The Problem: Sequence Risk Meets Longevity Risk David and Marie are a 65-year-old married couple preparing for retirement. With $1 million spread across Defined Contribution (DC) pensions, RRSPs, TFSAs, and non-registered accounts, they feel a quiet contentment about reaching this financial milestone. However, recent events have...
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Balancing Taxes, Investments, and Borrowing As Edi and Roy approached their retirement, they faced a common financial planning challenge: how to fund a $200,000 renovation to their home without derailing their carefully laid plans. With a healthy $3.5 million in assets split across joint non-registered accounts,...
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It was a typical Saturday morning at the local diner, where Lee, John, Dave, and Bob gathered for their usual breakfast and discussion about investments and the economy. This weekend, the hot topic was the recent decision by the Bank of Canada to reduce the...
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“Decumulation” (I don’t really like this word, but I suspect I lack sufficient influence to change things) is the spending down of assets that have been accumulated in preparation for retirement. It is the conversion of pension plans, RRSPs, TFSAs, and other financial assets into...
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When we think of managing risk, we usually think about insurance. We buy life insurance to protect our family against the risk of premature death. We buy disability insurance to protect ourselves against the risk of a lengthy loss of income due to a disability....
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There are compelling reasons to invest in equities over the long term. So much so that academics in the field of finance will tell you that the traditional strategy of investors shifting an increasing balance of their assets to fixed income as they approach retirement...
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Recently, I’ve been thinking about saving versus investing or the idea of engaging in “risky” investments versus “safe” interest-bearing deposit products. This idea came to mind again because of the findings presented in my last blog post that financial planners in Japan did not tend...
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On July 4, 2022, I posted my 154th blog, on the topic of bonds and GICs. Coming off a long-term situation when the returns from these fixed-income products left many investors with little interest in buying something other than equities (individual stocks, equity mutual funds...
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Being Cautious With Your Money For years your friends have been telling you to invest in the stock market. You resisted, insisting that High-Interest Savings Accounts (HISAs) and Guaranteed Investment Certificates (GICs) were all you needed. Besides, you already had some money in the stock market...
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Retirement is a significant milestone in one's life, representing a well-deserved transition from the daily grind to a more relaxed and fulfilling chapter. However, for many Canadians, the path to a worry-free retirement can be filled with uncertainties and financial challenges. In this blog post,...
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