Am I on track to reach my goal? - Page 2
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Thread: Am I on track to reach my goal?

  1. #11
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    @scorpion - thanks for reading

    Aggressive stuff, but it sounds like you are very determined. Your goal is not out of reach but definitely is a stretch goal.

    As you already know, you will need to save at least $50k + per year, every year on average and have some kind markets (i.e., a continued bull run for the next 10 years) to help you realize this goal.

    Market returns are out of your control. Your savings rate, and what your financial products cost you (i.e., money management fees) and managing taxes (or deferring them altogether) are well within your control. Focus on what you can control and don't worry about what you can't control.

    To help you reach your goal, you might need to take on more equity risk, i.e., little bonds if any. Only you can decide if you can stick to your plan if you have no bonds and equities decide to drop 20-30% in value. Then of course you buy more equities when this happens. Easy to say you can do this on paper, harder to do in practice. Been there and still working on that. People that say they can do this all the time, they are usually kidding themselves. It takes practice but once you do it a few times, it gets easier. i.e., buying in 2008-2009 when others were selling. I didn't used to do this, it was scary, but I've learned:
    http://www.myownadvisor.ca/now-enbridge/

    Your TD efunds will serve you will well.

    You seem to have the right attitude and that's not easy to put a number on but very, very important.
    Good luck with your savings rate and goals.

    Hidden Content - Saving and investing my way to a million dollar portfolio.

  2. #12
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    I will be able to save more than $50k a year as long as I have a well paid job. I work for a stable, reputed company but the industry is full of uncertainty. My net worth was around $125k at the end of Dec 31, 2013 and I am forecasting to reach around $203k by Dec, 2014....depends on market. I think my savings rate is so far so good but always try to reduce the expenses.

    I started to invest a year ago. So, I am learning day by day and investing more on equities. I will buy TD e-series another year. After that, I will switch to ETF to reduce cost.

  3. #13
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    OK..... I made some assumptions re your investment (RSP/nonreg) mix and future CPP levels as well as a 3% ror and 2% inflation guess..... but here is a rough 'die-broke at 95' plan....


    http://www.fimetrics.com/on-track.pdf

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  5. #14
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    Scorpion, I think you're going to have to put on your brave pants and "risk" more of that cash/bond/gic balance in time. I see you want to slowly get into the market which might mean you're already going down this path though. As an exercise of goal setting it's good to have targets and I think you might surprise yourself with how easy they are to strive for once you get going.

    One thing to consider also is that there is a whole world of ETF's that will cost you significantly less in MER's than even the miserly (for Mutual Fund's) TD e-series funds. I seem to remember the e-series stuff being around 0.5% MER, and there are many similar ETF's that will be in the 0.05-0.2% range pretty easily. Small change I know but it can be the difference of 7% or 7.5% returns on the flip side.

    https://personal.vanguard.com/us/ins...uth-about-cost

    Good luck.

  6. #15
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    Thanks everyone for your valuable suggestions....especially Steve to prepare the nice report. I will review it thoroughly soon.

  7. #16
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    What is the significance of having $1M at 40? Would you be disappointed if you have $800K at 40 and $1M at 42? Why?

    The goal sounds arbitrarily aggressive to me. It may be counterproductive, because it may push you to take unnecessary risk.

    You may want to review Larry Swedroe's guide to asset allocation:

    http://www.cbsnews.com/news/asset-al...ould-you-take/
    http://www.cbsnews.com/news/asset-al...isk-tolerance/
    http://www.cbsnews.com/news/asset-al...k-do-you-need/
    http://www.cbsnews.com/news/asset-al...licting-goals/

    According to Swedroe, asset allocation decisions should be based on 3 factors:

    ability to take risk
    willingness to take risk
    need to take risk

    Come up with a solid plan that matches your ability, willingness and need to take risk.

    Whether your reach $1M at 40, 42 or 45 depends on the market returns. They are out of your control.

  8. #17
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    I will not be disappointed if I have $700/800k at 40. The reason I chose this goal is that it will help me to reduce cost, increase savings and I will be able to get around $30/40K interest/dividend as a second income. I think it will give me financial freedom.

    I would like to complete MBA in Finance and change my career once I reach my goal. I don't want to quit my job and complete MBA at this moment.

    Quote Originally Posted by GoldStone View Post
    What is the significance of having $1M at 40? Would you be disappointed if you have $800K at 40 and $1M at 42? Why?

    The goal sounds arbitrarily aggressive to me. It may be counterproductive, because it may push you to take unnecessary risk.

    You may want to review Larry Swedroe's guide to asset allocation:

    http://www.cbsnews.com/news/asset-al...ould-you-take/
    http://www.cbsnews.com/news/asset-al...isk-tolerance/
    http://www.cbsnews.com/news/asset-al...k-do-you-need/
    http://www.cbsnews.com/news/asset-al...licting-goals/

    According to Swedroe, asset allocation decisions should be based on 3 factors:

    ability to take risk
    willingness to take risk
    need to take risk

    Come up with a solid plan that matches your ability, willingness and need to take risk.

    Whether your reach $1M at 40, 42 or 45 depends on the market returns. They are out of your control.

  9. #18
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    OK then...... that plan was for an ROR of 3%. It resulted in a $27K after-tax lifestyle. At 1%, he secures a $22K lifestyle.

    1% seems like a pretty risk averse goal to me.

  10. #19
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    It's been a good year and my net worth is around $205k at the end of 2014....target to save a million by 2024.

  11. #20
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    Quote Originally Posted by scorpion_ca View Post
    It's been a good year and my net worth is around $205k at the end of 2014....target to save a million by 2024.
    Not sure if you mentioned this, but why do you want to have a million dollars by the time you are 40?


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