Weekend Reading – Buffett buying up gold and Suncor, podcasts with beer, asset allocation and more!
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.
If you missed last weekend’s reading material about some great Aeroplan program changes, how to hit financial independence in your 30s, and much more – check that out here.
First up, thanks to the guys at FI Garage for having me on their podcast. We had fun drinking beer and talking personal finance and investing…
Earlier this week, I reflected on my journey to date to semi-retirement and shared more time is a goal worth chasing after.
What say you? Are you striving for a better balance of work and fun? Do tell!
Have a great weekend and I’ll be back next week to chat about investing the difference and I’ll try and answer another reader question in my inbox.
All the best,
A good read I found recently was about five misconceptions about Exchange Traded Funds (ETFs).
My favourite from this article above was not all index ETFs are created equal. For sure – as in hardly. Even if you track an S&P 500 ETF that follows the biggest names in the U.S. market, including tech, you have many options.
Personally, to avoid Canadian to U.S. currency conversion charges and to track the U.S. total market I like the iShares XUU fund. (I own that fund.) With XUU you get a fund of funds for a puny 0.07% MER before minor withholding taxes are factored in.
This way, you can ride the current tech wave and not have any individual stock risk! The top holdings in U.S. ETF IVV are as follows:
Did Warren Buffett just bet against the entire U.S. economy? Yes, he did – with these latest investing moves. Based on his moves, I don’t own much gold beyond ETFs but I do own some Suncor directly – sticking to my investment plan as a dividend investor. Thoughts on Buffett and gold buy? Bullish but it could pay off well in the coming years. Oil is very cyclical.
Here is what Buffett said about gold in the past, not exactly loving the asset:
In Berkshire’s 2011 annual shareholder letter he wrote: “if you own one ounce of gold for an eternity, you will still own one ounce at its end” and joked about a big pile of gold that “you can fondle the cube, but it will not respond.”
Speaking of betting against the economy and government decisions I wonder what it means here at home with our debt-load further exasperated by COVID-19?
MoneySense with blogger Dale Roberts has some thoughts when he tries to make sense of the markets.
I think a tax on the Canadian wealthy is coming. Increasing the capital gains inclusion rate (from 50% to something higher) is a given for me. Impacting every Canadian though, I could also see a cap/lifetime contribution limit on the Tax Free Savings Account (TFSA) at about $100,000 per individual. To offset those changes, I think our government will (finally) abolish any RRIF minimum withdrawal rules. You’ll simply need to pay tax on any RRIF withdrawals as income (as done today). That would make sense and simplify the tax code at the same time.
Congrats to Dividend Earner on his July dividend income. Well done!
Nice to hear my friend Bob Lai (Tawcan) on the Explore FI Canada podcast.
While shouting out the EFIC podcast, I want to acknowledge fellow Canadian bloggers/podcasters/content creators up for a U.S. Plutus Awards in the personal finance space. Kudos go out to:
Tom from Dividends Diversify wrote about living off your investments. I was interested in his asset allocation below, again, just a suggestion or rather an example:
- “10% savings products
- 20% real estate
- 20% bonds and preferred stocks
- 50% dividend stocks and ETFs.”
You know, (and listen to the podcast I was on above on this!)…I’ve been giving more and more thought to my desired asset allocation (and location) to enter semi-retirement with in the coming years. So far, without detailed allocations (yet) I’ll likely structure mine something like this:
- Would like to have ~ 1-years’ worth of expenses in cash as an emergency fund, other, to start semi-retirement with (about $50,000).
- Would like to have ~10% REITs in my portfolio – this is where I disagree with a Yale financial expert on this subject since 20% REITs is too much.
- I consider my small future pension from work “a big bond” and therefore I do not hold any individual bonds anymore.
- Our personal portfolio will likely be a blend of Canadian and U.S. individual stocks (about 40 or so), along with a few low-cost, mainly U.S.-listed Exchange Traded Funds (ETFs) for extra diversification.
Physician on FIRE (who also loves craft pints) discussed his year 1 of early retirement.
Have a great weekend!