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.

How to stop comparing yourself to Others: 12 Tips

What is one tip to help stop comparing yourself to others?

To help you stop comparing yourself to others, we asked personal coaches and thought leaders this question for their best advice. From practicing gratitude to asking yourself questions that challenge you, there are several things you may put into practice to help you stop comparing yourself to others.

Here are 12 tips to stop comparing yourself to others:

  • Practice Gratitude

  • Look Back and Count Your Gains

  • Admire Your Differences Instead

  • Override Your Dissatisfaction With Positive Affirmations

  • Celebrate Others

  • Take a Break from Social Media

  • Remember Everyone Has Their Challenges

  • Identify and Celebrate Your Own Strengths

  • Practise Meditation To Stay Grounded in Yourself

  • Focus on Your Own Personal Growth

  • Choose To Practise Good Values

Ask Yourself Questions That Challenge You

Practice Gratitude

When you regularly practice gratitude, you don’t have time to focus on what others have. You’re not inclined to compare yourself to them or think about what you lack. With a gratitude mindset, you’re focused on what you have, and how appreciative you are of having it. Gratitude resets your mind and redirects your energy towards building up more of what you already have rather than trying to catch up to someone else. — Chris Abrams, Abrams Insurance Solutions

Look Back and Count your Gains

It’s easier said than done, but try thinking about or even making a list of the things you used to want that you have or are closer to having now. For example, maybe 10 years ago you wanted to be moving up in your career and getting closer to buying a house. Rather than beating yourself up about what your friend or that person on Instagram is doing, ask yourself what you’ve already achieved that a past version of you would be proud of, or what you’ve learned that a younger version of you didn’t understand.

When you frame challenges and comparisons this way, you’re not only able to see your strengths and what you’re capable of much more clearly, but you’re also setting yourself up to be a better version of yourself as opposed to a better version of someone else. — Gigi Ji, KOKOLU

Admire your Differences instead

When you compare yourself to others, you mentally put yourself below them. You convince yourself that you don’t have something that someone else does have and you take your power away. But, if you admire your differences instead of comparing them, you put positive energy out into the world and that gives you the power.

The power to appreciate what you have, the power to learn from what others have, and the power to choose how you view the world and yourself in it. It’s easier to be positive than to be negative, so take the easy and healthy route and admire someone instead of comparing yourself to them. –– Staci Brinkman, Sips by

Override your Dissatisfaction with Positive Affirmations

Drown out the comparisons with positive affirmations. The moment that you start to compare yourself to someone, think of something that you do well and tell yourself that instead. It’s a simple trick, but over time, your mind gets the idea and will stop seeing yourself as less than, and instead as equal to, and the comparisons will fall away. It will take time, and it feels funny at first, but it’s a reminder that we’re our harshest critic, instead of our greatest support, and the latter takes practice. — Tony Staehelin, Benable

Celebrate Others

Many people do compare themselves to others these days and that tends to make them more self-absorbed. One way to stop that attitude is to celebrate others’ achievements. You can avoid the comparison syndrome by focusing on other people and learning to be happy for them in their moments. This can take some practice. It may not feel good at first because many are motivated to draw attention to themselves. However, you will care less about where you stand in society the more you learn to focus on other people. Focusing on others will make you happier and then the comparisons don’t have as much power over you. — Bruce Tasios, Tasios Orthodontics

Take a Break from Social Media

My top tip to stop comparing yourself to others is to take a break from social media. Social media is likely only one place you compare yourself to others, but it’s a big one. If you scroll on your phone for a few hours a day and in that time, feel bad about yourself, it’s time to take a break. Disconnect from social media for a bit and focus on yourself! If you choose to get back on social media, unfollow anyone who makes you feel bad about yourself. — Macy Sarbacker, Macy Michelle

Remember Everyone has their Challenges

Comparing yourself to others is fruitless because everyone has their own set of challenges. These challenges are often not visible to those on the outside. Individuals can never hope to know the struggles of others by comparing themselves to the success they see on the surface.

Wanting what others have lacks perspective because we often do not know what other people are carrying with them. A successful executive may appear to have a wealthy lifestyle when in reality they have the misfortune of tumultuous family life or chronic illness. Comparing yourself to others is pointless when you are unaware of what others are truly dealing with. — Katy Carrigan, Goody Continue Reading…

Retired Money: Rising rates make annuities more tempting for Retirees

My latest MoneySense Retired Money column looks at whether the multiple interest rate hikes of 2022 means its time for retirees to start adding annuities to their retirement-income product mix. You can find the full column by clicking on the highlighted headline here: Rising rates are good news for near-retirees seeking longevity insurance.

The Bank of Canada has now hiked rates twice by 50 basis points, most recently on June 1, 2022.  That’s good for GIC investors, as we covered in our recent column on the alleged death of bonds, but it’s also  welcome news for retirees seeking longevity insurance.

As retired actuary Fred Vettese recently wrote, retirees may start to be tempted to implement his suggested guideline of converting about 30% of investment portfolios into annuities. As for the timing, Vettese said it is “certainly not now: but it could be sooner than you think.” He guesses the optimal time to commit to them is around May 2023, just under a year from now.

After the June rate hikes, I asked CANNEX Financial Exchanges Ltd. to generate life annuity quotes for 65- and 70-year old males and females on $100,000 and $250,000 capital. The article provides the option of registered annuities and prescribed annuities for taxable portfolios. It also passes along the opinion of annuity expert Rona Birenbaum that she greatly prefers prescribed annuities because of the superior after-tax income. Of course, many retirees may only have registered assets to draw on: in RRSP/RRIFss and/or TFSAs.

For a 65-year old male investing $100,000 early in June 2022, with a 10-year guarantee period in a prescribed (non-registered) Single Life annuity, monthly income ranged from a high of $548  at Desjardins Financial Security with a cluster at major bank and life insurance companies between $538 and $542. (figure rounded). Comparable payouts on $250,000 ranged from $1299 to $1,390. Because of their greater longevity, 65-year old females received slightly less: ranging from around $500/month to a high of $518, and for the $250,000 version from $1238 to $1319.

Here’s what Cannex provides for comparable registered annuities (held in RRSPs):

For a 65-year old male (born in 1957), $100,000 in a Single Life annuity nets you between $551 and $571 per month, depending on supplier; $250,000 generates between $1,399 and $1,461 a month. For 70-year old males (born 1952), comparables are $625 to $640/month and $1,578 to $1,634 a month. Continue Reading…

Case Study: Am I going to be okay when I retire?

Photo by LinkedIn Sales Navigator from Pexels

By Ian Moyer

(Sponsor Content)

Pamela is a 63-year-old widow residing in Ontario, Canada with two adult children who live on their own. Pamela worked for more than 30 years as a Payroll Manager and was able to pay off her mortgage with the life insurance inheritance she received from her husband’s passing and put her savings towards retirement.

She is preparing to retire in two years and has increasing concerns about the amount she has saved for retirement.

Pamela earns $76,000 a year. Now age 63, she has saved:

  • $306,000 in a Registered Retirement Savings Plan (RRSP), contributing $5000 annually until retirement
  • $36,000 in A Tax-Free Savings Account (TFSA), contributing $1000 annually, which doubles as an emergency fund.
  • At age 65 Pamela plans on selling her cottage and adding $400,000 to her retirement funds.

Using Cascades Financial Solutions retirement income planning software, we help Pamela determine if she can retire at the age of 65 and sustain her lifestyle and accommodate traveling.

Pamela will decide to retire at the age of 65 if the after-tax income will meet her needs. With retirement fast approaching, she has three main questions:

  1. Do I have enough to retire? Pamala assumes she will need approximately 50% of her income to travel for five years.
  2. What are other income sources I can rely on? Pamela is concerned about the sustainability of her RRSP, TFSA and sale of the cottage alone.
  3. How do I deal with taxes? Pamela is unsure about the amount of taxes she will need to set aside.

Answering Pamela’s first question: “Do I have enough to retire?” The answer is YES! Based on her needs.

Using Cascades Financial Solutions, we’ve run a retirement income withdrawal plan resulting in three different ways to produce an after-tax annual retirement income of $45,703 for Pamela:

We’ve selected an asset allocation as moderate in the software: Moderate: 60% Fixed Income, 40% Equity,  5% rate of return and 2% inflation. All income and savings are reported in “today’s dollars” by Cascades.

Strategy Descriptions

Registered Funds First: This strategy involves creating retirement income from registered funds first, reducing the risk of leaving highly taxable investment accounts to an estate. The second priority is given to taxable non-registered accounts, leaving Tax Free Savings Accounts (TFSAs) last.

Non-Registered Funds First: This strategy involves creating retirement income from non-registered funds first, deferring the income taxes payable on registered investments. The second priority is given to registered investments, leaving Tax Free Savings Accounts (TFSAs) last.

Tax Free Funds First: This strategy involves creating retirement income from non-registered funds first and postpones the use of registered funds as long as possible. The second priority is given to Tax Free Savings Accounts (TFSAs), leaving registered funds last.

Determining a Winning Strategy: With all other factors being equal, the winning strategy provides a client longevity and the highest estate value, net of taxes and fees, at life expectancy. The differences in the net estate value represents the income tax savings of the winning strategy.  

Answering Pamela’s second question: “What are other income sources I can rely on?” There are two main programs that provide retirement income for most Canadians: the CPP or Quebec Pension Plan (QPP), and OAS.  The maximum CPP / QPP Pension you could receive starting at age 65 is $1,203.75 monthly ($14,445 annually) for 2021.[1]

Continue Reading…

How to mitigate the burden of Sudden Wealth

Image Source: Pixabay

By Beau Peters

Special to the Findependence Hub

You’ve always dreamt about it and now it’s happened. Your ship has come in. You’ve found the pot of gold at the end of the rainbow. Your future is secure. You have found sudden wealth and now the world lies at your feet, just as you’ve always wanted.

And yet, perhaps life isn’t quite what you expected. Perhaps the affluence you’ve found has brought with it as many unanticipated burdens as it has alleviated. Indeed, no matter how you came into your good fortune, the simple truth is that sudden wealth has its own challenges, ones that you must be prepared to address effectively if you want to secure your own future well-being.

The Psychological Toll

Before you came into your money, you probably imagined that if you were only rich, your life would be perfect. To be sure, wealth can solve a lot of problems. You no longer have to worry about how you’re going to keep a roof over your head or food on the table. You don’t have to worry about the car note or your student loans. You’re secure, as is your family.

However, when you’re absolved of financial worries, especially when this relief comes quickly, that can all too often shine a bright spotlight on other issues in your life. The obligation to make a living and pay off your debts might well have served as a distraction, enabling you to avoid confronting challenges in your relationships, your career, or even your own mental health.

With this obligation removed, so too is the distraction it once provided. You may well find yourself overspending in the effort to continue the avoidance. You may panic buy to comfort yourself or to relieve boredom. 

You may lavish your friends and loved ones with expensive gifts in an unconscious attempt to buy their affection or to compensate for guilt you may feel over your sudden prosperity. In fact, emotional spending is one of the most significant, and most pernicious, ways people waste money because the pattern is such a difficult one to break.

Whatever the reason, overspending can be one of the first and most important symptoms of psychological distress in your new life. Confronting the source of the issue, the depression, fear, guilt, or trauma that often lies at the root, is essential to overcoming it.  

Managing the wealth

When you’ve had a windfall, it can be tempting to think that the hard work is done. It’s often just the beginning. Far more often than not, the greatest challenge lies not in acquiring wealth but in keeping it.  Continue Reading…

What on Earth is Happening?

image from wikimedia commons

By Noah Solomon

Special to the Findependence Hub

Markets ended the first part of the year on a particularly sour note. Over the past four months, the MSCI All Country World Stock Index fell 12.9% in USD terms. High quality bonds, which have held up well in past episodes of stock market weakness, have failed to provide any relief, with the Bloomberg Global Aggregate Bond index falling 11.3%. Given the “nowhere to hide” atmosphere of markets, even a 60%/40% global balanced stock/bond portfolio suffered a loss of 12.3%.

Markets have entered a phase which differs from what we have witnessed over the past several years (and arguably over the past 40). In the following, we have done our best to share some of our most closely held beliefs about markets and investing, which we hope can serve as a guidepost for helping investors navigate the current market regime.
 

It just doesn’t matter … until it does

Most of the time, it doesn’t matter much whether your portfolio is positioned aggressively, defensively, or anywhere in between. Nonetheless, the fact remains that the big money is made or lost during the most violent bull and bear markets.

Defining a “normal” return for any 12-month period as lying between -20% and 20%, the S&P 500 Index behaved normally during 65.7% of all rolling 12-month periods between 1990 and 2021. Of the remaining 34.3% of periods, 29.0% were great (above 20%) and 5.4% were awful (worse than -20%)

Average 12-Month returns during Normal, Great, and Awful periods:

As the table above demonstrates, during normal periods there has not been a significant difference in average returns between the S&P 500 Index, the Bloomberg U.S. Aggregate Bond Index, and a balanced portfolio consisting of 60% of the former and 40% of the latter. It is another story entirely during the 34.3% of the time when bull and bear markets are in their most dynamic stages. The good news is that there are some key signals and rules of thumb that offer decent probabilities of reaping respectable gains in major bull markets while avoiding the devastation from the worst phases of major bear markets.
 

Don’t fight the Fed

It is with good reason that the “Don’t fight the Fed” mantra has achieved impressive longevity and popularity. The monetary climate – primarily the trend in interest rates and central bank policies – is the dominant factor in determining both the stock market’s major direction as well as which types of stocks out or underperform (sectors, value vs. growth, etc.). Once established, the trend typically lasts from one to three years.

When central banks are cutting rates and monetary conditions become more accommodating, it’s a good bet that it won’t be long before stocks deliver attractive returns. In late 2008/early 2009, central banks responded to the collapse in financial markets by cutting rates aggressively and embarking on quantitative easing programs. This spurred a rapid recovery in asset prices. Similarly, to offset the economic fallout of the Covid pandemic, monetary authorities flooded the global economy with money, which acted as rocket fuel for stocks.

Conversely, when central banks are raising rates and tightening the screws on the economy, the effect can range from limiting equity market gains to causing a full-fledged bear market (not an attractive distribution of outcomes). Once the Fed began hiking rates in mid-1999, it wasn’t long before stocks found themselves in the throes of a vicious bear market that cut the S&P 500 Index in half over the next two to three years. Similarly, when the Fed raised its target rate from 1% in mid-2004 to 5.25% by mid-2006, it set the stage for a nasty collapse in debt, equity, and real estate prices. When it comes to stocks, bonds, real estate, or most other asset classes, it’s all fun and games until rates go up, which ultimately causes things to break.

Markets don’t care what you think: NEVER fight the tape

The importance of not fighting major movements in markets cannot be overemphasized. Repeat as necessary: Fighting the tape is an open invitation to disaster. This advice not only applies to the general level of stock prices, but also to the relative performance of different sectors, value vs. growth, etc.


Ignorance, which can cause people to fight market trends, is a valid justification for making mistakes during the earlier stages of one’s investment experience. But after suffering the consequences, there are neither any excuses nor mercy when you fight the tape a third or fourth time. The markets only allow so many mistakes before they obliterate your wallet.

The perils of following rather than fighting trends are well summarized by investing legend Marty Zweig, who compared fighting the tape and trying to pick a bottom during a bear market to catching a falling safe. Zweig stated:

“If you buy aggressively into a bear market, it is akin to trying to catch a falling safe. Investors are sometimes so eager for its valuable contents that they will ignore the laws of physics and attempt to snatch the safe from the air as if it were a pop fly. You can get hurt doing this: witness the records of the bottom pickers on the street. Not only is this game dangerous, it is pointless as well. It is easier, safer, and, in almost all cases, just as rewarding to wait for the safe to hit the pavement and take a little bounce before grabbing the contents.”

To be clear, there is no free lunch in investing. Being on the right side of major market moves necessitates getting whipsawed over the short-term every now and then. Inevitably, you will sometimes be zagging when you should be zigging and zigging when you should be zagging. You can get head faked into cutting risk only to watch in frustration as markets rebound, and you can also get tricked into becoming aggressive just before a decline in stock prices.

The stark reality is that only geniuses and/or liars buy at the lows preceding major uptrends and exit the very top before the onset of bear markets. Realistically, you can only hope to catch (or avoid) the bulk of the big moves. Getting whipsawed every now and then is a small price to pay for reaping attractive returns during the good times while avoiding large bear market losses.
 

You don’t need to be perfect. But you’d better be flexible

It doesn’t matter whether you are an aggressive or conservative investor, so long as you are a flexible one. The problem with most portfolios (even professionally managed ones) is that they are not flexible. Conservative investors tend to stick with defensive portfolios heavily weighted in high grade bonds, utility stocks, etc. They never reap huge gains, but they also never get badly hurt. Aggressive investors, on the other hand, often buy risky stocks or speculate in real estate using high degrees of leverage. They make fortunes in boom times only to lose it all in bad times when the proverbial tide recedes.

Neither approach is sound by itself. Being aggressive is okay, but there are nonetheless times to gear down and be a wallflower. By the same token, there are market environments in which even conservative investors should be somewhat aggressive. Continue Reading…