities because he had seen too many of his retired friends become housebound. Made a lot of sense to me.
Two chains: debt and inflation. Regulations ensure everyone abides.
I have one foot off grid, so there is that route of escape. There’s lots of old timers up here, little old ladies buckin wood in their eighties. You couldn’t make them leave. Too many gardens and bird feeders.
The district says I can’t live off grid on my own land in a u-build or a roll-on. See, I’m 20kms as the raven flies to the nearest postage stamp depot, 30 by stage. They can’t have me living in bliss, minimally, on the off chance some elk might envy my privilege. Fortunately, my prop knocks against the nature park with year round wilderness camping, so I only have to move over ten metres.
“Honestly Officer, I wasn’t camping on my own land.”
When in Rome…
Actually, I’m gonna see about getting the zoning changed, installing public restrooms, and rent it out to groups. Nice views, mineral water.
“#106 Shawn Allen on 02.26.20 at 11:21 pm
TFSA, What’s in a name?
#86 ImGonnaBeSick on 02.26.20 at 9:10 pm
50 Toronto_CA on 02.26.20 at 6:45 pm
Yet the majority of people in Canada seem to think a TFSA is a savings account…wonder why that is..OH WAIT THEY NAMED IT A SAVINGS ACCOUNT
——
RRSP = registered retirement SAVINGS plan…
*************************************
Exactly, if the TFSA is often used as a temporary savings account it is NOT primarily becasue of the name. It is becasue of the feature that you take the money out anytime (unlike RRSP) without penalty.
Its biggest flaw (unlike RRSP too many people don’t leave the money in there basically permanently until retirement) is a feature, not a bug. And not the fault of its name.”
I don’t understand your point at all. People don’t use RRSPs as savings accounts for their cash, even though SAVINGS is in the name, it’s savings plan which is not a word people use commonly, unlike savings account which is synonymous with a cash bank account.
The name of the TFSA is tragic, proof would be the stats of people using it for cash like investments, and that the Roth IRA has the same features nearly but Americans don’t use them for cash.
I think it’s mostly because in 2009 when they came out people were scared stupid of stocks because of the GFC, the limits were only $5k a person which doesn’t lend to investments, agressive marketing from the Orange guys to give you 3% interest in them tax free, and yes, THE NAME is terrible.
Tax Free Investment Plan or Tax Free Investment Account would have been much better to let the average financial illiterate know that these are meant for long term investing, not next year’s vacation money.
#101 Thedood on 02.26.20 at 10:41 pm
Knee slap Knee slap Knee slap
-Good for you.
I live in Toronto and I’ve driven down to the states many times so I know from experience too.
MF
#124 BS on 02.27.20 at 2:17 am
No. What you are posting is incorrect and a myth.
A while back I posted some research on the comparisons between US and Canadian healthcare. I’m too busy to go look it up.
Findings were: both have positives and negatives. We wait longer for certain (not all) joint replacements, and to see (certain, not all) specialists. The ones in demand like Orthopedic surgeons doing knee replacements took the longest. However, we have much easier access to medications, other specialists, general tests and so on.
Detractors of our health care system seem to focus on the negatives (long lines for knee replacements), but ignore that a lung transplant may be quicker.
Those are the facts. Whining about taxes, and who is the current PM is tiresome and moot in this subject.
MF
@#88 Everything is better when you leave the US
You should get together with Millen-denial Surrealist and try and out troll each other……
@#99 Millen-denial Surrealist
“Bernie is going to win”
++++
Bwahahaha
Bernie’s campaign is going fold like the cheap suits he wears.
Honeymoon in Russia?
Castro is a hero?
Good luck getting the Florida vote.
Good luck getting anything more than a “protest vote” from the people who actually show up this Nov to the polls.
Lets see if the low turnout for two of the worst choices in a century of US Presidential elections beats Iran’s pathetic low voter turnout.
https://www.cbsnews.com/news/iran-historically-low-election-turnout-shows-iranian-frustration-and-fear-over-coronavirus/
@ #7
Public health care…… try waiting for close to a year to see a dermatologist…..oh, yeah, still waiting.
Thousands of people in this country are enduring incredible pain waiting for joint surgery, etc.
I’m off to the US to see a dermatologist. Sick of waiting for our lauded public health “care”. Dispensed with an eye dropper after 50 years of paying into that black hole.
#122,
My example was based on one person earning $80,000 a year. Of course if two people each earn $80,000 per year for 40 years or so they should be able to save $1.6M when factoring in returns. People do slug it out in retirement with $45,000 a year between the two of them by the way. Typically requires full ownership of your own home, otherwise it can be tight. Most people today who retire on $45,000 per couple own. In the future, I think a lot of these people will be renting or still have a mortgage. Paying $25,000 to rent a modest place for two will leave very little money for everything else. I don’t think people have really done this math. This is why you get pretty viscous estate battles.
#132 – Try Telederm (if you’re in Ontario) – Covered by OHIP.
https://support.otn.ca/sites/default/files/telederm-brochure-en.pdf
https://www.cbc.ca/news/canada/british-columbia/bc-liberals-strata-insurance-1.5476181
Tax payers to help pay starta fees.
Stock market pounding continues.
Side note; I always get amused by all the media site photos of distressed floor traders when markets plunge.
#23 Lee on 02.26.20 at 5:01 pm
#17 Stone
Does it matter? Even a person who earns $80,000 in their top years, which is about $60,000 after taxes, would still need $1,800,000 if it is 30X. Nobody earning $80,000 is going to save that much, at least not before their 200th birthday. I suspect that when the investment firms realize that scaring people with ads about how little people have saved don’t work in getting people to invest, they will start pushing adds that hype the average amount people have saved for retirement as being quite a bit to make you feel inadequate. The facts don’t matter, and are virtually impossible to disprove. They just need to know what will push your buttons.
___
$1000.00/mo from 25-65 at 6.0% is over 1.9 Mil. It’s doable but you have to start young and do it with purpose. Also need the cash flow to do it too of course.
IMHO – best just get going young and roll with the punches, wasting time fretting about this or that just means you’ll have to pay more later to get on track.
If you “fail” and only end up at 1.2, well, you’ve still got enough (probably more than enough) if you can keep a handle on spending.
“Tax Free Investment Plan or Tax Free Investment Account would have been much better to let the average financial illiterate know that these are meant for long term investing, not next year’s vacation money.”
They’d still get rooked. Financial illiterates walk into their bank, and get sold TFSA savings accounts, low rate GICs, or high fee bank mutual funds. They won’t be told that it’s a far better deal to instead deal with the bank’s brokerage subsidiary, with access to funds with lower fees, ETFs, and more competitive GICs from other nstitutions. They’re a cash cow and a source of cheap funding for banks.
Tony, Tom Sajedo is right. May-1-2020 CDIC insures GIC’s more than 5 years old, new change takes into effect and DICO, for years already for years insures GIC’s with no term limit.
He is in the CDIC, DICO deposit guarantee insurable limits.
I was hoping some bloggers would offer opinions on what their planned retirement savings number is.
Holy! APT going nuts. Up another 60% so far today. Thanks Corona.
As Charlie Munger said: wait, wait, wait… then when you see it, go hard.
Debunking the ‘social country’ lie and promoting the ‘debt slaves’ reality instead.
US has better pension safety net? Who knew…
So we basically pay European taxes for inferior to US benefits…
Cheers,
#21 Chad on 02.26.20 at 4:51 pm
Damn, that was an epic post. This information that the US has a stronger safety net goes against simple plain Canadian assumptions. The average Canadian definitely needs to be a little but less smug about their place in the world.
******************************
That’s just typical brainwashed snooty liberal thinking (there are far too many of them in T2’s Kanukistan). The reality is people all over the world are flocking the USA….not Canada. Yet most Canadian’s have no idea why because they have drank to much Kanadian Kool-Aid!
#137,
When Charles Schwab says you need $1.7M to retire he means today. In 45 years 1.9M will be about $650,000 after factoring in inflation. So $1,000 a month is way off.
You are right though; the younger you start, the better. I wish I had started just ten measly years earlier. If I had, I’d be “In the Bahamas” by now.
TSX down 533 or 3%. Hopefully the herd doesn’t run for the exits this time. If so, will be lots of bargains to be had.
Re: #141 Sail Away on 02.27.20 at 10:10 am
Good pick!
Re: #139 Scott Dangaski on 02.27.20 at 10:03 am
That would explain DUCA offering 3 percent for 8 years.
U.S. Health Care, NO THANKS.
Relative living in Arizona, broke her arm, has medical insurance, went to the hospital.
Got treated and then they told her that she owed them $8000 because the Dr. on-call at the time was not on the list of Dr.’s her medical care covered!
“”#99 Millennial Realist on 02.26.20 at 10:14 pm
Bernie is going to win.
Be part of the change.
Or be run over by it.””
Naive. Bernie will never be allowed to win. Bloomberg entered not to seriously attempt victory but to bring the agenda back to center and split the vote so no one candidate gets a majority vote as leading democratic contender and victor. Drum roll…..enter Hilary Rodham Clinton to save the day. She was never out of the picture. Try and think more strategically and less as an anarchist, kid.
As for your tiresome rants about being run over by change, be aware a spike belt has been laid out ahead of you as you appear to be driving incoherently and without a license.
over and out – O.K. Boomer
#99 Millennial Realist on 02.26.20 at 10:14 pm
Bernie is going to win.
Be part of the change.
Or be run over by it.
……………………………………
It will be great when Bernie gets elected. I love his open border and free health care and education for all even if u are an illegal immigrant. It will be great for Canada. We can just dump our crummy health care system and cross the border and use Bernie’s. Best health care in the world. We can be medical refugees and get free health care in the USA. For free !!! Our taxes will go down cuz we won’t have to pay taxes for health care any more. Maybe I will get a student loan or three and go Harvard or Yale. I won’t have to pay the loan back so what the hell ? I Feel the Bern !!!
I really do !
#100 Doug in London on 02.26.20 at 10:33 pm
So a lot of seniors who don’t have a pension have little saved and most of their net worth is tied up in their houses. So what happens if a lot of them try to sell and retrieve that house equity at the same time?
——————————————————————
I doubt we will see a rush to sell. Most will find a way to get by with what they have. Others will get a reverse mortgage but most will not leave their home. Just the way it is. Seen it over and over in my parents age group. Lots of boomer friends whose parents in their 90s and still living at home. There are outside services like home delivered meals and care givers that do a good job in keeping these old people in their homes. So those who think that there is going to be a mass migration of boomers into condos better think again. Ain’t going to happen. A lot of us are still taking care of our parents in our 70’s.
Ontario government wants to trim its high priced senior staff. The offer is double the severance, add on 6 months of pay and full unreduced pension benefits if package brings you within 2 years of full pension. Better than a pink slip, no severance, no pension, no savings.
#141 Sail Away on 02.27.20 at 10:10 am
Holy! APT going nuts. Up another 60% so far today. Thanks Corona.
As Charlie Munger said: wait, wait, wait… then when you see it, go hard.
—————————–
WOW congrats .
a month ago i was thinking buy some mask makers, but did not.
dumbass.
#140 Soon to retire on 02.27.20 at 10:05 am
I was hoping some bloggers would offer opinions on what their planned retirement savings number is.
__
There are a lot of dogs here who will discourage you in answering that question (maybe)! Plenty here are on track for a really big pile, or already have one. I believe we have a verified Billionaire posting here occasionally.
We’re not big earners, and have not gone crazy dumping everything we ever made into investments like the FIRE crowd. We raised 2 kids and killed the mortgage alongside saving. We’re still not out of the woods yet – but I can see light through the trees now.
We’re hoping to just nudge past a million by 65. We plan to try and take only the proceeds thereof and pass on whatever’s in there to the kids. Between Ms. IH’s pension, govy handouts, and interest proceeds our retirement income should be between ~90-100K if we wait till 65. This is about 70-80% of current income.
I consider the above to be a standard issue result for just about any normal working couple who put retirement savings in their top 5 things to get done in life. Started at 200.00/mo. currently do 1000.00/mo. so just about anyone can get to a Mil, which should also be enough for most folks.
I should also mention we’re not big spenders either, so we won’t need to go on 3 vacations every year…
Not super interested in the US vs Canada wars. I have good exposure to both, and both have their merits. The US is far more appealing to high income earners. I could make out significantly better there, as could most of my friends and colleagues. But none of us have moved there, it’s not just about wealth accumulation.
But this whole convo hasn’t discussed outcomes; crime rates, poverty rates, literacy rates, teen pregnancy, etc, etc. For all their wealth, parts of the US – in some cases large parts – are flat out dangerous. When we take teams to large conferences, in big US cities, we coach them on where they should and shouldn’t go.
And whole counties where people live in almost third world poverty. The drug problem is out of this world in the South.
I think some folks that talk about this rapid Canadian decline, and the US as a mecca, haven’t left the french quarter, the Vegas strip, South Beach or Manhattan. Or maybe even spent much time at all in the US. I love the USA, but there is something to be said about a rich country that can’t solve for a large part of their population. I’d be embarrassed if an area of town I lived in was off limits, couldn’t be walked at night.
#133 Lee on 02.27.20 at 9:07 am
#122,
My example was based on one person earning $80,000 a year. Of course if two people each earn $80,000 per year for 40 years or so they should be able to save $1.6M when factoring in returns.
___
I see big increases coming in broke retirees when the Mils hit retirement. Loads of them (well, at least the big city ones) will arrive at retirement still renting, single, and with jack saved up.
Even 1%’er singles will have a hell of a time buying an urban SFD while saving at the same time. Especially if we get more Trudeau’s in the future.
#152 Nuke on 02.27.20 at 10:49 am
Ontario government wants to trim its high priced senior staff. The offer is double the severance, add on 6 months of pay and full unreduced pension benefits if package brings you within 2 years of full pension. Better than a pink slip, no severance, no pension, no savings.
____
Triple Gold Plated.
#143 YVR Expat on 02.27.20 at 10:17 am
#21 Chad on 02.26.20 at 4:51 pm
Damn, that was an epic post. This information that the US has a stronger safety net goes against simple plain Canadian assumptions. The average Canadian definitely needs to be a little but less smug about their place in the world.
******************************
That’s just typical brainwashed snooty liberal thinking (there are far too many of them in T2’s Kanukistan). The reality is people all over the world are flocking the USA….not Canada. Yet most Canadian’s have no idea why because they have drank to much Kanadian Kool-Aid!
————————————————————
People are flocking to ALL Western / rich countries. Both the US and Canada could admit almost an unlimited amount of immigrants if they wanted.
And Canadians rarely emigrate to the US. Canadian populations living in the US are DOWN over the last 40 years. Net population of Canadians living in the US is shrinking.
I get that you hate Canada but despite all the talk in these comments barely anyone is moving there . The stats prove this, and anecdotally this is my impression as well; I have a massive business network and I can’t off the top of my head think of one person that has recently moved to the US.
Believe it or not, most Canadian like living here. Deal with it.
#34 tbone on 02.26.20 at 5:48 pm
Saw an ad the other day for a new condo in downtown Toronto .
parking space 75k extra , locker 7.5 k extra
500 square footer was in the 550k range .
That’s more than 10 % over the cost of the box you get to live in .
Nobody ever factors in the extra cost for what most people would want . Or at least what I would want .
Condo prices are more costly than I considered .
But they are so worth it .
………………………………………………..
Nope they are just a massive debt dumpster. Insurance, fees and a huge lose when you’re forced to sell due to the aforementioned. Old people are blind when they reason that they will save money in a condo. Good luck eating cat food and splurging on KD once in a while.
Any conclusions based on “surveys” are open to huge error. Here is some recent survey info that would seem to suggest the US of A is not doing so well either. If all was unicorns and rainbows, why is Bernie doing so well??
A December 2019 Bankrate.com survey found half of US workers didn’t get any kind of pay raise in the last year. Gains in average hourly earnings may have been heavily weighted toward a smaller number of workers who got much larger raises.
Another survey by Salary Finance of 2,700 US adults working at companies with 500+ employees found 32% saying they ran out of money between paychecks. That’s consistent with the Federal Reserve’s annual “SHED” survey, which last year found almost 40% of US adults would need to borrow money to cover a $400 emergency expense. It also found an additional 18% of Americans considered themselves “just getting by” and 7% “finding it difficult to get by.”
Perhaps not coincidentally, the Fed reported this month that household debt balances hit $14 trillion, an all-time high. This was actually low as a percentage of disposable income, but disposable income is again highly weighted toward the top. Many at the bottom are in debt up to their eyeballs.
And Social Security remains far more generous than CPP, while household debt is a fraction of ours. Stop being so Canadian. – Garth
#129 MF on 02.27.20 at 7:00 am
#124 BS on 02.27.20 at 2:17 am
No. What you are posting is incorrect and a myth.
A while back I posted some research on the comparisons between US and Canadian healthcare. I’m too busy to go look it up.
Findings were: both have positives and negatives. We wait longer for certain (not all) joint replacements, and to see (certain, not all) specialists. The ones in demand like Orthopedic surgeons doing knee replacements took the longest. However, we have much easier access to medications, other specialists, general tests and so on.
Detractors of our health care system seem to focus on the negatives (long lines for knee replacements), but ignore that a lung transplant may be quicker.
Those are the facts. Whining about taxes, and who is the current PM is tiresome and moot in this subject.
MF
______________________________________
Best not to argue with this guy, his 1 second google searches can dismantle any opposing point of view.
Garth, can you share your thoughts for a retiree of what you think of T series” mutual funds?
thanks.
Sure. Bad idea. – Garth
Interesting
Is J2 smarter than he lets on?
Unlikely…
https://www.google.ca/amp/s/www.cbc.ca/amp/1.5474684
@MF healt care sysytem
Yes you are correct that canada have one of the best healthcare systems, but there is a lots of room to improve. Wait times are unbelievably long, and you are willingly ignorant on the issue.
My wifi and son had same level-2 complexity surgery (i think) done in last 5 yrs, one 4 yrs other recently, combine wait time was huge.
Childhood friend of mine in croatia same surgery 4 days before my wifi had hers, gues what wait time 2 wks. In a contrast my wifi spent 10hrs in hospital, friend 4 days.
I had to take vacation to take care of her for a week. Funny thing is on a second day wifi aksd me can i cancel vacation and go back to, because i am to anoying.
Its not easy to be me…
Dow and TSX sliding back to November 2018 levels in less than a week. S&P fastest 10% slide in history according to MSNBC.
Buying opportunities for sure but we’re told to remain fully invested with small cash positions in the balanced portfolio.
Oh well, it’s all a paper loss or gain unless you sell or buy.
#151 Ronaldo on 02.27.20 at 10:46 am
I doubt we will see a rush to sell. Most will find a way to get by with what they have. Others will get a reverse mortgage but most will not leave their home. Just the way it is. Seen it over and over in my parents age group. Lots of boomer friends whose parents in their 90s and still living at home. There are outside services like home delivered meals and care givers that do a good job in keeping these old people in their homes. So those who think that there is going to be a mass migration of boomers into condos better think again. Ain’t going to happen. A lot of us are still taking care of our parents in our 70’s.
____
Yes Sir. I see the same, none of them want to leave the house, have to get dragged out when they start having trouble looking after themselves. Tons of services available too, as you say. I know loads of seniors who never left their homes until their mid 80’s. My Maternal Grandfather was in his early 90’s before he sold and moved in with an Aunt and Uncle.
Living in the sticks, I’m pretty well acquainted with old folks living out their years in an old farm house – right to the end. They ain’t moving, and no one’s going to make them! :) Quite a few have an adult child living with them these days too, so that should certainly help grease the wheels with chores and maintenance etc..
Garth, can you share your thoughts for a retiree of what you think of T series” mutual funds?
thanks.
Sure. Bad idea. – Garth
Can you briefly be a bit more specific, just want to know whether to fire my advisor for trying to get me into something for his own benefit.
The yield promised does not all come from growth, but from giving you back your own money. Sham. – Garth
Tony, we retired by selling my business in December-2018 and was left with $2.5 million in cash.
We get our C.P.P. right now $1,600 a month and have a modest RRIF fixed for 15 years paying out $10,000 a year for 15 years. We have a modest lifestyle, living expenses and are debt free. TFSA’s are fully contributed.
The rest of our RRSP’s are in 7 year Duca GIC’s compounded annually for 7 years, 3.5%. We are growing by $31,000 a year in our RRSP so glad did that in 2019. We are interested in a DRIP or dividend reinvestment plan with $1,000 a month as this could create $400,000 in 20 years and dividend producing of $20,000 a year income.
Soon to retire on 02.27.20 at 10:05 am
I was hoping some bloggers would offer opinions on what their planned retirement savings number is.
Both retired, own, no mortgage, both full CPP and OAS. $1.5M B&D. Or was, until the price of a new car, daily, began to get stirpped off three days ago.
#140 Soon to retire on 02.27.20 at 10:05 am
I was hoping some bloggers would offer opinions on what their planned retirement savings number is.
—-
I’m planning on a 3.65% withdrawal rate– makes for simple daily math.
So at 1.4m that’s $140/day
I’m currently scouting Vietnam for the third time as a retirement destination, and rent + eating out all 3 meals doesn’t even break $80 per day for the 2 of us so I’m comfortable with my plan, even if covid-19 drops it to 1.2m… I’ve done the “one more year” enough, and I believe I’ll stick with a 2021 retirement.
M40AB
#144 Lee on 02.27.20 at 10:36 am
#137,
When Charles Schwab says you need $1.7M to retire he means today. In 45 years 1.9M will be about $650,000 after factoring in inflation. So $1,000 a month is way off.
********
You have to account for inflation everywhere (or nowhere)in your calculations.
So if you are assuming 2% inflation to bring down that 1.9m you also must realize that it’s
$1,000 per month in year 1, then $1,020 per month in year 2 etc.
#153 bdwy sktrn on 02.27.20 at 11:01 am
a month ago i was thinking buy some mask makers, but did not.
——————————–
One train leaves, another arrives… Life is long.
To be fair, I’ve owned APT since 2009 and had a solid understanding of the company already, so when the Corona trigger tripped, I was comfortable moving.
So… an 11-year instant win. 14-bagger as of today.
Tater might weigh in to say this is all wrong because ratios and predictive equations are apparently more important than returns.
Americans have health care. Stop listening to Bernie. – Garth
According to U.S. congress:
https://www.cbo.gov/publication/55085
An estimated 30 million people or 9.1 % of the population, went without health insurance in 2018. If we look at this link:
https://en.wikipedia.org/wiki/Health_insurance_coverage_in_the_United_States#cite_note-CBO_Fcst19-1
We will quickly note that this 30 million uninsured comes from The 273 million non-institutionalized persons under age 65 or closer to 11% of younger adults falling in line with the 11.2% poverty line in the U.S. .
As for those over 65, everyone is on medicare which is required reading for those who think seniors have a free ride with medical bills in the U.S. . If one is to compare Canadian vs U.S. systems in terms of cost, its required reading:
https://en.wikipedia.org/wiki/Medicare_(United_States)
Medicare (for seniors) in the U.S. covers roughly half of expenses. The other half generally comes from private health care insurance or out of pocket. In 2019, Medicare spending was over $775 billion, coming directly out of payroll taxes (3.8%) and general taxes. Medicaid was a further $409 billion adding up to 1.184 trillion, or 5.5% of GDP.
https://en.wikipedia.org/wiki/United_States_federal_budget#/media/File:US_Federal_Budget_Comparison_2016_vs._2015.png
In Canada in 2016, we spent 7.3% of GDP on government (fed/prov) healthcare according to Frasier Institute (if someone wishes to provide a more up to date link, by all means) and according to the link below, 11.6% of GDP (2019) combining public and private:
https://www.cihi.ca/en/national-health-expenditure-trends-1975-to-2019
If these numbers flesh out, we have higher taxation in Canada as evidenced by the percentage of health care expenditures (5.5% U.S. vs 7.3% Can) but the spending of health care as a percentage between both nations are close, around 11%, perhaps marginally higher in Canada. The key differences between both systems are:
– In Canada, everyone is covered by health insurance.
we do not have 11% of the adult population below 65 without insurance, a major distinction. This number does not include adults of all ages with only partial coverage. This number Bernie Sanders floats around, 78 million people only partially covered, is likely true. I say this because no one in the media is rushing to say it isn’t.
– In Canada, we don’t deduct payrolls for health care, it comes from general taxes meaning cost is covered by a specific kind of taxpayer, another major distinction.
– In Canada, taxation is higher (close to 2% of GDP higher) but the delivery of healthcare in terms of personal cost is much lower, probably as much as 50% lower and much broader.
– In the U.S., GDP is higher because of higher private spending on health care. This is not an insignificant distinction. More money on the private side means more economic growth and technical advancement but also more for profit billing and higher admin costs leading to less efficiencies.
These distinctions do not include the systemic distortions of health care bills as the leading cause of bankruptcy in the U.S. or hospitals overwhelmed with patients admitted to ER that hospitals have to float the bill for or employment that doesn’t scale up or advance for fear of losing a health plan.
In short, most of the thesis of Garth’s argument (think to the future, save a nest egg for retirement) is correct. Ask the questions of how much this number needs to be. Don’t count on future pensions being what they are, these goal posts can be moved, these are major points. But, when it comes to comparing the health care systems of the elderly between Canada and the U.S., make no mistake, we are, if I may be so bold as Bernie Sanders, more socialized here in Canada. Our tax system taxes and spends more fairly in keeping with the egalitarian ideal. We see this on how budgets are spent (near 70% on education and health care). We have much less systemic tax inequality than the U.S. .
Just ask yourselves, if I was a senior living on a pension only with no savings, no cash, no plan B as the majority of seniors in Canada likely are, with empty pockets, living in North America and had my choice as to which system I wanted to benefit from, where would I go, what choice would it be?
Only the rich would prefer the U.S. system, taxed by the way, with payrolls to pay for it. (rife with entitlement, the rich senior will bathe in “you get what you pay for” while at the same time, take medicare as its free for them, they don’t pay for it out of their taxes, the working grunt does. U.S. system = rich man’s socialized medicine) For the rest of us lamen, how could one not choose Canada as the best place to live and spend the rest of one’s days. Our health care system in Canada does not discriminate based on income but more to the point our tax system does not discriminate (more or less) and we should be thankful for that. It’s by no means perfect but when we look at the end result, the nation we would most want to live in, the distortions of income inequality in the tax code and where it’s spent, we are better off in Canada.
To the high earners of the world beg to differ, I say wait. A pale horse is coming and the riders name is death. North American systems will be tested indiscriminately this coming winter and so too, will our beliefs and values. Do not be surprised by the result.
#163 Lambchop on 02.27.20 at 12:08 pm
Interesting
https://www.google.ca/amp/s/www.cbc.ca/amp/1.5474684
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From the article: “Quiet talks brokered by a government desperate to stop a growing economic threat led to two rail rivals coming together with a workaround to bypass the Tyendinaga blockade site.”
Awesome- sneak around the illegal activity.
How about arrest the fricken lawbreakers? How’s that for a workaround??
@fishman, post 125:
You’re wrong about retirement. In 1995 I got a generous buyout from a company, then worked on and off between then and 2013. When between jobs I LOVED the freedom, and now fully retired LOVE it even more. Over the years I’ve enjoyed travelling, not bound by being straight jacketed by paltry vacation allowances. I haven’t travelled too far in the last 4 months but always find something to keep me busy. Whoever dreamed up the idea of an afterlife in Heaven MUST have been retired.
#155 Mattl on 02.27.20 at 11:32 am
Much appreciated your comments today, thanks.
Is it true Canadian financials, bank stocks are down 10% to 15% in just a couple of weeks. I guess the 4% to 5% dividend yield is great but only if stock prices gain 5%+ per year over 5 year periods at the very least.
OH NO…. NOT the beard!!!
https://www.msn.com/en-ca/news/world/cdc-suggests-people-shave-facial-hair-to-avoid-contracting-coronavirus/ar-BB10r9Dk?ocid=spartanntp
I would like to comment on the USA/Canada healthcare debate. One is not “given” Medicare at age 65. One pays for it. As a Canadian expat in the USA I was somewhat shocked at my first Medicare premium when I retired at sixty five. The yearly premium is $6816. This is prorated to your prior year’s income. The more you make the more you pay. The other issue is co-pays in the USA. They can quickly add up for any visit, procedure or therapy. As to seeing specialists, yes it can be done quickly. It will depend on what sort of Medicare coverage and plan that you have.
Tater, have you ever heard the term ‘track soup’?
When you’re hunting and find lots of tracks, but no animals, someone is sure to say: ‘looks like we’ll be eating track soup tonight’
Indications, calculations and predictions are fine as far as they go, but are only useful when turned to tangible results.
#174 Sail away on 02.27.20 at 1:27 pm
Awesome- sneak around the illegal activity.
How about arrest the fricken lawbreakers? How’s that for a workaround??
“”””””””””””””””””””””””””””””””
Completely agree with you. It shows a lack of character and willingness to stand up for the laws of our nation, while simultaneously putting on a show of getting things done. It’s devious and spineless, as expected.
#125 fishman on 02.27.20 at 4:51 am
I imagine a routine would be useful to some in retirement.
Not us. I consider taking winters off the last few years as a dry run for retirement, and what works for us is NOT having a routine at all.
One day we’ll go snorkling, the next we go on a motorcycle ride all day and then for 2 days we might leave the house just for a meal or two spending the days watching Netflix or playing games.
#109 Ponzius Pilatus on 02.26.20 at 11:25 pm
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Time to move back to your land of milk and honey.
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Tell that to my employees.
Wow the S&P closed on it’s low of the day again. Looks like the beatings will continue until moral improves.
#120 SoggyShorts on 02.27.20 at 12:34 am
#164 akashic record on 02.26.20 at 7:40 pm
#115 SoggyShorts
The natives I am thinking about live in their entire tradition, culture, that identifies them over the history.
If this recognition makes me racist, so be it, I am comfortable with it.
*****
It’s racist because you are wrong.
They dont exist except in your imagination and haven’t for decades, if they ever did. It’s a fairy tale you’re spouting.
Show us on a map where these imaginary people’s are.
I asked my 100% native father in law whose family is on a reservation and his response:
It’s just as racist as if you insisted that everyone in Africa lived in mud huts and hunted with spears.
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I have no idea what you asked from your 100% native father in law, but if his answer was that “as if I insisted that everyone in Africa lived in mud huts and hunted with spears”, then you certainly didn’t convey my thoughts.
If you ever listened to the link with the Canadian anthropologist, I sent during this discussion, you would know that the conversation goes into great details about natives in our time. You can always catch-up – even invite your father in law to listen it together, let’s see what he thinks.
The yield promised does not all come from growth, but from giving you back your own money. Sham. – Garth
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So it’s kinda like a Ponzi scheme.
If Covid19 hits GTA, does anyone think that people will become paranoid about living in condos and apartments.
You share elevators and lobbies and the same air .
A house is much safer!
Yet, here in this blog people are talking about stocking up supplies. Better worry about shared space. ( such as on a cruise ship)
I wonder if there will be a drop in condo buyers and more sellers ? May be the price correction that is due .
OMG.
Market Summary > Alpha Pro Tech, Ltd.
NYSEAMERICAN: APT
25.25 USD +12.86 (103.79%) +60% more after hours
so is it a 30x bagger now? did u add?
only 500% or so this week.
hope you have enough of it to make up for the rest of this pickle.
masks, eh? nice.
pls advise when the bottom is for this go round!
As per Google, 8.5% of Americans are currently without health insurance (2019 figures). Medicare apparently applies to those aged 65+. Medicaid is apparently the program that will provide health care to those deemed financially eligible – seems to be like a health care version of GIS. So that 8.5% without health insurance may be able to access Medicaid. Also, never said the government took all house profits, just that they were taxed. The 500K exemption is for married couples, singles have a 250K exemption but apparently you have to have lived in the residence for 2 years for the exemption to kick in regardless of marital status. Property increases above those amounts are taxed. The citation on taxation didn’t say whether the exemption has a lifetime limit.
Forgot to include another bit of data regarding bankruptcy related to health care costs. Recent 2019 study says 66.5% of annual bankruptcies in the USA are due to medical expenses including loss of income due to not being able to work. Health insurance, Medicare & Medicaid have their limits. To be fair, not all medications or treatments are covered in Canada either. If you have good health, you really are richer than you think.
Boots on the ground reports from CNBC Beijing Bureau Chief – Eunice Yoon.
” Ningbo city in Zhejiang province now offering RMB20,000 ($2,857) reward for anyone who reports someone suspected of coronavirus who is later confirmed. RMB1,000 ($143) reward will be granted for people who report others who end their quarantine early.”
” Why are stock markets jittery? Because investors worry global business will look like this: Beijing tonight. More people out than in past weeks but still so quiet… ”
https://twitter.com/onlyyoontv?ref_src=twsrc%5Egoogle%7Ctwcamp%5Eserp%7Ctwgr%5Eauthor
Eunice was a regular feature on CNBC Squawk Box. Now heavily censored .
Anyone seen any interviews of the recovered cruise ship
COVID-19 passengers ? We could use some happy-happy.
Instead we get Joe Biden asking the voters of South Carolina to back him in his run for the US SENATE.