Decumulate & Downsize

Most of your investing life you and your adviser (if you have one) are focused on wealth accumulation. But, we tend to forget, eventually the whole idea of this long process of delayed gratification is to actually spend this money! That’s decumulation as opposed to wealth accumulation. This stage may also involve downsizing from larger homes to smaller ones or condos, moving to the country or otherwise simplifying your life and jettisoning possessions that may tie you down.

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

You think accumulating wealth was hard? Try this.

Posted By Financial Independence Hub | June 29, 2015

By Doug Dahmer, Emeritus Retirement Income Specialists

Special to the Financial Independence Hub

How you deploy your accumulated assets to fund the second half of your life is much harder than how you built them up in your accumulation years.

Read this again if you need to, but be sure you get this point.

First build an asset pool under the spell of “Dollar Cost Averaging over the long-term” — the favorite aphorism of the investment management salesperson. For the 30-odd years of your prime saving and accumulation years this mantra encourages you to keep giving money to them, disguises bad performance and promises you future success. Given enough time, however, let’s hope you have more than when you started.

That’s the easy part.

The hard part: making it last a lifetime

Financial planners and eldercare professionals targeting aging Boomers

Posted By Jonathan Chevreau | June 24, 2015

Here’s my latest MoneySense blog, which it titled Is your advisor retirement ready? It came out of a conference I attended in Niagara Falls last week: the National Elder Planning Issues Conference. I had delivered the keynote address on why Longevity changes everything — a theme you’ll often see in the Hub’s Longevity & Aging section — but also sat in on a couple of sessions on which this blog is based. As you’ll see it’s also quite relevant to our Decumulation & Downsizing section.

For archival and one-stop shopping purposes, here’s the blog below, with a few photos and subheadings added: Continue Reading…

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