Weekend Reading – Building wealth and getting semi-retirement ready, financial facelifts gone wild, and more #moneystuff

Weekend Reading – Building wealth and getting semi-retirement ready, financial facelifts gone wild, and more #moneystuff

Hey Readers!

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 the last edition (…just in case you missed it!?) right below:

Weekend Reading – How to invest in your TFSA, passive income updates, top stocks to own this year and more!

Earlier this week, I wrote this article with CPP and OAS financial expert Doug Runchey. A thank you to Doug once again for his time on my site: unpacking survivorship benefits when it comes to CPP and OAS.

In that article, you can also find a host of links about when to take CPP and OAS, should you defer these government benefits and if so, why, and much more.

I’ve also got those articles listed on my dedicated Retirement page with a dozen+ essays and stories of early retirees who have “been there, done that” to learn from. 

In terms of weekend chores, there is work to do around the condo and some last-minute holiday shopping before things get really wild in the coming weeks – to avoid any store-hopping in the coming weeks with the pandemic going on. 

I hope you stay well and stay safe during these times even with vaccines on the horizon. It’s still time to be very cautious and we’re a long ways from being out of the viral woods yet!!

I’ll be back next week with at least one new article you’ll read reference to below, and maybe more so stay tuned!

Thanks again for your readership – approaching 5,000 dedicated subscribers and over 750,000 pageviews year to date!

Have a great weekend!


Weekend Reads

Quite the Financial Facelift article in The Globe and Mail recently. I’ve shared the link but will write more about it below since I know some of you don’t pay to get behind the Globe paywall like I do!

The article features Stella, a do-it-yourself investor who has a tidy sum of “dividend-paying Canadian corporations to take advantage of the dividend tax credit…$860,000 portfolio heavily weighted in Canadian financials, utilities and telecom stocks.”

Stella is concerned about her portfolio of predominantly Canadian dividend stocks, and would like “better asset allocation”.  Very fair. This is however despite the dividend income delivered from her portfolio, a whopping $43,200 per year.

Where things get a bit interesting is in the firm financial advice and the comments from Globe readers.

First up, the planner in the article advises Stella to basically destroy the existing portfolio and convert it to a cookie-cutter indexed portfolio. The planner also advises to hold enough cash for three years of needs. He advises this to “reduce her portfolio’s overall volatility, allowing her to sleep a little easier knowing that she can cover her expenses and either reinvest or reallocate the dividends that she receives,” the planner says. “In addition, she will not be susceptible to changes in dividend payout rates, which are out of her control.”

Without sharing too much from any Globe comments section, this planner is largely ripped by the commenters for a host of reasons. Here are some examples including other advisors. All screenshots courtesy of article:

Stella - FF comment 1

Stella - FF comment 2

Stella - FF comment 3

Regardless of the comments, I feel the article is missing an important point: Stella has met her goals. Instead of blowing up the portfolio with a cookie-cutter indexing approach (i.e., some cash, “35 per cent Canadian equities and 35 per cent global equities” and so on) there could be a way to keep what she has built and migrate her investing approach over time to feel and be more diversified.

That paragraph also brings me to these two points:

  1. Depending upon your own tolerance for investing risk, few people need three-years of expenses held just in cash. While holding cash is very important (read on – how much cash should you keep?) you could argue that holding that much cash, where interest rates are now, is more risky than most equity products thanks to rock-bottom interest rates.
  2. I’ve always mentioned on this site DIY stock investing always has risks. For example, dividend cuts can and do happen from time to time. I’ve hit a few snags myself this year. This makes the use of broadly indexed funds a winner long-term since you’ll hold all growth stocks that pay no dividends, dividend growers (and dividend cutters) in a large basket. But to suggest any cookie-cutter approach to investing is misleading. Maybe the editing team was short on time…

I’ll have MUCH more to say about point #2 when I share what goes into a financial plan on my site next week – with input from a Certified Financial Planner.

In the meantime, you can see my quick takes on what your financial plan should cover here.

What should my financial plan cover?

A BIG thanks to Kornel at Build Wealth Canada, Canada’s top personal finance podcast. If you didn’t get a chance to check out the Canadian Financial Summit this year, and my presentation with Kornel – you can do here and below.

We had a great discussion (and went overtime!) on how I’m striving to structure my portfolio for semi-retirement instead of striving for some massive portfolio number that implies never working again.

As you might already know, I believe in Financial Independence and not full-on Retire Early.

Here is one article on that very subject.

Dividend Growth Investor reviewed a dividend healthcare stalwart to consider for your portfolio.

Last but not least, wow, quite the makeover at Million Dollar Journey. I am impressed by the layout – so check it out. I continue to look forward to the articles from this site from Cut the Crap Investing writer Dale Roberts and Kyle Prevost, my favourite new expat teacher in Qatar! 

Reader question of the week (adapted for the site):

Hi Mark, 

Did you see that RioCan REIT (a stock that you own I think from your Dividends page here) cut their dividend by 33%? What are you going to do with that stock?


Great question and yes, I did see that. 

What am I going to do? Nothing, right now. 🙂

I own a few hundred shares of REI.UN which is <1% of my portfolio. I figure retail will eventually come back in some shape or form and RioCan might thrive eventually. We’ll see…

Beyond this particular dividend cut, thankfully I own dozens of Canadian stocks as part of my get wealthy eventually strategy. Dividends can and do get cut. Dividends can and do increase as well. So, for RioCan, while the loss of some dividend/distribution income stings a bit for sure I don’t think it’s worth sweating the small stuff over in the coming weeks. 

I will decide how RioCan fits into my longer-term plan in the coming year or so!

You can find some recent, popular FAQs on this new page here. 

Happy investing!


My name is Mark Seed - the founder, editor and owner of My Own Advisor. As my own DIY financial advisor, I'm looking to start semi-retirement soon, sooner than most. Find out how, what I did, and what you can learn to tailor your own financial independence path. Join the newsletter read by thousands each day, always FREE.

32 Responses to "Weekend Reading – Building wealth and getting semi-retirement ready, financial facelifts gone wild, and more #moneystuff"

  1. I’m curious. At some point, do other people pause to contemplate if maybe they’ve got enough and don’t need to chase more growth? Or has it become a game that just never ends. Obviously this would be applicable to us older farts.

    1. LOL.

      I suspect you already know you “have enough”.

      I can only speak for me as a 40-something. I want to be productive, working and active until I’m about 55-60 so part-time or full-time work I will do but I want that work to be a) stressful and therefore b) something that I enjoy.

      In a pretty good place now but the blog takes work! 🙂 Need it to take off and make me a few hundred K per year so it helps my decision. Haha. Not likely but I will remain +ve.


      1. hahaha…some day you will be in the Old Fart’s Club. You’ve got a ways to go yet, keep that nose on the grindstone my son.

        But seriously, if an older couple has 500k, a million, or two, invested in equities, do they really need more? Where’s the finish line?

        1. Ya, I hear ya. I figure our “how much is enough” is our $1M portfolio (excluding pensions, condo value, etc.) and no debt. We will have more than that? Possibly actually but that’s fine and we will have exceeded our goals. It will be time to work part-time in the coming years and hopefully that is rewarding too 🙂

          I’ll keep you and all other readers posted of course.

  2. I have a question, do you have any recommendations for software that pulls all your transactional data from bank accounts and credits cards to build your own financial summary for spending and calculate your net worth? I had been using RBC’s Financial Tracker but it has stopped updating some sites, and when I called them about it, they said it’s on the way out. Cheers

    1. Ha. For sure Maria. Maybe I feel for the article as clickbait! 🙂

      Post going up soon/later today and newsletter out tomorrow!

      Thanks again for that!

  3. I have a few hundreds REI.UN too. The most hurting one is HR.UN, 1K shares in my DH’s account. I do want to get rid of these two along with some other stocks that reduced dividends in the future. Overall, the impact is small and if I was already retired, won’t be a problem to adjust to the situation by reducing the expenses a little bit. So I still sleep tight over these cuts.

    1. Ya, I’m not too worried about some of the REITs I own. They will come back in some cases like RioCan. H&R REIT I do worry a bit given most of their income is office space, 40% office and 28% retail.

      RioCan seems to have the major anchors/tenants we need in Canada in their buildings plus they are building more apartment buildings so I like this strategy more.

      I am tempted to buy more industrial REITs going forward. Granite or Summit.

  4. The facelift article shouldn’t surprise me. How often do we hear that dividends aren’t tax efficient and our portfolio has too much home bias. But Stella isn’t working, so the dividends are very tax efficient and she doesn’t have to touch principal. It’s all about cash flow, and the proposed changes seriously impact that cash flow. The simple change is just to put new cash, or excess dividends into an ETF like XAW. As always the comment section is the most entertaining.

    1. The comments sections from these articles are GOLD 🙂 – and makes me think the articles might be written this way or edited this way on purpose!

      XAW is an outstanding product and I might buy some myself inside the TFSA for 2021. Not sure yet!

      1. Agreed Mark, sometimes the commenters are more informed than the advisors who are tasked to come up with solutions for these profiles. Stella is doing just fine and should continue to do so because it is what she knows best and it works.

        The other frequent suggestion that often gets panned is the recommendation for alternatives, which I’d be interested to hear how others feel about. Are readers of this site making use of alternatives in their portfolios, which ones they use, and how much of their portfolios the represent. Gold is a common one, but so too are other commodities, private equity/debt, real estate (REITs?), infrastructure, and of course hedge funds. They can be held directly or in ETFs of course, and I’ve just learned about Accelerate’ OneChoice Alternative Portfolio ETF that holds multiple strategies. So far, I haven’t been interested in these myself because although less correlated with equities, they don’t seem to provide the longer-term performance of equity holdings.

        1. I suspect some readers are absolutely investing beyond stocks and ETFs. I know they are. They write me personally.

          Gold is a common one and some readers invest via ETFs or own gold companies directly. No more than 5% or so as far as I can tell.

          Private equity, yes, had a post on that:

          I would say not many readers are doing that though.

          Real estate – stay tuned. I actually have another investor profile coming out tonight/tomorrow on that!

          Based on what I’ve seen myself, S&P 500 returns for the last 10-20 years, it would be hard to beat >8% annualized returns in anything else with such little effort.


          1. Thanks for this Mark, that 5% number makes a lot of sense to me. Thanks for the private equity link, that was interesting to read too. I’ve debated adding some REIT exposure but have never been attracted to gold.

            1. Same on gold, but tempted but never purchased yet and probably shouldn’t.

              Curious about adding some industrial REITs in 2021 TFSA. I haven’t landed on our decision yet. Not adding more RioCan, just going to hold and stay the course on that one – continue to DRIP.

          2. Hindsight seems easy!

            10 yr SP 500 13.55% cagr
            20 yr SP 500 6.36% cagr

            I wonder who will predict where that kind of performance will happen for the next 10 years. I’m doubtful the S&P will lead again but I don’t try and predict.

            No interest in gold and not likely in private equity either.

            1. LOL. Ya, nobody saw the returns coming out of the pandemic either. I’ll still put my money on the U.S. market and multinationals for the coming decades for the best returns. If Canada even does remotely similar, slightly trailing, I will be thrilled.

              No plans to invest in gold here although I did briefly consider Barrick (ABX). Glad I didn’t.

              If anything, I’ll buy more QQQ for tech kicker in my RRSP and maybe more MSFT over time too.
              I’m tempted to buy some XUU in CDN RRSP to avoid more currency changes.
              Other than that, stay the course with my current CDN and U.S. stocks.

              Very boring I know.

              1. I’ll also still keep my boring share of equities in the US, Canada and internationally likely as long as I live. However I don’t think anyone can reliably predict the US will generate the best returns in the coming decade or decades. Historically speaking over time yes; the future – who knows? I’m hedging bets with diversification. Not for everybody. US over performance in this past decade might even suggest under performance ahead for a while. Dunno. Perhaps though your crystal ball is more clear than mine.

                Ian MuGuigan’s article in the Globe I think on Saturday was very interesting. Maybe equity markets really will continue to rock with no real alternatives due to rates/debt. I think there will need to be a great reset on govt debt globally. I wonder what the fall out will be from that.

                  1. Thanks for that source May. I read for interest but don’t take predictions too seriously. As general trends go I think their numbers might be on the right track. I agree US is priced high. But I also know anything can happen.

                    1. Ya, their prediction was the US bringing up the rear everywhere but Denmark.

                      I think it makes sense to me but only time will tell. Otherwise might be more accurate throwing darts blindfolded.

                1. I mean, after our investment income covers our basic expenses, I would like to invest in some growth equities too and I think high tech is where the future is. So I am looking to buy QQQ or ARK series ETF. But not now.

                  No matter how much I love cars produced by Tesla. I think Tesla price is a big bubble and there is no way can justify it.

                  1. Yes, tech will play an even bigger role in future.

                    Tesla has defied shorts and naysayers including me. I think the stock is overpriced at 10% of the price now. But clearly I’ve been proven wrong at least for now. I agree on being a bubble. Almost like a cult following of Musk.

                1. Probably real fine with the top 60. Stocks rotate anyway so the weak fall off XIU and the XIC cream rises to replace them.

                  I redid with new ones (13 yrs max for vym, 15 itot)
                  13 yrs
                  SPY 9.15%
                  VYM 7.26
                  VTI 9.39

                  15 yrs
                  SPY 9.28%
                  VTI 9.58
                  ITOT 9.42

                  18 yrs
                  VTI 8.92%
                  SPY 8.36

                  1. Impressive numbers aren’t they? Geez. Boring wins with any of those products although broad market vs. dividend ETFs seem to have the edge. Regardless, I’ll be using VYM in 5-years to “live off distributions” and see how that goes it the early years. My theory may or may not work!

                    1. Yes sir. It’s been a good run. History teaches us the future is likely not so rosy, especially starting from where we are now. I hope that’s wrong!

                      I get that. What I did and am doing. Now you know why I am having second thoughts particularly when ultimately I care about total return, with a side benefit of simplicity.

Post Comment