Weekend Reading – Money freebies, TSI specials, seniors in poverty, strip bonds and more

Welcome to my latest Weekend Reading edition, some of the best saving and investing articles from the blogosphere for the week that was.  Earlier this week I reminded you about this TurboTax giveaway, your opportunity to win some free online tax filing codes and I shared some more tax tips in the process.

Now that “RRSP season” is in full swing, I listed some RRSP tips and guidance for you and thanks to avid dividend investor and fan of my site, Tawcan, there is an overview about how to invest using ShareOwner.

Thanks for reading and supporting the site – see you here next week when I’ll share my interview with Millionaire Teacher Andrew Hallam.

How To Save Money just launched a free ebook:  5 Simple Tools To Save You Big Money Every Day.  Stephen included some good tips in his free ebook, including how to use Ebates and Great Canadian Rebates to earn cash back – check it out.

Fans of my site, the TSI Network, are pleased to offer this discounted subscription to The Successful Investor newsletter to readers.  The newsletter highlights top investing considerations for your portfolio, including one of my Canadian dividend paying studs in this post that recently reported a 7% quarterly profit.

This article tells us given current savings rates for many Canadians, some seniors can expect to live in poverty.

This Globe article shared this when it comes to asset location:  “I’ve never held a U.S. stock anywhere but in my registered retirement savings plan.”  I’ve done the same thing for a few years now as well – you can read about my asset location here.

Tawcan considers the timeless question:  how much do you need to retire?  We figure this is what we need to “retire well” assuming all debt is gone at the time of retirement of course.  Your mileage may vary.

Dividend Growth Investor found ten rewarding stocks.

Looking for short-term, tax-efficient bond exposure?  Look at BXF – First Asset’s 1-5 Year Laddered Government Strip Bond Index ETF.  There is a glowing review of this ETF here.

This is how the chief actuary at Morneau Shepell invests. “About 70 per cent of my investments are in equities and 30 per cent in fixed income. I wanted to be 60-40 a year ago, but there was no place to invest.”  He puts 1/3 of his equities in Canada, just over 1/3 in U.S. equities and the rest in international equities. I just finished reading Fred Vettese’s latest book The Essential Retirement Guide and I’ll giveaway a copy of his book my site in March.

Coca-Cola added more fizz to investor pockets this month, with another dividend increase.

Michael James on Money considered renting in retirement (or not).

Royal Bank also increased their dividend to $0.81 per share.

Big Cajun Man wrote about spousal RRSPs.

Million Dollar Journey updated his RESP portfolio for readers.

Barry Choi suggests to avoid sitting on your savings.

Steadyhand has some thoughts on what negative interest rates mean.  I have my own short take on this: prudent savers are further penalized and borrowers will rejoice since they can go further into debt or leverage.  I don’t see how this is a good thing for markets or the economy.

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27 Responses to "Weekend Reading – Money freebies, TSI specials, seniors in poverty, strip bonds and more"

  1. re: Fred Vettese — “He puts 1/3 of his equities in Canada, just over 1/3 in U.S. equities and the rest in international equities.”

    Classic home bias.
    Canadian equities comprise about 3% of the aggregate global stock markets (US is about 50%). Perhaps he does so for tax reasons, or perhaps he thinks the Canadian market will provide a superior risk-return profile than other markets.

    His book (co-authored) is well worth the read.

    Reply
  2. “New Statistics Canada data shows that 12 percent of seniors live in poverty, amounting to almost 600,000 people. Seniors living alone are particularly hard pressed finically, with more than 1 in 4 single seniors, most of whom are women, living in poverty. (I’m guessing it means they have income of $35,000 or less)
    Twelve million working Canadians do not have workplace pension plans and Canadians are increasingly unable to save sufficiently for their own retirement. Future generations of Canadians face the real prospect of substantial declines in standard of living in retirement if nothing is done now to help.”

    I don’t know if the figures are real but I really don’t feel responsible for others financial position. I have even less sympathy for future generations. They have choices and they have the opportunity do something to save for the future rather than spending all their current earnings. I certainly don’t feel it’s the governments responsibility to provide a “Standard of Living” for every Canadian”.
    Yes, there are those who need assistance and should be helped, but for many I think their position was self-created.

    Reply
    1. I do feel for our generation though Cannew, jobs are not coming out the woodwork like they did in the 1970s for Boomers. In fact, Boomers are trying to hang on to every single penny they make – at least some Boomers are – because they spent their brains out….

      I do feel it’s governments’ responsibility to provide a “Standard of Living” for every Canadian, because that’s our social safety net. Government should provide a min. standard of health care, education and financial support but yes, beyond that, yes, for sure, Canadians should on their own.

      Some seniors are in poverty due to misfortune. Others, self-imposed destruction. I feel for the former and have no problem paying taxes for the former, I struggle with the latter!

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      1. Mark: “I do feel it’s governments’ responsibility to provide a “Standard of Living” for every Canadian, because that’s our social safety net. Government should provide a min. standard of health care, education and financial support but yes, beyond that, yes, for sure, Canadians should on their own.”

        It’s a catch 22, we complain about taxes, the way gov’t spends and waste our money, the high cost of health care, lack of Infrastructure repair, yet we want to be provided with a High standard of living. I’d prefer to see less taxes, less government and more reliance on the family taking care of their own and each person taking more responsibility to care for themselves. How many people are not looking for work because they can get by on EI or welfare, or they say why work if I only make as much as EI, or feel they are owed they money. I’ve never taken EI (UIC in my day), but don’t feel any loss because I don’t mind paying for that type of insurance, or that some need EI.

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      2. are: “Government should provide a min. standard of…education…”

        I agree, yet the minimum standard of financial education is abysmal. Again, another Catch 22, we don’t want people living in poverty, yet the system doesn’t provide any education about the role of money, and its importance in life. Instead we get to write essays on Louis Riel.

        With that being said, poverty will never be eliminated. There will always be poor people of every demographic, no matter the level of financial education. What should be a focus is a strong system of economic mobility.

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        1. No, agreed, there will always be a rich-poor gap, or chasm as it is becoming now… As I get older I learn to appreciate what I have and try and volunteer and give back where I can. I will do more of that as I get older.

          Have a good weekend SST.

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      1. You should point out that that article from TAWCAN that you link to is 100% incorrect. YOC doesn’t change by one penny how much you need for retirement and doesn’t affect how much a portfolio yields at all.

        I have asked that he correct but so far it has not been corrected.
        People reading that are going to under estimate how much they need to save to retire.

        YOC can be an interesting metric but how they use it is very wrong.

        Reply
        1. Thanks Matt. I’ll need to read that article and correct him then. I agree yield on cost is a poor metric. You can have yield on cost (YOC) for any investment you purchase, this metric doesn’t make dividend stocks special.

          Ultimately the money you need for retirement is based on what you spend. Hopefully the current yield, not YOC, covers that. Also, if you’re a big spender, your nest egg is going to have to be huge.

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  3. cannew, I’m pretty much on the same page with your comments above, and especially about less government, less taxes and much more self reliance. Sadly it seems we’re headed in the opposite direction.

    I saw a survey watching the local TV news several weeks ago, that I thought typified current thinking by too many. They asked about the size of the federal deficit and particularly the stimulus spending (investments as our government coins it) with 4 specific choices- from no we shouldn’t be running a deficit to whatever it takes. The overwhelming answer with 78% of respondents was the highest spending choice – “whatever it takes”- whatever that means??? Obviously many people treat debt very casually (partially a terrible consequence of these low rates), and believe governments can spend their way to prosperity for the country. Now my wife and I joke “whatever it takes” when we hear about about record household debt levels, many citizens clamouring for more spending (but usually don’t want to pay), and government jumping in with more money (that they don’t have) to save us and answer the call. How do you save when you have so much debt?

    Maybe I’m wrong but it seems to me too many people are and have been concerned with how to spend vs. how to save. This site unfortunately will not reach these people.

    I don’t believe Canada has an official poverty level but I think a poverty level for a single retired person is lower than you suggest by about 10K- maybe $25K. 35K or less for 2 people. My wife and I can and do spend slightly above this when we’re not traveling and we’re far from destitute.
    http://www.moneysense.ca/save/financial-planning/the-all-canadian-wealth-test-2015-charts/

    Mark, please don’t put me in that category of Boomers you spoke about. It’s disappointing to think too many of my generation have made poor financial choices when there was decent employment/savings opportunity and their own parents were generally very fiscally prudent.

    Reply
    1. RBull, I certainly do not put you in that category.

      I work with a few Boomers who have used the words “entitled” and “deserved” when it comes to their pensions, and the organization “taking care of them”. I find that very troubling and I pretty much bite my tongue (blood trickling out of the side of my mouth) every time I hear that. The organization does not owe you anything. You are fortunate to have a job, you should be working hard to keep it and you should be saving on your own. The fact that some Boomers with a career of 30+ years admit to “no savings”, they prioritize new cars over their TFSAs and RRSPs, they focus on the trip to Punta Cana over any mortgage prepayments – and yet complain they don’t make enough money is annoying.

      To each their own for sure but I also have to sympathize; people don’t know what they don’t know and on top of that, even if they know they find it very difficult to make good decisions.

      You are correct: “…seems to me too many people are and have been concerned with how to spend vs. how to save. This site unfortunately will not reach these people.” I’m far from perfect, we could be saving more for sure, but I think we’re on the right track and a balanced saving vs. spending act. I’m trying to do my little part running my little blog. If it helps and inspires people, that’s a good thing, and I’m happy for that.

      Thanks for your comments RBull. You bring a great voice-of-reason here.

      Reply
      1. I think achieving the balance between spending and saving is of extreme importance Mark. My belief is that if we manage our money well and look for opportunities to save money, we can both live a good life now and have enough set aside to have a respectable retirement.

        Thanks for featuring my new eBook!

        Reply
  4. Thank you for highlighting my article. Just for the record, this is a list of companies that had raised dividends for the week. As part of my monitoring process, I review dividend increases that happen on certain stocks that meet some criteria. This list is just one example of my way to create and monitor a population of companies for further research.

    Reply
    1. Thanks for the clarification and happy to list your article. I was fortunate to have a few stocks raise their dividends again this winter and I’ll highlight a few of those likely in a post next week. That helps future cash flow but also offset the O&G companies I own that cut dividends recently with the energy sector meltdown.

      Reply
  5. Thank you Mark. You’re a great example of being fiscally prudent and savvy, with a good plan that balances now and the future. I am sure your blog inspires and educates many in a positive way.

    I hear plenty of that too. Government is the largest employer here and there is much entitlement thinking and talk, but its not limited to boomers, and neither is the rampant spending, debt gorging and little saving.

    Reply
    1. Well, we’re far from perfect. We have good jobs and could be saving more but we have to live. An example of that was going to Scotland last summer for a couple of weeks, as we saved for a bathroom reno!

      Interesting point our the entitlement talk; debt gorging – good term 🙂

      Reply

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