The tax-trashed mortgage

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  By Guest Blogger Sinan Terzioglu
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When I lived in the US and considered purchasing a home I learned mortgage interest for a personal residence is tax-deductible if you meet certain qualifications. This certainly provided a good incentive to seriously consider buying.  After returning to Canada I heard about a strategy of converting a non-deductible mortgage into a tax-deductible investment loan so I was curious to know if it made sense for me.

This is a legal tax strategy which involves homeowners making principal payments against their mortgage, then borrowing the same amount from a home equity line of credit and using the funds to purchase income generating investments.  The interest on the loan is tax-deductible so the strategy essentially converts a non-tax deductible mortgage to a tax-deductible investment loan.  The overall debt does not increase but the risk does as you would be leveraging your equity and taking on investment risk.

To execute, you need to obtain a re-advanceable mortgage which is a type of mortgage that includes a home equity line of credit (HELOC).  Funds drawn from the HELOC would then be used to purchase investments with a reasonable expectation of generating income such as dividends from equities, interest from fixed income securities and/or rental income from an investment property.  The interest payments on the HELOC are tax deductible which results in a tax refund that would then be used to make prepayments on your mortgage with the goal of paying down the balance owing more quickly.

For example, suppose you purchase a home for $1,000,000 and obtain a re-advanceable mortgage of $500,000. The re-advanceable mortgage gives you access to an initial HELOC limit of $300,000 which is calculated as the maximum of 80% of the value of the home minus the mortgage balance.  As you make monthly mortgage payments the principal portion paid down enables borrowing additional funds from the HELOC equal to the principal just paid and letting you invest in additional funds. Over time the net debt stays the same but the result is a growing leveraged investment portfolio until the mortgage is completely paid off.

Let’s assume your HELOC rate is 4.50% and you use $300,000 available to invest in year one.  The annual interest charge would be $13,500 so with a marginal tax rate is 40% you could expect a tax refund of $5,400. Use that plus the income generated from the investments to pay down the mortgage.  The process is repeated until your mortgage is paid off.

From a purely financial perspective the strategy makes a lot of sense if the investments provide a return higher than the loan interest rate.  For those who have implemented the strategy over the long term and invested in high quality productive assets they have been able to pay down their mortgages sooner and increase their net worth more quickly and in some instances fairly significantly.  All that said, after careful consideration of all the benefits of this plan and having the confidence in my long term income generating investment strategy, I decided it was not for me and I do not recommend it for most Canadian homeowners.

The financial crisis of 2008-2009 and the recent COVID-19 crisis have once again highlighted how important it is to have a stable foundation to be able to withstand economic turmoil.  In my opinion, nothing is more important than the capacity to survive the most difficult times. While the probability of markets rising over the long term is high there are many other risks that can have a significant impact on this strategy in the near to medium term such as:

  • Interest rate risk. Higher rates will lead to higher borrowing costs on the HELOC but also potentially pressure investments and the value of your home.
  • Investment risk. Poor investment choices could easily lead to the permanent loss of capital. Some novice investors have reached for yield in individual securities and as a result have lost significant amounts of capital because they perceived certain securities to have safe dividends only to see them reduced and sometimes eliminated which has led to significant declines in shares prices.  There is no shortage of examples across several sectors in Canada such as the energy sector.
  • Behavioural biases. It is extremely important to know your risk tolerance.  Equity markets will continue to be volatile and there will be years when markets drop 20%+ in short periods of time and possibly more.  How you behave in these times could have very big implications on your long-term wealth.
  • Leverage risk. Borrowing to invest amplifies your results in both good times and bad but I think Warren Buffett’s quote about leveraged investing says it all:

“It’s insane to risk what you have and need for something you don’t really need.”

Adopting a survival mindset is essential when developing and sticking to a long-term financial plan.  To do well you simply have to live within your means, invest and earn a reasonable long-term rate of return.  By following Garth’s Rule of 90 you shouldn’t need to utilize leverage to reach your financial goals.  The key to achieving longevity in your long-term financial plan is to increase your probability of success and the most optimal approach is to have balance not just in your investment portfolio but across all of your assets.

If you are considering this strategy for yourself, only do so if your time horizon is at least 10+ years so you increase the chances of the strategy working out.  Also, ensure you keep very close track of all the interest paid and income received from your investments because if the CRA ever audits your tax return you’ll have to clearly explain yourself.  The HELOC funds must be invested in a non-registered account only and cannot be used for contributions to your TFSA or RRSP otherwise the interest would not be tax-deductible.  Most importantly, the funds should only be invested in very high-quality securities and/or diversified ETFs.

Sinan Terzioglu, CFA, CIM, is a financial advisor with Turner Investments, Private Client Group, Raymond James Ltd.  He served as vice-president of RBC Capital markets in New York City and VP with Credit Suisse in Toronto.

About the picture: “Like most, she was Born to Serve. Always wanting to work.  Obsessed about chasing and returning things (mostly balls, the occasional sock and loved stuffed animals!),” writes Chris. “Kaia’s raison d’être was to bring a smile to a face, and make people feel happy.  It was a mission. On our walks she would ignore other dogs but stare at their owner.  Often she would sit patiently and wait carefully observing an individual.  It would bring me so much happiness to see how she would watch other people patiently waiting just to be noticed.  Then once eye contact was made there was no hope for any poor soul.  She would draw them in.  They couldn’t resist; no matter how bad their day was.  She would paste herself to their leg and let out a whimper as they touched her soft coat. She would make the grumpiest curmudgeon smile, appreciative for any love or kindness they showed. Once the smile broke out she knew her work was done. Thank you for sharing my memories of her. Here for a good time.  Not a long time.  Many good memories to share.  A more peaceful world.” 

71 comments ↓

#1 Dolce Vita on 07.04.21 at 10:41 am

Garth looking good for his August long weekend 70% vaxd wish.

Projections vs. Actual pretty much bang on the past few days. Long & the short of it for 33.2M Cdns Projections (≥ 12 yrs old…I included the eligible nose pickers too):

July 26
26.9M 1st dose vaxd, 81% of the population
23.7M 2nd dose vaxd, 71% of the population

July 30 (for those taking Friday off, if Cdn that will be all of you)
27.1M 1st dose vaxd, 82%
25.6M 2nd dose vaxd, 77%

———-

Data to July 3, 2021 11:16AM EDT from CTV’s excellent Vax Tracker, some its data tidbits used in the above Projections:

1.) 7-day doses/day avg = 518,103 (Jun 27 to Jul 3: 262210*, 917958, 577099, 608608, 46214**, 986765, 227866*)
2.) 25.84M 1st dose vaxd (78%), 12.8M 2nd dose vaxd (37%).
3.) Ratio of 2nd to 1st dose vaxing is 10.2:1 or about 91% of all doses administered were 2nd doses (Canada turn on a time vaxing because of the Delta variant). Consistent for the past week.
4.) Projections assume above %’s of the population want to be vaxd – PM Trudeau made good on his promise from earlier this year.

*Weekend (a.k.a. in Canada: ESSO)
**Canada Day

——————

And England 4 – Ukraine 0 YES! About 23h CET Tue Jul 6 Italia will have sent España back to her sandblasting beaches, greasy food and cheap beer (latter 2 why the UK loves to vacation there).

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Wished I’d had a Tax Trashed Mortgage opportunity back in the 80s when they didn’t have HELOCs like they have today. Thought about the idea back then but told by Revenue Canada no can do on a principal residence.

Times have changed.

#2 crowdedelevatorfartz on 07.04.21 at 10:41 am

I have some friends that have successfully done this.
“The Smith Maneuver” I believe they called it?

Spent quite a bit of time and money on accountants and with the Tax man but it worked.
Not sure I’d try it.

#3 Divine Intervention on 07.04.21 at 10:51 am

Beautiful, heartwarming Kaia. They don’t call them Golden for nothing.

“All that said, after careful consideration of all the benefits of this plan and having the confidence in my long term income generating investment strategy, I decided it was not for me and I do not recommend it for most Canadian homeowners.”

The fact that Sinan has opted not to participate in such an undertaking is quite telling.

For me, I have been doing this heavily for 35 years, off and on. Back when I was selling mutual funds in the mid 80s, many investment companies were pushing this tactic. Initially, it was just borrowing, but then morphed into full blown HELOC leveraging. As you can imagine, it turned out extremely well for me in retrospect. (FYI, I was subjected to a margin call only months after implementing this strategy because of the 1987 stock market crash. A year later, it was all good. Since then, its pretty well been clear sailing.)

#4 Blessed_Canadian_Millenial on 07.04.21 at 11:01 am

Very timely post.

Another con for leveraging: HELOC can be called by the bank at any time as it’s a demand loan

The risks outweigh the benefits as you stated, and I totally agree with you

#5 Ponzius Pilatus on 07.04.21 at 11:22 am

I’m sure there are more schemes out there to save on your mortgage.
People will go through a lot of trouble to save a couple of bucks, just to prove that it can be done.
And “show” the tax man.
Just do what Garth and the boys are saying.
Buy a house only when you can afford it.
Have a Black and Decker retirement plan.
And you will sleep well.

#6 Flop… on 07.04.21 at 11:48 am

Got my second shot yesterday, celebrated by going out to dinner for the first time in around 17 months.

Not that I would really call eating at Chipotle going out for dinner, but there we were.

All this retirement talk on here is making my feet itchy, even though I got the second shot, I’m committed to a longer-term plan.

Been semi-retired due to health reasons for the bulk of the last decade, managed to nab a half-decent job and am trying to make it my last one, but you never know if funding for these positions can be funnelled elsewhere.

As a new government employee I have to earn holiday time, so I can’t currently go anywhere, which is a bit of an inconvenience to someone who was self-employed and went away when ever it suited me.

Always shovelled a little bit away each month for full retirement since I was 18, regardless of illness, backpacking the world, or paying off a mortgage, mistakes have been made but so has a constant attempt at having some form of a decent retirement, which isn’t always easy for someone who has never earned anything beyond 50k in a year.

For now I’m forced to bide my time, accumulate some holiday time, embrace a higher forced savings rate, be grateful I found the courage to overhaul my superannuation and TFSA, and hopefully enjoy a spell of half-decent health that many around me appear to take for granted…

M47BC

#7 Ponzius Pilatus on 07.04.21 at 11:52 am

For me, I have been doing this heavily for 35 years, off and on. Back when I was selling mutual funds in the mid 80s, many investment companies were pushing this tactic. Initially, it was just borrowing, but then morphed into full blown HELOC leveraging. As you can imagine, it turned out extremely well for me in retrospect. (FYI, I was subjected to a margin call only months after implementing this strategy because of the 1987 stock market crash. A year later, it was all good. Since then, its pretty well been clear sailing.)
——————
You’ve got quite the guts to admit on this blog that you were a Mutual Funds pusher.
I worked for a Credit Union in the 80s , and we got very nice commissions from selling them.
Everyone made good money, except the buyers.

#8 ElGatoNerodeYVR on 07.04.21 at 12:10 pm

Wow, for 2 days I a row we get practical advice with actual numbers that work today and not a forecast based on projections.
Good work ,keep’em coming.
A couple points:
I use 5% total return for my long term planning as well and 2% inflation, yes real returns are higher but.. .why tempt fate plus your real drawdown is same ( plus inflation) every year regardless if the market is up 20% or down 20% ; besides after 20% down you need like 30% gain to make up for it ( back of a paper napkin math).
The 80% target is a decent estimate but strongly suggest everyone actually has a realistic budget based on income after taxes .
I actually budget at 100% same spendings excluding mortgage as that is the only thing that will go away.
The Smith maneuver as today’s post is also known as is an interesting concept which has way too many risks associated to it for pitiful Return vs. Risk. I too have passed on it.
For the more adventurous ones I guess the Manulife one is such a product ,TD, RBC will offer something similar as well, they practically begged us to take a convertible mortgage at prime plus some basis points for the HELOC portion. No thank you.

#9 Dr V on 07.04.21 at 12:20 pm

Sounds exactly like the Smith maneuver

https://www.investopedia.com/terms/s/smith-maneuver.asp

Keep in mind that the income and gains, in your
portfolio may be taxable, as this only works for a non-reg account.

#10 Dr V on 07.04.21 at 12:50 pm

3 divine – you don’t get a margin call on a HELOC as the funds are secured against the house. What I am not clear on is whether the HELOC portion of the mortgage is a demand loan.

#11 Sail Away Whattaboutism on 07.04.21 at 12:52 pm

#65 Sail Away on 07.04.21 at 9:00 am

A botanist of European descent commenting on foreign-to-him multi-century cultural practice as a brief visitor is a very useful contrast to well documented forced extraction and poorly to non documented deaths to disease, starvation, accident, murder and infanticide under the protective custody of men of cloth in the near modern era in a culture founded on the written word who documents things and events of importance yet oddly didn’t document the deaths of these children well into the 20th century. Yer a danged whattaboutist genius Sail Away.

#12 My Body My Choice on 07.04.21 at 12:56 pm

Re: #1 Dolce Vita

“Garth looking good for his August long weekend 70% vaxd wish.”

Possibly, but will it end there? We’ve seen time and time again that the health authorities change the goal posts. The media and govt is using the term “fully vaccinated”.

The term “fully vaccinated” is already incongruent with the science. Since all viruses constantly mutate, there will always be a need for booster shots. But the govt. and media want us to believe it’s 2 shots and we’re done.

I will bet you gold bars to donuts that in a few months time, a new variant, maybe Delta, maybe Epsilon, maybe Zeta, will require everyone gets a 3rd shot, then probably a 4th shot.

“There is no place for dogma in science. The scientist is free to ask any question, to doubt any assertion, to seek for any evidence, to correct any error.
Where science has been used in the past to erect a new dogmatism, that dogmatism has found itself incompatible with the progress of science; and in the end, the dogma has yielded, or science and freedom have perished together.”
J. Robert Oppenheimer, The Open Mind, 1955

#13 TurnerNation on 07.04.21 at 1:03 pm

Weekend things. This old Brougham – our forum host can grow a mullet (if not already in place) and relive his youth. Touring around the seaside town, doing burnouts, so on and so forth . Laying haste to the departure of any Birkenstock-clad electric car driving tourists.
This will pass anything but a gas pump.
6.6l V8.
https://www.autotrader.ca/a/oldsmobile/cutlass/guelph/ontario/19_11926330_/

— Back to the global Economic Resets.
Yep CV can do that. Supply Chain shortages? Or via Cyber hacks?

https://www.maritimeprofessional.com/news/crew-change-crisis-getting-worse-368804
In addition to the provided data, the contributing ship managers also highlighted several key developments that have impacted crew changes in the past month. They said continual high infection rates and subsequent domestic lockdowns are still challenging crew changes and causing disruption to crew movements.

Travel restrictions continue to prevent seafarers from going back home and many flights have been canceled.

——

Uhh tell me again how Australia is the test zone for all of this? You know why right? Because only 5% of them submitted to the jab. This means permanent lockdowns:

.Scott Morrison’s four-phase pathway out of COVID practically guarantees Australia will not be opening up for at least 2 more years (theguardian.com)

.Israeli officials are said set to weigh reinstating some virus restrictions as the highly contagious COVID-19 Delta variant continues to spread in the country. (timesofisrael.com)

#14 Dogman01 on 07.04.21 at 1:22 pm

Wow…Great Article Sinan.

For many people interested in their personal Finance there is a lot of information out there. It can breed a version of FOMO, but instead “Fear of Mission Out of Smart Financial Opportunities”, FOMOSFO.

I have always sat on the sidelines of the using my home equity for Investment and the Tax advantages, it sounds smart but something just feels a bit off on applying equity leverage on my “basic shelter” needs. Does not seem balanced or diversified.

Since you guys are so open with you knowledge and if you take requests; a good primer on the actual use of the “Norbert Gambit” with mainstream Canadian brokerages. I need some US cash in the future and I want to invest direct in some US ETF’s however I cringe at the bank exchange rates.

Is the Norbet Gambit just my FOMOSFO or is it something practical.

#15 Dogman01 on 07.04.21 at 1:37 pm

#8 ElGatoNerodeYVR on 07.04.21 at 12:10 pm

The Manulife-One

Years and years ago I watched the Manulife-One account presentations. I went to my bank and converted my big mortgage to a HELOC.

Benefits:
– Every cent we made applied directly on the HELOC they day it was deposited. (Paycheques etc)
– No need for an “emergency fund”, emergency = HELOC withdraw.
– Whenever you ask how much do we have you realize it is Negative and then you do not buy the impulse stupid thing that you did not need.
– Jan 1 you pull out the TFSA money and oput it to better use
– Max out the RRSP, no worries on where you will get the cash each year.
– Tax refunds, boom directly into the HELOC.
– House gets paid off quick and now you have much better problems to think about.

This is for “Ant” family units, if you are a Grasshoppers with low impulse control, this is dynamite.

#16 crowdedelevatorfartz on 07.04.21 at 1:43 pm

@#13 TurnerNation

“Israeli officials are said set to weigh reinstating some virus restrictions as the highly contagious COVID-19 Delta variant continues to spread in the country. ”

++++

Israel was the first country to be double vaxx’ed to the max.
And now the Delta variant is spreading there.
Me-thinks the politicians in Canada bent to the business owners this summer to open everything up.
If Delta ( or another newer variant) is nailing double vaxx’ed people.
Get ready for another winter of lockdowns and masks.

#17 Sail Away on 07.04.21 at 1:50 pm

#11 Sail Away Whattaboutism on 07.04.21 at 12:52 pm
#65 Sail Away on 07.04.21 at 9:00 am

A botanist of European descent commenting on foreign-to-him multi-century cultural practice as a brief visitor is a very useful contrast to well documented forced extraction and poorly to non documented deaths to disease, starvation, accident, murder and infanticide under the protective custody of men of cloth in the near modern era in a culture founded on the written word who documents things and events of importance yet oddly didn’t document the deaths of these children well into the 20th century. Yer a danged whattaboutist genius Sail Away.

———-

Preach it, Faron!

Have you ever had a girlfriend who you realized was a bit squirrelly, so you broke up but in her mind that meant you needed more of her so she was always there to the point of sleeping in your rhododendrons and inspecting your clothes in the apartment common laundry room?

Wait a minute… that’s you!

#18 The Totally Unbiased, Highly Intelligent, Rational Observer on 07.04.21 at 2:00 pm

Today is the fourth of July, 2021.

You probably know what that is in the USA.

That’s right!

It is the official launch day of GETTR, where everyone can now Get Together without being silenced for their beliefs.

It will replace TWITTER, where people now “miss what’s happening.” With all the biased and unfair censorship, “People on Twitter are the last to know.”

#19 Dolly Moderna on 07.04.21 at 2:28 pm

Is it weird that just the US flag is flying over Toronto City Hall, just three whole days after all the turmoil in Canada about Canada Day??
https://www.instagram.com/johntory/

#20 SoggyShorts on 07.04.21 at 2:39 pm

#12 My Body My Choice on 07.04.21 at 12:56 pm
The term “fully vaccinated” is already incongruent with the science. Since all viruses constantly mutate, there will always be a need for booster shots. But the govt. and media want us to believe it’s 2 shots and we’re done.
***************************
Just to be clear, how many smallpox, polio, and measles booster shots do we need?

I know coronaviruses are a little different, but that doesn’t make it impossible.

#21 kommykim on 07.04.21 at 2:44 pm

RE: By following Garth’s Rule of 90 you shouldn’t need to utilize leverage to reach your financial goals.

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For the average Canadian, who barely keeps up with TFSA and RRSP contributions, using a HELOC this way makes no sense anyway. But for the 1% Blog Dog demographic it might.

#22 BillyBob on 07.04.21 at 2:45 pm

#65 Sail Away on 07.04.21 at 9:00 am

A botanist of European descent commenting on foreign-to-him multi-century cultural practice as a brief visitor is a very useful contrast to well documented forced extraction and poorly to non documented deaths to disease, starvation, accident, murder and infanticide under the protective custody of men of cloth in the near modern era in a culture founded on the written word who documents things and events of importance yet oddly didn’t document the deaths of these children well into the 20th century. Yer a danged whattaboutist genius Sail Away.

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

Tossing around “murder” and “infanticide” is quite amazing considering not a single body has been exhumed nor forensically examined. But I suppose waiting for hard facts isn’t convenient to the narrative. Everyone get their orange shirts on, never you mind about silly things like science and reason, just join the cause or get cancelled. Oh I am so glad to live somewhere that lived this playbook in the last 50 years and wants no part of it.

I did have to laugh at how one tribe’s killing or enslaving of another was brushed off as a “cultural practice” beyond the understanding of those awful white foreigners. Not even a hint of irony at the hypocrisy lol.

I feel gratitude that human stupidity only amuses me instead of surprising me anymore. Because these are hilarious times.

#23 Barb on 07.04.21 at 2:46 pm

“…because if the CRA ever audits your tax return…”

————–
EVER? as in FOREVER? or within 7 years?
Have tax “rules” have ever changed retroactively?

If Sinan didn’t do it, it’s doubtful we non financial people should.

Chris, the picture of Kaia brought a smile to my face, so she’s still working at it. We can see heaven in a dog’s eyes.

#24 Liquid on 07.04.21 at 3:17 pm

Do you guys see a scenario with all this growing debt where credit seizes up? How likely is that?

Or will everyone just keep lending endlessly?

#25 Nonplused on 07.04.21 at 3:23 pm

Interesting advice, which we’ve touched on from time to time. However borrowing at 4.5% to earn 5% doesn’t make a whole lot of sense to me, especially since the value of the house and the value of the investments are both notional and can change at any time, for good and for bad. You can go underwater on such an investment strategy in a week. The tax savings is what makes the strategy work, but only if you are in a high tax bracket.

#26 westcdn on 07.04.21 at 3:24 pm

I can’t disagree. Good defense wins championships. I am aggressive with investments but I keep a keen eye on the chances of events running against me. A cataphatic loss is to be avoided at the cost of missing out but if want to win you have to adapt.

Lottomax has been a waste of money for me but you can’t win unless you buy a ticket. I am better off on the CNX exchange – the old VSE – capital of shysters.

Someone was trying to hack my RIF. The bank locked it down and I had to prove my rights. It was a major pain and cost me interest charges but no one told me what was going on. Stay alert against thieves. Sometimes they pretend to be your best friend and will put your interests first.

#27 Paddy on 07.04.21 at 3:34 pm

Re: Blessed Canadian millennial

Very timely post.

Another con for leveraging: HELOC can be called by the bank at any time as it’s a demand loan

The risks outweigh the benefits as you stated, and I totally agree with you

‘’??????????

If all HELOCs are demand loans then, it doesn’t matter what you have done with the money. Majority of people take out the money and blow it on crap anyway, bank calls the loan…then what? You put a new 100k kitchen in your house, courtesy of the HELOC, you gnna tear your kitchen apart and sell what you can to pay back the loan??? Hell no

so leverage yourself to the max….

Also, in order to deduct your interest on your loan, the money must be invested in a vehicle that provides income…swapped based ETFs or say a stock that doesn’t pay a dividend doesn’t count.

#28 Baba Novac on 07.04.21 at 3:36 pm

Hey Sinan,

Very interesting post, as usual. I am left to wonder why you (with plenty of investment knowledge and, presumably, the discipline that such knowledge brings) still chose not to pursue the route of the re-advanceable HELOC.

It gives me food for thought for a similar move I am pondering myself: i.e. using the HELOC on a fully paid-out home as a reserve pool of funds and a means to do away with/decrease the lowest-yield bond allocation portion of my B&D portfolio. Do you have any comments at a high level on such an approach?

Essentially, what I am thinking about is the alternative approach of treating (up to 30-50% of) a HELOC as a shock absorber for a B&D portfolio, INSTEAD of holding some of the lowest-yield/tax-inefficient 10-15% allocation to bonds (the VABs or corporates of the Canadian bond universe). Of course, my B&D that follows closely the Turner Investments’ model would continue to hold the allocation to MFT-type loans, the global bonds and the 15-20% dedicated to preferreds (all of which are much higher yielding), but less or not affected by increases in overnight prime in the near/midium term.

My thinking: in a market downturn, I would be willing to commit to a previously written investment policy to use HELOC funds to buy into the weakness (instead of deploying those lower yield bonds not held): 10% HELOC deployed at 10-15% drop; 20% of HELOC deployed at 20-25% drop; and say another 10% of the HELOC if stocks drop beyond 30%. This could allow one to keep a slightly higher stock allocation in the portfolio, and only keep mostly prefs/floating loans for the fixed portion of the portfolio. This strategy would be underwritten by an ability to pay out the HELOC without selling into the market weakness if the bank decided to call it (though keeping LTV ratio <50% would mitigate the risk of a call).

Sinan, if you have some time to spare, I would be happy to hear what you might have to say about the more specific aspect I described re low-yield bonds in portfolio vs keeping HELOC deployable into market downturn based on a rational/pre-determined methodology… In any event, thanks again for the great post!

#29 the Jaguar on 07.04.21 at 4:05 pm

@#121 NSNG on 06.29.21 at 9:48 am

Re your post/reference to the Jack London Book or Orwell’s Down & Out in Paris and London. Came across a new reference today in a new book I am reading about world events in 1933 that are eerily similar to the current environment. It wasn’t just overseas. 25 miles south of Chicago, a place called Oak Forest:

“Oak Forest Heritage Preserve, more than 170 acres of rolling forest and wetlands in Chicago’s south suburbs. The site served as working farm, an infirmary and, from 1910 until 1971, the burial ground for Cook County’s indigents. the story of the poor farm that opened in 1910, a complex of buildings where Cook County housed the poor, elderly and disabled — and put them to work.With thousands of residents, the poor farm was like a small city. A rail line was extended to the property. Children who lived there had their own schoolhouse and teacher.

Before the 1935 Social Security Act, counties and cities held the main responsibility for the welfare of poor people. Across the United States, counties and cities ran similar poorhouses and poor farms in the 19th century and early 20th century.
The idea was thought to be progressive at the time: the poor would build character as they supported themselves in a self-sustaining community.”

There is quite a history of our not too distant past that many of us are not aware of….

#30 Phylis on 07.04.21 at 4:45 pm

#17 Sail Away on 07.04.21 at 1:50 pm
#11 Sail Away Whattaboutism on 07.04.21 at 12:52 pm
#65 Sail Away on 07.04.21 at 9:00 am

A botanist of European descent commenting on foreign-to-him multi-century cultural practice as a brief visitor is a very useful contrast to well documented forced extraction and poorly to non documented deaths to disease, starvation, accident, murder and infanticide under the protective custody of men of cloth in the near modern era in a culture founded on the written word who documents things and events of importance yet oddly didn’t document the deaths of these children well into the 20th century. Yer a danged whattaboutist genius Sail Away.

———-

Preach it, Faron!

Have you ever had a girlfriend who you realized was a bit squirrelly, so you broke up but in her mind that meant you needed more of her so she was always there to the point of sleeping in your rhododendrons and inspecting your clothes in the apartment common laundry room?

Wait a minute… that’s you!
Xxxxxx
What, the curmudgeonly attack at the end was a giveaway?

#31 Sinan Terzioglu on 07.04.21 at 4:56 pm

#27 Baba Novac – Utilizing a HELOC to purchase equities when markets drop could certainly work very well. That said, you would be adding substantial risk to your portfolio especially if you don’t hold government and corporate bonds which we believe are important shock absorbers for balanced and diversified portfolios. This strategy would require a more active approach but if you have a plan in advance as you have outlined that’s great but you should also have a plan for when to sell to cover the HELOC not just when markets recover but if they continue to drop. Risk management is even more critical when using a HELOC to invest. Utilizing leverage in an attempt to earn higher returns opens you up to a lot more risk so I recommend you ensure you are able to handle it financially and psychologically if markets were to drop 50% or more – Sinan

#32 Generous Mom on 07.04.21 at 5:01 pm

My daughter has a severely handicapped child and needed a new van for $100,000. Yes that is the price if you have 3 other kids and need a place for everyone and the wheelchair as well.
So instead of giving her the $100,000 for the van, I gave her a chance to learn about investments.
I knew her mortgage was coming due. I told her to add $100,000 to her mortgage and buy 5 bank stocks and put them in her TFSA and also her husband’s. (They had nothing in them before.) We did this late last year so the dividend rates were a bit higher, somewhere around 4%. I told her to pay off the extra mortage payment (around $500. a month) with the money that will come to her through dividends. The mortgage is around 2%.
It’s another case of some risk, but she can always pay off chunks of the mortgage with the principal invested if things go severely south! Yes, I’m out money, but this was a true necessity. She has 3 other children who are still in car seats and it is illegal to put a car seat in the front row. It’s expensive to have a genetic defect. Canadian Taxes only refund about 15% of ependitures. His diapers alone are over $100 a month. Most of these genetic defects are carried by the mother. Girls have 2 X’s, so if one X chromosone is defective, the other X often is OK. That’s why boys have more problems passed to them. In vitro allows the eggs to be tested for the defect before being implanted. We are fortunate to have the science that is helping us all. Understanding the molecules in our bodies is a good thing. Understanding finances is important too!

#33 Science Based Retirement on 07.04.21 at 5:34 pm

To “Tarot Card” (and anyone else who wants to pile on) re:

“Fifth, to the poster above about doing the math on taking CPP early . . . .”

(see “Retirement Checklist” posted by Ryan L. on July 3)

You, my steerage compartment acquaintance, hit the nail squarely on the head when you said, “what works best for me may not be the best solution for you.” – I was not addressing you. I don’t know you or your wife or the details of your financial life, but if you use a competent and trustworthy financial advisor she/he should know these things. They should then advise you accordingly. If it is in your (or your wife’s) financial best interest to take CPP at 60, they should PROVE that to you, with a comprehensive retirement income plan for both of you up to the day the last of you draws your last breath, including a full calculation of the taxes you will pay. (Of course, these plans cannot be perfect, and must be updated regularly as your financial life evolves, but what is the alternative? Nothing?). The plan should show you options – what will likely happen to your finances if you take CPP at 60 vs. at a later age – the math MUST be done. Full Stop.

As I alluded at the beginning of my previous comment, there are people who WILL benefit by taking CPP at 60 (those with GOOD REASON to believe they will die young, those with no other source of income). Those who WILL benefit from taking CPP at 60 SHOULD take it at 60 – no argument from me whatsoever.

Everyone needs to understand that CPP is a taxable benefit. Your wife may or may not have been making enough in taxable investment returns or withdrawals from RRSP or RRIF etc. to have to pay any taxes at 60, but others DO have taxable income when they retire (lucky sots!) – they DON’T get the full CPP after they pay tax on the proceeds. They are behind before they start.

Congratulations on getting a guaranteed for life 10% return on the investments in the wife’s TFSA – mind sharing exactly how you are doing that? Doesn’t sound B&D to me!

Too much to get into in this space (Mr. T. will squash me if I go on much further, I’m sure), but consider also those who take CPP early while allowing their RRSP to build into a ticking tax time bomb. By the time they MUST convert it to a RRIF (or cash it in, or convert to an annuity, or any combination of the three) income is fully taxable. Your wife may be in for a BIG tax surprise in a few years that was totally avoidable, and will have a poorer retirement (financially) as a result. Maybe she won’t. Only one way to find out.

Oh, and the amount you will get in CPP benefits compounds every month that you delay taking it, tax free, at a rate you are extremely unlikely to sustain in whatever magical 10% annual return world you invest in. And it is indexed to inflation once you start taking it. It will not go down because the market craters, it will never pay less if inflation goes negative. What could top that???

Unfortunately, I run into many people who either do not understand retirement finances or who put their trust in an advisor who either doesn’t understand these things or who benefits by snowing their clients. Few people understand the consequences of making the irreversible decision to take CPP too soon. Until Canada makes financial planners fiduciaries to their clients, tread carefully! Self-education is the best defense.

In my (humble!) opinion, Garth is 99-44/100% correct about everything else he writes (as was Ryan L. on his post), and he writes honestly (I have benefited substantially by reading his books). I can only believe that he has never really sat down and worked things out for real-world clients regarding when the optimum time to take CPP is in their specific cases. Platitudes like “a bird in the hand” are NOT acceptable financial planning advice.

Finally (whew!) I don’t agree with Tarot Card that one’s body is one’s best investment. As important as it is, it takes second place to one’s MIND as the best investment. More people need to use theirs to question rather than to be credulous.

#34 cuke and tomato picker on 07.04.21 at 6:08 pm

My wife and I feel we have achieved full immunity as of
Sat. July 3rd having had the second dose 2 weeks ago.
We went shopping for new summer clothes today and visited a market at the Merry Winspear parking lot and bought a few things. We wore our masks throughout the day. Happy to get out and about. We will continue to be very careful also south island only has 2 cases.

#35 Tom Domi on 07.04.21 at 6:42 pm

I could be wrong about this but if you deduct the interest by borrowing money using the house no as collateral isn’t that now considered an investment property and not a primary residence for tax purposes.

This would mean that you would have to pay capital gains taxes on your house now and lose potentially hundreds of thousands of dollars wiping out probably all the benefits of deducting mortgage interest.

The answer is no. – Garth

#36 Tudval on 07.04.21 at 6:44 pm

” essentially converts a non-tax deductible mortgage to a tax-deductible investment loan” that’s not an entirely accurate description, since the existing mortgage is still not tax deductible, only the additional funds borrowed for investment purpose. The only difference from borrowing the money from an unsecured LOC, is the possibly lower interest rate.

#37 VladTor on 07.04.21 at 6:55 pm

….Adopting a survival mindset is essential when developing and sticking to a long-term financial plan. To do well you simply have to live within your means, invest and earn a reasonable long-term rate of return…..

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

Sinan, GOLD WORDS !
In my opinion investors should print it and attach close to computer monitor. And reread it always before doing transaction. It will you cool down.

Sinan, can you give me a favor and refresh shortly for me and others readers what does it mean …Garth’s rule 90.

Thank you

#38 S.Bby on 07.04.21 at 6:57 pm

#15

I did the same thing when my bank suggested it and it seemed like a good idea so I did it. The interest rate on the HELOC was lower than my mortgage rate and everything I earned went onto the HELOC. I’m not a big spender so it worked out ok.

#39 Sail Away on 07.04.21 at 7:02 pm

I consider the Smith Maneuver similar to the collecting pennies in front of the bulldozer analogy. There are lots of unknowns completely out of one’s control and something going sideways could cause a lot of financial angst.

#40 Al on 07.04.21 at 7:09 pm

Smith Maneuvre worked for me. Initial investment of 90G’s of the company shares which I got upon being laid off turned into seven digits rental properties portfolio. Only once CRA questioned the written off interest on one of the quite a few HELOC’S. I have a very good team, my banker and accountant collected all necessary information to satisfy CRA. It’s not for everyone though, I have very high risk and pain thresholds.

#41 Young Man at 18 on 07.04.21 at 7:15 pm

DELETED

#42 Sail Away on 07.04.21 at 7:20 pm

#22 BillyBob on 07.04.21 at 2:45 pm

——-

Hey BB, I didn’t make the impassioned conflation to child murder and all… that was some other shadowy anonymous emotional creature lobbing a tarball my way hoping it would stick.

Luckily it was a long midnight golf shot that fell short. Weep with me at the self- and country- hatred.

#43 Yukon Elvis on 07.04.21 at 7:51 pm

36 comments. Slow day. Maybe it is a boring topic. Maybe Garth is asleep at the keyboard….I’ll start: What is the difference between a Liberal and a puppy?
The puppy stops whining when it grows up.

#44 ElGatoNerodeYVR on 07.04.21 at 8:03 pm

15 Dogman01 on 07.04.21 at 1:37 pm
#8 ElGatoNerodeYVR on 07.04.21 at 12:10 pm
《》This is for “Ant” family units, if you are a Grasshoppers with low impulse control, this is dynamite.
=====
True words , it helps if one also stays married and life is long.
I prefer the “Borrow 2 invest ” approach from say B2B bank as that loan is secured by your portfolio. Requires high income ofcourse but at least the house stays unencumbered and if you have 40% + marginal tax rate the higher rate is an advantage.
But again, different approaches work for different people, for me personally the Manulife One would have been disastrous due to unforseen life changes, barely escaped with the home equity share due to ironclad paperwork. YMMV , good to have options for sure.

#45 Sinan Terzioglu on 07.04.21 at 8:28 pm

#37 VladTor – Garth’s Rule of 90 suggests that the maximum percentage you should have in real estate equity relative to your net worth be no more than 90 minus your age. For example, suppose a 50 year old has $350,000 in a RRSP, $75,000 in a TFSA and owns a home worth $500,000 with a mortgage of $250,000 so his net worth is $675,000. The Rule of 90 suggests that this 50 year old have no more than 40% of his net worth in real estate equity so max $270,000 vs 37% currently so he is in good shape. The older one gets the less real estate exposure they should have relative to liquid financial assets – Sinan

#46 BCWally on 07.04.21 at 8:42 pm

That is a good risk analysis. Speaking of HELOC’s I wonder if everyone knows that they are call loans in which the bank reserves the right to have their money back at any time, particularly in a housing price drop to preserve the 80% margin. Imagine having to pay some of it back from an already losing investment.
So all those parents out there who took out this type of loan to fund their children’s down payment and create the current housing affordability crisis be aware.

#47 Ustabe on 07.04.21 at 9:19 pm

@ #42 Sail Away on 07.04.21 at 7:20 pm

If you were a fish, you’d be in the fry pan now. Hook, line sinker.

I know you and your two buddies miss the guy but he’s not here. (Hint: find someone who can show you how to see the headers on a web page, usually can see the IP addresses.)

#48 Dr V on 07.04.21 at 9:23 pm

45 Sinan – take the same example but have a $300k mortgage. Gives $625NW with $200k equity for 32%.
so a larger mortgage give a lower (better) ratio.

I don’t think this is what Garth intends.

And the rule is really out of whack when the RE market goes nuts.

#49 VladTor on 07.04.21 at 9:29 pm

to #45 Sinan Terzioglu

Dear Sinan, thank you very much for explanation 90 rule with excellent example. Can not be better!

I did copy for future.

Question is only one – why 90, not 75 or 95 for example? Rule is simple for understanding, but why it not including inflation?

#50 TurnerNation on 07.04.21 at 9:39 pm

On the Economic Shutdowns.
The fictional “State of Emergency” in Ontariowe was extended. Now until July 14th.
Appears they are going for rolling, short extensions until ???

https://www.ontario.ca/laws/regulation/r21486

#51 ImGonnaBeSick on 07.04.21 at 9:49 pm

#46 BCWally on 07.04.21 at 8:42 pm
That is a good risk analysis. Speaking of HELOC’s I wonder if everyone knows that they are call loans in which the bank reserves the right to have their money back at any time, particularly in a housing price drop to preserve the 80% margin. Imagine having to pay some of it back from an already losing investment.
So all those parents out there who took out this type of loan to fund their children’s down payment and create the current housing affordability crisis be aware.

—-

Yes, but isn’t this a bit overblown in regards to the risk of this strategy? I’m pretty sure the HELOCs have the option to be converted to mortgages, so wouldn’t it just be smarter to convert it to a mortgage if a demand was actually made? I think the real risk here is using “margin” with a short term timeframe…

I haven’t done this because I’m quite debt adverse, but it is intriguing.

#52 Wrk.dover on 07.04.21 at 10:06 pm

If one is tempted to bet the farm for a maybe gain, then maybe the farm has more value tied up in it than one can afford to have.

Downsize, then lever the difference (possibly) away.

But still have an owned home in the end.

Says the man in the humble house.

#53 NSNG on 07.04.21 at 10:49 pm

#29 the Jaguar on 07.04.21 at 4:05 pm

It’s funny how we almost never hear of these things from our informative media. You can probably be sure that if we don’t hear about it, they will probably try to bring it forward again at some point.

Another thing that was very popular up into the ’30s – especially among the elite – was the eugenics movement. It was culturally acceptable to think that way until some clown decided to try it at the national level. What was his name again? Oh yes, Adolph Hitler.

Many things are popular until they get into the hands of a madman. I wonder if A.I. will follow that same pattern? Social media is already.

#54 Those were the daze! on 07.04.21 at 11:07 pm

#7 Ponzius Pilatus on 07.04.21 at 11:52 am

For me, I have been doing this heavily for 35 years, off and on. Back when I was selling mutual funds in the mid 80s, many investment companies were pushing this tactic. Initially, it was just borrowing, but then morphed into full blown HELOC leveraging.
——————
You’ve got quite the guts to admit on this blog that you were a Mutual Funds pusher.
I worked for a Credit Union in the 80s , and we got very nice commissions from selling them.
Everyone made good money, except the buyers.

_____________________________

I (the industry) would charge 9% commission for amounts invested up to $10K, which was a fair bit of cash 35 years ago. People had very few options. Stocks were very expensive to trade and ETFs didn’t exist.

I was in my early 20s and the only people with money were 3 times my age. This was back in the day when most people had never heard of mutual funds. I just didn’t have the patience for convincing people and selling so I created the software to run the business for my boss. But it got me intersted in investing outside of real estate which our family was big into.

#55 Divine Intervention on 07.04.21 at 11:17 pm

#10 Dr V on 07.04.21 at 12:50 pm

3 divine – you don’t get a margin call on a HELOC as the funds are secured against the house. What I am not clear on is whether the HELOC portion of the mortgage is a demand loan.

_______________________________

True enough. Generally not. However, as I mentioned in my post, this was pre HELOCs. That’s why I said initially it was just a loan I used back in the 80s. Basically, a margin account but with your bank, not your broker.

That being said … even your HELOC loan today can be called in at the request of the bank, even if you are in good standing. Or they can unilaterally change the rate that you pay.

It’s all in the fine print that nobody reads! So make sure that you keep that in mind and don’t have to liquidate at a bad time.

#56 Norberts gambit on 07.04.21 at 11:30 pm

#14 Dogman01 on 07.04.21 at 1:22 pm

Wow…Great Article Sinan.

Since you guys are so open with you knowledge and if you take requests; a good primer on the actual use of the “Norbert Gambit” with mainstream Canadian brokerages. I need some US cash in the future and I want to invest direct in some US ETF’s however I cringe at the bank exchange rates.

Is the Norbet Gambit just my FOMOSFO or is it something practical.

____________________

It is in fact very real … simple … and legitimate.

It is well documented online. I’ve been using this before it was Norbert’s. If you are lucky, you can end up making hundreds/thousands on the deal if the deal ends up in my favor. That’s in addition to all the savings.

Keep in mind:

-each bank may do it a bit differently. I’ve only done TD.
– it is possible to lose (or make) money on the deal during the time it takes for the transaction to settle. For that reason, maybe should call it Norbert’s Gamble instead.
– if you use DLR and DLR.U pair, prepare to pull your hair out understanding it. Every time I do it, I swear I have to refresh my understanding of it, since I only do it occasionally when I need US funds.
Easier to understand and use a stock that trades on both sides of border.

#57 sam on 07.05.21 at 1:17 am

coming from U.S to Canada? thats depressing…

#58 #notstoopid on 07.05.21 at 2:17 am

Why not buying energy and resources related stocks ( or an ETF/stock mix) with both hands while this sector is at an all time low ( caused only by political idiocy) makes you an idiot. The difference between buyers and nose pickers are the easy riches buyers accumulate while nose pickers languish in fear.

https://fb.watch/v/27tQS0IgF/

#59 Faron on 07.05.21 at 5:23 am

#22 BillyBob on 07.04.21 at 2:45 pm
#65 Sail Away on 07.04.21 at 9:00 am

Tossing around “murder” and “infanticide”

Person seems on it:

“Many of of us have stories from our elders about the horrors they endured,” Fulmer said, speaking of physical and sexual abuse, deaths and disappearances, forced sterilizations, abortions and infanticide. “Kill the Indian, save the man. These are all variations of the same sentiment across the U.S. and Canada.”

https://www.juneauempire.com/news/community-members-hold-vigil-for-residential-school-victims/

US resi schools but, same same.

LOL @BB+SA

#60 Faron on 07.05.21 at 5:31 am

#54 Faron on 07.05.21 at 5:23 am
#22 BillyBob on 07.04.21 at 2:45 pm
#65 Sail Away on 07.04.21 at 9:00 am

“…scene of sexual violence in which a priest rapes a young girl. The sexual violence continues through the birth of the child—whose life is barely allowed to signify beyond a scorched earth piece of remaindered sexual violence—through and beyond the scene of the infanticide of that baby…”

https://core.ac.uk/download/pdf/210601362.pdf

Took about 2 seconds of googling, but by all means stick to your willful blindness.

LOL

#61 Faron on 07.05.21 at 5:37 am

#22 BillyBob on 07.04.21 at 2:45 pm
#65 Sail Away on 07.04.21 at 9:00 am

I feel gratitude that human stupidity only amuses me.

Me too. but, I often forget what it’s like to interact with stupid people. Luckily, right about them you pop back onto the comments section all rainbow wig and size 21 shoes and then I remember — such amusement! Much wow.

#62 Sail Away on 07.05.21 at 7:27 am

#54 Norberts gambit on 07.04.21 at 11:30 pm

Keep in mind:

-each bank may do it a bit differently. I’ve only done TD.
– it is possible to lose (or make) money on the deal during the time it takes for the transaction to settle. For that reason, maybe should call it Norbert’s Gamble instead.
– if you use DLR and DLR.U pair, prepare to pull your hair out understanding it. Every time I do it, I swear I have to refresh my understanding of it, since I only do it occasionally when I need US funds.
Easier to understand and use a stock that trades on both sides of border.

———-

Agreed. I use the process all the time but rarely anymore just for the purpose of exchanging money unless it’s a large amount for some specific reason, like a land purchase. Allowing dividends from US holdings to accumulate is generally enough to cover vacations and family gifts.

#63 crowdedelevatorfartz on 07.05.21 at 8:40 am

@#58 Faron
“Took about 2 seconds of googling, but by all means stick to your willful blindness.

LOL

+++++

Yawn.
A dissertation written by a girl defending her doctorate in …..Philosophy.
Ugh.
For the University of North Carolina.
That bastion of Philosophers.
Socrates must be gouging his own dead eyes out in Hell at the idiocy that poses as philosophical science these days .

I always view papers such as these with a jaundiced eye after a friend of mine received his Masters in Business Degree after submitting his final papers written in English, on ‘ “Selling American Made Cars in Europe” to his Professors at the University of Paris.

He had spent 3 years partying all over Europe while driving his 1995 jeep Cherokee. Girls loved his car because it was “American”.
His main goal in Europe wasn’t to further his intellectual prowess….
His paper was submitted, the “Professors” asked him a few questions in English, the degree factory stamped “approved” and off he when back to Canada with great stories, a Masters in Business from that bastion of Business ….the University of Paris ( ugh) and it opened many more doors in his pursuit of a Management job.

Misson accomplished.

P.S.
Just curious, do you stand on a podium to prove to all in the mob you commitment to the Trudeau feminist cause before the flagellation?
I wonder do you take the Hair Shirt off or put it on when you flair your back with chains at the anti male gender protests?

#64 Dharma Bum on 07.05.21 at 9:04 am

#29 The Jaguar

The idea was thought to be progressive at the time: the poor would build character as they supported themselves in a self-sustaining community.
——————————————————————————–

You’re right. History repeats itself.

Today, it’s called the GTA.

Except they’re barely sustaining.

#65 Sail Away on 07.05.21 at 10:09 am

#61 crowdedelevatorfartz on 07.05.21 at 8:40 am
@#58 Faron

“Took about 2 seconds of googling, but by all means stick to your willful blindness.

LOL

———–

Yawn.

A dissertation written by a girl defending her doctorate in …..Philosophy.
Ugh.
For the University of North Carolina

———–

I’m pretty sure an opinion steeped in woke culture with pre-accepted ideals carries more weight than an eyewitness account.

This was agreed at the flag-ripping, statue-toppling, book bonfire vegan hotdog roast.

#66 the jaguar on 07.05.21 at 11:19 am

@Dharma Bum
The excerpt goes on to say ” in Chicago the authorities ordered nonresidents without work to leave the city, and clearing houses sent the swelling numbers of the destitute and the unemployed to the Oak Forest poorhouses…….None of these could match the starkness of the Angelus Building on South Wabash Avenue, a firetrap without heat or light, where sixty-seven African American families took refuge, as though returning to the dark holds of their ancestor’s slave ships”……

There was a lot of suffering before the fifties and following boom years. And we’re so ungrateful.

#67 BillyBob on 07.05.21 at 12:04 pm

#42 Sail Away on 07.04.21 at 7:20 pm
#22 BillyBob on 07.04.21 at 2:45 pm

——-

Hey BB, I didn’t make the impassioned conflation to child murder and all… that was some other shadowy anonymous emotional creature lobbing a tarball my way hoping it would stick.

Luckily it was a long midnight golf shot that fell short. Weep with me at the self- and country- hatred.

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

Yep, I’m aware – my comments were directed at the Faron doppelgänger that took his silly little shots at you. It’s funny how a writing style is so distinctive, isn’t it?

I would have thought that with the dissipation of the heat in Victoria he might have been capable of commenting without insults, but alas. He doesn’t even seem able to differentiate between the US and Canada. Or the fact that the plural of anecdotes is not data.

I will await to see what the actual cause of death was for the inhabitants of the unmarked graves, as proven by forensics. That would be the proper use of science and expertise.

Of course, that presumes there is any will to actually find out the truth. Which is doubtful, given that it may not support the heavily-promoted narrative, and we can’t have that!

#68 Faron on 07.05.21 at 12:32 pm

#65 BillyBob on 07.05.21 at 12:04 pm
#61 crowdedelevatorfartz on 07.05.21 at 8:40 am
#42 Sail Away on 07.04.21 at 7:20 pm

And when the eyewitness accounts are in? Oh, wait, they are…

http://www.trc.ca/assets/pdf/Survivors_Speak_English_Web.pdf

search the word “abuse” then try “sexual” then try “rape”

But, those are just words, not proven in court, so probably nothing.

Still, kinda reminds me of when SA was pretending that COVID was no biggie. Oh, wait, he still does…

Drop us a line when you three are done making fools of yourselves. The Jaguar incoming to join that party in three… two… one… Job#1 in three… two… one… IHCTD9 slightly later when he will tell us about his native buds who were never raped in school so it musta never happened.

#69 Whuttabout... on 07.05.21 at 2:04 pm

#11 Sail Away Whattaboutism/Faron on 07.05.21 at 5:23 am
“Many of of us have stories from our elders….
……………….
The problem with stories is that they tend to become embellished with each retelling, and memories aren’t reliable.
Younger people today were not raised with the ‘spare the rod, spoil the child’ style of parenting. I went to a regular school, (70s/80s) where getting sent to the principal’s office for the strap was the usual punishment for bad behaviour, and it was worse when my parents were in school. Unthinkable now, but that’s how it was.

#70 Sail Away on 07.05.21 at 3:17 pm

#66 Faron on 07.05.21 at 12:32 pm

Still, kinda reminds me of when SA was pretending that COVID was no biggie. Oh, wait, he still does…

——–

Correct. That said, I also have no problem adhering to imposed albeit silly rules and vaxxes while exploiting opportunities. Remember APT earned me a fortune in the beginning? 30X! Yowza!

And as usual… you squandered my fantastic tip. Probably threw a few insults, too.

#71 Rakiki on 07.06.21 at 9:54 am

We have been leveraging with margin and HELOC for about 15 years with good results. We keep the loan at about 20% of total portfolio value. Distributions from the total portfolio cover 2.5 times over the principal and interest from the current loan.

We signed up for a 5 year fixed mortgage (tied to our HELOC), deductible at our marginal rate. Every payment reduces the total owing which makes it more conservative than an interest-only loan. The risk is acceptable since we have two decent incomes, no other debt, two DBs, and are mid-40s. Borrowing to invest makes sense as one of many legs of a financial stool, but the others have to be solid.