Weekend Reading – Best ETFs for Canada, shortest recession (ever), FIRE is for wimps and more #moneystuff
Welcome to my latest Weekend Reading edition where I share some of my favourite articles from the week that was across the personal finance and investing blogosphere.
You can find my last Weekend edition here about Warren Buffett buying up Suncor and Canadian gold stocks, my latest (free) podcast on moneystuff including ideas about structuring your portfolio for retirement, and taxation that might be coming our way to pay for this healthcare crisis called COVID-19.
That’s a pile of money….
Check those articles out and much more below!
See you on the site and I’ll be back next week with more original content.
Family Money Saver wrote about why people don’t do FIRE (Financial Independence, Retire Early). Dedicated fans of this site probably already know my reasons but if you don’t here is the punchline: “retire early” doesn’t fit me but financial independence and working on my own terms absolutely does.
Generally speaking, we believe we can semi-retire once the dividend income goal on this page is reached based on our planned expenses. We’re about 70% there towards our goal (give or take).
Our goal is to live off the income generated by our portfolio (both dividends and distributions) while working part-time. We’ll draw down the capital at a later date.
Speaking of retirement – this is nuts. I fell for more clickbait this week: there is no way anyone needs $8 million to retire.
A Purple Life is a mere few weeks away from early retirement. She claimed FIRE is for wimps.
Helpful stuff at Credit Card Genius – how to save money on any foreign currency exchange fees when using your credit card.
Early Retirement Now (ERN), an outstanding U.S. site and blogger for the record, shared his thoughts on the U.S. economy – including the shortest recession – ever.
Image courtesy of the big ERN:
Thanks to Jon Chevreau for highlighting one of my latest blogposts – where I discuss the precious currency of time – don’t waste it!
Have you considered investing like the 8th largest pension plan in the world – eh?? You should. Check out how the Canada Pension Plan Investment Board invests right here.
While Boomer & Echo suggests there are risks carrying debt (including your mortgage) into retirement, they are not as dire as they once were. Low-interest rates are perpetuating this problem. There is no incentive to save nor pay down debt – just take more on. Robb has made a conscious choice to prioritize his RRSP, TFSA, and even non-registered investments before his mortgage. Smart but I’m biased too and I’ve done the same for years.
Why? See below.
Now to daydream a bit….The Prince of Travel highlighted the costs of going to one of my sought after destinations – The Maldives. Read on about this lavish place of luxury.
I know GenY Money wishes to travel to the Maldives one day as well…so here is her recipe to get there via early retirement and freedom.
- A high, prolonged savings rate.
- Strain out debt.
- The desire to get there, including a willing partner.
- As an alternative but an enabler, establish a side-hustle or anything else to accelerate the process beyond any day job.
Dale Roberts wonders if you have enough tech in your portfolio? I don’t – not based on this recent run up!!
Reader question of the week (adapted slightly for the site)
Love the site, love the journey. Thoughts as a new investor? What are the best low-cost ETFs to own for Canada? There seem to be so many to choose from and I don’t know where to start.
Paralysis by Analysis
Let me help you get unstuck. I’ve narrowed my best-of to these ETFs in Canada below. Check them out and let me know if you have more questions. You can read up about ETFs, indexed ETFs for that matter, how I invest and dozens of other articles in the links below.
I’m happy to answer more questions anytime via the blog.
Index investing? Why? Read on since Warren Buffett plans to put his estate into an indexed fund.
Best-of Canadian ETFs to ride Canadian market-like returns:
|iShares Core S&P/TSX Capped Composite Index ETF (XIC)
|S&P/TSX Capped Composite Index
|Own all the major stocks in the Canadian market, >200 of them and ride their returns less minor fund fees.
|iShares S&P/TSX 60 Index ETF (XIU)
|S&P/TSX 60 Index
|Own the biggest names in Canada, get consistent 3% yield + long term growth. Win-win and one of my personal favourites. (I used to own this fund for many years.)
|Vanguard FTSE Canada All Cap Index ETF (VCN)
|FTSE Canada All Cap Domestic Index
|Exposure to small, medium and large cap stocks in the Canadian market, similar product to XIC but different provider of course.
|BMO S&P TSX Capped Composite Index ETF (ZCN)
|S&P/TSX Capped Composite Index
|BMO Low Volatility Canadian Equity ETF (ZLB)
|Uses smart beta/rules based approach
|Yes, higher MER but low-volatility fund for any defensive times. Think a better balance of financials, utilities, grocery stores/consumer staples and telcos as top holdings.
All the best and talk soon!