The Magic Wealth Ingredient
There is a legend about a successful financial advisor in Warren Buffett’s stomping grounds of Omaha, Nebraska. It is reported that this advisor has learned the art of communicating the basics of wealth building with the local farmers. The advisor, who we will call Fred Smith, greets clients in his office with a window behind […]
Buy Now, Pay Big Time Later
Brent and Darlene really enjoy their ‘toys’ and their lifestyle. In the last few years, they bought themselves a big screen TV, a stereo system, two expensive new vehicles, a ski boat and took a tropical vacation, mostly on credit. They also used their credit cards to pay for numerous restaurant meals, theatre tickets, hockey […]
NIRP, ZIRP and You
In his early July testimony before Congress, US Federal Reserve Chairman Jay Powell. Mr. Powell stated that the Fed funds rate will be reduced, given lower than expected U.S. inflation. This follows on the heels of President Trump’s demands for lower interest rates to help support the economy and more specifically the US stock market. […]
Law of Large Numbers
Over the next several years, governments in advanced countries will likely continue to struggle with mounting debt burdens and the associated rising costs of servicing that debt. It is also noteworthy to remember that total government debt continues to increase every year because of deficit spending. So how does the Law of Large Numbers […]
Looking at Investment Returns
A major Canadian financial institution ran an investment promotion earlier this year that promised attractive returns for GIC-type investors, who needed higher returns to generate income. While dealing with an advisor from this particular institution on another matter, the conversation turned to the details of their offer. The highlighted promotion offered a much higher […]
The Role of Luck in Your Planning
One of the most interesting facets of the financial services industry is how so many people tend to invest their money and plan their financial affairs by chasing trends and doing what is “popular”. For example, many investors like a “sure thing” and will often pile into an investment sector that is hot. […]
The Often Unasked Question
With the December market correction in both the US, Canada and elsewhere slowly receding into the past, it is a good time to review what exactly happened and how clients have reacted to the recent events. To put December into context, it was the most severe correction late in the year since the early […]
BHAG for 2019
As you look to 2019 for a fresh beginning, we invite you to set your intentions to have a breakthrough year! To do that, you are invited to reach for and set some Big Hairy Audacious Goals (BHAG)! That’s right! Why look to set incremental goals when you can set goals that cause you […]
Boomer Advice to Young People: Invest Early & Diversify
When asked if they had any regrets, Baby Boomers wished they had started investing and saving at a much earlier age. Hindsight being 20/20, the Boomer generation can pass on some much needed advice and guidance to their kids and grandkids. It is normal for younger people to focus on earning money to accommodate their […]
New Energy Landscape
Bill Nye the Science Guy met with Prime Minister Justin Trudeau in Ottawa earlier this year to promote the use of alternative energy fuels in our economy. He is a strong advocate of moving away from carbon-based fuels. Yet, Nye admitted, in a Toronto radio interview some days later, that the economy will likely transition […]
Understanding Market Volatility – Part 2
Our previous article looked at the increase in market volatility in 2018 in historical terms to put it in perspective. The other factor to consider is where are we in the market cycle and what this might mean for you personally in terms of your own long-term financial strategy. Many market commentators suggest that […]
Understanding Market Volatility – Part 1
This year began with some market turbulence resulting in a correction in the S&P Index in late January of about 10%, and about 7% for the TSX during the same period. You would have thought the world was ending with all the hand-wringing and hysteria stirred up by media reports at the time. More […]
De-Dollarization and You – Part 2
The US has been Canada’s largest trading partner for decades, so our economy is closely tied to the fortunes of our southern neighbour. In addition, because the US economy is still currently the largest in the world, whenever an investor implements or revises a financial strategy, it is always important to consider how US Government […]
Hype, Hope and Glory
Advisors offer clients many value-added services, in addition to investment planning, insurance and risk management planning and general financial and Estate Planning advice. This often leads to a discussion by clients of what is hot in the market and what is actively being discussed in the media and whether the client should participate in the […]
How to Start An Investment Plan
Wouldn’t life be better if it was easier to get ahead? For many, there’s just too much month left over at the end of the pay cheque. After all, you’ve got a mortgage or rent and utilities to pay, food and clothes to buy, and a vehicle to operate. First, let’s understand the difference […]
America Decides
On November 8, 2016, Americans will elect the 45th President of the United States. Many Canadians have been vehement and passionate observers of every twist and turn of the campaign. Yet, once you strip away the nasty name calling and accusations of one kind or another by both candidates, you are left with their policy […]
Active Versus Passive Investing
There are very passionate views on both sides of the debate as to whether it is better for individual investors to use active investment managers versus using an index approach, with its main selling feature being lower fees. Let us first bear in mind why people invest in the first place, whether it is […]
The Story Behind ‘Sell Everything’
The media in general has a tendency to take an idea or story and run with it until the original context or point is lost in a wave of misinformation, taking a form of its own. At that point, the idea can become very dangerous to you as an individual working to build your own […]
TFSA Designations Matter
The method that you use to name a successor, owner or beneficiary of a TFSA makes a big difference to your estate, not only for a TFSA to maintain its tax-exempt status but also to ensure that the assets are distributed to the intended recipients. You can name your spouse or common-law partner as […]
Investing Like the Rich Do
“Everyone has a plan until they get punched in the face.” George Foreman. With RRSP season upon us, it might be useful to see how the wealthy invest their funds for some indication as to how they differ from average Canadians. As Baron Rothschild famously stated, “The time to buy is when there’s blood […]
China’s Global Impact
The August correction in the Chinese stock market led to a lot of “how terrible” news coverage and speculation as to whether or not this signaled the end of the China growth story and how it would impact the US and global economies. Calmer voices were more resolute in the midst of the chaos, […]
Anatomy of a Market Correction
The origin of the recent stock market correction started earlier in the spring of this year. During the month of April, the Canadian, U.S. and many other global stock markets achieved new record highs. Instead of celebrating such a numerical milestone, many media commentators started wringing their hands in worry and expressing their fears […]
Evolution of an Investor
Sometimes during social events or other gatherings a person will approach someone in the financial services business with an opening question: “I hear you do investments. What kind of returns can I expect?”. The type of questions asked by individuals are usually a good indication of their investing experience. Newer (younger) investors are often […]
Living Longer & Retiring Faster
Over the last one hundred years, every new generation of Canadians has enjoyed the benefit of a longer life expectancy. With dramatic improvements in health care, the human life span has never been longer. Additionally, some have set their sights on early retirement. The combination of living longer and retiring earlier creates a serious cash […]
QE Continues
Quantitative Easing, otherwise referred to in the media as ‘QE’, refers to governments printing money out of thin air in order to stimulate economic growth. The US ended their program of QE in late 2014. The impression this left with many people was that the need for economic stimulus ended. This also goes hand […]
Predicting the Future
Human nature includes the desire to predict and or anticipate both the immediate and longer term future. The reason for doing so is often to eliminate or reduce the fear or anxiety about the unknown. Human beings detest uncertainty and will do almost anything to reduce this uncertainty. In ancient times people made special […]
Investor Emotions & Media Influence
During a recent client call, the topics discussed included how the media influence people’s investment behaviors. This client woke up one day with an ‘epiphany’ thinking that a market correction was just around the corner. They did admit after a discussion that they had been reading something to that effect in the newspapers during the […]
Improving Investment Returns
One Saturday, famed investment manager Peter Lynch was working at the office when he decided to answer the phone. The caller was a holder of his mutual fund who was calling to cash in the investment. Peter explained how he was excited about the growth prospects for the economy and his fund and asked him […]
Building Wealth
There are many definitions and meanings for the term ‘wealth’. It is often said that it is easier to build wealth over time than it is to keep it! Some confuse high incomes with wealth while others point to assets owned as an indicator of wealth. And, many people use the terms ‘assets’ and ‘wealth’ […]
Reaching for Yield in a World of Low Interest Rates
While we can talk about concepts such as inflation and purchasing power the struggle for many people today is earning enough income on their savings to meet their lifestyle needs. Interest rates and the earnings from capital through dividends, bonds and real estate rental income have dropped dramatically in the past few years. Government […]