Monthly Archives: July 2015

Robo advisers here to stay: Dan Hallett

Posted By Jonathan Chevreau | July 14, 2015

Good piece by High View Financial Group’s Dan Hallett in the Globe & Mail the past 24 hours.

In Why robo-advisers are here to stay, Hallett notes that the user-friendly online investment advisory firms removes the sometimes intimidating barrier of dealing with human advisors face-to-face: “Leveraging the power of user-friendly technology removes that barrier for the tech-savvy while creating a scalable platform for these firms. This keeps costs low; a key benefit of Robo-Advisors.

(Note on spelling: the G&M spells it robo-adviser in the headline but robo-advisor in the story itself. The Hub prefers robo-adviser but some guest bloggers spell it the other way.)

In any case, this is a nice example of a market “naturally establishing a pricing floor for basic investment advice,” Hallett writes, “i.e. 35 basis points (0.35%) per year of the value of client portfolios plus tax and product fees.”

Hallett predicts some traditional advisors could get pushed out of the business: every Robo-Advisory firm he’s looked at is a licensed portfolio manager and hence a legal fiduciary.

Some Drawbacks
Continue Reading…

Have advertisers put a spell on you?

Posted By Michael Drak | July 13, 2015

By Michael Drak

Special to the Financial Independence Hub

“Advertising is the art of convincing people to spend money they don’t have on things they don’t need.”

— Will Rogers

Recently the Contessa (my wife) and I went to see the Bette Midler show and at the unbelievable age of 69 she put on one heck of a performance. She still has it and had us laughing when she was poking fun at herself singing I Look Good and I Still Have my Health.

This was followed by a standup comedy routine in which she threw her usual zingers into the crowd. “I still look good, but I don’t know what happened to some of you,” she teased. “It’s 50 shades of grey in this section right here. I don’t know whether to sing to you or tell you something about reverse mortgages.”

At one point in the performance she came out dressed as the witch character from her 1993 film Hocus Pocus and sang one of my favourite songs, I Put a Spell on You.

Which brings me back to the subject of this article.

Honey, I think our computer is possessed!

Weekly Wrap: Semi-retirement, Mini-Retirements, RVing & Variants

Posted By Jonathan Chevreau | July 11, 2015

The current issue of MoneySense features my Financial Independence column, with the current instalment being an update on the “semi-retired” first year of my personal Findependence: What semi-retirement is really like.

Do a search on semi-retirement and/or financial independence and you’ll find plenty more articles on this theme. For instance, in February, the Afford Anything blog ran a piece titled Mini-Retirements, Semi-Retirement, Early Retirement — What’s the Most Awesome Lifestyle? There are some interesting variants in the piece, such as “Perpetual Semi-Retirement.”

Back in April, The Toronto Star and other media ran stories like this one: Semi-retirement the new normal in Canada: Survey. The Hub also weighed in on the survey, noting that 15% plan never to fully retire, but many will embrace Semi-Retirement.

Way back, the Get Rich Slowly blog ran this reader story about Making the Move to Semi-Retirement. Note the reference to the classic book about Financial Independence, Your Money or Your Life, which is all about the tradeoffs between time/life energy and money. Recommended reading for anyone interested in Findependence!

The RV has replaced the rocking chair

5 Asian locations where retirement is more affordable than North America

Posted By Jonathan Chevreau | July 10, 2015

By Jonathan Chevreau

Financial Independence Hub

I’ve personally never travelled to southeast Asia, although my family has and my daughter currently is posted in Hong Kong for a one-year teaching gig. As a result, I was more than usually interested when a review copy came in the mail titled Planet Boomer: Retire now for less in Southeast Asia.

It’s written by a boomer Canadian couple, Jim Herrier and Ellen Ma, who left marketing and advertising positions in 2006 to move to Singapore and Shanghai, then researched a bunch of other locations to help them write the book.

The book is slated for release in mid-August.

Asia 50% more affordable than North America

The pair argue that the financial crisis of 2008-2009 battered the investment portfolios of many Canadian boomers, and that “the math of a comfortable retirement for many of the nearly 10 million Canadians between 44 and 64 is not working anymore.” On average, those boomers are $400,000 short of their ideal retirement savings goal. Most of the 15 destinations in five Southeast Asian countries are at least 50% more affordable than Canada or the United States. Continue Reading…

Protecting Your Nest Egg In Retirement

Posted By Financial Independence Hub | July 9, 2015

By Marie Engen, Boomer & Echo

Special to the Financial Independence Hub

Investors who are in, or near, retirement are in a difficult position. They need their investments to provide them with steady cash flow to live on, but they also need their wealth to last for a potentially long life.

Retirees who are caught in a bear market don’t have the time to wait out temporary dips in stock prices, even if they have a greater risk tolerance. Being forced to sell investments that have plummeted in order to provide money to live could have a devastating effect on the sustainability of a portfolio.

Some investment advisors are mobilized to guide their pre-retirement clients out of equities and into bonds, in an effort to offer income and stability. But now that interest rates have reached historical lows, traditional bond portfolios will have a difficult time providing an acceptable level of income while protecting purchasing power over the next 25 to 30 years.

Structure your portfolio for both short- and long-term needs

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