Weekend Reading – Mental mistakes, great debates, broke NHL players and #money stuff

Weekend Reading

Welcome to my latest Weekend Reading edition!

Here are my thoughts from this past week:

For investors who don’t want to go it alone and/or who are unsure how to build a low-cost ETF portfolio – consider this article to get you started. 

Although I’m not old enough yet (let alone wealthy enough yet) to tap my RRSP I wrote about some RRSP withdrawal strategies to consider before turning age 71.

I’ll be back next week to post my latest dividend income update and likely some other money musings as well.

All the best and enjoy the weekend!

Mark

Here are the mental money mistakes we make.

Tawcan wrote about the great debate that will never end – index investing versus dividend growth investing.   At the end of the day I feel these strategies are more similar than different but no doubt many people will continue to disagree on that.

Another sad story about broke and bankrupt NHL players, this one about former tough guy player Chris Simon.  Chris earned more than $15 million during his NHL playing career and yet according to recent court documents, he hasn’t worked since November 2015 and his gross income for all of last year was just $3,836.13.

Million Dollar Journey wrote about the global merits of ETFs XAW and VXC.

The Blunt Bean Counter highlighted a number of reasons why talking about money is taboo.

Physician on FIRE provided some insight into what your part-time number might be.  I think for us if we’re able to keep up our savings rate, age 50 is when we could start.

Should the age of eligibility for CPP/OAS be raised?  Save with SPP has some thoughts on that.

Here are some considerations for keeping a modest cash wedge in retirement – how we might open up the investing tap.

Dividend Earner is now earning over $1,000 per month in dividends. Like I mentioned above I hope to provide my passive income update in another week or so – stay tuned!

Here are 7 ways to get ahead with your first paycheck.  In the article the millennial author writes about the 50/30/20 rule.  I like that rule but this is what I consider the best (and most straightforward) budgeting rule of thumb.   This is because I feel folks will confuse wants versus needs including what debt repayments actually constitute.

Mark Seed is the founder, editor and owner of My Own Advisor. As my own financial advisor, I've grown our portfolio from $100,000 to well over $500,000. Our next big goal is to own a $1 million investment portfolio for an early retirement. Come follow my saving and investing journey by subscribing to my site. Delivered by Subscribe Here to My Own Advisor

12 Responses to "Weekend Reading – Mental mistakes, great debates, broke NHL players and #money stuff"

  1. Lots of interesting articles Mark.
    On CPP:
    Funny it takes so long for people to realize that at some point the young will be supporting the old. Even making the changes only “Increase the probability of it’s sustainability”.

    Commented on Boomers article earlier, but suggesting that one invest in Index funds for growth? I’m not the one to judge as I’m 100% Cdn DG stocks, but look at the five Cdn Dividend funds when compared to the five DG stocks I mentioned. (be sure to look at the charts in the “All” setting:

    ZDV Ave Price just below current price. No Dist growth
    https://www.google.ca/finance?q=TSE%3AZDV&ei=-nExWdmgMZbDU-C2g-gM
    VDY Ave Price just below current price. No Dist growth
    https://www.google.ca/finance?q=TSE%3AVDY&ei=CHIxWfm_MdHBU-25i4AM
    XDV Ave Price just below current price. Dist dropped over time
    https://www.google.ca/finance?q=TSE%3AXDV&ei=c3IxWaibOMHLU5LrrfgM
    XEI Ave Price just below current price. Min Dist growth
    XIU Ave Price just below current price. Better Dist growth
    https://www.google.ca/finance?q=TSE%3AXIU&ei=P3MxWZG2CMmiUbK4orAM

    BCE Steady price growth. Good Div growth
    https://www.google.ca/finance?q=TSE%3ABCE&ei=u3MxWcm9N4WZULDQpMgL
    CNR Good price growth, great div growth (lost of splits)
    https://www.google.ca/finance?q=TSE%3ACNR&ei=RHQxWbiHL8HCUfH1pqAM
    FTS Good price growth since 2005, excellent div growth
    https://www.google.ca/finance?q=TSE%3AFTS&ei=lXQxWdi4KYLOU77cu6gM
    ENB Excellent price growth, excellent div growth, 2 splits
    https://www.google.ca/finance?q=TSE%3AENB&ei=_nQxWZHxHtacUOT7vsAM
    RY Excellent price growth, excellent div growth, 2 splits
    https://www.google.ca/finance?q=TSE%3ARY&ei=XnUxWZChD4OUUP39nJgM

    These may not be the best funds to use as a comparison but they are one Mark listed. I can attest that by investing only in quality DG stocks I’ve gotten both Income increase and price growth, not just one or the other.

    Reply
    1. Ha, well, I for one certainly know I’ve been paying for the livelihood of “older” folks for a LONNGGG time now! That’s what younger generations do 🙂

      I’ve always thought about dividend ETFs this way – you get steady income not really any capital appreciation. The only minor exceptions are some U.S.-listed ETFs like VYM and HDV. There is capital appreciation there.

      Also, I just so happen to own most of those and DRIP them for the reasons you already know: BCE, FTS, ENB, etc.

      Reply
      1. Year to date 11 dividend increases, so on target to match the 21 last year. That’s what I love about our holdings, they continue to pay us just for holding.

        Reply
  2. This debate on funds or stocks takes me back to the fork/spoon debate with Campbell Chunky Soup (and I still haven’t decided on THAT one yet!)

    Reply
  3. I agree with you Mark – the approaches are more similar than different. In fact, when I published my holdings once, a reader made fun of me for “making my own etf”. My dividend portfolio is essentially a custom built ETF that fits my needs, so they were not far from the truth.

    However, it is always fun to rile up the masses and see where their misconceptions lie 😉

    Reply
    1. That’s very much how I see the CDN portion of my portfolio = my own CDN dividend ETF with higher assets in utilities and telcos than the index provides in its cap-weighted methodology.

      The die hard indexing fans will always critique my path but there are indexers out there, including those that follow this site, that take a much more balanced view – which I appreciate.

      Reply
  4. How about best of both worlds? I make up my own etf of Canadian stocks ( ry, td, bns, fts, ema, cn, cp, enb, sap, bam, bce & t) for income and tax efficiency, as I am retired, and one US stock, Brk.b, whick is almost like an etf, and pays no dividend, so no withholding tax.

    Reply
    1. Nothing wrong with that Brian but I’m biased, largely my approach: 30+ CDN stocks including all the ones you mentioned for income and tax efficiency and a couple of U.S.-listed ETFs for income and diversification. BRK.B is like an index fund. 🙂

      Reply
  5. re: mental money mistakes we make
    — such as with almost everything in life, master the mental game and most of the physical pieces fall into place.

    re: index investing versus dividend growth investing
    — indexing is the top form of diversifying and reducing risk, it’s the best way to preserve wealth using public equities. DG investing, although similar, decreases diversification and increases risk, thus has a foot in both wealth preservation and creation. Those who think DG is a silver bullet most likely have no quantification of the inherent risk involved.

    re: talking about money is taboo
    — it’s a Canadian thing. We can talk in general terms (‘Build Your Net Worth!’) but never in specific terms (“I might one day share how much money I make/have…”). Our American cousins have no problem voicing their financial opinions. Their hyper-Capitalist society is most likely one of the main drivers as to why ~5% of their population are millionaires vs. ~1% of the Canadian population. They embrace money whereas the polite Canadian culture still deems ‘money talk’ to be taboo.

    re: 7 ways to get ahead with your first paycheck
    — #6 – Select a Credit Card….yeah…great idea. Cuz, y’know, that always works out. LOL. Yet another amateur PF blogger who understands exactly what the bank/credit card marketing department want him to understand about the process — and nothing more. Using credit cards makes EVERYONE less wealthy, in real terms, above and beyond those perceived “free benefits”.

    Reply
    1. @SST,

      I never thought about it that way but you’re probably right: “We can talk in general terms (‘Build Your Net Worth!’) but never in specific terms (“I might one day share how much money I make/have…”).”

      I have to wonder if because we’re not as focused on talking about capital creation this is exactly why we shy away from money conversations.

      Hey, I didn’t say I agreed with all of her points. Credit cards are useful to a point but they are really not for everyone. I wonder if folks truly realize that the people that cannot afford to pay off their credit card debts are the same people that subsidize the rewards to others. Not exactly a great thing to promote to each their own.

      Reply

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