Making it

Yesterday this odd blog veered into the world of vehicle turntables, wall-to-wall marble and unknown pneumatic bathtub babes. So let’s return to earth. Apparently there are still some normal people left, trying to scratch out satisfying lives in a world of extremes.

Like Courtney. “Your blog has helped my husband and I turn our finances around though we’re still working on it. When we first started out he was massively in debt from a failed business and I was just a year out of high school and we were both working minimum wage jobs,” she writes.

It’s taken us many years to pay off most of what was owed but along the way we still struggled with some unfortunate financial situations (being let go several times due to downsizing was our main hardship). With everything said and done, we are just about to pay the final installment for our car loan (I realize now we never should have opted for a car loan but I wasn’t reading your blog back then) and I still have just under $15,000 in OSAP loan debt.

We bring in $5500 net per month and pay $1500  in rent so aside from the student loan we don’t have any other major expenses (finally). Along the way we managed to add a small amount of $21K to our RRSPs (which sadly has only recently been invested in a B&D portfolio) and have save up an equally tiny $25K in cash that we, up until recently, were hoping to use as the beginning of our down payment fund. Obviously that is but a dream to us now with this crazy hell on earth known as the housing market. I’m fairly certain a home will never be in the cards for us.

With all of this in mind, my husband is now 45 and I’m 37. We don’t have kids (but who knows what the next few years holds). At the rate we’re going, how pooched are we? Will we be huddled under a bridge eating cat food in our old age? Or is there still hope for a semi comfortable retirement? How much should we be investing from what we bring in – do we even make enough to help us??

I’m guessing we’re possibly better off than a lowly few but are far worse off than the majority and the future is looking a little bleak so any guidance from our Dog and saviour is greatly appreciated. Give it to us straight…are we pooched??

Nah. Nobody who comes leaves without hope, C. You and hubs have shown diligence in digging your way out of debt, surviving a business disaster and now dealing with a global plague while working low-wage jobs. Sounds like you have lessons for all the whiny, privileged, white-collar, WFH, salaried, pensioned, soft-palmed dilettantes who cluck and moan, brag about their house equity and fill the comment section with endless ennui.

Let’s look at two scenarios. Let’s also be realistic about real estate. Buying some will seriously impact future income. Not buying property may impact your sense of worth and social status. It’s that kind of world now. Life is about choices, and the best ones are made without emotion. I’m thinking you already know that.

First, let’s see what happens if you stay employed, keep expenses down, rent long-term and want to retire in two decades, when your squeeze hits 65. Let’s assume neither of you have a corporate pension. No inheritances. Nor did you lose any Bitcoins in the sofa.

So if you can live on $1,500 a month after rent that leaves $2,500 a month to save and invest. This will be a challenge. Lots of noodles and thrifty shopping. But the end goal will totally be worth it. Saving thirty grand a year will allow filling both TFSAs annually, put enough in two RRSPs to offset most taxes (about $6,000 each), and still land another six grand in a joint non-registered account.

Now, add in the $46,000 you’ve already saved (congratulations on that), and invest the boodle in a B&D portfolio of low-cost ETFs (no bank mutuals) within those accounts. Make monthly contributions and stick to the budget. If you average a 6% annual return – a reasonable expectation – you’ll have a portfolio worth about $493,000 by the time your husband is 55 and you’re 47. Keep at it for another ten years and that egg will swell to $1.3 million.

Now he’s 65 and you’re 57 and this portfolio should throw off an annual (and tax-efficient) income of just over $78,000. Add in CPP and OAS eventually and you two can have cash flow of about $112,000 by maintaining that balanced approach. This would also largely preserve the million bucks.

Okay, so what if you buy real estate?

Consider a $600,000 two-bedroom condo somewhere in the outer GTA, for example. And let’s figure on a 5% down payment to preserve cash and score the best mortgage rate (if you can pass the stress test). So the carrying costs of the unit would be $2,500 for the loan (at 2%) and another eight hundred for monthly fees, insurance and property tax. Total, $3,300.

That would leave $700 a month to invest, all in the two TFSAs. Add in the $16,000 in savings left after the property purchase and invest it as above. In a decade the portfolio will contain $143,000 and in twenty years, about $376,000. Income from that plus the public pensions would hit $56,000 a year. Plus a condo whose value may (or may not) have inflated, depending on location, condition, interest rates, the economy and the market.

Risks in renting: routine increases in tenancy costs. Social shaming. Risks in owning: mortgage rate increases, property tax and condo fee hikes, economic changes, special assessments and repairs plus loss of mobility and potential illiquidity in a down market.

There’s some rough math for you, C. Not so bad, is it? You can retire with an income higher than your current wages – for life. Or you can buy property, if that’s the big goal, and live modestly. This is entirely within your own hands. You can succeed.

Not everyone needs marble to be rich.

About the picture: “As a man who obviously loves dogs, we thought you would like to see a picture of our long-haired dachshund Zelda,” says Scott in Toronto. And Zelda turns out to be a social influencer. “Her Instagram tag is @zeldatheweinerdog.  She has 5000 followers!”

151 comments ↓

#1 AveBar on 04.28.21 at 1:26 pm

And that’s assuming they never move. The transactions costs, realtor fees and land transfer fees really add up. We were looking at moving to a bigger house but decided we will renovate our current home instead. Too much overhead costs to move. Plus the wife would want to re-decorate and buy new furniture if we move. The horror.

#2 Paul on 04.28.21 at 1:26 pm

Its fine to count on a 6% return during their growth period, but that is pretty aggressive during the draw down period. Don’t you think it would be more responsible to go with a 4%? People make real life decisions based on your advice.

Why would expectations change for the 20-30 years they are retired? The portfolio, if correctly maintained, should continue to generate returns consistent with historic norms while retaining the principal. The 4% rule is bunk. Garth

#3 Patty on 04.28.21 at 1:27 pm

I never write in…only read. This story is inspiring. The hard work and sense of responsibility shown by this couple is an example to all of us. Good work on how far you have come… If you decide to have a family they will have great financial role models in you.

#4 Immigrant man on 04.28.21 at 1:35 pm

There is always Elliot Lake, where you can totally pick up a decent detached home in the 200-300k range.

Says the guy who’s never been there. – Garth

#5 TurnerNation on 04.28.21 at 1:45 pm

Greeting from the Occupied Territory of Kanada. In one of the many locked down Prefectures. Awaiting the UBI savior.

If you doubt it look outside your local big Box Store. Citizens forced into lining up outside in all weathers, 6-6-6 feet apart, muffled or muzzled. No talking. Only the essential goods you may buy today Comrade. Government orders & rationing you know. You might be stopped at a Checkpoint on the way home

It’s been said that the world was conqured by way of only two terms: Mandatory, and Asymptomatic.
As in you no longer have a right to exist and be healthy in this New System. Nobody gets a free ride.

— Here it comes. The global control over our Movements/Travelling is PERMANENT. If had before even a hint of exposure to the UN 2030 goals spoken openly of, by T2 (I linked his twitter video the other day) you’d know all about this.

“Globe says Air Canada hears Ont. wants flight controls
“These variants entered through our borders, both international and domestic, and it is critical that every effort is made to keep them out,” they wrote to Public Safety Minister Bill Blair and Health Minister Patty Hajdu. “We are asking that you implement mandatory predeparture PCR testing for all domestic air travellers entering Ontario.”


–Manitobans. Your government has put together a 29-page document of Manadatory CV rules you must follow. To keep you healthy. I am a tad envious, what optimum health you will enjoy! I’m sure that these Manadatory rules will remain in place for many months and years.
https://manitoba.ca/asset_library/en/proactive/20212022/orders-soe-04272021.pdf

— Did you know there is a hotly contested election race in India at the moment? That might explain some things…Keeping people away from the polls.

#6 Peter on 04.28.21 at 1:46 pm

So far, the market showed us that getting into debt to buy houses and condos, brought more equity than investing, due to the leverage you take. That might not be the case further, but looking back at myself 7 years ago I had the same impressions then as well.
The question is, do you want to play it safe (investment) or you want to take on more risk but with a potential greater reward (as we’ve seen so far)

These are people with low-income jobs, little in the way of savings and no pensions. Do not goad them into more risk. – Garth

#7 Dan in Nanaimo on 04.28.21 at 1:51 pm

Garth – Timely mathematical advice of why not to succumb to the FOMO mania combined with an implied downgrade of one’s social and financial status by not galloping with the herd.

For certain, the ‘lots of noodles’, ‘thrifty shopping’, and ‘not losing bitcoins in the sofa’ squares with the math.

For many, I sense a sea change is on the horizon. And for good measure, make sure the noodles are keto.

#8 Immigrant man on 04.28.21 at 1:54 pm

There is always Elliot Lake, where you can totally pick up a decent detached home in the 200-300k range.

Says the guy who’s never been there. – Garth
——————————
I looked at the RE website… ok, fine. How about Timmins? Prices are about the same. And I am presently in Timmins.

#9 Rook on 04.28.21 at 1:54 pm

There was an article in the G&M today about how real estate is ripping apart Canada’s social fabric.

There was another one in the NP about how Toronto condos might be the best game in town right now.

So, dear readers, just for funsies, let’s play a ‘what if?’ experiment. Given the following:

1. the government has declared it won’t do anything to housing, and;

2. If the bottom falls out, the government will likely bail out the home-owner voting bloc;

What would said bail-out look like?

#10 Faron on 04.28.21 at 1:57 pm

#215 Job#1 on 04.28.21 at 12:58 pm

A few things:

0) You didn’t read the twitter thread did you? Too long? Too much “research”?

1) If you didn’t like the policy, why didn’t you sign up and force the issue? Is it because you live nowhere near Hamilton let alone these postal codes? Is it because this issue actually has zero bearing on your life but your hopped up on it because right wing media and Twitter amplified it for you?

2) Tangential to the argument is that people, in general, aren’t a-holes. People who aren’t a-holes are capable of recognizing that a tiny allocation of doses in a small set of postal codes to anyone who identifies as racialized (this could have included you if you were willing to walk up and say you are a racialized person, guaranteed) either has an impact on them because it means they get vaxxed and that their getting vaxxed was made slightly easier for them or has absolutely zero impact on them because they don’t live there or don’t think they qualify.

3) Race is a risk factor for all kinds of diseases many of which make having severe COVID cases more likely:

https://www.cdc.gov/coronavirus/2019-ncov/community/health-equity/race-ethnicity.html

Oh, sorry, that’s from the woke US CDC.

4) If you want to argue that you wouldn’t show up for a vax because you don’t look racialized enough and fear being looked at funny then you should consider yourselves welcome to being a minority race in any country. getting looked at slantily because you “don’t fit in” is a racialized person’s daily life. Welcome to it.

5) Thanks for proving my earlier point that any time there’s a teeniest hint of discussing racism here, a bunch of dudes (and one pyooma) come out of the woodwork to argue that nothing should be done and that racism either isn’t a thing or combating it represents “reverse racism”.

6) Yes, I’m being an a-hole here because I’m sick of retrogressive clowns that adore the 1950s or the 1740s as the “great again” that we should wind Canada and the US back to.

#11 Willy Wonka on 04.28.21 at 2:03 pm

Lost your job?

Well “the best social assistance is a JOB” Lisa Macleod when asked to increase welfare rates.

Property owning, home owner? Free money to fuel the housing bubble?

#12 Tarot Card on 04.28.21 at 2:05 pm

Thanks for the blog Garth
Great post
Wow!
Good luck Courtney, and thanks for the inspiring letter!

#13 Where's My Money Going Greedeau? To Shutting Down Money Laundering Inquiries! on 04.28.21 at 2:07 pm

DELETED (Libel)

#14 Barry on 04.28.21 at 2:12 pm

Wise words Garth. My advice – they would be mad to buy a home. All I’m hearing is a suck – you – in sound, a.k.a debt peonage. Aside from your commentary they should use their TFSA to the max as between both of them there is about $150,000 in contribution room. What a gift! Wife and I diligently contributed and invested in large cap dividend growers staight off from 2009 and presently we have an income of almost $17,000 (if we needed it) which we reinvest combined with the $12,000 per annum additional contribution. The price of stocks go up and down but it’s the secure income we’re after … BCE might be a start just for the present 6% yield and annual dividend growth.

#15 Northshore guy on 04.28.21 at 2:13 pm

With that income and no kids, renting is best option. Once kids come along life becomes super expensive, at that time you need cash flow not debt.

Kids don’t care if you rent or own. Social shaming of renting is a reality of our generation but rather have that then spend it all on real estate and then lose sleep because you have nothing left.

#16 Island Gal on 04.28.21 at 2:14 pm

OK, I’m finally in a position where it makes sense to open one of those “low cost ETFs”. I’m not sure what that means. I know what the idea of the funds are….but where do you get them? Can I get them from an investment advisor? Or do I have to buy them from Questrade or something similar. I don’t think I’m in the financial ballpark for Garth Quality….. I’m just looking to start with a couple thousand dollars. But, do all financial advisor’s sell low cost ETFs? How do I tell the low cost advisors from the high cost advisors?

#17 Ken on 04.28.21 at 2:16 pm

Listen to Garth, Courtney…sage and sane advice!

#18 ogdoad on 04.28.21 at 2:19 pm

Great story, Garth and C. Love it – These stories are much more relatable than the stories of people making 400k per year, have perfect lives and GF’s (not), are ueber educated yet still feel they need validation from you (no offense) because they ‘deserve’ it. FOMO at its core. Entitlement – wait, how many people did you say visit the blog everyday?

I’m not talking about you, cry group:)

Having problems (like we all do!!!) and overcoming them – And with luck, stopping work with a nest egg. That’s Zen, baby!!

Og

#19 Billy Buoy on 04.28.21 at 2:23 pm

Didn’t expect a rate hike at all by the Fed today and they confirmed it.

Just keep printing and buying bonds Central Banks.

Stagflation here we come !!!

Hardly. GDP growth is about to explode. – Garth

#20 TurnerNation on 04.28.21 at 2:28 pm

As this is a dog blog… Mainstream news show with Predictive Programming. Save the planet, end pet ownership. All joy is sucked out in the New System isn’t it?

“Susanna Clashes With Environmental Campaigner In Debate About Giving Up Pets | Good Morning Britain
https://www.youtube.com/watch?v=hFSYFG7ygCw&t=2s
According the the animal charity PDSA, over half of adults in the UK own a pet. …However, many environmentalists are calling for people to stop having pets all together in the hope of saving the planet.”


— But why, why all these rules? Our elite rulers treat us as slaves. They know our psychology and make-up and wants and fears better then we do.
This is their strategy. Notice the curfews serve a purpose?

https://en.m.wikipedia.org/wiki/Drapetomania
“If treated kindly, well fed and clothed, with fuel enough to keep a small fire burning all night — separated into families, each family having its own house — not permitted to run about at night to visit their neighbors, to receive visits or use intoxicating liquors, and not overworked or exposed too much to the weather, they are very easily governed — more so than any other people in the world. If any one or more of them, at any time, are inclined to raise their heads to a level with their master or overseer, humanity and their own good requires that they should be punished until they fall into that submissive state which was intended for them to occupy. They have only to be kept in that state, and treated like children to prevent and cure them from running away.”

— Outdoor exercise in the prison kamp yard is forbidden at this time comrade. North Korea is laughing at us now.

.Peel’s top doctor says he wouldn’t recommend reopening outdoor activities right now (cp24.com)

….
….when the Science shows otherwise. They don’t want us healthy and out in the sun at all. #Stayhome.

https://www.medrxiv.org/content/10.1101/2021.02.28.21252625v2.full
Comparable seasonal pattern for COVID-19 and Flu-Like Illnesses
Conclusions We conclude that seasonal patterns of COVID-19 incidence and Influenza-Like Illnesses incidence are highly similar, in a country in the temperate climate zone, such as the Netherlands

https://www.nature.com/articles/s41598-021-81419-w
Conclusion
As already evidenced by previous correlation studies10, a low 25(OH)D concentration should be considered a contributing factor to COVID-19 severity.
Europe and the northern USA are starting a long COVID-19 crisis this autumn, as they will return to a level above the October sun UV daily dose only at the end of March 2021.
Measures to reduce the pandemic severity during the coming winter using controlled preventive vitamin D supplementation should be considered

#21 Phil on 04.28.21 at 2:33 pm

There is a possibility alluded to by Garth, that the economic future may be far different than the near past and present.
Being invested in relatively liquid investments may provide opportunities that cannot be seen from this present vantage point.
Getting rich-ish with a chance of rich (sounds like a weather forecast).

#22 Billy Buoy on 04.28.21 at 2:38 pm

Hardly. GDP growth is about to explode. – Garth

Respectfully disagree Sir.

Short term GDP growth on repoening but then downhill based on reality of demographics, debt loads…that is unless CB’s print even MOAR $$$$$$$$$$$$$$$$$, further flood the world = Stagflation.

We know wages are hardly going to grow again in proportion to the $$$$ floating around, needing a place to land.

Income gap increasing til everything breaks. 10 years?

Vapernomics. – Garth

#23 NSNG on 04.28.21 at 2:41 pm

I was going to use this anecdote for the CPP discussion a couple of days ago but it is equally applicable today.

We have a guy at work. He dispatches. He collects CPP and OAS plus his wage. He is in his 70’s.

Yes, it is rough that he needs to work still but he seems to like his job and it keeps him busy. He’s quite energetic. I was shocked to hear he was over 70. I would have guessed he was in his early 60’s.

So yes, if necessary you can find work once CPP/OAS kicks in and it is much easier to compete with mills and younger on wages when you don’t have a family to feed or a mortgage to pay and you are subsidized by a pension. It is not the nicest but you don’t need to stop working at 65 and you do probably need to keep active anyway. So hobby or jobby. Take your pick.

#24 Ray on 04.28.21 at 2:42 pm

Where do you suggest in investing in low cost ETF Funds
For investments under $100k
If not the banks do you suggest robo advisors?

#25 Sail Away on 04.28.21 at 2:49 pm

#15 Island Gal on 04.28.21 at 2:14 pm

OK, I’m finally in a position where it makes sense to open one of those “low cost ETFs”. I’m not sure what that means.

———-

IG, you can do this, but should first take 6 months to a year to educate yourself on markets, allocations, procedures, and implications.

Go slow, learn first. Some good places to start are Bogleheads, Canadian Couch Potato, Mr Money Mustache, any number of beginning investing books.

I’d suggest begin with a list of questions, then check them off one by one as you find the answer. Also ask them here.

Answer#1: Open a ‘Self Directed TFSA’ in both CAD and USD at your existing bank. This will ensure the investing account is directly linked to your online banking dashboard. Keep it simple. Don’t take any advice from the bank person.

Why on earth would she need to take months to educate herself on ‘markets, allocations, procedures and implications’? Should she also take a mechanic’s course before she buys a car? Get real. – Garth

#26 Prince Polo on 04.28.21 at 2:50 pm

Kudos to Courtney for not playing the role of ostrich and sticking her head in the sand.

The best time to invest was yesterday. The 2nd best time to invest is today. Good luck on your journey!!

#27 Ponzius Pilatus on 04.28.21 at 2:52 pm

#199 Job#1 on 04.28.21 at 10:07 am
#147 Faron

“It’s about maximizing impact.”

How does prioritizing a racial subset of people in a hotspot postcode do that? To carry the question to a further absurdity, would you prioritize only the blacks working in Amazon fulfillment centres?
To paraphrase John Cleese, you are…utterly immune to the ravages of intelligence.
—————
The only thing I have to say is that people who quote other (mostly famous) people have no own opinions.
Followers, they are.

#28 Former Navy Chief on 04.28.21 at 2:55 pm

#16 Island Gal

My humble advice is to start slow and low.

I signed up for one of those apps (Moka) that round up your purchases and invest the money in low cost ETFs.

My returns are around 7% since I started, and the monthly fee is just $3.39 per month.

#29 ElGatoNerodeYVR on 04.28.21 at 2:58 pm

Sound advice from Garth . I started saving in my early 40’s from 0 and I can atest that this is a plan that works. In my mid 50’s sitting on a nice nest egg that would allow FI at 60.
The 1,500 a month would be tough to live on but 2k is more doable and pick-up a Saturday shift someplace( Home Depot ,fast food,hotel ,painting lawn mowing in the summer , snow shoveling in the winter ) to bring in another $500 a month. I did it for a few years until better career options presented.
10 years of this and you are set; and definitely do not buy a place.
If you think jobs were tough to find before with layoffs just wait till you hit 50 and nobody wants to hire you so preserving cash flow and mobility is crucial.

#30 Rook on 04.28.21 at 3:01 pm

#24 Ray on 04.28.21 at 2:42 pm

Where do you suggest in investing in low cost ETF Funds

———————————

Not Mr. Turner, but if I recall correctly, here’s what I’ve learned from the blog:

You want roughly 40k (40%) into fixed income – government bonds, corporate bonds, preferred (dividend paying shares) and inflation protected bonds.

You want 60k (60%) into growth etfs (stocks). You can purchase a lot of etfs that are set up to mirror the performance of the major indexes. S&P, TSX, etc, in USD or CAD. The idea of the index etfs is they mirror the performance of the actual indexes (minus the fees, of course). You want some exposure to Canada, some to the US, some to the emerging market and some wherever else you please.

I’ll shy away from recommending specific symbols (I’m not sure if I’m even allowed to), but I will recommend morningstar.ca. They have a great etf and stock screener that allows you to look up various ETFs, their performance, and how much they charge in fees.

If you’re dead set on ETFs, stick with big guys for now: Vanguard, BMO, Citadel, possibly ishares. ETFs from all of these companies can be bought essentially like stocks – punch in the symbol and the number of units you want to buy.

Pick your asset allocation, pick the stocks you want to buy in which proportions, pull the trigger, then go away. In 6 months, come back and re-balance to bring your portfolio back in line with your allocation: buy what’s lost money, sell what’s made money. Don’t try to time the market, don’t try to pick individual stocks, don’t look at your portfolio every day.

Best of luck!

#31 wallflower on 04.28.21 at 3:05 pm

Zelda is spectacular.

I am perplexed as to why more younger people do not relocate to cities like Thunder Bay. This might be something to consider for this couple IF home-owning becomes important. (Good size city offering all amenities including the most scenic area in Ontario within urban distance. Super outdoor features.)

The one enormous problem with renting (which, btw, I recommend ALL young people do) as an ongoing model is the constant threat and reality of being bumped out since rental is now predominantly small landlord and condo-type offers. It is super difficult to find purpose-built rentals. Those are mostly retained infinitum by current inhabitants.

#32 Scott on 04.28.21 at 3:08 pm

@ #25 Garth’s reply

Too true! I think it’s great advice from Sail away if some one asked how to educate themselves on how to invest. Not the case at all. If some one has the interest to do that they’d find the info them self (as many on here have I suspect).

#33 the jaguar on 04.28.21 at 3:11 pm

Mercy. I see Job#1 has climbed into the ring. Anybody know what a “Pyooma” is?

#34 Ponzius Pilatus on 04.28.21 at 3:11 pm

Risk in renting: Social shaming.
Ha, So true.
When I came from Vienna, Austria, where about 70% are renting and feeling no shame, I quickly found out that in Canada, without a piece of dirt to your name, you are a loser.
The good thing is, that I was already married.
Otherwise, the prospect of finding a mate would have been almost insurmountable. (if you marry that renter, I’ll disown you!).
The good news is, after a few years , I had scapped together enough for a down payment and was finally able to partake in the “pride of ownership”.
And was  able to go out without keeping my head down in shame.

#35 Phylis on 04.28.21 at 3:11 pm

Is it legal to rent tfsa space to someone? Silly thought I know, but it could be done with a pinch of trust.

#36 Tudval on 04.28.21 at 3:14 pm

Let’s be honest now. $5,500 net a month is well below average in the GTA. In fact, I think many homebuyers make more than that on one income. But there are still 2 bdrm condos for about $500k in the city, which are not so bad. If interested, I will give you the location. 10 mins from downtown. Hey, If my in-laws could raise two very successful kids in exactly one such condo and also had a pretty happy life, why should I sympathize with anybody who says it’s too modest for them?

#37 Jackie Tullo on 04.28.21 at 3:19 pm

Will someone kindly explain to me how my 45yr old son, who receives $900/month on ODSP, is supposed to survive in this economy? They aren’t allowed to invest (he can’t afford to anyway) and owning any assets worth over $30k will get him kicked off. I really fear what’s going to become of him when I’m gone… What are we supposed to do with these individuals? Toss them under a bridge?

#38 Ponzius Pilatus on 04.28.21 at 3:20 pm

#25 Sailo.
Let’s say yu ARE an engineer and an owner of a very successful company.
Then you should calculate in the opportunity cost of your “hobby”, to come up with the true value of your self directed investments.

#39 Polecat on 04.28.21 at 3:21 pm

Good job C nothing wrong with renting. Wife and I selling our place and renting. Can afford to buy but why? You’re better off on the course you’re on.

#40 oops on 04.28.21 at 3:26 pm

#25 Sail Away on 04.28.21 at 2:49 pm

– Oops

#41 Sail Away on 04.28.21 at 3:28 pm

Re: “Why on earth would she need to take months to educate herself on ‘markets, allocations, procedures and implications’? Should she also take a mechanic’s course before she buys a car? Get real. – Garth”

———–

For a car, I’d recommend significant research on Consumer Reports.

If she intends to do mechanical repairs herself, then yes, a mechanic’s course would be prudent.

#42 crowdedelevatorfartz on 04.28.21 at 3:30 pm

They seem to be doing everything right.
Crushed the debt.
Saving and investing.
Staying out of debt.

Whats not to like.
The first $100,000 saved/invested seems impossible.
It took me 10 years.
After that it just keeps growing as they keep investing.
They will be fine.

#43 Andy on 04.28.21 at 3:38 pm

Slimeball real estate agents in Ontario:

https://www.cbc.ca/news/canada/hamilton/hamilton-real-estate-broken-rules-1.5996591

#44 Job#1 on 04.28.21 at 3:40 pm

#10 Faron

I read your linked tweets. I refuse to conflate health issues with racial grievances. Nor do I recognize US gov. agency pronouncements as relevant to Canada.

Tell me how my application will fare at this spigot of public largesse:

https://pm.gc.ca/en/news/news-releases/2020/09/09/prime-minister-announces-support-black-entrepreneurs-and-business

#27 Ponzius Pilatus

What does who I choose to quote have anything to do with this issue? I admire his turn of phrase, amongst the other achievements of his life and career. You seem to prefer the cheap shots, while avoiding the issue itself.

#45 Job#1 on 04.28.21 at 3:46 pm

#33 the jaguar

I trust it is a veiled and vulgarly distorted reference to thyself.

#46 T on 04.28.21 at 3:47 pm

Renting is freedom who cares what others think?

#47 TheDood on 04.28.21 at 3:49 pm

#14 Barry on 04.28.21 at 2:12 pm
Wise words Garth. My advice – they would be mad to buy a home. All I’m hearing is a suck – you – in sound, a.k.a debt peonage. Aside from your commentary they should use their TFSA to the max as between both of them there is about $150,000 in contribution room. What a gift! Wife and I diligently contributed and invested in large cap dividend growers staight off from 2009 and presently we have an income of almost $17,000 (if we needed it) which we reinvest combined with the $12,000 per annum additional contribution. The price of stocks go up and down but it’s the secure income we’re after … BCE might be a start just for the present 6% yield and annual dividend growth.
_____________________________

Whether they realize it or not, they are in a great position, and were given some priceless advice. Just run with it and don’t look back. Anyone in a lower income bracket considering RE purchase in Canada right now are fools. Forget the house, go for the income instead.

#48 Ustabe on 04.28.21 at 3:52 pm

#16 Island Gal on 04.28.21 at 2:14 pm

OK, I’m finally in a position where it makes sense to open one of those “low cost ETFs”. I’m not sure what that means…~~~… But, do all financial advisor’s sell low cost ETFs? How do I tell the low cost advisors from the high cost advisors?

It is not nearly as complicated as some would have you believe. To start go to https://www.reddit.com/r/PersonalFinanceCanada/
and scroll down, nearly to the bottom of the page. Look on the right hand side and you will see a header saying Wiki/Frequently Asked questions. Click on those links one by one, read then over a week or so or binge them tonight.

Just like here ignore the majority of the comments below any topics on the main page.

#49 Sail Away on 04.28.21 at 3:54 pm

#38 Ponzius Pilatus on 04.28.21 at 3:20 pm
#25 Sailo.

Let’s say yu ARE an engineer and an owner of a very successful company.
Then you should calculate in the opportunity cost of your “hobby”, to come up with the true value of your self directed investments.

————

Sure, for argument’s sake, let’s pretend that’s the case.

Let’s go with $100/hr take-home at 50% tax rate. 2,000 hours = $100k opportunity cost every ten years.

Benefit achieved? Exponentially more.

Also, when you’re very interested in a subject, you learn and retain it thoroughly. Interest is the secret sauce.

#50 Lee on 04.28.21 at 3:55 pm

The analysis ignores inflation. In 20 years the $112,000 will feel like $60,000. And taking 6% off of the top of the B&D portfolio leaves little inflation protection except to the extent dividends are increased by the companies the ETFs invest in. Then again, people can get by on $60,000.

#51 Habitt on 04.28.21 at 3:59 pm

Awesome response to Courtney Garth. Thanks.

#52 mark on 04.28.21 at 4:00 pm

Well done on the couples inroads with your finances, your on the right track.

I think we are in the 1st inning with the virus, it has taken the low hanging fruit, and now has hit India. Think about it its a poor country those that survive live a lot of the time in very unsanitary conditions, they survive Because they have good immune systems that have kept the masses alive.
Granted they have limited health care, but for the virus to hit and kill so many, I predict in north America we have seen nothing yet and I hope I am wrong and this bug gets squished. I doubt it prepare, now its hitting the young people. This is years from being over.

#53 Bowser on 04.28.21 at 4:05 pm

Listen to the man, 15 years ago, I was $30k in debt thanks to the tech bubble bursting years prior and not being to find work for 2 years. Today, I’m closing in on $350k in liquid assets that keep spitting out dividends every month. Currently 41 and plan to retire by 50.

Also, don’t forget your wages go up over time as well as you become more experienced in what you do. I started my career at $27k in 1998 and now making well over $100k. Most of it goes into my investments every month after I paid off my bills.

Oh, and I rent… lol

#54 Dr V on 04.28.21 at 4:12 pm

“Saving thirty grand a year will allow filling both TFSAs annually, put enough in two RRSPs to offset most taxes (about $6,000 each), and still land another six grand in a joint non-registered account.” – Garth

https://assets.ey.com/content/dam/ey-sites/ey-com/en_ca/topics/tax/tax-calculators/2021/ey-tax-rates-british-columbia-2021-01-15-v1.pdf

Assuming an even split income, $5500/mo = 2 X $38000 taxable annual income.

From the link, in BC, there is a “sweet spot” in the $35-42k range where the tax rate actually drops. If
retirement income were to drop to below $35k, then at least some of the RRSP income would be taxed at a
higher rate than the deduction.

So maybe the suggested RRSP contribution should be
lowered, at least until a higher current marginal rate is
reached.

#55 Daveyboy on 04.28.21 at 4:17 pm

I’ve just made enough money in the markets in the last month to pay my rent off for the next year.

Thanks Garth!

#56 oops on 04.28.21 at 4:24 pm

#41 Sail Away on 04.28.21 at 3:28 pm

Tone.

you’re not the rescuer.

Either are the other $hit-heads who think they’re better.

#57 Brian Ripley on 04.28.21 at 4:27 pm

My Canadian Housing Starts vs Census since 1955 charts up with the March data: http://www.chpc.biz/housing-starts.html

​It looks like a breakout of housing production above the long term downtrend since the mid 1970s continues to be on hold.

I have added a table and chart of the decadal percentage changes in all provincial housing starts over the last 4 decades and since the respective provincial peaks… the biggest outlier province is Alberta where starts peaked in 2006 and now in March 2021, they are 51% below the peak.

Total Canadian starts are down 3% from last year, up 6% from 10 years ago but are down 22% from the peak in 1976.

A common complaint by developers is the dearth of available land. One part of the solution could be rezoning.

​The “improvement” that sits on the land is a wasting asset. If serviced land is so valuable, shouldn’t the ratio be 1 house equals at least 3 townhouses or 4 condos?

On the March data, Single Family Detached Sellers in:
Vancouver wanted 1.9 T-houses or 2.7 condos in trade
Calgary wanted 1.8 T-houses or 2.3 condos in trade
Toronto wanted 1.8 T-houses or 2.1 condos in trade
http://www.chpc.biz/6-canadian-metros.html#Crazy

#58 Stoph on 04.28.21 at 4:28 pm

#16 Island Gal on 04.28.21 at 2:14 pm

————————————————————-

The Globe and Mail has a comparison of different DIY online brokerages.

https://www.theglobeandmail.com/investing/markets/inside-the-market/article-the-2021-globe-and-mail-online-brokerage-ranking-whos-best-for/

I’d pick a brokerage that has no annual fees, and free ETF purchases for the ETFs you plan on investing in. I’d start by looking at whichever bank you currently use to see if their online brokerage meets your needs.

#59 the jaguar on 04.28.21 at 4:28 pm

@ 45 JOB#1. I do not recall participating in any debate such as the one you are currently engaged in, but my thinking runs along the lines of Thomas Sowell, whatever the Ferret might say about it.

#60 Joseph R. on 04.28.21 at 4:29 pm

The 4% rule is bunk. Garth

———————————————————

I am curious as to why you say that? William Bengen, the inventor of the 4% rule stands by his rule; It is still taught at all major retirement preparation websites. Mr Bengen did, update “SAFEMAX” in October 2020 from 4% to less than 5%, “depending on inflation”:

https://www.fa-mag.com/news/choosing-the-highest-safe-withdrawal-rate-at-retirement-58132.html?issue=334

It’s based on an outmoded asset allocation model. – Garth

#61 Dolce Vita on 04.28.21 at 4:34 pm

American’s and their new mask guidelines from CDC.

Here I thought Italia had gone mad with its Zona Rossa, Arancione, Giallo and Bianco designations for risk and what you can and can’t do.

4 colors. Basically, unless white, stay home, wear a mask in publi.

Not to be outdone, the Americans have this for masks, scroll to see both “handy charts”:

https://www.businessinsider.com/chart-cdc-new-mask-guidance-for-fully-vaccinated-explained-2021-4?IR=T

Only 3 colors and a dizzying array of images to remember where I would just say in the end:

I’m wearing a mask until it’s all over, vax or not.

————————

For all you BC people, from NIH on the Brazil variant:

“This variant carries a unique constellation of mutations that allow it not only to sneak past the human immune system and re-infect people, but also to be about twice as transmissible as earlier variants.”

Health Officer Moonbeam neglects to inform the populace about that. But it’s all good there.

It also dodges the VAX and infects.

https://directorsblog.nih.gov/2021/04/27/tracking-the-evolution-of-a-variant-of-concern-in-brazil/

#62 crowdedelevatorfartz on 04.28.21 at 4:37 pm

@#37 J T
“Will someone kindly explain to me how my 45yr old son, who receives $900/month on ODSP, is supposed to survive? ”

+++++

Until a Universal Basic Income is implemented ( which I highly doubt will ever get past voters/taxpayers).
The brutal reality….
You son is relegated to what amounts to welfare.
The govt hands out juuuust enough to survive in the hopes that people will eventually go back to work.

#63 crowdedelevatorfartz on 04.28.21 at 4:39 pm

@#42 Joseph R

I expect and plan on a 5% annual return and if the annual returns are higher than that ( they usually are)….. so much the better.

#64 Howard on 04.28.21 at 4:40 pm

Condo insurance going up you say?

https://www.thestar.com/news/gta/2021/04/28/viral-video-shows-niagara-falls-flooding-in-north-york-condo.html

#65 crowdedelevatorfartz on 04.28.21 at 4:41 pm

@#56 00ops
“Either are the other $hit-heads who think they’re better.”

++++

Everyone thinks they’re better…..Mom told them so……

#66 Faron on 04.28.21 at 4:46 pm

#44 Job#1 on 04.28.21 at 3:40 pm

#10 Faron

Tell me how my application will fare at this spigot of public largesse:

I don’t know. Self-identify as black and give it a whirl. At best you’ll get a loan that you will have to pay back. Second best you’ll have a case before the Supreme Court for a charter violation by the GoC. At worst you’ll get laughed off the stage.

You may want to converse with black Canadians to see how they are succeeding in gaining the ability to borrow sooo so much money ($25k to $250k a pop — you know, anywhere from a tenth to a half of the avg cdn home loan we all know are being handed out like candy). And you may want to look at the for-profit banks that are partnering likely because they stand to rake in interest payments which will then help feed their divvies which will land in your pocket anyway.

#67 Trojan House on 04.28.21 at 4:49 pm

Bad things are happening in Ontario’s real estate market.

https://ca.finance.yahoo.com/news/bad-things-happening-ontario-real-080000554.html

I know this probably happens all the time. Apparently, complaints are up at RECO.

#68 Dave on 04.28.21 at 4:49 pm

I live in a hot spot of Ontario. L7C. Only 20% test positive for covid. We can increase that number. Neighbor across the street is trying to increase it. Neighbors son is over with his girlfriend. We are in lockdown! His sons car is getting summer tires installed by dad. Daughter has been coming and going out of other people’s cars. Not social distancing. B.1.617 loves stupid people and loves to be with young people. B.1.617 really appreciates when the young kids go and see the old folks too so that it can visit with them too. Only a matter of time now.

#69 Jackie Tullo on 04.28.21 at 4:50 pm

#62.

It’s a sad day in this country indeed when society’s most vulnerable are turning to assisted dying as a viable option simply because they can no longer afford to live. Google it and see for yourself.

What an absolute disgrace of a nation we have become…

#70 Dolce Vita on 04.28.21 at 4:53 pm

The advice was good today Garth.

Simple. Straightforward.

And to stick with the plan.

————————-

Speaking of advice, I came across this “VAX Olympics” Tweet about Canada vs. World and our FANGURL, Minister Anand, liking it:

https://twitter.com/jmt_18325/status/1387086360163483651

Rude. Insensitive. Beyond words.

Canada and the few rich nations of the World last year engaged in bilateral agreements with vax manufacturers, many as it was not known which would succeed.

Why Canada bought more doses that it needed.

Meanwhile, the VAST MAJORITY of humanity live in countries that could not afford this largesse. BILLIONS of them.

In effect, the above Tweet RUBS THEIR NOSE in it and reminds them that their lives are worth less in terms of who gets the vax and not.

Ask Brazil and India how that fact is working out for them.

——————–

Minister Anand and Canadians:

Knock off the Vax Olympics rhetoric its DISGUSTING. You sicken me with your lack of sensitivity to the plight of other human beings in less fortunate countries.

#71 Doug t on 04.28.21 at 4:55 pm

Keep up the good work Courtney – your going to be fine

#72 Sail Away on 04.28.21 at 4:56 pm

#56 oops on 04.28.21 at 4:24 pm
#41 Sail Away on 04.28.21 at 3:28 pm

Tone.

you’re not the rescuer.

Either are the other $hit-heads who think they’re better.

———

My goodness. So vulgar.

#73 Doug t on 04.28.21 at 5:02 pm

#56 oops

Yeah sailaway def has a “tone” – the kind that makes people leave a party early

#74 Northshore guy on 04.28.21 at 5:03 pm

5500 Deerhorn Lane, North Vancouver
Listed for 2.698
Sold for 2.870
Previously sold for 2.095 in Jan 2016

Prices i n that neighborhood tanked in 2019, if the sold in 2019 they would have lost money.
What the hell is the buyer thinking??

#75 Squire on 04.28.21 at 5:13 pm

Good luck Courtney. Garth has just shown you two paths. Choose wisely and as they say, the husband is the head but the wife is the neck and she can turn the head. I know i would choose the option of watching money coming in not out.

#76 R on 04.28.21 at 5:13 pm

Normalization is beginning, just as Garth said it would. Interest rates will slowly increase, WFH will fade, we even might be able to go to see a ball game, maybe even this summer. ( foolish optimism ?)
https://financialpost.com/fp-work/its-time-to-return-to-the-office-jamie-dimon-signals-to-wall-street

#77 crowdedelevatorfartz on 04.28.21 at 5:17 pm

If you own a penthouse in Downtown Vancouver and feel like making some money…….

The penalty for 3 flagrant violations of the Covid Health protocols and running an illegal, unlicensed bar ?????

https://theprovince.com/news/local-news/vancouver-man-who-police-say-ran-condo-nightclub-pleads-guilty-to-health-charges

#78 espressobob on 04.28.21 at 5:24 pm

Investing? Tough subject.

Some try to take on a contender in a way heavier weight class. Good luck with that. DIY. A few can do this on the other hand.

Most start with the bank. The staff will try to razzle dazzle with past performance a certain mutual fund provided. Being unaware the customer sees this as a no brainer and swallows hook line and sinker. The outcome is usually below the benchmark and over time but the portfolio grows ever so slow.

The day comes after years of piling into said funds were its time for the banks division thats specializes in this area. They post on TV all the time. The dreaded commisined advisor again with mutual funds and the hood wink. How about those rear loaded versions your stuck with because its in your best interest? Not bad for the advisor who pockets a nice cheque in the process. More underperformance ensues. Nuts.

Then there’s the fee based advisor. A more ethical bunch that usually charge around 1% of ones entire portfolio for services rendered. Some of which is tax deductible. You find yourself owning ETFs ( exchange traded funds ) with low Mers ( management expense ratio ) that track major indices.

The real problem is to qualify for fee based management a minimum is required ( same for commissioned). Most start at 750k, Garth I believe is generous at 150k. But you would have to ask him.

It’s rough starting out since there’s a gap in the industry. This is what I dont understand.

#79 Linda on 04.28.21 at 5:25 pm

Courtney & squeeze should indeed avoid purchasing RE in Canada right now – unless they somehow manage to score a $1 ‘as-is’ house with land deal somewhere. Build the TFSA first – if they are earning minimum wages then RRSP tax deferral isn’t really the best bang for their current buck & under no circumstance succumb to purchasing a condo. Condo fees plus possible special assessments are not a good idea.

#80 45north on 04.28.21 at 5:27 pm

Patty This story is inspiring. The hard work and sense of responsibility shown by this couple is an example to all of us.

yep

#81 45north on 04.28.21 at 5:28 pm

Rook If the bottom falls out, the government will likely bail out the home-owner voting bloc;
What would said bail-out look like?

extra security on Parliament Hill

#82 Grey Dog on 04.28.21 at 5:29 pm

Garth, you continue to be an inspiration!

I wish all good that can happen in life to this wonderful responsible couple that can live within their means. Peace of mind.

I’m so enjoying your Dog of the Day Daily feature.

#83 KK on 04.28.21 at 5:44 pm

Garth, did you take inflation into account in your projections? Also, the problem with renting is that you’ll have to pay rent until the day you die, and the amount only keeps growing.

Of course a properly-managed B&D portfolio is routinely adjusted for inflation. But so what? How does worrying about future cost-of-living increases make one iota of difference in saving and investing behaviours? AS for rents, they are politically suppressed in most places. – Garth

#84 Dolce Vita on 04.28.21 at 5:54 pm

#76 R

we even might be able to go to see a ball game, maybe even this summer. ( foolish optimism ?)

——————————

Maybe. Maybe not. Depends what day of the week.

Doses/day (yesterday) = 256,320

Cdn Population ≥ 15 yrs old = 31,966,591 or 63,933,182 jabs needed.

Jabbed to date = 12,762,080 or 51,171,102 jabs to go.

Take jabs to go ÷ doses/day = 200 days when all 32M twice jabbed:

Nov 13, 2021.

If herd immunity is 80% then repeat above 40,936,882 jabs to go and you get:

Oct 4, 2021.

—————-

If instead, and Provinces getting better, you single jab everyone and forget about 2 jabs for now done by, 32M single jabbed:

July 11, 2021

Ratio of single to double doses = 11. Used to be 7 not even a month ago. So Provinces leaning to all jabbed once then twice later. Good I think.

To answer your question:

CFL ✓
Blue Jays ✖
Les Canadiennes ✓
Toronto FC ✖

Serie A Milan AC ✓

And it depends if vaxing M-F. Weekends about 2/3 of weekday rate. Just like what my Dad would say that ESSO stood for:

Every Sat Sun Off.

#85 George on 04.28.21 at 6:04 pm

Great entry Garth

Thanks

#86 Job#1 on 04.28.21 at 6:08 pm

#66 Faron

So, blacks are the only ones NOT”… succeeding in gaining the ability to borrow sooo so much money”? Their special status will not solve the problems of others in the same circumstances. How can anyone view this program as other than discriminatory?
Over a million people in Ontario have no family doctor. No continuity of care, or follow-up, when your options are limited to walk-in clinic or ER. This is the real basis of the problems we face; a lack of medical resources. All of us, regardless of colour, race, or ethnicity, are disadvantaged to a greater or lesser extent by this systemic failure. To suggest that race-based policies can correct this fault is ludicrous.
I will conclude by pointing out that none of this rationing and prioritizing of vaccine recipients would be happening if we had adequate supplies. Nor would we have to extend the interval between shots.
-BTW, Pfizer reiterated today that only their original interval of 21 days is supported by clinical trials to achieve the desired efficacy. The real elephant in the room!

#87 Kilt on 04.28.21 at 6:09 pm

Live off $1500 a month? Two adults. Seriously? Good luck with that. Not impossible, get rid of the car though.
Maybe they should focus on a more realistic monthly savings goal. Once achieved, then focus on where you can cut costs.

Personally, I would be concerned. Twenty years from retirement and you need to live off KD and Netflix in order to avoid eating cat food later on. And you are probably in better shape than many. Only differences is, they aren’t fretting about the future.

Kilt.

#88 Ponzius Pilatus on 04.28.21 at 6:11 pm

#54 DR. V
You really seem to be very knowledgeable in tax issues.
My Dr, like some other Doctors I know, have no clue.
My Dr. always asks me for tax advise, but I tell him that I’m a CPA, not a tax accountant.

#89 mom in law sweet on 04.28.21 at 6:15 pm

one warning…save and squeeze and clip and bike for forty yrs= nice nest egg…then u drop dead.. hope you enjoyed your life…

As opposed to what? Living large on their low incomes? – Garth

#90 Steven Rowlandson on 04.28.21 at 6:38 pm

“So if you can live on $1,500 a month after rent that leaves $2,500 a month to save and invest. ”

First of all $1500 a month is a good month for income these days for me and not all months are that good.
How do I do it? Until March 2014 I paid $428.50 for rent, $5,200 vehicle costs per year and $100 per week for food. The rest was savings which was mostly gold or silver after 1990. After 2020 I got my inheritance and tried a balanced growth mutual fund in a TFSA and that is the financial experiment. I increased my gold holdings by a bit and maintain a slush fund to tide me over and add to the mutual fund at the start of the year. The thing one must remember is that if something is unaffordable I don’t touch it with a 10 light year long pole and that largely means real estate and new vehicles which are just as bad price wise as homes for sale or rent. I now live in the Honda Hilton
There are two kinds of investor in Canada. The monopoly game player and the stock ticker game player. Both games were created in the 1930s and one is a closed system that screws players over and the other is an open system that is less likely to do so if there is no bad luck or cheating. I am the stock ticker game investor. What kind of investor are you?

#91 Faron on 04.28.21 at 6:50 pm

#58 Stoph on 04.28.21 at 4:28 pm

#16 Island Gal on 04.28.21 at 2:14 pm

I’ve used Qtrade, rated A in Stoph’s link, and was happy. Keep a small monthly inflow or min balance and there are no annual fees. They have a selection of free-to-trade ETFs as long as you trade $1000 or more. XBAL/XGRO included. They aren’t the best, but should get you started and for free if you are careful. I’ll leave it to others whether XBAL or XGRO are the finest options.

Best of luck.

#92 Ponzius Pilatus on 04.28.21 at 6:58 pm

#83 KK on 04.28.21 at 5:44 pm
Garth, did you take inflation into account in your projections? Also, the problem with renting is that you’ll have to pay rent until the day you die, and the amount only keeps growing.
—————–
I get the emotional arguments for owning.
However, the financial arguments for owning don’t have a leg to stand on.
The concept of opportunity cost seems to be too complicated for most.

#93 Stone on 04.28.21 at 6:59 pm

#16 Island Gal on 04.28.21 at 2:14 pm
OK, I’m finally in a position where it makes sense to open one of those “low cost ETFs”. I’m not sure what that means. I know what the idea of the funds are….but where do you get them? Can I get them from an investment advisor? Or do I have to buy them from Questrade or something similar. I don’t think I’m in the financial ballpark for Garth Quality….. I’m just looking to start with a couple thousand dollars. But, do all financial advisor’s sell low cost ETFs? How do I tell the low cost advisors from the high cost advisors?

———

1 – Ensure you have an emergency fund first with a few thousand in it before moving to next steps.
2 – Open a TFSA (Tax Free Savings Account) with Questrade. Canadian ETFs are free to buy with them with Questrade. They will not charge you a fee to do that. $9.95 fee though for each time you sell which you likely won’t do for many many years to come (which is why it’s important to have an emergency fund first). The max annual contribution currently at $6000 for the TFSA. Don’t go over that amount or you’ll be penalized by CRA 1% per month on the over-contribution.
3 – If you have more than $6000 to invest per year, consider opening up an RRSP (Registered Retirement Savings Plan) as well. If you don’t have any RRSP contribution room available, open up a non-registered cash account with Questrade instead.
4 – If you’re unsure how to open a TFSA or RRSP with Questrade, call their 1-800 number and have the agent on phone walk you through the account opening process. They are there to help you and grow the number of accounts they manage so win win for you and them.
5 – If you’re really clueless (I’m not trying to offend by saying that, just basing myself on what you explained) on what ETF to buy, just purchase an all in one ETF portfolio from them based on your risk tolerance. The agent on the phone will walk you through this as well. That’s what they’re there for.
6 – Continuing on #5 above, if you feel comfortable enough to purchase individual ETFs instead of an all in one ETF portfolio, then you can consider the following:

VSB 20%
ZPR 20%
VCN 20%
XAW 40%

Again, the agent on the phone at Questrade can walk you through how to buy them so you gain some practice and confidence.

The most important thing is that you contribute regularly and grow your investments no matter whether markets are tanking or rising.

If Garth craps on the advice I gave above, ignore everything I mentioned above.

Do you work for Questrade? I’d pick a robo. – Garth

#94 crowdedelevatorfartz on 04.28.21 at 7:00 pm

@#89 Mother in Law Suite
“one warning…save and squeeze and clip and bike for forty yrs= nice nest egg…then u drop dead…

OR
You dont drop dead.
You live for another 30 years and you have some savings……..
I have staff working for me that have never saved a dime in 55, 65 and 67 years.
CPP and OAS are their only hope ( and kids to build an In-Law Suite)

Great toys.
Great holidays.
But NOTHING saved.
They will work until they die or cant do the job.
Either way.
They only have to look in the mirror and admit their spendthrift profligate ways are to blame for their situation.
But they won’t.

#95 Bert on 04.28.21 at 7:13 pm

I hope you’re ready for a 90-95 cent Canadian dollar. The BOC going in one direction and the FED going the other coupled with oil and commodities is going to squeeze the $CAD higher and higher.

#96 DON on 04.28.21 at 7:38 pm

#9 Rook on 04.28.21 at 1:54 pm
There was an article in the G&M today about how real estate is ripping apart Canada’s social fabric.

There was another one in the NP about how Toronto condos might be the best game in town right now.

So, dear readers, just for funsies, let’s play a ‘what if?’ experiment. Given the following:

1. the government has declared it won’t do anything to housing, and;

2. If the bottom falls out, the government will likely bail out the home-owner voting bloc;

What would said bail-out look like?

***********

How about asking that question after the upcoming expected election in October. If a majority is achieved for four years. Over indebted house owners ‘feeling the pain’ will be reminded that they are adults and are responsible for their own financial well being. Besides the gov will be focused on the impacts to the broader economy/community.

Did the US bail out their home owners? Spain? Ireland?

#97 Alex Mark on 04.28.21 at 7:39 pm

Real estate insanity – Canada is off the charts
http://www.investmentwatchblog.com/real-estate-insanity-canada-is-off-the-charts/

#98 Planetgoofy on 04.28.21 at 7:49 pm

Okay, so what if you buy real estate? Garth

At 60?!
But your suppose to buy RE in your youth as I did.
I owned 2 duplexes in Kelowna when I was 24 / 1990.
Now I have a pile of paid for RE..7 figs and a mil cash.
Inflation makes you look smarter than you are. Just look at me.
I wouldn’t buy right now or sell.

#99 DON on 04.28.21 at 7:55 pm

I think Courtney and her hubby have shown resilence and the ability to turn things around. They took responsibility and made a plan. They stuck together and came out from under lrss than appealing circumstances. Lessons learned. I would consider it a pleasure to know folks like this.

What kind of jobs are you looking for Courtney? Maybe someone on this blog knows someone. You never know. Keep on grinding away and be kind to yourselves.

#100 Late Start on 04.28.21 at 7:55 pm

This situation mirrors my situation to a tee but my wife doesn’t work, I have a defined benefit pension (for now), and I’m 50 this year. Don’t have quite as much to invest but close. I’ve been following Garth’s advice for the last few years and its given me more hope and confidence than any advice I’ve ever received.

You have a massive impact on people’s lives Garth. More than any other politician in my lifetime. If the Cons could nominate an old school Progress Conservative they’d have a convert for life.

#101 the Jaguar on 04.28.21 at 7:56 pm

I like the way this adorable little creature Zelda meets the camera eye. ” I might be small, but I am mighty” she seems to say.

#102 DON on 04.28.21 at 8:01 pm

#31 wallflower on 04.28.21 at 3:05 pm
Zelda is spectacular.

I am perplexed as to why more younger people do not relocate to cities like Thunder Bay. This might be something to consider for this couple IF home-owning becomes important. (Good size city offering all amenities including the most scenic area in Ontario within urban distance. Super outdoor features.)

The one enormous problem with renting (which, btw, I recommend ALL young people do) as an ongoing model is the constant threat and reality of being bumped out since rental is now predominantly small landlord and condo-type offers. It is super difficult to find purpose-built rentals. Those are mostly retained infinitum by current inhabitants.

************

In the last couple of years there has been a push to build massive rental apartment buildings like the ones in Langford and Parksville BC

#103 Dr V on 04.28.21 at 8:02 pm

88 Ponzie – 25 years ago I bought a small business corp. My accountant would split the income equally between me and Lily, also both contribute to CPP. He is all about the tax. Minimize, avoid and defer. A little self study at the time showed me RRSPs are not always the most tax efficient choice. This year I will make a big RRSP contribution as I will take a large wage and try to
wind down that corp.

Then we’ll see how to best draw that money out without attracting too much tax. Combination of public pension, RRSPs, non-reg and divvies from corp. TFSA doesn’t even enter the equation (bonus!)

Where I get lost is the corporate stuff. Losses carried forward etc.

#104 Km on 04.28.21 at 8:10 pm

@island gal
Tangerine or wealth simple. Pick a balanced portfolio and start plugging in money.

#105 Nonplused on 04.28.21 at 8:12 pm

I probably wouldn’t have recommended a savings rate quite so high but on the other hand investing early allows more compounding. My thinking is living on $36,000 a year when you are working so you can have $78,000 a year in retirement seems a little back heavy. But hey it never hurts to have money in the bank.

#106 Nonplused on 04.28.21 at 8:36 pm

#204 Job#1 on 04.28.21 at 11:25 am
This should produce a few giggles…

Daily Mail US
@DailyMail

“Hunter Biden will guest teach class on ‘fake news’ at Tulane this fall.”

https://twitter.com/DailyMail/status/1387140713301909512

————————————-

At first I thought it must be The Onion or The Babylon Bee, but no.

#107 Stone on 04.28.21 at 8:36 pm

#93 Stone on 04.28.21 at 6:59 pm

Do you work for Questrade? I’d pick a robo. – Garth

———

Nope and never have. Happily retired. In her case, a robo is fine too. I just like them.

#108 Dr V on 04.28.21 at 9:14 pm

16 island Gal – good advice from Stone, garth & KM, maybe others too.

Stone’s is good if you think you’ll be comfortable and reliable enough to do so regularly.

Garth’s is good but beware the robo-advisor as there can be an extra cost for re-balancing that you can do
yourself.

If you’re young and just starting, I might suggest a simple portfolio of index funds equally split between Canadian, US and international stocks, plus fixed income. RE, Emerging markets, and preferred shares can wait. Regular contributions thereafter, all within your TFSA, so know your limits.

If you bank at RBC or TD they both offer low-cost index mutual funds, which you should be able to set-up small, regular contributions on-line. Set it and forget it.

Remember, fees are the enemy so avoid non-index MFs.

After a few years, you may wish to switch to ETFs to lower costs. If all done in TFSA, no tax consequence.

Good luck!

#109 crowdedelevatorfartz on 04.28.21 at 9:28 pm

Cullen Commission Update
Former RCMP officer,
Former Minister of Alcohol,
Former Solicitor General Rich Coleman.

2001:
Coleman’s Liberals Promised to Limit Gaming
Decided to “Modernize and Expand gaming”
Realized More cash revenue for govt.

2004:
Largest Expansion of gaming in BC’s History River Rock Casino is opened.
Decided the police didnt need to expand their gaming task force.
Casino employees warned Loan Sharks were openly working in River Rock Casino….

2009:
The Joint Task force on Gaming and money Laundering was cancelled.
Police were instructed to investigate guns and gangs.

2011:
Police were concerned about money laundering and gangs in casinos

When questioned today.
Coleman disagreed that dirty money was in casinos.

#110 Father’s Daughter on 04.28.21 at 9:34 pm

Maybe I’m oblivious to others opinions of me (would probably be for the best in this situation as I don’t care) but I have never felt the social shame of renting. My friends don’t know or care that we lease, my parents don’t care, my husband doesn’t care, my toddler etc.
Sure, we lease a whole house now for but for many years prior we lived in a cool but also sketchy apartment and still nobody seemed to care. Many of our peers live in big fancy houses. I don’t get this whole social shame of renting, I honestly don’t feel it..
I may be motivated to buy a house eventually, for many reasons, but peer pressure isn’t one of them
Also good luck guys! With continued discipline you’re not pooched and you’re in the right place

#111 Ponzius Pilatus on 04.28.21 at 10:28 pm

#103 Dr V on 04.28.21 at 8:02 pm
88 Ponzie – 25 years ago I bought a small business corp. My accountant would split the income equally between me and Lily, also both contribute to CPP. He is all about the tax. Minimize, avoid and defer. 
———————
That does not surprise me.
Many accountants and owners of smaller to midsize companies focus on minimizing taxes. 
My focus has always been on maximizing income and building the business.
Cutting down cost of  goods sold, and exploring more revenue streams.
Manage your Accounts Receivable.
A sale is only a sale once the payment is received.
Have a budget and a 5 year plan, which should be updated periodically.
Check what the competition is doing.

#112 kommykim on 04.28.21 at 10:40 pm

RE: #97 Alex Mark on 04.28.21 at 7:39 pm
Real estate insanity – Canada is off the charts
http://www.investmentwatchblog.com/real-estate-insanity-canada-is-off-the-charts/

========================================

That article is 99% nutbar material.

#113 Tanya S on 04.28.21 at 10:53 pm

Great post today … very applicable for so many younger people. We read daily, and you providing this couple with support made our day.

#114 NSNG on 04.29.21 at 12:02 am

The next election should be interesting. If the government wins a majority we will watch the face of it morph from a little puppy dog into a wolf.

#115 Fortune500 on 04.29.21 at 12:09 am

Garth thank you for profiling these two. More of these type of financial makeovers please. I come from parents who struggled and both rent. I have no inheritance either. We have worked hard to put ourselves in an better financial situation but I really appreciate someone remembering the renter, lower wage folk who are often completely ignored by the Canadian financial media.

#116 David Greene on 04.29.21 at 12:19 am

#37 Jackie Tullo on 04.28.21 at 3:19 pm

Will someone kindly explain to me how my 45yr old son, who receives $900/month on ODSP, is supposed to survive in this economy? They aren’t allowed to invest (he can’t afford to anyway) and owning any assets worth over $30k will get him kicked off. I really fear what’s going to become of him when I’m gone… What are we supposed to do with these individuals? Toss them under a bridge?

My heart goes out to you. Have you looked into an RDSP for your son? ODSP cannot touch RDSP money. Yes, you read that right. They can’t touch it.

If you or no other family members don’t have a lot of money to contribute, the federal government can provide matching grants and loans. Most financial institutions only allow you to have simple investments in an RDSP account, but TD Direct Investing allows you to invest in all kinds of securities.

I highly recommend looking into this.

#117 Longterm on 04.29.21 at 12:33 am

#61 Dolce Vita on 04.28.21 at 4:34 pm

It also dodges the VAX and infects.

*****

Really? Did you even read the document you linked to? And I quote:

“No doubt you are wondering what this means for vaccines, such as the Pfizer and Moderna mRNA vaccines, that have been used to immunize (at least one dose) over 140 million people in the United States. Here the news is encouraging. Serum from individuals who received the Pfizer vaccine had titers of neutralizing antibodies that were only slightly reduced for P.1 compared to the original SARS-CoV-2 virus [6]. Therefore, the vaccine is predicted to be highly protective. This is another example of a vaccine providing more protection than a natural infection.”

#118 crossbordershopper on 04.29.21 at 12:39 am

my 15 year old daughter saids why save? why would i do without? like its a crazy concept for her, if you can afford it, or get financing for it, or whatever its good.
i still pay cash for everyhing, old school , but i lived in the real world, where i didnt have consistant income. when i graduated there were no jobs, like no jobs, and it kinda affected my life ever since. the day will come with people will be lucky to get a minimum wage job.
i am jealous of people who make ok money for 30 years and end up with nothing , they must of had a really good time, better than i would ever have.
so, honestly maybe my daughter has it right, live for today. easy for here to say, since she will be only child and waiting for people above her to die, so she can have that viewpoint.

#119 Rural Rick on 04.29.21 at 1:04 am

#37 Jackie Tullo on 04.28.21 at 3:19 pm

Check out a Hensen trust for your son.
https://en.wikipedia.org/wiki/Henson_trust

#120 Nonplused on 04.29.21 at 2:45 am

#104 Km on 04.28.21 at 8:10 pm
@island gal
Tangerine or wealth simple. Pick a balanced portfolio and start plugging in money.

———————————

My wife was with Tangerine for years and they kept moving her into GIC’s. That was fine I guess when the introductory rates were north of 2% but then they kept auto-renewing at 0.01%. We’ve her over to an RBC manager now, not the wealth management folks but the girl they have for free and she’s doing a much better job managing RESP’s, RRSP’s, and a B&D portfolio, plus suggestions on what the savings rate needs to be to get to anything resembling a retirement goal.

So ya I don’t know, but I think the friendly girl at the bank is still not a bad choice if you haven’t attracted the attention of their wealth management group just yet. They make all the same suggestions as a robo trader but will also discuss things like goals and savings rates.

#121 Wrk.dover on 04.29.21 at 6:38 am

Best shot at saving, is to figure out your probable retirement income. Then immediately start to live at that level/save the rest. The retirement income will increase from that decision.

Saving is just a payment to yourself.

It started with us in our 50’s for a new car. $1000/mo.

We got the car and continue to save $1000/mo on $4000/mo 23 years later.

#122 Wrk.dover on 04.29.21 at 6:57 am

Edit: savings started mid forties.

Prior to that, extra money was invested in tangible homesteading assets/equipment.

#123 Another Deckchair on 04.29.21 at 7:24 am

@87 Kilt;

“Live off $1500 a month? Two adults. Seriously? Good luck with that. Not impossible, get rid of the car though.”

Yes. About 25 years ago, I was carless, and carted 2 kids around in a bike trailer or public transport for a while.

Do what you have to do when money’s tight.

Courtney – if you read this: These days, my partner and I could buy 100 cars without sweating, we only have 1 in the driveway, but we love living a simple life so the car sits quite a bit.

#124 Steven Rowlandson on 04.29.21 at 7:33 am

#4

$200,000 in Elliot lake isn’t affordable either.
Anything higher than 6,000 man hours at minimum wage is genocide.

#125 Felix on 04.29.21 at 7:51 am

What’s going on with the pathetic mutt in that picture?

It looks like it’s been abused and thrown in the dryer.

The relationship between humans and canines is dogawful.

#126 crowdedelevatorfartz on 04.29.21 at 8:45 am

Well.
Its good to know everyone but the govt is talking about the Covid loopholes in our borders…….

https://www.citynews1130.com/2021/04/29/walk-border-canada-taxi-home-instead-hotel/

#127 IHCTD9 on 04.29.21 at 8:54 am

C and hubs are living the reality of a post-Trudeau Canada, where policy inaction has allowed house prices to swell beyond the reach of most folks. It’s too bad, we canucks really need to own hard and liquid assets in order to attain any kind of prosperity going forward. Wages just aren’t going to cut it anymore.

Any Canadian who owns hard and sheltered liquid assets is way ahead of 99% of the wage earners. This will only magnify as wages continue to stagnate, be taxed/fee’d away, RE inflates, and inflation bites. The Libs are either either too stupid to understand the long term ramifications of their spending and fiscal policy inaction, or they just don’t care beyond getting elected.

Poster MR likes to say be a part of the change or be run over by it. In Canada, if you don’t own real estate and a pile of tax sheltered investments – then you will be the one getting run over.

We can pretty much thank the Trudeau Liberals 100% for this pathetic and likely terminal situation.

#128 IHCTD9 on 04.29.21 at 9:12 am

#121 Wrk.dover on 04.29.21 at 6:38 am
Best shot at saving, is to figure out your probable retirement income. Then immediately start to live at that level/save the rest.
____

We were in this boat through natural forces for over 1.5 decades. Simultaneous mortgage payments, tuition payments, investing deposits, raising 2 kids, and more. A few years we ran into overdraft almost every month. Lifestyle evolved around what was left over.

Today a lot of those costs are gone or on the way out, our income has also risen. Some lifestyle inflation has appeared – but in very mild form. We are completely accustomed to living off 25-30% of our current income. This never helped us to invest more, but I think it will come in handy during retirement.

#129 Dharma Bum on 04.29.21 at 9:21 am

That couple’s story both scared and saddened me.

The amazing part is that, for people in their situation, they are actually doing quite well. Way better than most.
How can people survive in this financial jungle with what amounts to a couple of minimum wage jobs? At that age. Wow!

I gotta hand it to them. They have heart and are tough.
I couldn’t do it.
Not in this town.

Hang in there.

#130 Joe Forester on 04.29.21 at 9:56 am

Just had quarterly company meeting of 300 employees.
Expect everyone back in the office , to maintain company culture, collaboration, discussion,bbq’s, mentoring for younger employees.

#131 Joe Forester on 04.29.21 at 9:58 am

… that is after pandemic fades off..

#132 Dr V on 04.29.21 at 10:26 am

111 ponzie – yes! Just like that!

But I also look at the converse See too many excellent “income generators” who spend it all and are taxed to death as they have to realize all that income.

#133 Grandma Sue on 04.29.21 at 10:33 am

Rates will never go up. It would initiate a complete social and economic collapse. A $20 loaf of bread not that far off now… and RE will collapse too then. By then when get a great reset and will be under full socialist rule

The CB will start raising rates in the second half of 2023. There will be no collapse. – Garth

#134 Grandma Sue on 04.29.21 at 10:37 am

Also, neighbour just had a deck installed on payments! He paid 3.5x cost for me to build my own 4 years ago. Is there anyone left who can manage money? Far and few between

#135 enthalpy on 04.29.21 at 11:05 am

Nice realistic and relatable example today.
Thank you.

#136 BROCK on 04.29.21 at 11:21 am

Well, by renting and not bowing to peer pressure I just bought a sweet Porsche. And I can afford to run it too, all because I don’t try to keep up with the “Joneses”. Life is too short to give all your money to a bank. Mortgage means “death pledge” and they’re serious about that.

#137 crowdedelevatorfartz on 04.29.21 at 11:22 am

@#134 Grandma Carpenter
” He paid 3.5x cost for me to build my own 4 years ago. ”
+++

Have you checked the price of lumber these days?
Easily double or triple what it was 3 years ago.
Labour?
Good luck finding anyone…. hence the price for that is uppa uppa uppa.

Is your neighbor a white collar office guy?

Might be cheaper( and safer) for him to have someone else build it than spending all his weekend hours stumbling around with a skilsaw…..

#138 Dr V on 04.29.21 at 12:27 pm

136 Brock – I just don’t know what to say…..

#139 Sara on 04.29.21 at 12:52 pm

Awwwe. Felix you won’t like this.

https://www.ctvnews.ca/video?playlistId=1.5406445

#140 UmiouiuS on 04.29.21 at 12:56 pm

#125 Felix on 04.29.21 at 7:51 am
What’s going on with the pathetic mutt in that picture?
It looks like it’s been abused and thrown in the dryer. The relationship between humans and canines is dogawful.
*******************************************

How would you know, Felix? You’re named after a cat.

#141 IHCTD9 on 04.29.21 at 12:57 pm

#110 Father’s Daughter on 04.28.21 at 9:34 pm
Maybe I’m oblivious to others opinions of me (would probably be for the best in this situation as I don’t care) but I have never felt the social shame of renting. My friends don’t know or care that we lease, my parents don’t care, my husband doesn’t care, my toddler etc.
Sure, we lease a whole house now for but for many years prior we lived in a cool but also sketchy apartment and still nobody seemed to care. Many of our peers live in big fancy houses. I don’t get this whole social shame of renting, I honestly don’t feel it..
I may be motivated to buy a house eventually, for many reasons, but peer pressure isn’t one of them.

___

Work on keeping that mindset.

Unless you are really willing to think, and live outside the box, you’ll likely never find the prospect of home ownership in mainstream Canada worth the cost anymore, even if you can afford it. Trudeau and the BOC have scrubbed just about all the value out of it.

20 years ago we bought our place for 1.37X income, and paid it off in 14 years. Big value that pays dividends to this day. That Canada is now gone. If someone wanted to buy our house today, and replicate the math; they’d need a 365K income. That’s in small town Ontario too – the one-time last bastion of the good life which has now been destroyed by the dunce cap sporting Trudeau Liberals.

I suppose the next thing Trudeau will do is somehow cause rents to double…

#142 NoName on 04.29.21 at 1:01 pm

#137 crowdedelevatorfartz on 04.29.21 at 11:22 am
@#134 Grandma Carpenter
” He paid 3.5x cost for me to build my own 4 years ago. ”
+++

Have you checked the price of lumber these days?
Easily double or triple what it was 3 years ago.
Labour?
Good luck finding anyone…. hence the price for that is uppa uppa uppa.

Is your neighbor a white collar office guy?

Might be cheaper( and safer) for him to have someone else build it than spending all his weekend hours stumbling around with a skilsaw…..

Funny thing you mention skillsaw, two days ago i spent probably an hour rumiging true garage to find mine, that i didn’t used for years.

And on a first cut i cut the board on a half and as added bonus i managed to cut a saws power cable while i was placing sow down. All that while wife was watching.

Oh the horror…

side note

1x6x8 x4
2x2x8 x4
———–
100CAD
And i had to wait.

(no word of the lie here)

#143 westcdn on 04.29.21 at 1:12 pm

Sigh. I was in “discussions” with my youngest. Have you never been wrong because I make adjustments when I get the feedback. I am headstrong so backing down is not easy for me. But I will. She goes I am wrong lots. I guess we both have courage to be wrong, adapt and live.

I said I was a 2 out of 3 investing guy and learn from my failures. What I have noticed is my number 2 picks are getting better and number 3’s less painful. Makes a big difference. Number 1’s have an element of luck. I have missed opportunities because of my mindset yet I have little to complain despite what life has thrown at me. It has not been easy.

I bought some American shares on margin so I happy to see the exchange rate going in my favor. I don’t get the strength of the Lonnie but I will take it. It is not much but covers my commissions.

I filed my Income Tax Return and owe a few thousand. I didn’t expect capital gains and more dividends. Then I have property taxes to pay. Lets say I am raising some cash which strikes me as a good thing. Best to have a 1st world problem.

I thought this was a good read

https://americanmind.org/features/life-after-cancellation/they-cant-cancel-your-soul/

#144 crowdedelevatorfartz on 04.29.21 at 1:14 pm

@#142 NoName.
Hahah.
I’ve fixed the cord on a few saws over the past few decades.

Yes, lumber has skyrocketed in price in just the past year.
2″x 4″x 8ft was $2.00 a year ago.
Now?
$5-7$ a plank.

#145 Alberta Ed on 04.29.21 at 1:27 pm

That’s $1.3 million worth of sound advice, for free.

#146 KK on 04.29.21 at 1:29 pm

#92 Ponzius Pilatus on 04.28.21 at 6:58 pm
I get the emotional arguments for owning.
However, the financial arguments for owning don’t have a leg to stand on.
The concept of opportunity cost seems to be too complicated for most.
———–
Agreed. With the average house price in Canada nearing $700,000, owning probably no longer makes financial sense for the average person. I’m just trying to understand both sides as best as I can. I’ll do some more thinking on this, but if anyone is feeling generous today, can you help me understand the above case study in terms of inflation? If the couple has a nest egg of 1.3 mil in twenty years, will it still feel like 1.3 mil then? Will it be enough considering that they’ll be shelling out roughly 3.5K for rent every month for the next 20+ years?

#147 Wrk.dover on 04.29.21 at 1:45 pm

#128 IHCTD9 on 04.29.21 at 9:12 am
A few years we ran into overdraft almost every month.

______________________________

Never ran OD here but, Dog I was good at kiting cheques!

Some over a week, never failed….

#148 SoggyShorts on 04.29.21 at 2:34 pm

#60 Joseph R. on 04.28.21 at 4:29 pm
The 4% rule is bunk. Garth
———————————————————
I am curious as to why you say that?
************
Check out http://www.earlyretirementnow.com for an excellent in depth analysis that rips apart the 4% rule.

#149 Voice Of Reason on 04.29.21 at 6:57 pm

#37 Jackie Tulio
Will someone kindly explain to me how my 45yr old son, who receives $900/month on ODSP, is supposed to survive in this economy? They aren’t allowed to invest (he can’t afford to anyway) and owning any assets worth over $30k will get him kicked off. I really fear what’s going to become of him when I’m gone… What are we supposed to do with these individuals? Toss them under a bridge?

If your son receives ODSP because of a severe disability, make sure he qualifies for the Disability Tax Credit. The Credit can be transferred to you and reduce your tax bill. Same with the Caregiver amount. With an approved DTC (see the CRA), open an RDSP, contribute as much as you can in the next 4 years so that you get all the Grants and Bonds possible (as Grants and Bonds are not payable past age 49). Invest the all the funds wisely. At age 60 he can start taking money out and it won’t count against his OSDP and neither will the value of the RDSP. In Ontario you can have a max $40,000 in assets (excluding an RDSP) before the gov stops the ODSP. For will and estate planning a Henson Trust must be part of your will so that your son does not receive any inheritance directly. Funds received from a Henson Trust will not affect his ODSP. Once your son turns 65 he will most likely qualify for GIS and his ODSP will stop. He will also receive OAS. So at 65 he will receive more Gov money than ODSP. Funds coming from an RDSP and Henson Trust are not included in the Income threshold for OAS and GIS Clawback. Life Insurance proceeds should go to the Henson Trust rather than as direct beneficiary. Again a large inheritance or life insurance payout or anything else greater than $10,000 in one year will put a stop to his ODSP. You can contribute a max $200,000 (excluding Grants and Bonds) in an RDSP. Leaving an inheritance to anyone receiving ODSP is like giving it all to the government!

#150 Nuke on 04.30.21 at 9:25 am

Your column hits home. I moved into a new townhouse in a desirable Toronto downtown neighbourhood. The TH is part of a non-profit community. The lease has been kept below inflation and is in the $1,500 range. The property is better maintained than most of the multi-million $ properties and has a front porch and a treed backyard. I do save the balance of my six figure income. Have a full DB pension that combined with savings and government benefits will kick out more aftertax income than I currently earn, especially after income splitting. However, love my work (my chosen job and career), 7plus weeks paid vacation as well a holidays so not retiring as pension and investments simply buildup. Did sell my house a few years back and invested the proceeds. So leasing over owning does have benefits, especially if you are able to get into non-profit housing where you are either a board member or a resident representative with some control over the budget and maintenance. This should be a norm not an alternative living arrangement

#151 happygolucky on 05.01.21 at 2:19 am

#5 TurnerNation on 04.28.21 at 1:45 pm
Greeting from the Occupied Territory of Kanada. In one of the many locked down Prefectures. Awaiting the UBI savior.
If you doubt it look outside your local big Box Store. Citizens forced into lining up outside in all weathers, 6-6-6 feet apart, muffled or muzzled. No talking. Only the essential goods you may buy today Comrade. Government orders & rationing you know. You might be stopped at a Checkpoint on the way home
It’s been said that the world was conqured by way of only two terms: Mandatory, and Asymptomatic.
As in you no longer have a right to exist and be healthy in this New System. Nobody gets a free ride.
— Here it comes. The global control over our Movements/Travelling is PERMANENT. If had before even a hint of exposure to the UN 2030 goals spoken openly of, by T2 (I linked his twitter video the other day) you’d know all about this.
“Globe says Air Canada hears Ont. wants flight controls
“These variants entered through our borders, both international and domestic, and it is critical that every effort is made to keep them out,” they wrote to Public Safety Minister Bill Blair and Health Minister Patty Hajdu. “We are asking that you implement mandatory predeparture PCR testing for all domestic air travellers entering Ontario.”

–Manitobans. Your government has put together a 29-page document of Manadatory CV rules you must follow. To keep you healthy. I am a tad envious, what optimum health you will enjoy! I’m sure that these Manadatory rules will remain in place for many months and years.
https://manitoba.ca/asset_library/en/proactive/20212022/orders-soe-04272021.pdf
— Did you know there is a hotly contested election race in India at the moment? That might explain some things…Keeping people away from the polls.

—————————————————-

And Greetings from Asymptomatic and Mandatory Kanada…
Damage is done, but this “pathetic” blog has different agenda…