By Guest Blogger Doug Rowat
.
Some things don’t age well.
Take, for instance, the famous 2014 Oscars selfie. Posted by Ellen DeGeneres to Twitter it immediately became (for a time) the most retweeted post in history and it even made Time’s list of the 100 most influential photographs of all time.
But look more closely. Brad Pitt and Angelina Jolie are now engaged in a bitter divorce, DeGeneres has seen her reputation (and ratings) trampled after allegations of a toxic work environment and Kevin Spacey, well…. Even Meryl Streep has had to since awkwardly defend herself for once referring to Harvey Weinstein as “God”.
In short, a selfie that could have been forever viewed as simply fun celebrity indulgence has now become cringe-worthy.
But, in contrast, some things age very well.
Take, for instance, the TFSA (how’s that for a transition?). In the beginning, it faced indifference and scorn, but it’s now grown into a powerful investment vehicle. When it was launched in 2009, the $5,000 contribution limit caused it to be dismissed as inconsequential. Then it became a source of political gamesmanship as Justin Trudeau heavily criticized it during his 2015 election campaign. And right from the start, its usefulness has been entirely misunderstood by most Canadians.
But, of course, investors who saw its potential early and used it correctly have benefitted greatly. Trudeau, of course, followed through on none of his threats and the TFSA contribution limits have steadily grown during his time in office. The cumulative contribution limit currently stands at a meaningful $75,500.
And here’s how an investor who maximized the contribution limit every year would have made out if they’d placed their TFSA funds in a simple, plain-vanilla equity ETF with an annualized growth rate of 9% (this rate of return is conservative–many equity ETFs have experienced much higher annual returns since 2009). For simplicity, I also applied the 9% growth rate for this year as well. Here’s where that hypothetical investor’s TFSA would be today:
Hypothetical TFSA growth
Source: Turner Investments
While just about anything can be plunked into a TFSA (GICs, bonds, stocks, etc.), the best strategy is to overweight well-diversified growth assets, such as equity ETFs. Capital gains in a TFSA are, as its name implies, tax free, therefore it’s to your advantage to tilt a TFSA towards growth. In the simple example above, almost $67,000 in capital gains would be entirely tax free.
Unlike an RRSP, you can also draw from a TFSA without consequence, though we recommend investors refrain from doing this—let it grow.
Amazingly, Canadians have still not clued in to the true value and utility of a TFSA. A recent BMO survey, for instance, indicated that 38% of Canadians cite cash as their primary TFSA investment. (If this is you, read the above paragraph again.) Another recent survey, this time from TD, also indicated that 27% of Canadians still don’t understand the difference between a TFSA and an RRSP. And a client sent me this recently, which was displayed prominently at their local bank:
A vacation? Stop thinking short-term with your TFSA
Source: Turner Investments
Is it any wonder that Canadians misunderstand TFSAs when the banks themselves are advertising them this way? Yes, technically, a TFSA can be used to save for a short-term expense, such as a vacation, but this is hardly its best use. TFSAs should be viewed as a tax-advantaged, long-term investment vehicle that, if focused properly on growth assets, can significantly contribute to retirement wealth.
TFSAs aren’t perfect. Contributions made to a TFSA aren’t tax-deductible. This is the TFSA’s main disadvantage compared with an RRSP. So don’t pile a chunk of money into a TFSA expecting a big cheque from the government at tax-return time. And, unfortunately, you can’t utilize capital losses within a TFSA to reduce tax liabilities. However, most equity ETFs, for instance, have a reliable tendency to move higher over time, so the inability to utilize capital losses should have limited impact on low-turnover, long-term TFSA investors. In other words, all things being equal over the long term, capital gains will be the more likely outcome from transactions within a TFSA. Finally, know your exact contribution limit. You’ll be penalized for over-contributing and dealing with the CRA to fix the over-contribution is an enormous pain.
Will the TFSA contribution maximums continue to increase? Only time will tell.
If tax avoidance becomes too favourable for investors the federal government does have a history of moving the goal posts. Witness the income trust ‘Halloween massacre’ of 2006. However, the government’s consistent history of adding TFSA contribution room each and every year for more than a decade, combined with gradually increasing the annual contribution amounts (exclude the $10,000 figure from 2015 to get a smoother picture), suggest that TFSAs will only continue to become even more significant investment vehicles.
Finally, let’s end with a selfie that’s aged perfectly.
You might recall me posing in my skivvies and Air Jordans last year, telling you all about the benefits of alternative investments (https://www.greaterfool.ca/2020/06/13/save-the-last-dance/)? Well, look what just made the cover of Bloomberg Businessweek:
Trust the man with the hairy legs
Source: Turner Investments
But that’s why you come here every day. Because we’re usually right.
I was right about my Air Jordans. And I’m also right about your TFSA.
Doug Rowat, FCSI® is Portfolio Manager with Turner Investments and Senior Vice President, Private Client Group, Raymond James Ltd.
112 comments ↓
Any guesses on when Liberals will punish TFSA winners? I mean, housing seems untouchable, so let’s go after people who are trying to be less of a burden on CPP/OAS.
Canadian uranium stocks will continue their ascent higher as new reactors become operational worldwide and supply shortages take hold.
Also Canadian oil stocks.
Both great holds for your TFSA.
Hey Doug, my son has an unworn pair of red/white air Jordan’s with the “wing” patch on the ankle – any idea of their approximate value?
Blog dogs – for sale, mint condition Air Jordan’s (Canadian colour pattern!!) but hey, keep it on the down low!
M57BC
Doug – are you guys still taking clients or is the ark full?
Thanks for the TFSA bolstering post Doug. The ability to invest in a tax sheltered account which triggers zero tax consequences upon withdrawal can not be overstated. Happy Easter weekend.
There is a reason why actors are treated with contempt. You may enjoy Deniro’s performance but his opinion carries little weight, even if you agree with what he says.
Folks, you really gotta stop sharing your investments and returns. It is detrimental to your investment performance.
Have to admire those Russians. They are tough. 2nd prize would go to the Norwegians. Don’t mess with them either….
https://pressreader.com/article/281646782939839
Doug: Are those your legs or are you riding a chicken?
helicopter money can make anyone look like a genius. too bad you didn’t keep your comic books. they’ve tripled in value since you sold them …
Thanks for the blog Garth
Thanks for the post Doug
Just so you know hairy legs for men is so pre CoVid
I know what your shoes cost so I bet you made more than 9 percent last year! Happy for you to get what you want in life, and why not enjoy life!
Usually right,
Yes, you have been a shinning light through these market storms. Forecasting is really tough!
And then along comes Dougs guest post and says long term growth always wins! Almost to simple to be true.
And I believe you!
Buttttttttttttt
Is this time different?
I firmly agree that with all this government money and covid ending and gosh all the new technology coming down the pipe ……..for sure we are going to have a sugar rush.
Butttttttttt for how long?
I worry about all this debt.
Is it because of the way you think? And I am not being insulting, I believe you look at all the things going on in the world for the next 6 months and one year. Which is all rosy and so you stay invested as the train has left the station.
Butttttt
All this debt.
You must worry about it?
So my question to you, as all this debt cannot end well?
Should I worry about my investments? I do not mean gold or cash, a defence position? And if yes what? And please do not say a balanced 60/40 portfolio because I believe from what I am reading this may not be the best strategy going forward.
Have a great Easter weekend!
Never mind TFSA’s and the Jordans.
The question has been answered whether we wanted to know or not..
Boxers.
GAH – that photo represents Exactly what Hollywood is – a bunch of narcissistic sad individuals that actually believe they are important
@#165 Pill Popping People
“Letting the elderly waste away in suffering and pain, or should we help them go peacefully into the afterlife.”
++++
Soylent Green?
https://www.youtube.com/watch?v=Xs-gocza6t8
Edward g Robinsons last cinematic foray ….
#10 Doug t on 04.03.21 at 10:58 am
GAH – that photo represents Exactly what Hollywood is – a bunch of narcissistic sad individuals that actually believe they are important
—————————————————————
A substantial portion of the electorate sees these as qualities to look for in a leader. Trump is the embodiment of Hollywood values.
#136 Sail Away on 04.02.21 at 9:39 pm
#75 Stone on 04.02.21 at 5:28 pm
#48 Sail Away on 04.02.21 at 4:22 pm
#30 VGRO and chill on 04.02.21 at 3:24 pm
#11 SoggyShorts on 04.02.21 at 2:26 pm
#136 Cowtown Cowboy on 04.02.21 at 12:14 am
B&D ytd at 9.19% ytd woop woop!
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Would you mind sharing your weightings?
@Stone, I think you’re up 9%+ too, no? Mind sharing yours?
I can’t seem to even make a theoretical hind-sight B&D that good this year
——————————————————
Well I went to great lengths yesterday detailing my various current holdings but it seems my post didn’t make the cut…might have had something to do with my disparaging comments about stoner…
Anywhoo, a nice basket of etf’s, mainly US and some REITS and Pref’s along with some quality individual stocks makes up most of my holdings…as is often stated, timing the market is a fool’s errand.
“There’s never been a worse time to be certain about anything”!
Fabulous macro discussion between two very bright individuals of different generations. Well worth your time to have a listen!
https://m.youtube.com/watch?v=hs4z8eU1qvI&feature=youtu.be
To post 2 Uranium
I have read all the same predictions because of governments policy about nukes no new mines for the last ten years and it takes ten years to develop a mine so there is a shortage coming. You failed to mention uranium stocks are up like 120 percent.
I am not convinced that uranium is part of the new green deal. While I love Ballard power I think that is old news, the newest technology in the pipeline is green hydrogen.
Just in development
Good luck with your trading.
Spin the wheel as they say.
#1 RowatNation aka Prince Polo
Any guesses on when Liberals will punish TFSA winners?
——————————
The privileged trust fund kid has made his distaste for the TFSA quite clear. Since he’ll probably lead the coming Liberal majority government—one that will be desperate for cash flow—I’d say there is at least some cause for concern.
I’ve had a TFSA since 2009 and maxed it out every year since then. My results are similar to those shown in Doug’s chart above. Well, not quite that good, but I have yet to draw from it.
Still, I’ve always look at it as something of an anomaly the tax man doesn’t know quite what to do about. Yet.
#1 RowatNation aka Prince Polo on 04.03.21 at 9:53 am
Any guesses on when Liberals will punish TFSA winners? I mean, housing seems untouchable, so let’s go after people who are trying to be less of a burden on CPP/OAS.
—————————————————————
Why would the Liberals go after the TFSA?
Houses are as untouchable as you say: BC already implemented a vacancy and speculation tax on homeowners:
https://www2.gov.bc.ca/gov/content/taxes/speculation-vacancy-tax/how-tax-works
Toronto City Concil voted in favour of a same tax.
#1
That’s the beauty of the TFSA–you can pile up a ton in it and still get full OAS/GIS.
I cant even get those shoes, and my wife works for them!
#176 The Woosh on 04.03.21 at 8:51 am
Poor sail away…stooping down to calling people liars.
———-
Hey, when I buy a car, I like to see the title. Easy to produce and establishes good faith.
You may have noticed the distinct lack of transparency in this case… and insults after requesting proof. That’s an answer.
Great post Doug. May I say with all sincerity that your writing style has become more and more enjoyable over time and as it has decreased in technical speak it has improved my ability to understand and digest your posts more. I really enjoyed today’s message. Thank-you to you and Garth for the ongoing education. It has really helped my family’s financial plans.
#7 helicoper money
“helicopter money can make anyone look like a genius. too bad you didn’t keep your comic books. they’ve tripled in value since you sold them …”
A lot of people seem to have forgotten that asset prices have gone down, and stayed down, for long periods in the past. That’s what 12 years of NIRP/money printing has done. Now lots of people think the markets are essentially nationalized and will never be allowed to fall again, and who could blame them.
Not suggesting Doug is one of those people, BTW, but there’s quite a few people out there that could use a dose of humility.
#5 leebow on 04.03.21 at 10:19 am
Folks, you really gotta stop sharing your investments and returns. It is detrimental to your investment performance.
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What are talking about? Sharing is caring.
Excellent TFSA information Doug. Always good to educate the masses. I too was guilty of the cash strategy in a HISA in the very beginning. Like most the ‘savings account’ part of the name plus advertisements led me to the incorrect conclusion that a TFSA was just a glorified savings account. Hallelujah, this blog educated me to the actual rules. Farewell pitiful interest on large balances; hello actual growth of assets:)
I encourage all Canadians to take advantage of this financial gift, especially those at the lower end of the economic scale. Those are the people who are most likely to be without any kind of financial resources in retirement other than CPP/OAS/GIS. As yesterday’s blog post mentions, OAS may soon become like GIS – only available to those whose incomes are designated as low income. As someone or another once said ‘old age isn’t for sissies’.
Robax, never thought I’d see those pins again!
I think I hazed you the first time, so that was enough.
What’s that you want me to make a Hollywood joke to link the two subjects together?
Ok, no problem.
Daniel Craig is going to end his stint as Bond soon, so there’s an opening for you.
Doug Rowat is James Bond.
The Man With The Golden Legs…
M46BC
tfsa are for wealthy people who already have money. the vast majority of canadians over 60% i suspect dont have a tfsa, never will and dont have any money ever to put anything into it.
sounds good, save, growth, over years you will be fine, the truth is , the poor are poor when there young, never find a good job, hand to mouth , cant save, kids show up, loose job, loose wife. and then your 50 with nothing. very common.
if things go good, you have a good family, good education, you get a higher paying job, can save, assuming you dont spend money stupidly on stuff you dont need. then great. save a little over time it grows into more.
the reality is simply, winners win, and loosers loose. tfsa even though over time may make sense, the vast majority of people will not truely benefit from it. honestly 6K a year is no milestone to save. but for most people they scrap together a few hundered a month, then an issue comes up and poof, no money. back to work every day.
i am wearing a pefectly comfortable $3 pair of shoes i got at the salvation army store. more comfortable then those 100 dollar italian loffers i have. too narrow at the top hurt my feet.
lifestyle is 100% of the gameplan, not even 95%. its 100% of the gameplan.
#121 Nonplused on 04.02.21 at 8:04 pm
Interesting how the article paints Trump as a defeated hero, sort of a Don Quixote character.
https://www.tabletmag.com/sections/news/articles/the-thirty-tyrants
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Unfortunately for the Western world, Trump was the standard bearer, the guy whom identified that China was a hostile rival and that America’s elites had abandoned Americans and tied their fortunes to China.
What was needed was an Eisenhower, recognizing the narrative that China would simply go along and join the world order was false and wrong. MAGA was needed.
The campaign to make all things “Trump” Toxic (not being helped by Trump’s personality disorder), the elite of America, “China Joe” Biden, Corporate America and the Democratic party have a clear path to the full hollowing out of the USA.
As you stated, and on the plus side; WWIII is now likely avoided. The next few decades hold some danger as the increasingly “hollow-man”, USA may mis-calculate relative strength, A Thucydides Trap, however I think Global “Corporate America” will keep the US military hawks in line. With Biden , America has definitively lost the 21st Century, they just may not know it yet.
Watching Trudeau on China, you can practically see the tug of war of conflicting interests. Those whom control the Liberal Party dream of China access, while Public Opinion recognizes a hostile power that will threaten Human rights and will hollow out their economy.
With Meng Wanzhou, Trump placed incredible pressure on Canada to choose a side.
Trudeau however serves just one interest while trying to manage the other, that is what his employers expect of him.
Canada is not only in a real estate bubble, but also in a Tinder bubble.
The social justice couples are the very ones who are overbidding in the KWG, GTHA-Niagara and Barrie regions, creating inequality for the rural populations. How hypocritical are they?
Yet they accuse TFSA as being a tax avoidance for the rich.
#20 Sail Away on 04.03.21 at 12:20 pm
#176 The Woosh on 04.03.21 at 8:51 am
Poor sail away…stooping down to calling people liars.
———-
Hey, when I buy a car, I like to see the title. Easy to produce and establishes good faith.
You may have noticed the distinct lack of transparency in this case… and insults after requesting proof. That’s an answer.
———
Did we conclude a financial transaction? You bought something from me? Why would I be looking to establish good faith with you? You’re a nobody.
You haven’t even genuflected yet. So rude.
Is there any way we can blame TFSA investments on rich greedy Boomers?
My after tax money invested in something that can go down as well as ……..up unlike the current tax free Gen X investment into real estate speculation….
No risk when the “Bank Of Boomer” Mom and Dad loan you the down payment.
Those lucky Gen X’ers get all the breaks.
Do you have any suggestions for one or two Growth ETFs for a TSFA that would not require rebalancing?
9% annually since inception, seems a little rich no?
I am a laggard, my TFSA has a balance of only $130,800
Hate that pic. The two Brad’s are the only good actors in the lot.
Wonderful post we have 12 thousand dollars set aside
in 4 different places so it goes into a TFSA on the first banking day of 2022,23,24,25. We take our RIFS once a year on Dec. 15th first comes with holding tax then we set up 2026 etc.
#16 Damifino on 04.03.21 at 11:58 am
#1 RowatNation aka Prince Polo
Any guesses on when Liberals will punish TFSA winners?
——————————
The privileged trust fund kid has made his distaste for the TFSA quite clear. Since he’ll probably lead the coming Liberal majority government—one that will be desperate for cash flow—I’d say there is at least some cause for concern.
—-
More Canadians have TFSAs than RRSPs. They’re extremely popular. It would be dumb to tamper with them. But poor judgement is a Trudeau trademark.
—Doug
#32 Yorkville renter on 04.03.21 at 2:20 pm
9% annually since inception, seems a little rich no?
—-
Not particularly.
https://investor.vanguard.com/etf/profile/performance/voo
—Doug
An extremely based blog post by an extremely based person with hairy legs.
You can also purchase options in the TFSAs (no selling of options).
Let’s peer into the future shall we?
1. For years internet cranks and outcasts warned of a looming one-world government and military.
The source document eludes me but many sites are claiming:
“The federal NDP are set to debate whether or not to phase out the Canadian Armed Forces (CAF) at their upcoming 2021 convention.
The policy resolution titled “Elimination of the Canadian Armed Forces” was submitted by the party’s Spadina-Fort York Electoral District Association (EDA). ”
……..
2. This always was the goal. Complete tracking of every human using the Blockchain. All the training we’ve had so far – capacity limits, tracking, signing in, scanning – was toward this goal.
.China’s Xi Jinping is pushing for a global Covid QR code.
https://www.cnn.com/2020/11/23/asia/china-xi-qr-code-coronavirus-intl-hnk/index.html
.It is punishable for businesses to not check if their customers have the corona passport, says the Ministry of Justice.
It can be expensive for hairdressers and other businesses to not follow the corona passport law after they have reopened, said the Ministry of Justice to the news Politiken. It would be punishable with fines.
https://www.tv2fyn.dk/fyn/boeder-op-til-12000-kroner-ignorere-coronapas
………….
3. How to force this in Kanada? More scary headlines without context. This is easy guys.
What do our rulers not want, us working out and being healthy.
This sounds like a Sell job for Mandatory QR codes – controlling our movments:
What is a case? A test ? A sick person? What comes first the chicken or the egg.
.Quebec City gym now linked to 141 confirmed COVID-19 cases (montreal.ctvnews.ca)
@#38 Millennial bottom 1% of spelling
“An extremely based blog post by an extremely based person with hairy legs.”
+++
I thought we were talking about basketball shoes not baseball cleats.
But my bias is well based……
#12 Joseph R. on 04.03.21 at 11:45 am
#10 Doug t on 04.03.21 at 10:58 am
GAH – that photo represents Exactly what Hollywood is – a bunch of narcissistic sad individuals that actually believe they are important
—————————————————————
A substantial portion of the electorate sees these as qualities to look for in a leader. Trudeau is the embodiment of Hollywood values
***************************************
Dead on, just a small sp. error- corrected.
Doug, doesn’t this entire analysis hinge on being correct about what the future brings, based entirely on what the past has brought, especially the last 10 (unprecedented) years? This despite the fact that balanced portfolio paradigm takes almost all of its justification from the idea that you can count on the market to do certain things (or maybe just 1 specific thing, like grow at a specific annualized rate) over the long haul? It seems to me this sort of approach is sold as ‘well no one knows the future, so might as well do what would’ve worked in the past’, which to me belies the idea stated in your last sentence that you’re right about anyone’s TFSA. After all that can’t be known until later.
@#15 Taro Card
“I am not convinced that uranium is part of the new green deal…”
+++
Perhaps Nuclear garbage is the new gold?
Digging it up is expensive.
How about when we bury it?
https://www.cbc.ca/news/canada/montreal/chretien-nuclear-waste-project-1.5971996
I wonder if Quebec will continue to demand Labrador back if it glows in the dark for the next 250,000 years…..
Vancouver home sales are on fire
https://www.citynews1130.com/2021/04/02/march-real-estate-sales-vancouver-record/
While the homeless encampment is also on fire.
https://www.citynews1130.com/2021/04/02/fire-vancouver-strathcona-park-third/
I was fined $1000 for over contributing to my TFSA a few years back. Actually I didn’t really over contribute, I just transferred $25000 from a TFSA account into a another self-directed TFSA account. The CRA determined the money was withdrawn (one day) before the new account was setup with the money being replaced. I blame the bank but regardless I figured I’d simply call the CRA and the nice agent would realize I didn’t gain advantage and it was a simple error. Wrong, I had to pay up. Looking back now I’d say they were an inspiration for me to change my ways. If someone made the same mistake by doing the same thing in January with a $100k over contribution error I believe the fine would be $100k x 1 percent x 12 (months) for a total of $12000. Ouch!
That photo was cringe-worthy since inception. Pausing during an award show for self-adoration. The ultimate self absorbed clique, who provide nothing to the world outside their own vanity while showing phoney personas of joy and contentment (see Doug’s astute comments on how reality destroyed that illusion).
#184 Dubble on 04.03.21 at 3:10 pm
To the pro-oil and mining gentleman. You speak of Canada holding the 3rd largest reserve of oil in the world, yet say nothing about the massive amounts of fresh water required to turn it into a useable product.
I believe that Canada’s fresh water is a more valuable resource than oil. I believe fresh water will be the worlds most important resource in the future, and to squander it processing tar sands is a crime, and shows no forward thinking whatsoever.
******************
Oil sands projects recycle 80% to 95% of the water they use. They also use saline water where possible.
https://www.nrcan.gc.ca/our-natural-resources/energy-sources-distribution/clean-fossil-fuels/7-facts-oil-sands-and-environment/18091
https://www.alberta.ca/oil-sands-facts-and-statistics.aspx
Thanks Doug. Great Column. Trudeau did actually carry through with one of his threats. Stephen Harper raised the TFSA contribution limit to $10,000….. Trudeau promptly lowered it back down to $5500 because in his words”it benefitted rich people!”. What an idiot!
Just to confirm TFSA’s actually work my wife and I have faithfully made our full TFSA contributions every year into a balanced portfolio as you suggest. Total Value now of both accounts combined is above $250K.
@#49 Retired
“Just to confirm TFSA’s actually work my wife and I have faithfully made our full TFSA contributions every year into a balanced portfolio as you suggest. Total Value now of both accounts combined is above $250K.”
+++
Nice.
I can’t say I’ve had the same performance but I use the RRSP tax refund to shovel into the TFSA.
$100k and growing.
Your entries are always a blessing Mr. Rowat!
Thank you.
#122 Stone on 04.02.21 at 8:06 pm
That’s the deal.
****************
It seems we come to this blog for very different reasons.
I’m here to learn and share knowledge. Like you, I’m in early retirement, and I find this blog to be generally more mature than most FIRE blogs.
I guess I just don’t get why you tell everyone about how great your portfolio is if you aren’t going to share the recipe. I mean what does anyone gain from that?
I share mine freely because I think others might actually benefit from the knowledge, even if it is a case study in what not to do as my 100% equity PF was in March 2020.
Simply throwing out results without methods seems pointless to me.
I’ve seen you post things like
“That investment method sucks, mine is better”
but then when I ask:“Ok, so what is your method?”
you reply:
“I’m not telling”
That’s a pretty useless conversation we had there.
#184 Dubble on 04.03.21 at 3:10 pm
I’m tired of subsidizing big oil and watching us destroy the resources that are truly valuable in the process.
***************************************
Canadian oil and natural gas provided $105 billion to Canada’s gross domestic product (GDP) in 2020, supported more than 500,000 jobs across the country in 2019 and provided $10 billion in average annual revenue to governments for the period 2017 to 2019. This revenue helps pay for roads, school and hospitals.
https://www.capp.ca/economy/canadian-economic-contribution/
*****************************************
Your path to financial prosperity is the equivalent of calling a pair of white oakley’s and a jacked up pickup truck “investing”
****************************************
Excellent job stereotyping. Want to go for a spin in my 911 Carrera S?
Great post Doug.
Little calf raises, perhaps a little lunges., burn it off with some Crazy Legs…now those pumps are Workin’, bro!!!
No TFSA’s when I was young but I had a Grandfather that taught me at a junge age about interest and how it makes money work for you – by doing nothing (my favorite part). My friends had no idea – nor did their parents. My grandfather was not middle class either. How far back does this go? I was the 1% in my group (of many) that could talk about $$$$$$.
You guys are on to something here. Farther reaching than just the wannabee geniuses that post here (im an idiot so I can say that)…hmm..don’t go tellin’ everyone. Won’t your retirement cost more? Honest question.
But really, I would love to hear an honest, subjective view from ya’ll comparing the affect of inflation today as compared to the affect of inflation before…I don’t know. Why is it bad? What affect on poor (and how come)? what affect on rich? Before/after monetary policies?
or…I guess I could just Google.
Og
#125 Kurt on 04.02.21 at 8:12 pm
#137 Km on 04.02.21 at 9:46 pm
“learn to drive hurr dee durr”
******************
While I don’t live in the country, I absolutely had to have a truck for work, so the 4×4 in winter was just an added bonus.
Maybe you guys have heated parking everywhere you go, but that hasn’t been my experience, and I’ve had to drive out of many a snowed-in parking spot that your teeny cars could never clear.
Also for minor offroading while camping it would be a long hike from where your Honda Fit got stuck to the site.
Not everyone who owns a truck does it to “be cool”. Actually, I personally don’t think any vehicle is capable of doing that, but some are certainly more practical than others.
Robax, I could ask you to review my TFSA holdings, but I am looking for you to analyze something much more important.
What was my mental state when I wrote this post at 11pm last night…
M46BC
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#167 Flop… on 04.03.21 at 2:09 am
So I’ve been looking to see what my buddies from Melbourne have been studying at the Australian Centre for Disease Control or AC/DC have been up to.
AC/DC recent findings into COVID pandemic and unanswered questions.
Who Made Flu?
Dirty Sneeze Done Dirt Cheap.
Flu Shook Me All Night Long.
Highway To Smell.
It’s A Long Way To Herd Immunity If You Wanna Rock and Roll.
Back In Black In 50 Years.
For Those About To Flop ( We Salute You)…
M46BC
#43 JacqueShellacque on 04.03.21 at 3:09 pm
Doug, doesn’t this entire analysis hinge on being correct about what the future brings…
—-
Yes, equity market returns could be negative for the next 10 years, the government could scrap future TFSA investment and force investors to retroactively pay cap-gain taxes on all past profits. So, yes, if you believe these scenarios, TFSAs should be avoided.
You sound like you live for compliance disclaimers.
—Doug
#10 Doug t on 04.03.21 at 10:58 am
GAH – that photo represents Exactly what Hollywood is – a bunch of narcissistic sad individuals that actually believe they are important
–
lol, it’s just a picture.
#52 SoggyShorts on 04.03.21 at 4:45 pm
#122 Stone on 04.02.21 at 8:06 pm
That’s the deal.
———–
It seems we come to this blog for very different reasons.
I’m here to learn and share knowledge. Like you, I’m in early retirement, and I find this blog to be generally more mature than most FIRE blogs.
I guess I just don’t get why you tell everyone about how great your portfolio is if you aren’t going to share the recipe. I mean what does anyone gain from that?
I share mine freely because I think others might actually benefit from the knowledge…
Simply throwing out results without methods seems pointless to me.
———–
Agreed. Stone claims financial independence, trumpets results, refuses to share the portfolio… but then wants a job with Garth and you to hire him as an investment manager?
Apparently financially independent early retirees need other people’s money.
Lots of S’s come to mind: snake oil, scammer, shyster
#10 Doug t on 04.03.21 at 10:58 am
GAH – that photo represents Exactly what Hollywood is – a bunch of narcissistic sad individuals that actually believe they are important
///////////
Kinda like Stone.
My runners suffer from nail fungus along with limberitis. Nasty condition when the shoes material deteriorates and potentially starts another pandemic.
So yes, it’s wise to max ones TFSA. It could prove to be a great line of defense in the future…
Wow, finally an article thats not so damn depressing, come on Garth lighten up…
my cynic antennas are coming up and ringing big!
“disrupt and break things” bringing value to human kind -inverse relationships
========================
In what was the second-largest settlement of its kind, pharmaceutical giant Abbott Laboratories agreed to pay more than $1.5 billion to settle civil and criminal charges related to unlawful marketing
https://www.policymed.com/2014/09/shire-pharmaceutical-settles-for-565-million-to-resolve-false-claims-act-allegations.html
A tax inversion or corporate tax inversion i….
The controversy came to a head In 2015, when Pfizer Inc. announced it would move to Ireland as part of a merger with Allergan PLC, setting up one of the largest ever corporate inversions. This announcement was met by widespread outrage in In 2016, Pfizer Inc. called the deal off.
AbbVie’s proposed $54 billion acquisition of Shire was structured as an inversion, and would have allowed AbbVie to reincorporate in Britain, lowering its tax bill. To fund the deal, AbbVie had planned to use billions in overseas cash that would not have been taxed if the company had completed the inversion. But among other changes, the new Treasury rules meant that AbbVie would have had to pay taxes on that cash, eliminating many of the financial benefits of the deal.
https://www.investopedia.com/terms/c/corporateinversion.asp
Tesla CEO Elon Musk has responded to criticism of his huge wealth by Senator Bernie Sanders, saying he would use his money to help humankind.
“I am accumulating resources to help make life multiplanetary & extend the light of consciousness to the stars,” Musk said on Twitter.
https://www.palantir.com/palantir-gotham/
===================================
=just in time
The old devil blue suede shoes
Jesus shoes and now satan call me by your name!
MSCHF (pronounced Mischief) is an American art collective based in Brooklyn, New YorkAs of January 2020, MSCHF was reported to have received $11.5 million USD in funding. It has reported its own value as being $200 million USD, following a private funding deal with the venture capital group Founders Fund.[3]
========
Many states aren’t correctly reporting revenue losses from tax breaks and other developer perks. See Chapt. 4: “Compliance, Non-Disclosure and Under-Reporting.”
Source: Good Jobs First, “Abating Our Future: How Students Pay for Corporate Tax Breaks”
https://infogram.com/gasb-77-explore-your-state-1h8n6m3gx99vj4x
Explore Your State
Other significant findings:
South Carolina reported more K-12 losses than any other state; its $423 million in abated revenues was a staggering 31 percent increase from two years prior.
At $112 million, no district lost more in net tax abatements than the Philadelphia City School District, where 75 percent of students are Black and Latino.
Storey County School District in Nevada reported the highest per-pupil foregone revenue — over $35,000. That is due primarily to subsidies given to Tesla Motors, led by billionaire Elon Musk.
Of the 149 districts that reported losses of more than $1,000 per student, 34 were in Texas.
87 New York school districts lost between $1 million and $10 million in FY 2019; and three of these — Peekskill, New Rochelle, and Rensselaer — lost over $10 million. All are relatively poor, and two have large shares of Black and Latino students.
Officials in California, home to more students than any other state, are misinterpreting the rule, saying because the state makes up the revenue districts would otherwise lose from abatements local governments do not have to report totals.
School boards do not typically award abatements; states give that power to cities or counties in what amounts to “an intergovernmental free lunch” where education is the biggest loser. The report recommends that states amend tax-break laws to completely shield those revenues dedicated to education.
#184 Dubble on 04.03.21 at 3:10 pm
Your path to financial prosperity is the equivalent of calling a pair of white oakley’s and a jacked up pickup truck “investing”
****************************************
Excellent job stereotyping. Want to go for a spin in my 911 Carrera S?
***************************************
Almost forgot, don’t forget your Maui Jims
I don’t believe you can buy options in. TFSA as it can result in you borrowing money to cover the option
Here’s CRA website
Because you may have to have a margin account or borrow money which is not allowed…..
Therefore, option writing, in and of itself, is generally not subject to the qualified investment rules. However, several other income tax rules may restrict the ability of a registered plan to engage in option writing strategies (discussed in ¶1.41 to 1.44).
Read and be informed.
https://www.canada.ca/en/revenue-agency/services/tax/technical-information/income-tax/income-tax-folios-index/series-3-property-investments-savings-plans/series-3-property-investments-savings-plan-folio-10-registered-plans-individuals/income-tax-folio-s3-f10-c1-qualified-investments-rrsps-resps-rrifs-rdsps-tfsas.html#toc9
That’s one ugly dog photo today.
My R/E agent says a TFSA is a great way to save for a house…
@#53 Donny G
“Want to go for a spin in my 911 Carrera S?”
+++++
Only if I get to drive….
@#56 Flop
“What was my mental state when I wrote this post at 11pm last night…”
+++++
Well lubricated?
#68 crowdedelevatorfartz on 04.03.21 at 6:30 pm
@#53 Donny G
“Want to go for a spin in my 911 Carrera S?”
+++++
Only if I get to drive…
******************************
Absolutely, super fun!
#52 SoggyShorts on 04.03.21 at 4:45 pm
#122 Stone on 04.02.21 at 8:06 pm
That’s the deal.
****************
It seems we come to this blog for very different reasons.
I’m here to learn and share knowledge. Like you, I’m in early retirement, and I find this blog to be generally more mature than most FIRE blogs.
I guess I just don’t get why you tell everyone about how great your portfolio is if you aren’t going to share the recipe. I mean what does anyone gain from that?
I share mine freely because I think others might actually benefit from the knowledge, even if it is a case study in what not to do as my 100% equity PF was in March 2020.
Simply throwing out results without methods seems pointless to me.
I’ve seen you post things like
“That investment method sucks, mine is better”
but then when I ask:“Ok, so what is your method?”
you reply:
“I’m not telling”
That’s a pretty useless conversation we had there.
———
Strange? Did I owe you something? What have you done for me lately? Listen. You definitely know what my fixed income component is. I shared something important yesterday but apparently you only accept the silver spoon method of delivery. I’m trying to get you to think critically. When you can do that as well as extrapolate, you will become the master of your financial destiny and not someone constantly just trying to copy what others have done. They will look to copy you. Look at your current portfolio mix. Look at the current results. You finally added some fixed income this year after getting a thrashing in 2020 because you couldn’t rebalance and you got burned royally. I’m happy to see you finally accept that you need some fixed income. Unfortunately, you don’t properly understand what you bought though for your bond ETF considering where we sit in the economic cycle and where yields sit. You’re still basically betting most of your hand on USA. Forget about me for a moment. You’re not even paying attention to what Garth, Doug, Ryan and Sinan have been saying. They said short term bonds at this time. What do you have? Did you do that? Did you load up on prefs? Did they say bet 68% of your portfolio on the S&P500? Absolutely not. They said diversify globally. What did Ryan say a little while back? Back up the truck on Kanaduh!!! Do you think 18% is backing up the truck? I don’t. And yes, I keep saying “bet”. You’re still gambling and you’re thinking short term profit. I like you Soggy but you need to wake up. All those nuggets of wisdom are in front of your eyes but you still can’t seem to figure it out. I realize you’re probably pissed at what I wrote here. One day, I hope it will all click together for you and you’ll realize what I actually gave you. You were given a brain to do more than eat, sleep, defecate and fornicate. Please make better use of it.
Nothing is perfect…
M46BC
“Melbourne vendors setting reserves higher than price guides.
“Greedy” Melbourne sellers have been accused of setting a reserve far higher on auction day than the price advertised for their home.
And those caught engaging in the dodgy practice could set their agent up for a fine if the agent was accused of underquoting, an expert warns.
Buyer’s advocate Emily Wallace, who co-hosts the My Millennial Property podcast, said she’d seen a big rise in money-hungry vendors bumping up reserves in recent weeks.
The glut of buyers competing for limited listings skewed market conditions in the seller’s favour, she said
And she estimated up to 70 per cent of auctions she’d attended in the past month had reserves higher than the advertised price, while about 30 per cent of those had reserves tens of thousands of dollars more.
“Recently, I’ve noticed it’s a mix of vendors being a bit greedy and buyers being a bit desperate,” Ms Wallace said.
“Agents are always guided by the vendor (on auction day). It (reserves being set well above advertised prices) actually reflects badly on the agents, even though it’s not their fault.”
Ms Wallace stressed the trend wasn’t the same as underquoting, which was when agents advertised a property at a lower price than the vendor was willing to accept in order to draw in buyers — a practice against the law that could earn them tough fines.”
https://www.realestate.com.au/news/melbourne-vendors-setting-reserves-higher-than-price-guides/
#15 Tarot card on 04.03.21 at 11:49 am
To post 2 Uranium
I have read all the same predictions because of governments policy about nukes no new mines for the last ten years and it takes ten years to develop a mine so there is a shortage coming. You failed to mention uranium stocks are up like 120 percent.
I am not convinced that uranium is part of the new green deal. While I love Ballard power I think that is old news, the newest technology in the pipeline is green hydrogen.
——————————-
The green new deal is a western thing, most of the world’s population is not going to play along unless it is economic and meets their needs for 24/7 reliable power. China alone has 46 nuclear reactors with 11 more under construction as of 2019. The US currently has 96 operational reactors (none under construction). In In 2018, nuclear comprised nearly 50 percent of U.S. emission-free energy generation (wind, solar, hydro).
I’m betting on Gen IV nuclear reactors to eventually get the green light. These are smaller, fail-safe reactors. A lot of work has been done on developing them by Japan and China. One of the things Trump did while in office is authorize test development in the US, which was previously under a moratorium. Bill Gates is a big proponent and has sunk billions into research.
Will they work? I don’t know but I sure hope so.
As for hydrogen, it should be thought of as an energy carrier rather than an energy source, sort of like electricity. The 2 main ways to make it are to strip it from natural gas or via hydrolysis, both of which use a lot of energy in themselves (hydrolysis uses electricity, natural gas can be burned directly more efficiently). So I don’t see hydrogen as being anything more than a talking point. We already have electric cars so why convert the electricity into hydrogen? Just charge the batteries. Sure, a fuel cell car has a greater range and can be “refilled” faster, but I’d put my bets on a new battery technology before hydrogen.
Battery technology has come along way in just the last 15 years. Consider my old cordless drill, with 1.5 Ah NiCad batteries. Big and heavy. I just bought a new cordless drill with 1.5 Ah lithium-ion batteries. They are 1/3 the size and weight. So who knows when another breakthrough might occur?
(Lithium-ion batteries are responsible for the upsurge in electric vehicles and the miniaturization of things like cell phones, tablets, and laptops with an 8 hour battery life due to their superior energy density when compared to NiCad or lead-acid batteries. And drones too. Previously the batteries were too heavy to try and fly with electric motors. Now these drones are everywhere and so cheap they sell them as children’s toys.)
#59 Sail Away on 04.03.21 at 5:12 pm
#52 SoggyShorts on 04.03.21 at 4:45 pm
#122 Stone on 04.02.21 at 8:06 pm
That’s the deal.
———–
It seems we come to this blog for very different reasons.
I’m here to learn and share knowledge. Like you, I’m in early retirement, and I find this blog to be generally more mature than most FIRE blogs.
I guess I just don’t get why you tell everyone about how great your portfolio is if you aren’t going to share the recipe. I mean what does anyone gain from that?
I share mine freely because I think others might actually benefit from the knowledge…
Simply throwing out results without methods seems pointless to me.
———–
Agreed. Stone claims financial independence, trumpets results, refuses to share the portfolio… but then wants a job with Garth and you to hire him as an investment manager?
Apparently financially independent early retirees need other people’s money.
Lots of S’s come to mind: snake oil, scammer, shyster
———
You demonstrate a poor person’s mindset. Being interested to work with smart and interesting people has nothing to do with financial independence or gain. Especially when earning money is no longer the driver. You like kitschy whale art, organic water and beta orbiting Musk. I like collaborating with smart and interesting people.
@#74 Stone
” I like collaborating with smart and interesting people.”
++++
That’s very flattering but….. I’m busy this month.
And maybe next month….
I’ll have my people call your people.
my scroll wheel is smoking. Can we keep the bickering down a bit?
Good post, thanks Doug. Question: once a portfolio gets big enough, shouldn’t fixed income mostly go to the registered accounts, for tax efficiency? Maybe I misunderstood what Garth was recommending, but to me it meant short bonds into RRSPs, Preferreds/Div ETFs into TFSAs, and growth ETFs plus a bit more fixed-income into Margin accounts, for overall balance. Obviously this means less-than-stellar RRSP & TFSA returns, for better overall portfolio efficiency. Thanks again!
#184 Dubble on 04.03.21 at 3:10 pm
To the pro-oil and mining gentleman. You speak of Canada holding the 3rd largest reserve of oil in the world, yet say nothing about the massive amounts of fresh water required to turn it into a useable product.
I believe that Canada’s fresh water is a more valuable resource than oil. I believe fresh water will be the worlds most important resource in the future, and to squander it processing tar sands is a crime, and shows no forward thinking whatsoever.
I’m tired of subsidizing big oil and watching us destroy the resources that are truly valuable in the process. Your path to financial prosperity is the equivalent of calling a pair of white oakley’s and a jacked up pickup truck “investing”.
—————-
Agree.
As I said before, let’s finish the pipelines, and use them to transport water.
That should be a win-win.
#53 Don Guillermo on 04.03.21 at 4:51 pm
#184 Dubble on 04.03.21 at 3:10 pm
I’m tired of subsidizing big oil and watching us destroy the resources that are truly valuable in the process.
***************************************
Canadian oil and natural gas provided $105 billion to Canada’s gross domestic product (GDP) in 2020, supported more than 500,000 jobs across the country in 2019 and provided $10 billion in average annual revenue to governments for the period 2017 to 2019. This revenue helps pay for roads, school and hospitals.
https://www.capp.ca/economy/canadian-economic-contribution/
*****************************************
Your path to financial prosperity is the equivalent of calling a pair of white oakley’s and a jacked up pickup truck “investing”
****************************************
Excellent job stereotyping. Want to go for a spin in my 911 Carrera S?
———————-
Just a little FYI, white Oakley’s are known as “douche goggles” where I come from. That is one stereotype that proves accurate more often than not!
#74 Stone
#59 Sail Away
You two are like Joey and Auguste. Probably reasonable people in real life, but in this quasi-anonymous environment you behave like total buffoons. Another confirmation that the layer of civility is thin. Same hairy neanderthal underneath.
Apparently neanderthals have capacity for basic stock market transactions.
#76 Man … on 04.03.21 at 8:07 pm
my scroll wheel is smoking. Can we keep the bickering down a bit?
All last week as well. I’m thinking that most on here are in that broad swath of 35-55 with a few youngsters and a not insignificant percentage of over 65’s. So half their lives gone and still not happy. That is a shame, eh?
The CPC exhibits similar behaviour, yet some still think they will be able to form government soon. ha!
#71 Stone on 04.03.21 at 6:38 pm
#52 SoggyShorts on 04.03.21 at 4:45 pm
#122 Stone on 04.02.21 at 8:06 pm
Strange? Did I owe you something?
——————————————————
You owe everyone to shut up about your portfolio if you don’t back it up with substance. And that goes for everything else you opine about.
@#73 Nonplused
… aaaand just when we thought Nuclear Power is the answer….
The Radioactive swimming pool is about to burst…….
https://www.sun-sentinel.com/news/florida/fl-ne-bradenton-phosphate-leak-evacuation-radioactive-20210403-oyzgiielpjaqfpmmpdk3jismqi-story.html
#75 crowdedelevatorfartz on 04.03.21 at 7:41 pm
@#74 Stone
” I like collaborating with smart and interesting people.”
++++
That’s very flattering but….. I’m busy this month.
And maybe next month….
I’ll have my people call your people.
———
This month or next? I was thinking 2026. I have a 15 minute slot available…oh…sorry…that’s gone too. Better make it 2027. In Singapore lah.
#82 Lead Paint on 04.03.21 at 9:33 pm
#71 Stone on 04.03.21 at 6:38 pm
#52 SoggyShorts on 04.03.21 at 4:45 pm
#122 Stone on 04.02.21 at 8:06 pm
Strange? Did I owe you something?
——————————————————
You owe everyone to shut up about your portfolio if you don’t back it up with substance. And that goes for everything else you opine about.
—————————————————
I must say that Stone has done a very good job refocusing the deplorables. You’re all focused on just one thing. Your portfolios must really stink in comparison.
Being ‘in the market’ has really been ‘ where it’s at’ during this pandemic. March 23, 2020 was like a dinner bell to me. I bought with both hands. It was a good year, but ‘21 has proven to be even better than even I could have expected. I don’t like doing the ‘annualized’ thing , it’s a tad misleading, but if I did I’d turn my 83% first three month return for ‘21 into a 332% annualized Hog-Fest.
90% Maple, 4 ETF’s . 30% Energy. Bonds zero. All solid dividend payers. Lots and lots of doubles across the board. Some great splits and mergers you’d never see in an index play. It’s been “ the year” to have caught the rotation into value. Hey, Zero rates had to to show up somewhere. Zip. I have 57 issues, growths, proxy-like, and lots of the stuff that everybody seems to want these days. Banks yes, not to late. Prefs, slow but viable.
There’s lots more good news on the horizon. Stocks be a ‘poppin. Like Gretzky said “ Skate to where the puck is going to be”.
#71 Stone on 04.03.21 at 6:38 pm
#52 SoggyShorts on 04.03.21 at 4:45 pm
#122 Stone on 04.02.21 at 8:06 pm
Blahblahblah
**********************
I think you’ve grossly misunderstood our relationship here. You seem to think I’m begging to sip at the font of your wisdom.
I am not.
I started DIY investing in 2019 and my returns thus far are comparable to yours or actually higher iirc (23.23%,4.23%, and 4.32% YTD)
My interest in your dubious claims is mere curiosity since you keep saying you are consistently beating all other B&D portfolios in existence.
The logical conclusion is that you are either overweight in something higher risk, lucky, or lying.
Unlike everyone else, I was giving you the benefit of the doubt.
@#70 Don Guillermo on 04.03.21 at 6:38 pm
#68 crowdedelevatorfartz on 04.03.21 at 6:30 pm
@#53 Donny G
“Want to go for a spin in my 911 Carrera S?”
+++++
Only if I get to drive…
******************************
Absolutely, super fun!
–
saving up my pesos for a GT3.
may take awhile – hopefully by retirement.
although my back might not be as agreeable by then.
Doug,
I’ve reached the extent of my excel skills when calculating the time value of different holdings within different accounts.
For simplicity, assume someone has 500k – 20% US equity ETF, 20% aggregate bond ETF, etc.
They can choose to hold either all 100k of bonds within their tfsa or their 100k in US holdings.
The bond ETF takes roughly an $875 tax hit on year one(35%(Canadian average?) marginal tax rate x $2500 interest paid) and loses approximately $150 foreign withholdings by keeping the US ETF in a sheltered account.
It may depend on expected retirement income and the resulting tax bracket, but is there ever a case where it makes sense to hold bonds within a tfsa instead of equity-based assets? Or is this being too near-sighted?
Thank you
#22 Concerned Citizen on 04.03.21 at 12:36 pm
markets have a way of teaching people that humility….
#83 crowdedelevatorfartz on 04.03.21 at 9:34 pm
@#73 Nonplused
… aaaand just when we thought Nuclear Power is the answer….
The Radioactive swimming pool is about to burst…….
https://www.sun-sentinel.com/news/florida/fl-ne-bradenton-phosphate-leak-evacuation-radioactive-20210403-oyzgiielpjaqfpmmpdk3jismqi-story.html
——————————
Hmmm I read most of the link you provided and it does not seem this potential accident had anything to do with nuclear power, whether Gen IV or older. Seems like it had to do with fertilizer production. Are we to stop producing fertilizer?
PS Fartz,
Uranium is a naturally occurring thing as is radon. There is a little bit of it everywhere. It is the nasties like plutonium which are a result of Gen III and earlier reactors that are the real worries, but Gen IV looks to minimize and perhaps even consume them. What comes out of a Gen IV reactor is still hard to deal with but nothing like a Gen III or earlier.
There is always a little bit of background radiation caused by the fact that not all the uranium the world started out with has decayed. There is even more background radiation caused by above ground nuclear testing in the 50’s and 60’s (that’s plutonium, mostly, and nasty stuff). And yes when we dig stuff up sometimes there are radioactive isotopes in the mix. Heck, even your smoke detector is radioactive. It wouldn’t work if it wasn’t.
The TFSA sounds like such a great idea but mine, despite having contributed every year as much as possible, is losing money, I’d have more money if I’d stashed it as cash. It’s frustrating, I do some right, then something goes wrong and with inflation calculated in I have lost quite a bit of money. I just can’t figure it out and to me the markets look more like a big gambling casino. It does not work for all even if they can contribute and getting this knowledge is not easy. I wish it were different but I understand those that don’t even try. I wish there would be a solution the state handles with professionals who know what they do, I’d be better off this way.
#93 Enigma on 04.04.21 at 4:28 am
The TFSA sounds like such a great idea but mine, despite having contributed every year as much as possible, is losing money, I’d have more money if I’d stashed it as cash. It’s frustrating, I do some right, then something goes wrong and with inflation calculated in I have lost quite a bit of money. I just can’t figure it out and to me the markets look more like a big gambling casino. It does not work for all even if they can contribute and getting this knowledge is not easy. I wish it were different but I understand those that don’t even try. I wish there would be a solution the state handles with professionals who know what they do, I’d be better off this way.
***********
That seems impossible to be down money. But maybe if you are accounting for inflation and you invested in GICs. Still though, you’d be further ahead than if you had it in your mattress.
@99 Leechy Fruit
Similar question to mine. On second thought, bonds pay little, so it matters not if exposed to higher taxing of RRSP and margin accounts. It thus seems best to stuff high-returns assets into TFSA, where growth will be entirely free. Bonds should go to the RRSP “time-bomb” and be fully taxed as income later.
Missing out likely cost us $100K for my wife and myself, along with losing out by partly being in cash during recent turmoils. Fortunately it’s only few percentage points overall; still shows the potential value of a good financial planner… Cheers
#87 SoggyShorts on 04.03.21 at 10:54 pm
#71 Stone on 04.03.21 at 6:38 pm
#52 SoggyShorts on 04.03.21 at 4:45 pm
#122 Stone on 04.02.21 at 8:06 pm
Blahblahblah
**********************
I think you’ve grossly misunderstood our relationship here. You seem to think I’m begging to sip at the font of your wisdom.
I am not.
I started DIY investing in 2019 and my returns thus far are comparable to yours or actually higher iirc (23.23%,4.23%, and 4.32% YTD)
My interest in your dubious claims is mere curiosity since you keep saying you are consistently beating all other B&D portfolios in existence.
The logical conclusion is that you are either overweight in something higher risk, lucky, or lying.
Unlike everyone else, I was giving you the benefit of the doubt.
———
Didn’t I tell you a couple months ago to consider this?
VSB 20%
ZPR 20%
VCN 20%
VUN 20%
XEF 16%
XEC 4%
Also, did I not tell you that my portfolio has similarities to the above however I decided to tweak mine making it riskier and was comfortable with my choices because it was within my risk tolerance?
Seems to me that what I shared with you would have improved your ytd return significantly while giving balance and diversification to your portfolio.
Whatever did you do with that? Nothing? Be honest. Not with me but with yourself.
If it wasn’t for Garth and this blog and the hammering home of the gift that the TFSA is, I would be among that low percentile ignorant group.
I handle mine and my wife’s TFSA’s and being a little riskier with mine I am only about even (but making a comeback) while my wife sits on a 125% gain with dividends of over $1200/mth and more to come as some are currently on pause due to the pandemic.
@#91 Noplused
“I read most of the link you provided and it does not seem this potential accident had anything to do with nuclear power,”
+++
Odd,
I though we were discussing how “green” nuclear power is and the by-product is radioactive waste…..
So, a tailing pond about to burst in Florida with radioactive waste is a bit of a stretch I will admit .
Would you be willing to buy the farmland for growing food after its flooded?
Kinda like houses with elevated levels of radon gas in the basement and higher incidences of cancer in the occupants?
Radiation is radiation….. natural or not….best to be avoided….like tanning booths.
@#93 Enigma
The management of CPP return over 7% net of costs by investing in a diversified portfolio of stocks and bonds, with the added kicker of certain private investments.
Sadly the initial funding was set artificially low, and benefits too high which resulted in the necessity of raising premiums substantially, and limiting benefits. It would have been a huge success if premiums had been ten percent or more from the start, as long as some government didn’t steal the money along the way.
So once in a while I check a chat where “traders” and “investors” congregate. Mostly for amusement and sentiment analysis.
Circa September one fella shows up and says he is a novice, saved 2-5-10 thousand dollars and ready for success. Asks for feedback on his portfolio. Typical Tesla/gold crap.
Sometime in February I check the chat again and here he is, talking about the wealth of market experience he accumulated during his investment career, how he beats Buffet in annualized performance, and announces to the world that he is ready to pass his knowledge to an apprentice. I fell off my chair. And as I was falling off the chair I experienced a moment of total clarity.
I think it was Druckenmiller who said that Soros has periods of depression after cashing in on successful investments, because he (Soros) has no idea what to do next and is worried that he will never again find another worthy opportunity.
So yeah, there you go.
#89 Leechy Fruit on 04.03.21 at 11:07 pm
///////////////////////////////////////////////////////////
Personally I don’t think that hard, either gear the portfolio for growth or passive income, can’t be both.
TFSA has all TSX listed ETFs.
Non-Reg has all TSX listed ETFs.
RSP has only USD voo and some bnd.
Rebalancing across accounts is not straightforward and has tax implications, just keep it simple. Deferred capital gains (total return) are my target in the building stage, not revenue.
@#92 Nonplused
Well, I guess life could be worse.
You could train for years and be kicked out of a prestigious sport competition for “tossing your water bottle in an undesignated area”…..
https://www.cyclingnews.com/news/michael-schar-kicked-out-of-tour-of-flanders-for-littering/#:~:text=Michael%20Sch%C3%A4r%20(AG2R%20Citro%C3%ABn%20Team,when%20the%20incident%20took%20place.
…..and people wonder why England left the EU…
#58 KLNR
Picture worth a thousand words
#93 Enigma
I’m not sure your wish to involve “the state” in any investment advice solution can be a good idea. The state has already done us the favour of making the TFSA available.
No matter how much I think I have learned about investing and finance since reading this blog, I still don’t feel competent to direct my investments. For the low, low price of money, I get professionals who live and breath this stuff, to do it for me. I can assure you my advisors do not consider the markets as a big gambling casino.
If you have the interest, motivation and perseverence to educate yourself, (I didn’t, -too much like a job),you can start by searching this blog. There is a wealth of information in past blog posts and related comments, that should help you find your way.
I can give real world confirmation on TFSA growth numbers. I contributed to mine from the very beginning and they are now sitting at a nice $159,000. This is also after wasting the first few years when I didn’t know any better listening to TNLB and putting it in “high interest savings account”. When I realized I could buy investments in it, I started seeing real return on the money. They should really drop the S from the name. It is just a tax free account. Doesn’t have to be a “savings” account. Banks abuse that nuance too much.
#96 Stone on 04.04.21 at 8:38 am
Didn’t I tell you a couple months ago to consider this?
VSB 20%
ZPR 20%
VCN 20%
VUN 20%
XEF 16%
XEC 4%
———–
That portfolio has a ytd total return of 5.4%.
So to gain a better return than the B&D you went into… stocks? Anybody can play the cowboy game, but it’s hardly considered BD.
Sticking solely with the Turner advice of prefs returned 11.56% ytd.
Ponzie’s Pickup Paranioa
Has the Austrian Audi Aficionado spread his message to La Belle Province?
Or have the environazi’s run out of targets?
https://driving.ca/features/feature-story/motor-mouth-environmentalists-looking-to-cancel-pickup-trucks
Only Ponzie knows for sure.
Radiation is radiation….. natural or not
…….
Bring it on. I’ll be out on howe sound in an hour, enjoying some long awaited sweet, sweet radition that finally hits on a weekend. Wearing shorts.
Nuke power is our only choice other than oil if we dont want to reduce consumption by 95 percent . Greenies should lead the
way by cancelling hydro service but they are scientifically illiterate hypocrites.
Everything produces waste, even you. Disposal can be done safely. It will be.
#94 Ballingsford
i wish i’d be joking. Sitting at a bit more than 73k. Inflation not calculated. No GICs. I do have some of the ETFs that are at times posted here but have made a few mistakes where all what was gained disappeared again.
#99 Keith
Even a 5% number would have been much better for me than a minus outcome. Lots of people just can’t accumulate money even if they try hard. There is a reason that the gap between rich and poor is widening. I am educated, I live within my means, not a gambler but just can’t make it work. It’s embarrassing but people like me exist.
#95 Keen Reader
But by keeping equity ETF’s in a non-registered account, you don’t lose out on the capital gains – you’re just taxed more heavily upon withdrawals. How much you’re taxed depends on your taxable income in retirement.
With bond ETF’s in a non-registered account, you’re taxed right away(current yield on aggregates is 2.5% taxed at your full marginal rate), and losing out on the foreign withholdings by having equity US ETF in a TFSA (15% of the dividends paid = roughly $200. I incorrectly said $150 last time but whatever, same deal)
I need to make clear that I’m not suggesting this is the best way forward, just posing a question to gain clarity and maximize efficiency.
Also, I saw you mentioned preferreds be placed in sheltered accounts. Assuming you have spillover, those should be held in a non-registered account because of their dividend structure.
Best of luck to you, Keen
65:
The 9 long call contracts for Tesla that I own inside my TFSA suggests otherwise.
106 Sail…..Hahahahah….and Double Bwahahahaha.
” Anyone can play the cowboy game”. Bwahahahahaha.
Go ahead…..try it. And tell me if you don’t because us “Cowboys” are somehow impure?
Dirty money in stocks? Yup, us Cowboys are cheating by getting more out of ” the game”. Seriously ?
I’ve posted my plays in advance on this blog many times over the years to prove my point. Proof that it ain’t no string of luck.