Longevity & Aging

No doubt about it: at some point we’re neither semi-retired, findependent or fully retired. We’re out there in a retirement community or retirement home, and maybe for a few years near the end of this incarnation, some time to reflect on it all in a nursing home. Our Longevity & Aging category features our own unique blog posts, as well as blog feeds from Mark Venning’s ChangeRangers.com and other experts.

Rob Carrick’s G&M retirement: what he and other retiring PF writers have learned about Retirement

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Rob Carrick: Globe & Mail

My latest MoneySense Retired Money column has just been published and features input from Rob Carrick, who just retired from the Globe & Mail after almost three decades covering Personal Finance (PF henceforth). You can find the full column by clicking on the hyperlinked headline here: How financial journalists plan their own retirement.

While some may view this as an exercise in Inside Baseball, the column also features interviews with someone Rob and I agree was the “granddaddy” of Canadian PF writing: Bruce Cohen of the Financial Post. Bruce in effect handed off the PF beat to me a few years after I joined the paper in 1993. For the column, Bruce provided several retirement tips but clarified there were at least two such PF writers even before him (Mike Grenby and Henry Zimmer.). Guess you could call them the grandaddies of Canadian personal finance writing!

Unlike other journalists mentioned in the column, Bruce is one of the few who actually did truly retire: after a 5-year transition he says he fully retired at the traditional retirement age of 65. Now 75, he lives on 50 acres north of Toronto. He cites actuary Malcolm Hamilton’s conclusion that spending/lifestyle in retirement is pretty much the same as pre-retirement: “Ergo, most people did not need a 70% income replacement ratio. That’s been true for me, though I don’t know if it still applies  to the general population as many older people seem to carry significant  debt into retirement and many adult children are living with their parents.”

The MoneySense column also includes input from Garry Marr, another ex Postie who just weeks ago announced he is returning to the Financial Post to write about — you guessed it — Personal Finance.

Retiring from Full-time Retirement Blogging

Retirement Manifesto’s Fritz Gilbert

Meanwhile, south of the border, we got some input from Fritz Gilbert, who announced this spring in his The Retirement Manifesto blog that he is  “retiring” from full-time blogging about Retirement. 

Pretty ironic, isn’t it?

Since Rob Carrick is still only 62 years old, he clarifies that while he is no longer a salaried employee at a newspaper (he formally left on June 30th), he definitely plans to keep his hand in PF writing, including two monthly columns at the G&M: one on traditional PF, the second on his new Retirement experience.

He agrees that Retirement is a bit of an outdated word and that what he is doing is closer to Semi-Retirement, or indeed the term I coined in my financial novel, Findependence Day. Continue Reading…

Investing for Income vs. Total Return: Why choose?

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By Mark Seed, myownadvisor

Special to Financial Independence Hub

Welcome to a new Weekend Reading edition, on an important but seemingly never-ending debate: should you be investing for income or total return?

Maybe in the end, why choose one over the other at all???

First up, recent articles on my site.

I contributed to this recent MoneySense Best ETFs in Canada edition – that includes one global ETF I own for total return since 2020:

And, I shared our planned financial independendence budget. I would be happy to compare notes with you on what you intend to spend and when in your retirement.

Investing for Income vs. Total Return, why choose?

Leading off this Weekend Reading edition, a theme I’ve written about from time to time here: income investing vs. total return.

Is there a right way to invest? Which one is better?

Both approaches have merit: which was the subject of my enjoyable debate with passionate DIY income investor Henry Mah a few weeks ago. You can watch it here!

Personally, while I’ve always had a passion for owning some dividend-paying stocks in my portfolio and likely always will, I can’t ignore the benefits of total return.

At the core:

Investors often focus on total return and likely should during their asset accumulation years in particular since total return encompasses both income generation, such as dividends, and capital appreciation (changes in the market value of your investments). We should all know by now that growth/price increases remain an essential component of wealth-building: prices moving higher and higher than what you paid for them is good.

Income investing focuses on generating regular cash flow from your investments, rather than solely relying on capital appreciation or downplaying it based on your stock selections. Income funds, income-oriented Exchange Traded Funds (ETFs) or in Henry’s particular case, owning a small basket of concentrated stocks from the TSX that pay dividends has provided income-focused investors like Henry arguably lower-risk for him while growing his income higher over time via higher dividend payments.

Honest Math - Dividends

In the TD debate here, I argued striking the right balance between income needs and growth in the total return equation is probably best for most: it has historically delivered long-term success and there is no reason to believe why a basket of global stocks won’t continue to do so.

So, I get the income investor debate, I really do, and maybe moreso given I consider myself in semi-retirement now; my part-time work started a few months ago.

Investing for income via dividend stocks often includes these benefits for retirees:

  • Tangible income: shares of companies that distribute a portion of their profits to shareholders, are often mature and established businesses that have ample cashflow to sustain their payment obligations. This tangible income (and arguably stable income) can help cover living expenses.
  • Rising income: such established companies can also raise their dividends year-over-year, rewarding shareholders with rising income that can help offset inflationary pressures. Sustained 3-4% or more dividend increases by some companies can be inflation-fighters.
  • Tax benefits: depending on what stocks you own where (i.e., in what accounts), dividend payments can offer favourable tax benefits. Read about the tax treatment of Canadian dividends below. 

Academic history lessons along with any Google search on this subject will show various charts and graphs that demonstrate the critical role that dividends – and, in particular, reinvested dividends – play in delivering an attractive total return to investors over time. But this just makes sense, in that reinvested dividends are like not getting any dividend payment paid to you in the first place …

Another important contributor to equity market returns has been dividend growth. Equities are growth assets – which I argued in the TD debate – so companies who tend to grow their revenues, profits and earnings over time, is the reason why they can continue to reward their shareholders with higher dividend payments. Growth is needed, for total return, for your/our juicy dividend payments to continue. Continue Reading…

Financial Independence: While you’re still young enough to Enjoy it

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Image by: Averie Woodard on Unsplash

By Jordan McCaleb

Special to Financial Independence Hub

Financial Independence (aka Findependence) is a dream many hope to achieve, the freedom to live the life you’ve always dreamed of, pursuing passions or simply choosing to work on your own terms. While these are all great reasons, what about achieving this earlier?

This article will explore key investment strategies and asset allocations to accelerate your path to early financial freedom, including the role of precious metals investments.

Traditional Investments & their Limits

It’s important to acknowledge that traditional investments (stocks, bonds, mutual funds, and ETFs) will always be the building blocks when it comes to financial independence. 

However, when it comes to achieving Findependence earlier in life, traditional investments may have potential limitations and risks involved.

Potential Limitations and Risks:

  • Inflation: Inflation erodes the real value of your accumulated savings over time.
  • Market Volatility: Unpredictable swings and downturns can threaten your gains and potentially delay your FI (financial independence) timeline.
  • Economic Uncertainty: Geopolitical risks and unforeseen crises can increase risk and cause market corrections, impacting even the safest portfolio.

While traditional investments form a crucial base for any Findependence strategy, they may not be enough to achieve the resilience and growth required. Achieving financial independence early requires specific and powerful assets to drive your portfolio, providing a balance to your financial ecosystem.

Accelerating your FI Timeline: Beyond just Investing

Accelerating your Findependence timeline requires additional steps. A crucial part is increasing your savings rate, aiming for 50% to 75% of your income, creating a powerful snowball effect that reduces your time horizon. This pairs with increasing your income through career advancement, salary raises, or profitable side hustles.

Simultaneously, optimizing expenses and embracing a frugal lifestyle in areas like housing, transportation, and food can further boost investment growth over time. A key step is defining your (FI Number) typically 25 times your desired annual expenses ($50,000). This lifestyle-specific figure provides a clear target.

Diversifying for Resilience: Beyond the Basics

Beyond traditional investments and accelerating your timeline, diversification involves not just different stocks, but asset classes as well (equities, fixed income, real estate, and alternatives). Each behaves differently under various economic challenges. Diversifying across geographies and industries can protect against downturns in a market or sector.

A crucial concept to know is asset correlation: You want your assets to not run in the same direction. According to Stock Rover, this reduction in volatility can significantly impact overall returns. For example, a portfolio experiencing wild swings of +20% then -20% loses money, while reducing it to +10% then -10% swings leads to a healthier outcome. In essence, a low correlation portfolio better withstands economic turbulence.

Strategic Allocation: The Role of Precious Metals

When aiming for early Findependence, strategic alternative assets are crucial. Gold and silver stand out as a hedge against inflation and economic uncertainty due to their low correlation nature. Historical data from Investopedia reveals that while the S&P 500 dropped almost 10% (2007-2010) during the 2008 financial crisis, a 1971 gold investment significantly increased in value. Gold IRAs also offer tax advantages for those interested in physical metals. Continue Reading…

Rethinking Retirement Income

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How real Spending Patterns challenge Traditional Retirement Income Planning  

Canva Custom Creation: Lowrie Financial

By Steve Lowrie, CFA

Special to Financial Independence Hub

Here’s a contrarian thought.

When most people imagine retirement, they picture steady cash flow from their investments to support their lifestyle.

The common assumption is that they’ll preserve their financial nest egg and live off the growth” drawing a consistent amount each year while keeping the principal largely intact.

But there are actually three broad approaches. At one end, some plan to spend their entire portfolio over their expected lifetime (as one client joked, “I want my last cheque to bounce.”  At the other end is the idea of preserving capital entirely. Most people, in practice, end up somewhere in between.

But what if that assumption is only part of the story?

The reality is that real-life retirement spending isn’t flat. It fluctuates unevenly and unexpectedly over time. And those patterns can have a big impact on your retirement income strategy.

Retirement Planning has changed. Have you?

For decades, retirement planning has focused on Saving: building a nest egg, maximizing RRSPs, and making the most of tax-advantaged accounts.

But the real challenge begins after you stop working. Then, the question becomes:

How do I turn my savings into reliable, lasting income?

This is where traditional models often fall short. Most assume spending stays constant throughout retirement. But as recent research from J.P. Morgan Asset Management shows, that’s not how real retirees actually spend.

For more on how conventional rules can mislead, see Debunking Retirement Financial “Rules.”

What the Data shows

J.P. Morgan studied anonymized spending data from more than 5 million U.S. households, offering a detailed picture of how retirees actually spend in retirement. These findings closely align with what I’ve observed over 30 years of working with Canadian clients.

Three key Retirement Spending patterns:

  • Spending Surge: Many retirees experience a spike in spending right around the time they retire. This is often due to lifestyle changes and delayed goals coming to fruition in the early retirement years, like travel, home upgrades, or helping adult children.
  • Spending Curve: Over time, overall spending tends to decline. For example, households with investable assets between $250,000 and $750,000 saw an average inflation-adjusted spending decrease of about 1.65% annually through retirement.
  • Spending Volatility: Perhaps most important, spending is anything but steady. According to J.P. Morgan’s 2025 Guide to Retirement, 60% of retirees saw their expenses fluctuate by 20% or more in the first three years of retirement. And this volatility often continues well into later years.

These findings show that retirement income strategies need to be flexible enough to accommodate spikes, declines, and everything in between.

Why it matters

Most financial plans assume a flat, inflation-adjusted income for 25 to 30 years. That’s a very good place to start. However, based on both this research and my practical experience observing hundreds of client habits over three decades, here’s what can happen:

  • You over-save early, delaying retirement unnecessarily
  • You under-spend during healthy years, missing out on the freedom you’ve earned
  • You get caught off guard by spending spikes, leading to early withdrawals or tax surprises

J.P. Morgan’s data shows retirees typically need about 92% of pre-retirement income at age 65, but just 70% by age 85. That is a significant shift and a reminder of why you want healthy exposure to equities, which is the only asset class that has historically given the best chance of outpacing inflation over the long run.

A better way to Plan for Retirement Income

Here are a few ways to build a more adaptable, evidence-based retirement plan: Continue Reading…

Retired Money: An online Canadian Retirement Club

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My latest MoneySense Retired Money column looks at a recently launched Retirement Club devoted to Canadians in or near the cusp of Retirement.

Primarily online, Retirement Club was launched by occasional MoneySense contributor Dale Roberts and a partner, Brent Schmidt. You can find the full MoneySense column by clicking on the highlighted headline:  Retirement planning advice for people who don’t use an advisor.

Roberts, who once was an advisor for Tangerine, is known for his Cutthecrapinvesting blog and in the U.S. for his contributions to Seeking Alpha. While I have no financial or business interest in the club I did become a member. There are regular Zoom calls where (mostly) recent retirees exchange views on topics like the 4% Rule, RRSP-to-RRIF conversions, ETFs, Asset Allocation in the age of Trump 2.0 and many of the topics this Retired Money column often attempts to tackle.

            You can find Roberts’ own announcement of the club – which charges an annual fee of $250 – on my own site earlier in mid-April. (+HST, but it may qualify as an Investment Counsel fee deductible on your personal tax returns). As always check with your accountant, advisor or tax professional).

            My initial impression is that the club seems to involve a lot of work for someone who describes himself as semi-retired. But that seems to be par for the course for financial writers approaching retirement. I’m in a similar boat, as is the American blogger Fritz Gilbert, who recently announced the similarly ironic fact that he was retiring from Full-time Blogging about Retirement. (also in April).

Aimed at self-directed investors

            In his introduction, Roberts wrote that many of his audience are self-directed investors. That jibes with his site’s campaign against high-fee investment funds, in favor of low-cost index funds or ETFs purchased at discount brokerages. While some, like myself, may also use the services of a fee-for-service advisor, many DIY retirees are in effect running their own pension plans. In theory, one of those much-written-about All-in-one Asset Allocation ETFs can do much of the heavy lifting for such investors, but in practice, there’s a fair bit of anxiety about markets, the Canadian government’s rules about TFSAs, RRIFs etc., Asset Allocation, the ongoing Trump Trade War and much more. So it makes sense to gather in one place and exchange views with others going through a similar process.

          In a regular email update to Club members, Roberts explains that “the key concern of Retirement Clubbers is financial security and how to use their portfolio assets in the most efficient and cost-effective manner. That’s why we have a master list of retirement calculators (free and pay-for-service) to test.”

Delaying Government Pensions

         As you’d expect, the Club regularly addresses the major chestnuts of Personal Finance as it relates to those within hailing distance of Retirement. The most common ‘Retirement Hack’ espoused by the Club is to delay receipt of the Canada Pension Plan [CPP] and Old Age Security [OAS] past the traditional retirement age of 65 to allow for more generous payouts at age 70. Most club members lean to taking these benefits as late as possible but of course personal circumstances may dictate earlier start dates.

        To bridge the income gap (from age 60 to 70 for example) RRSP/RRIF accounts will be harvested (spent) in quick fashion: often termed an RRSP meltdown. TFSA and Taxable accounts can also be tapped to provide necessary funding as retirees delay receipt of those CPP and OAS benefits. Continue Reading…