Weekend Reading – Surviving the Capital One hack, side hustles for extra income, housing bubble risks 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.
Earlier this week, I wrote about the pros and cons of dividend reinvestment plans. Of course this approach to investing is not perfect (no approach is), but I believe it’s a great way to put your portfolio on autopilot and build tremendous wealth over time by taking your emotions out of investing.
Rob Carrick from The Globe and Mail agreed with me, and put this article in his Carrick On Money column recently. Thanks for the mention Rob!
I hope you enjoy these articles and you have a great weekend!
I contributed to Dan Kent’s post about the best Canadian dividend paying stocks to own this year.
Yet another hack in the financial industry this week. Earlier this week, Capital One announced that a hacker had breached their cloud data systems and stolen personal information tied to around 100 million American customers, and six million Canadian customers. I have a card in my wallet. *Sigh*. Here are the steps I’m going to take as this hack plays out:
- I’m going to monitor my credit score more frequently. This way, if I see a significant drop, I’ll know something is probably up.
- I’m going to review all my credit card statements – diligently. I will watch for any unauthorized transactions and report them promptly.
- I will continue to report any suspected theft/fraud right away. If and when I see anything, I will report it to the Canadian Anti-Fraud Centre, tell my bank(s), and contact the credit reporting agencies like Equifax.
- I will likely order an Equifax credit report again – soon.
What would you do?
Boomer and Echo was kind to include one of my latest articles in their Weekend Reading edition – the upside down mortgage rate edition.
My friends over at How To Save Money highlighted 25 ways to earn some extra income via various side hustles.
Here are some common mistakes by Canadian investors. In this article, there is a proposal for wealthy Canadians with no employer pensions to draw down, to obtain 7 years of GIS (Guaranteed Income Supplement) benefits by drawing down their TFSAs or savings first, between ages 65 and 71, and letting the RRSPs grow until mandatory withdrawals start at age 72. This is a rather controversial loop-hole in our tax system – since those benefits can be worth tens of thousands of dollars to already very wealthy Canadians that might not need any sort of “income supplement”. Thoughts?
Reader question and email this week (information adapted slightly below):
I recently backed into your site. Very impressed! Perhaps I missed this, but have you shared your portfolio’s performance? Any insights you can share about market growth vs. just dividend yield?
What is your typical dividend payout each month? Maybe more details could be shared over time about each dollar invested assuming no dividend reinvestment?
Thanks very much!
Great detailed questions. Thanks for those!
In a previous post, I disclosed some benchmarking details on my site. I will probably provide another update later this year or early next year given I will have 10 years of dividend history as a DIY investor. Time flies!
That said, while I love dividends, I do believe investors should be mindful that total return matters. Based on your questions to me, it seems like you’re already aware of the power than low-cost, indexing can provide.
While total returns matter, there is a wrinkle in Canada. Given the oligopoly nature of our Canadian market, I’ve decided to unbundle one of my favourite Canadian ETFs that delivers solid income and growth over time for our market: XIU. I used to own this fund but now I own most of the top-20 holdings in this fund directly for dividend income – and save money management fees in the process.
I know from my dividend income journey, my plan is to have cash flow cover some of our basic living expenses. I’m not “there yet” with that desired income level but we are getting there. I figure we’re 63% of the way there to realize one of our big lifelong financial goals: earn $30,000 per year in dividend income from some key accounts.
I hope post my July dividend income update soon!
Thanks for being a new fan and reader of the site. I hope to see your comments on my posts.
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