Victory Lap

Once you achieve Financial Independence, you may choose to leave salaried employment but with decades of vibrant life ahead, it’s too soon to do nothing. The new stage of life between traditional employment and Full Retirement we call Victory Lap, or Victory Lap Retirement (also the title of a new book to be published in August 2016. You can pre-order now at VictoryLapRetirement.com). You may choose to start a business, go back to school or launch an Encore Act or Legacy Career. Perhaps you become a free agent, consultant, freelance writer or to change careers and re-enter the corporate world or government.

What we’re doing in this beet-red Bear market

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Image Tawcan/Unsplash

By Bob Lai, Tawcan

Special to the Financial Independence Hub

Unless you’ve been living under a rock, you probably have heard that the global stock market has been on a downward spiral. Yup, the bear has entered the room and many of us are seeing beet-red market conditions over the last number of months.

Year to date the TSX is down more than 13%.

TSX YTD performance

Meanwhile, the S&P 500 is down more than 22% year to date.

S&P500 YTD performance

The typically high-flying NASDAQ is down more than 30% year to date.

NASDAQ YTD performance

For those investors who only started investing in 2021 or those who are used to the only-going-up-bull-market condition, the recent downward trend is undoubtedly hard to stomach.

Given that we’ve been DIY investing for more than a decade, some readers have reached out and asked what we’re doing in this bear, beet-red market condition.

So what are we doing?

Allow me to explain.

Think long term

First of all, it’s essential to think long term. If you’re still in the accumulation phase, like us, you should be wishing and hoping for an extended bear market.

Why?

Because investors in the accumulation phase will want to buy stocks at discounted prices.

How often do you see the likes of Royal Bank and TD having an initial dividend yield of over 4.1%? The 10-year historical average dividend yield for Royal Bank is 3.92% while the 10-year historical average dividend yield for TD is 3.8%. Continue Reading…

Canadian Financial Summit 2022 (Virtual)

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This week a veritable who’s who of Canadian financial personalities and personal finance bloggers will be featured at the 2022 (and virtual) edition of the Canadian Financial Summit, starting this Wednesday. Hub readers will recognize several guest bloggers, including (pictured above) Robb Engen of Boomer & Echo; Bob Lai of Tawcan; Kyle Prevost of Million Dollar Journey and MoneySense; myself; as well as well-known media commentators like Robb Carrick of the Globe & Mail, Peter Hodgson of the Financial Post, Fred Vettese of the G&M, financial planner Ed Rempel and many more. There will also be MoneySense colleagues Dale Roberts (of Cutthecrapinvesting) and MoneySense executive editor Lisa Hannam

The online summit runs from Wed., Oct. 12 to Saturday, Oct. 15th, 2022.

To register, click on the home page here.

Here are just some of the topics that will be covered:

  • How to plan your own retirement at any age
  • How to save money on taxes by optimizing your RRSP to RRIF transition
  • What cryptocurrencies like Bitcoin actually are – and if you should be investing in them
  • How to maximize your Canadian Child Benefit (CCB)
  • How to efficiently transition your investing nest egg to a steady stream of retirement income
  • What Canadian real estate investments looks like in 2022
  • How to deal with inflation on your bills and in your investment portfolio
  • How to avoid crippling fees and terrible advice
  • When to take your OAS and CPP
  • How to buy your own pension – income for life!
  • Why Canadian dividend stocks might be the right fit for you
  • How to use your housing equity to maximize your retirement lifestyle

Here’s what MillionDollarJourney had to say about the conference:

I’m proud to say that MDJ’s own Kyle Prevost is co-hosting the event alongside MDJ writers Kornel Szrejber and Dale Roberts – so I can speak firsthand to the quality of the product!

One thing I always appreciate about this Summit each fall is that it is produced by Canadians – for Canadians.  Too much of the money-related content we see is American-based in nature – but you won’t have to translate any talk about 401Ks or American private health insurance at this event!

Together, the roster of All Star Speakers have authored more than 100 personal finance books, hosted 1,000+ podcast episodes, written 20,000+ blog posts and newspaper columns, and have been featured in thousands of media articles and interviews from every news and financial publication in Canada.  

Needless to say – you will not find this elite group in one place anywhere else!

And it’s free!

Here’s a sampling of the event’s FAQ:

Is the Canadian Financial Summit really free?

Yes. The videos are completely free to view for 48 hours. After that you need the any-time, anywhere All Access Pass.

What’s the catch?

There. Is. No. Catch.  We believe you’ll think the information presented by our 35+ Canadian experts is so solid, so actionable, so lacking in fluff and sales jargon – that we think you’ll pay for it after already seeing it for free.

How do I watch The Summit?
Simply click here to claim your free ticket. You should immediately get an email confirming your registration – just follow the directions in that email and you will get a link sent to you 24 hours before The Summit goes live. You can view The Summit on any phone, tablet, or computer.
I signed up for the 2017,2018, 2019, and 2020 All Access passes, but am not sure how to access those membership pages.

Click here, and simply fill in your info.  You will be be taken to a page that allows you access the 2017, 2018, 2019, and 2020 content. If you have forgot your Canadian Financial Summit password, simply click here to re-set it.

A sampling of the sessions

Rob Carrick

Where is Housing Headed?

In a drastic change from past years, we’re seeing some major pull backs in the Canadian housing market. Join Rob and I as we break down how this is affecting Canadians’ net worth, who is getting hit the hardest, and where we go from here. We also discuss if renting is still an option that we’re recommending and what we think could happen in regards to the long-term trends of immigration and housing stock within Canada now that the pandemic is in the rearview mirror.

Ellen Roseman

Addressing Canadians’ Inflating Sense of Worry

Longtime Canadian consumer advocate Ellen Roseman is back and wants to help Canadians weather the recent storm of inflation and rising costs of living.  Her personal experience with Canada’s last bout of quickly rising prices have given her some hard-won wisdom in practical ways to deal with modern inflation issues.  We talk about what to pay attention to, watch out for, and some top tips in this high-price environment.  We wrap by speculating on what all of this will mean for Canadians’ investment portfolios. Continue Reading…

14 creative ways to make Extra Money on the side

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What is one way to make extra money on the side?

To help you find creative ways to make extra money on the side, we asked career coaches and business leaders this question for their best insights. From doing freelancing through Upwork to engaging in pet care, there are several easy ways to start making extra money in addition to your regular day job.

Here are 14 creative ways these leaders recommend for making extra money on the side:

  • Do Freelancing Through Upwork
  • Put Ads on Your Car
  • Sell Informational Products
  • Offer Gaming Services Online
  • Do Social Media Marketing
  • Become a Food Delivery Driver
  • Donate Blood Plasma
  • Sell Old Electronics
  • Try Random-Rewards Banking
  • Rent Free Space on Airbnb
  • Work as a Virtual Assistant
  • Become a Video Game Tester
  • Teach English Language
  • Engage in Pet Care

 

Do Freelancing through Upwork

We have hired a lot of freelancers from Upwork over the years who have their normal day jobs but do the same type of work on their own through Upwork in their spare time. Upwork makes it very easy to list your skills and have a company hire you for small projects. We have worked with one candidate through Upwork for over 5 years now. We will have website redesign projects and he will help us. I know this is a side gig for him and we work around his schedule, but it also saves us a lot of money not having to hire through a marketing company and getting the same level of talent. If you have any good computer skills you can find a task that you can help someone with through Upwork. It can be as simple as data entry or replying to emails, there are all types of jobs available. Being an online freelancer is nice because all you need is a computer and internet connection, there is very little up front cause to start earning extra money on the side. — Evan McCarthy, SportingSmiles

Put Ads on your Car 

A super easy way to make anywhere from $100-$300 in extra income is by simply driving your car as you normally would through car-wrapping ads. There are usually a few general requirements for legitimate car wrapping ad companies in larger cities: such as a minimum driving time as well as driving a newer car that is still in good condition. Assuming you meet these requirements, however, you can comfortably earn an extra income without making any changes to your day-to-day life. –– Kristine Thorndyke, Test Prep Nerds

Sell Informational Products

If you’ve got enough knowledge or hands-on experience in a particular field of interest, selling informational products like e-books, audiobooks, or courses is a great way to make some extra money. The best part about informational products is that once you’ve poured in your time and energy to create them, they won’t need constant attention or time: literally making you money while you sleep. — Harry Morton, Lower Street

Offer Gaming Services Online

If you’re an ardent gamer or someone who dedicates a lot of time to video games, you could make some extra money by selling gaming services online. There are a few different ways of going about this. You could offer coaching services to help others improve their gameplay or even sell in-game items and currency that you’ve acquired. You could also stream your gameplay on platforms and earn income from advertisements. The amount of income depends on how many hours you’re willing to commit and the type of services you offer. But if you’re able to build up a large following, you could potentially make a career from this side hustle job. –– Demi Yilmaz, Colonist.io

Do Social Media Marketing

In this digital world, businesses are always searching for strong social media marketers. The millennial generation or Gen Z can thrive in these positions as they spend the majority of their time on popular platforms such as Instagram and TikTok. This side gig can easily be done on your own time as freelancers can schedule posts through third-party apps like Later, and work on an influencer marketing strategy through Aspire IQ. Graphics can be made through free websites such as Canva, and all community management can be handled straight from your home office. While a content role such as social media may feel like it’s never-ending, it’s a great side hustle for those looking to advance their digital skills. — Corey Ashton Walters, Here

Become a Food Delivery Driver 

One way to meet fitness goals while making cash on the side is to run food for a food delivery app. Professionals can handily make over a thousand dollars a week part-time by working in busy delivery areas during peak hours. Depending on the area, delivery drivers can bike or use a car to maximize total deliveries during their shifts. In particularly busy cities for food delivery, such as New York, orders are certain to be nonstop on specific days of the week, guaranteeing flexible supplementary income.  Continue Reading…

Retirement, Meet Target Date Funds: The opportunities, and how they work

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By Brian See, Evermore

Special to the Financial Independence Hub

Target date funds are a fantastic investment tool, particularly for Canadians who are saving for retirement. Despite their benefits, though, they have not been made widely available to the masses yet.

If we look at our U.S. neighbor, target date funds are already taking off. In fact, target date funds hit a record US$3.27 trillion in assets in 2021, up from $52 billion in 2020. The market value speaks for itself: target date funds are here to stay, and they’re growing in popularity.

When it comes to retirement, there are many Canadians who don’t save long-term because it seems out of reach. In fact, about 1 in 3 Canadians have never saved a dime for retirement even though the majority of Canadians have expressed concern about not having enough money in retirement. To boot, record-high inflation is leading Canadians to fear a retirement crisis, and 72% of Canadians believe saving for retirement is ‘prohibitively expensive.’

We have seen target date funds play out well in the U.S. If Canada is able to further adopt this form of investing to the market, we can close this retirement investing accessibility gap.

In order to understand the opportunities that target date funds provide for investing for retirement, it’s important to break down how they work.

How Target Date Funds work

At their core, target date funds are a one-stop-shop for long-term saving and investing. Target date funds use a systematic or rules-based asset allocation where the mix of stocks and bonds changes over time as you approach the target date. The funds are a mix of stocks and bonds that increase and decrease their risk levels according to the person’s age. This “glide path” model increases risk as you’re younger, and decreases risk as you get closer to retirement because, simply put, you’ll need that money to draw upon in retirement! Target date funds are also easy to choose. You simply pick the year you want to retire and select the target date fund with that year.

Of course, with any investment strategy, there are risks. The inherent risk here is that you are investing in the market. Stocks and bonds go up and down: they ebb and flow but in the long term, markets have increased in value. A key feature of target date funds is that they are diversified across asset classes, geographies and sectors, and that diversification helps whether there is a downturn in the market or not. Target date funds weather the storm. Continue Reading…

MoneySense Retired Money feature on Canada’s new “Tontine” Retirement solutions

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My latest MoneySense Retired Money column looks at the revolutionary “Tontine” type Retire Solution announced by Guardian Capital and finance professor Moshe Milevsky earlier this month. My initial take was here on the Hub and the more in-depth MoneySense feature story can be viewed by clicking on this highlighted headline: Tontines in Canada — Moving from Theory to Practice as a solution to our Retirement Crisis.

We’ve illustrated this blog with financial projections of one of the three new Guardian Capital Retirement solutions developed in partnership with Milevsky. Some of the ideas were adapted from Milevsky’s latest book: How to Build a Modern Tontine. The theory behind this book is a driving force for Guardian Capital’s efforts to commercize these concepts and put them in the hands of retirees and would-be retirees worried about outliving their money. Nobel Laureate Economist William Sharpe has described this as “the nastiest, hardest problem in finance.”

Milvesky’s book is certainly aimed at industry practitioners and sophisticated financial advisors and investors, and contains a lot of mathematics that may beyond the reach of average investors or retirees. So rather than attempt to review it, we’ll move on to the efforts to bring these ideas to the market. What Milevsky calls “tontine thinking” is belatedly showing up in the marketplace in Canada, starting last year with Purpose Investments’ and now with three different solutions from Guardian Capital. Hub readers also can read an excerpt of the book which ran earlier Wednesday: Longevity Insurance vs Credits — a Primer.

All this has been a long time coming. MoneySense readers may recall two of my Retired Money columns about Milevsky and the future of tontines published in 2015: Part one is here and part two here. Also see my 2018 column that explains tontines in detail: Why Ottawa needs to push for tontine-like annuities.

Last June (2021), Purpose got the tontine ball rolling in Canada with its Purpose Longevity Fund. Here’s my MoneySense take on that one: Is the Longevity Pension Fund a cure for Retirement Income Worries? 

As the MoneySense feature explains, Milevsky is Guardian Capital’s Chief Retirement Architect. It sums up the original 2021 launch of Purpose Longevity Fund, and how it compares to Guardian’s three solutions.

Think of Purpose’s product as a lower-case tontine, and Guardian Capital’s as a Tontine with a capital T.

Guardian Capital’s Modern Tontine  

Guardian Capital’s September 7th press release uses the term “Modern Tontine.” There, Guardian Capital Managing Director and Head of Canadian Retail Asset Management Barry Gordon said “With our modern tontine, investors concerned about outliving their nest egg pool their assets and are entitled to their share of the pool as it winds up 20 years from now … Over that 20-year period, we seek to grow the invested capital as much as possible to maximize the longevity payout.”

 Along the way, investors who redeem early or pass away leave a portion of their assets in the pool to the benefit of surviving unitholders, boosting the rate of return. “All surviving unitholders in 20 years will participate in any growth in the tontine’s assets, generated from compound growth and the pooling of survivorship credits. This payout can be used to fund their later years of life as they see fit, and aims to ensure that investors don’t outlive their investment portfolio.” Continue Reading…