Hub Blogs

Hub Blogs contains fresh contributions written by Financial Independence Hub staff or contributors that have not appeared elsewhere first, or have been modified or customized for the Hub by the original blogger. In contrast, Top Blogs shows links to the best external financial blogs around the world.

Why David Trahair is 100% in fixed income

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David Trahair
David Trahair

By David Trahair

Special to the Financial Independence Hub

I have been writing about personal financial issues for over 12 years now. I have also been giving seminars to other accountants on my ideas since 2008.

Suffice it to say I have spent a large amount of time thinking about and analyzing the best way to get ahead financially and I have had a tremendous amount of feedback along the way.

And I still have 100% of my family’s investments in guaranteed fixed-income products.

Zero exposure to stock market

That’s correct, I have zero exposure to the stock market. It’s all in Guaranteed Investment Certificates (GICs) or provincial government bonds using a three-year laddered approach.

Sound crazy? Well I’ll tell you why it’s not.

First of all, the assumption is that you have to have exposure to the stock market because it’s the only thing that will give you excellent returns. But how good are those returns versus plain old GICs?

I have done an analysis for my Enough Bull course that will give you some idea. Continue Reading…

5 Pitfalls to Avoid on the Road to Retirement

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MattArdrey
Matt Ardrey

By Matthew Ardrey

Special to the Financial Independence Hub

One of the greatest things I can do for my clients is to reassure them that they’ll be financially independent when they’re ready to retire. Unfortunately, not everyone meets their financial retirement goals. When they don’t, it’s often because they’ve made one or more of the five following mistakes:

1.) Not understanding your spending habits

Most people know what they earn and what they save, but have no idea what they spend. As you approach retirement and your ability to earn income is more limited, understanding what you spend and where you spend it becomes crucial.

Not knowing what you spend can lead to living beyond your means. Spending more than you earn can result in debt accumulation and, ultimately, reduced savings. Think of savings as fuel for your retirement; if you don’t have enough in the tank, you might not make it to your final destination.

2.) Carrying debt into retirement

A cornerstone of financial independence is being debt free. Continue Reading…

Weekly Wrap: High-flying tech stocks, dividends as contrarian play, best careers for Early Retirement

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Map of the Silicon Valley area of CaliforniaGood cover story in the current issue of the Economist on the technology boom and the Nasdaq composite index surpassing its previous all-time high early in the year 2000.

The magazine argues that while the tech boom may get bumpy, “it will not end in a repeat of the dot com crash.” Certainly, the past week was mostly positive for growth stocks like the four that make up the so-called “FANG” acronym: Facebook, Amazon, Netflix and Google.  Amazon turning a profit: who knew?

True, none of the FANG stocks  pay dividends but the older tech giants that do,  like Apple, IBM and Microsoft, experienced haircuts this week.

Dividends now a contrarian play?

Continue Reading…

Always Try to Keep the Odds in Your Favour

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Illustration depicting a highway gantry sign with a healthy lifestyle concept. Blue sky background.By Michael Drak

Special to the Financial Independence Hub

Recently, Globe & Mail personal finance columnist Rob Carrick wrote an article entitled ‘It’s time to get real about retirement planning.” In it he stated that people should not count on working past retirement age because many will not be able to do so due to health issues. Everyone that knows me is aware that I’m a big promoter of continuing to work at something you love, for as long as you can, so this article really caught my attention and got me to do some serious thinking. The following are the conclusions that I came up with:

Always try to put the odds in your favour

Want to increase the odds of extending your work life past the normal retirement age? You need to adopt a healthy lifestyle as early as possible. Most of us know what to do but for whatever reason fail to do it. You need to keep active, work out on a regular basis, eat the right foods, and stay engaged. Odds are you will live enjoy a longer and happier life than your smoking neighbour whose retirement is based on watching tv and drinking lots of beer to help kill the boredom.

Chronic Stress will eventually take its toll

Continue Reading…

How pairing fee-only planners and robo-advisers can save you money

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Woman meeting financial adviser in officeCute Robot

By Robb Engen, Boomer & Echo

Special to the Financial Independence Hub

The financial services industry would have you believe that individual investors don’t want to pay upfront for investment advice – in fact, the industry claims that investors prefer to pay for financial advice through fees that are part of their mutual funds.

But we all know mutual funds in Canada cost too much and the relationship between investors and financial advisors is mostly transactional in nature. Embedded commissions and trailer fees might make sense for investors who are just starting out, but over the long term this conflict of interest will be expensive and lead to poorer outcomes for investors.

An unconventional pairing

With the relatively new arrival of fee-only financial planners – advisors who don’t sell products but offer unbiased and objective financial advice for a set fee – and the emergence of robo-advisors – online investment management services – there is an opportunity for Canadians to access a better form of financial advice that costs less than the traditional bank advisor-mutual fund model.

That’s right, pairing a fee-only financial advisor with a robo-advisor (or DIY, if that’s your thing) can actually save you money and lead to better investor outcomes.

Here’s an example Continue Reading…