Weekend Reading – Expenses that may disappear edition

Weekend Reading – Expenses that may disappear edition

Hi Everyone,

Welcome to a new Weekend Reading post: some expenses that may disappear in retirement (or not) edition. 

A few thoughts on that particular subject soon but first some reminders about some recent content…

To avoid wasting money in your asset accumulation or asset decumulation years, you should really, really consider the tyranny of compounding costs – fees that kill portfolios. 

I highlighted where I’m parking some cash now, in some low-risk, low-cost cash-alternative ETFs that yield more than 4%Are these ETFs right for you?

This past week, I updated my post on whether the 4% safe withdrawal rate rule was really worth looking at. I think this “rule” has some merit, to a point. Read on why in that link above…

Weekend Reading – Expenses that may disappear edition

Weekend Reading - Expenses that may disappear edition

Source: Behavior Gap

Respected CFP Mark McGrath’s tweet caught my eye this week, related to future retirement expenses that may disappear as you enter that lifestyle phase.

For the most part, I’m aligned with him based on our plans and forecasts.

A good example of our thinking stems from our Dividends page.

For years, I’ve highlighted some basic, average costs/expenses we incur. We spend more money than expenses identified on that page, but those are our foundational expenses we need to cover in semi-retirement or retirement from our portfolio. 

I’ve tracked those key expenses for years because I want/we want the income from our portfolio (dividends, distributions or some capital withdrawals over time) to cover those expenses and a bit more. We simply cannot afford to retire before that occurs. 

You can see from that table, on that page, once our mortgage is done, that should free-up at least $2,200 per month in after-tax dollars – after-tax income we don’t need to make and our lifestyle would not change.

Without a mortgage, we’ll have no debt. This is not a trivial milestone. We can’t wait. 

Mortgage June 2023

When you have debt, you pay other people first. 

Yet lack of mortgage, let alone no cashflows diverted to saving for retirement, could be replaced as you age by other costs that Mark didn’t indicate in that tweet – although I know he is aware of them. 

Inflation is a slow wealth killer. Larry Bates reminded us so in his Beat the Bank book. 

Healthcare costs are a major wildcard. I had a post on this very subject here.

The costs of elder care in Canada

Lower taxation is not a given – you can only be tax efficient to a point – with taxation rates and rules likely to change to service government programs over time. If lower taxation occurs in the coming decades, great, but I’m hardly planning for that in our house. 🙂 

When it comes to our plan, while I do believe our mortgage costs and the need to divert our employment income to savings for retirement purposes will disappear, there are some retirement headwinds to fight and we’re planning for them now: higher inflation, higher healthcare costs, higher overall taxation. 

This reminds me of this Carl Richards sketch art below, and the role of some reality-based planning knowing there is always uncertainty in the future. The beauty of plans are, while never perfect, they define your assumptions about the future so you can change course more readily when life changes on you. 

From Carl’s musings on this subject:

“In fact, the only thing we know for sure about that straight line is that it is wrong. We just don’t know why… yet. But it will be wrong again and again and again because we can’t predict the future, no matter how many numbers we crunch.

The good news? That’s okay.

That’s right… it’s okay not to know. It has to be okay because there’s no other option.

I’m not saying don’t ever draw the line. For sure, that’s an important part of the planning process. It gives us an approximation, a baseline, a direction to go.

I’m just saying, don’t confuse the line with reality.

After the line is drawn, we need to relax into the idea that planning is an ongoing process. We need to understand that what matters far more than the line is how we behave when it’s time to make course corrections.

Reality-based planning, on the other hand, is the process of being less wrong tomorrow. It’s the constant work of narrowing the potential range of outcomes over time.”

Current Reality - Goals, Behavior Gap

Sources: Behavior Gap.

Nice. I like it. The process of planning and re-planning is always key. 

More Weekend Reading!

Great reference I did not know about, when it comes to taxation deductions or credits with thanks to Canadian Tax Guy – a good Twitter follow. 

His link to CRA:


From Jon Chevreau, good tips on avoiding a CRA audit.

Gordon Pape (subscription, Globe and Mail) recently wrote:

“Investors are always being told to diversify. But what exactly does that mean? A knowledgeable financial advisor can put together a well-diversified portfolio, tailored to the client’s needs. But if you want to do it yourself, it can be a challenge.”

I disagree. With some one-ticket ETFs, investing diversification couldn’t be easier out-of-the-box.

On a related theme, Justin Bender still loves the simplicity of an all-equity ETF for your wealth-building years. 

From Justin:

“All things considered, I still prefer the simplicity of an all-equity ETF. But if you just can’t stand the thought of potentially leaving some cash on the table, a two-fund approach might be an appropriate compromise for you and your portfolio.”

This is an interesting two-fund approach for any Canadian investor that wishes to avoid individual stock selecction and too much home-bias:

VXC and VCN - Ditching your All-Equity ETF May 2023

Source: Justin Bender

Thanks to Dale Roberts for mentioning my debt-ceiling thoughts amongst others on his Sunday Reads:

Buying the big Canadian banks, plus the debt ceiling on the Sunday Reads.

A reader asked me to re-post one of my popular cases studies so I’ll do one better – I’ll link to my Retirement page too!

Here is how much you need to retire on $6k per month at age 50 with 3% inflation.

How much do you need to retire on $6,000 per month?

Enjoy this and many, many more case studies on my standing Retirement page including a link to my low-cost services to run projections reports for you too! Contact me anytime to get started. 

Have a great weekend and stay well.


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.

12 Responses to "Weekend Reading – Expenses that may disappear edition"

  1. A great reminder Mark that sometimes we tend to over save for retirement (or going work optional 😉).

    I think that when I reach financial independence I will slowly fade away from work as opposed to a full immediate stop. The gradual decrease in work load can help smooth out some of those adjustment periods.

    1. Ya, I can’t see myself stopping work for income, in a part-time or work optional capacity, for another 10-20 years. But not working full-time via a strict Monday to Friday is very likely. 🙂

      Thanks for your comment.

  2. I can tell you for sure, when I compare dollar for dollar, the tax savings on my RSP contributions in the 80’s and 90’s, to what I am paying in tax now as I withdraw the money… it’s almost a wash. Yes, I had the tax refund invested for a length of time, but as I withdraw the money now, I am giving back almost the entire gain and the original tax deduction amount back. Fill your TFSA first in my view, and then fill up your RSP. Also your withdrawals from your TFSA don’t count against your income, which helps.


    Hi Mark: First I would like to say that paying $9.99 on a $30.00 stock and watching it go over $50.00 on 1000 shares does not seem like tyranny to me. Next when you retire or leave the workforce there is less commuting to work so less gas to buy. Also you can do what you want when you want. When I was in the GE I had to pay for my license plate sticker so I left work a little early buy the time I got to the car and drove around the block to the office when I went to open the door it was locked. Now I can do those errands anytime of the day. Andy I’m in your boat when it comes to financial independence. That is why I continue to invest and watch the dividends increase each year.

  4. Hi Mark, do you have any reference on the best order of maxing out investment accounts when there’s a difference in incomes between spouses? I make 2x my wife now and wondering how to max out the income splitting

    1. Hi Geoff,

      Thanks for your question. In your asset accumulation years, I find the keys are to max out the TFSA, then RRSP (at any income-level), including spousal RRSP and then consider taxable investing. When it comes to taxable investing, assuming there is no other taxable income to report, you can invest in Canadian dividend paying stocks and earn about $50k per year = tax-free. That’s pretty darn good 🙂


  5. Perhaps I’m in the minority, but I plan to continue to max TFSA contributions in retirement until I need to draw on that account so reduced savings for retirement in retirement but not total elimination. I’m beginning to come around to the concept that retired vs not is not a bimodal state, but a spectrum. It’s more about financial independence and choosing how to live as you like or are able to with perhaps the privilege to work on the projects that serve you whether they generate income or not.

    1. Wow, that’s great Andy!

      I’m not sure we’ll have the income stream(s) available to keep maxing out both of our TFSAs in retirement but if we can contribute to this account, in the coming years, for sure we will. We’ve estimated if we don’t contribute to the TFSAs ever again both accounts combined could be worth close to $500k in value in another 10 years. That’s a pretty good emergency fund for our 60s+.

      Yes, I’ve long since believed financial independence offers a spectrum of choices. We hope to start working part-time next summer. I’ll keep you and other readers posted!

      Thanks for your comment.

  6. Disappeared or reduced…

    – life insurance (annual reductions through the pension plan)
    – disability insurance
    – commuting costs (fuel, repairs, etc)
    – commuting insurance premium on vehicle
    – routine take out (coffee/muffin)

    Probably more, just can’t think of them. Throw in increasing age discounts on the spending side.

    I grossly over estimated our actual spending post-retirement.


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