# Preparing for retiring soon. Income needed



## jman123 (Jan 28, 2015)

Greetings,

I think there is a strong possibility I will be retiring by the end of March 2019. I will 66 years old in April.

I am looking into how I am going to go about replacing some of my current work income. 

My retirement income would be my QPP pension and OAS which I have held off getting till I retire. No other income except a small work income from my wife , which is not 100% guaranteed. 

Right now, I have the majority of my money with an advisor but I do have about $200K in a few RRSPs and a LIRA that is strictly under my control.

In the past I used the Couch Potato Portfolio so I have ZAG,XAW,VCN and XUU shares. 

I also have dabbled within a TFSA account with a small amount of money invested in Dividend paying funds (BNS,CM,MIC and GWO). I decided to buy these from the "Top 100 Dividend Stocks of 201x" as suggested by MoneySense. 

Now MoneySense have come out with their 2018 list and I am thinking of consolidating my RRSPs , selling what I have and going with buying some of the funds on their "A" team, maybe a few on their "B" list. Also from a recent article on MoneySense looking at iShares MSCI World Index ETF. Also, looking at web sites talking about the US "Dividend Aristocrat" index , REITs, etc... so a bit overwhelmed on what to do or choose. 

I have yet to approach my financial advisor on how he is going to manage my funds so that I can have income but I thought I would try doing something on my own (and if I don't like his approach, take it all back and manage it myself or find someone more of my mindset). 

It seems that dividend paying stocks,funds,etc... seems to be the way to go although it has been mentioned to me in the past that you should be looking at your returns and not be so hung up on dividends. In that case I would have to determine what to sell if I want income.

Since I'm sort of hoping to get at least a 4% return GICs don't cut it. So, if I go with Dividend stocks that pay at least 4% and close my eyes slightly if the stock price goes down and hold them for many years (or forever) maybe I should take this path? If I go with this approach then I can maybe plan that I would have at least an additional $8K income next year from that $200K. That's still a long way to go but a start. 

Your advice/opinion? 

Thank you


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## Jimmy (May 19, 2017)

I would try and keep your age % in FI first of all so you don't risk capital losses on ETFs, stocks as you draw on them for income. Would not be so worried about getting div producers either. Just sell what you need in RRSPs each year from the assets that have done well to fund your income needs IMO.

Maybe when the markets rebound and interest rates rise, move more $ over to ZAG. Also as you get older look at shorter duration FI ETFS (less effected by interest rate rises) . ZAG is about 7 yrs. maybe look at ZSU, ZCS which are < 3 yr or ZST < 1 yr.


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## fireseeker (Jul 24, 2017)

Jman, I suggest you investigate whether you might qualify for GIS. 
If you do, you may wish to factor that into whether adding dividend and interest income is a good idea. Dividends may artificially increase your income and reduce GIS (I think).
There are more details here, but only you will be able to calculate your potential GIS eligibility using your exact numbers.

https://retirehappy.ca/understanding-gis-guaranteed-income-supplement/


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## james4beach (Nov 15, 2012)

jman123 said:


> Since I'm sort of hoping to get at least a 4% return GICs don't cut it. So, if I go with Dividend stocks that pay at least 4% and close my eyes slightly if the stock price goes down and hold them for many years (or forever) maybe I should take this path? If I go with this approach then I can maybe plan that I would have at least an additional $8K income next year from that $200K. That's still a long way to go but a start.


Dividend stocks are very different things than GICs. I just wanted to point this out even though you might already know this. The GIC is a guaranteed contract that has a fixed return, and that always returns your principal (plus interest). A dividend stock is an equity that comes with no guarantees, nor a guaranteed dividend. Sometimes dividends continue and keep increasing over time, but other times they do not, and may decline. A dividend stock does not ever assure you of a positive return, and can decline significantly in value the same way all stocks can. In other words the dividend stock is much more risky than a GIC.

It's possible to buy a good quality ETF such as CDZ which does pay a decent yield (currently 4.3%, I think) but just keep in mind that the dollar value of the investment could indeed fall sharply, and that is often very difficult to stomach. There is also the possibility that dividend payments could decline a bit.

Unfortunately however, you're not really going to be able to get dividend yields much higher than what CDZ has without getting into dangerous territory. If you start picking stocks that have yields into 5% or more, you are likely going to end up with a very dangerous stock portfolio that is less likely to do well going forward, and less likely to continue paying dividends. This means that a dividend approach on your 200K is only going to take you as far as about 9K income per year -- plus the unavoidable risk of seeing your 200K value slashed down to 100K or less, in case of a severe bear market in stocks.

~ Instead ~ as Jimmy mentions, I think it's probably better to stay in typically conservative investments, more in GICs (5 year ladder) and other fixed income and not worry about dividend stocks. Stick to a % stock % fixed income portfolio that is right for your age and risk tolerance. Then, just extract cash out of your portfolio as you need it, for example using the GICs maturing in the ladder, and maybe some stocks too.


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## OnlyMyOpinion (Sep 1, 2013)

You like the top holdings of CDZ?
GEI, AR, RNW, GRT.UN... 
I don't care for them.


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## lonewolf :) (Sep 13, 2016)

If you want income would go with a deferred annuity till you retire then annuitize. Income would be greater then GIC which might allow you to collect QPP @ a latter age.

If pension small enough or can be deferred & grow you might be able to collect GIS, If so max out TFSA before retiring & live off TFSA for as long as possible letting annuity & pension grow. If possible would keep some money in gold.

Do not think your in a position to buy dividend stocks unless very small percentage max 2%


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## Retiredguy (Jul 24, 2013)

_Consider_ delaying OAS and CPP to age 70 and get the substantially larger amounts (indexed). Between age 66 and 70 reduce RRSP's in an amount equal to what you would be receiving from OAS/CPP. RRSP's will be taxed very low. You say the_ majority_ of your money is with an advisor. Majority is obviously greater than the 200K you self manage.

In retirement monthly (indexed) income is more important than total amount of your wealth.


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## agent99 (Sep 11, 2013)

Sounds like jman has bulk of savings/investments being managed by a financial advisor (not adviser??  ) Hopefully someone trustworthy.

For the rest of his savings, I would suggest he use those to learn by doing. The easy way may be to use funds, but I have never found one I like! He seems to be interested in actual dividend paying stocks (although he called them funds) He also wants to have a yield of about 4%. 

I think this can easily be done. There are some good stocks that have dividend yields in the +/- 6% range (See link at bottom for mine - Call them HY). Then there are the banks and utilities currently yielding 3.5-5% (MY) and then there are safe fixed income bonds, preferreds and GICs (LY). I would buy say 50% of the MY stocks, 25% of HY and 25% of LY. Overall yield should be above 4%. 

Hopefully the advisor has some of his main portfolio in a mix of equity and fixed income. My suggestion assumes a reasonable overall fixed income allocation - say 40%.

https://www.canadianmoneyforum.com/...FFN-thoughts?p=1984422&viewfull=1#post1984422


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## jman123 (Jan 28, 2015)

The only way I would qualify for the GIS is if I took most of my income from my TFSAs. I'm expecting that my RRSPs and LIRA handled by my adviser will produce me with the majority of my income needed.


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## jman123 (Jan 28, 2015)

Retiredguy said:


> _Consider_ delaying OAS and CPP to age 70 and get the substantially larger amounts (indexed). Between age 66 and 70 reduce RRSP's in an amount equal to what you would be receiving from OAS/CPP. RRSP's will be taxed very low. You say the_ majority_ of your money is with an advisor. Majority is obviously greater than the 200K you self manage.
> 
> In retirement monthly (indexed) income is more important than total amount of your wealth.


Well , it's too late for me to delay getting the QPP (I live in Quebec) since I started taking it when I as 61 years old. I took it for longevity reasons. My father lived only to 62 years of age, I figured maybe better to have a bird in the hand then two in the bush. 

For the OAS , I figured it makes more sense "politically" to take it when I retire. My wife is not keen on seeing our nest egg diminish (at least not till after we are in our 70's). Having to take out less from my RRSPs and LIRAs and taking the OAS in order to help fill the income gap would help achieve that. 

I guess nobody wants to see their nest egg diminish but on the other hand we won't live forever.


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## jman123 (Jan 28, 2015)

Sorry to mix up funds with stocks. Yes, I guess , I mean stocks. The Moneysense A list seem to be mostly banks and insurance companies , so it seems relatively safe. 

Don't want to get into an annuity right now. Maybe at 70. 

Will check out the stocks that are mentioned. 

Have also to think about setting up a GIC ladder.

Thanks


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## Retiredguy (Jul 24, 2013)

jman123 said:


> Well , it's too late for me to delay getting the QPP (I live in Quebec) since I started taking it when I as 61 years old. I took it for longevity reasons. My father lived only to 62 years of age, I figured maybe better to have a bird in the hand then two in the bush.
> 
> For the OAS , I figured it makes more sense "politically" to take it when I retire. My wife is not keen on seeing our nest egg diminish (at least not till after we are in our 70's). Having to take out less from my RRSPs and LIRAs and taking the OAS in order to help fill the income gap would help achieve that.
> 
> I guess nobody wants to see their nest egg diminish but on the other hand we won't live forever.



My read of your original post was that you had not yet started either the QPP or OAS. 

Lots to think about. Enjoy a long retirement!


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## Beaver101 (Nov 14, 2011)

Retiredguy said:


> *My read of your original post was that you had not yet started either the QPP or OAS. *


 ... that's what I have read too. 

*Lots to think about. Enjoy a long retirement!* ... don't forget that $ is only part of the retirement equation.

Anyhow, why isn't your financial adviser assisting with your retirement planning considering he/she is handling most of your RRSPs and LIRA as per your post #9. How much are you paying him/her for his/her "advice (what is it? investment or other financials)"?


Or is that you're trying to get away from your adviser as per your first post?


> Right now, I have the majority of my money with an advisor but I do have about $200K in a few RRSPs and a LIRA that is strictly under my control.


???


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## jman123 (Jan 28, 2015)

Retiredguy said:


> My read of your original post was that you had not yet started either the QPP or OAS.
> 
> Lots to think about. Enjoy a long retirement!


Sorry , what I meant to say initially was that I collect now the QPP but am waiting till I retire to start collecting my OAS.

Also, my intent in asking about dividend income was that it seems for what I have read and from a few retired people I know it seems that this is prominent way to generate income in retirement. I hear buy bank stock (Bank of Montreal, RBC, BNS, etc...) and mostly just sit on it collecting the dividends and don't worry whether the stock goes up or down.

I was just wondering what others on this forum do.


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## OnlyMyOpinion (Sep 1, 2013)

jman123 said:


> Sorry , what I meant to say initially was that I collect now the QPP but am waiting till I retire to start collecting my OAS.
> Also, my intent in asking about dividend income was that it seems for what I have read and from a few retired people I know it seems that this is prominent way to generate income in retirement. I hear buy bank stock (Bank of Montreal, RBC, BNS, etc...) and mostly just sit on it collecting the dividends and don't worry whether the stock goes up or down.
> I was just wondering what others on this forum do.


I am going to generalize: Some members have sufficient div income along with other sources to meet their retirement spending needs. Others have a fixed income ladder that supplements income while equity investments are left to (hopefully) grow for another 5 years or so. Still others tap into capital by selling sufficient holdings from a balanced porfolio as needed (perhaps using a variable percentage withdrawl method). 

So in short, it depends entirely on how you've chosen to bring your various sources/accs into your income, how much they contribute in total, and how much you need for your basic/discretionary spending needs, now and each year into the future.
If you don't already, you need to have a handle on these. I have several scenarios or 'sensitivities' run that model our retirement expenses and income sources.

There is nothing wrong with your idea of buying a portfolio of 'blue chips' as part of your income stream. As you recognize, 'reaching' for too high yield can be dangerous (risk of div cuts) if you are depending on that income to cover basic expenses. 
You don't mention what assets are in your RRSP & LIRA - make sure that you are not too concentrated in your investments when you look across all your sources/accs. CPP would be considered 'fixed income'. Diversity of sources and investments is good. An overall 60/40 equity/fixed income balance is commonly suggested - but everyone has a different 'sleep at night' quotient.


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## humble_pie (Jun 7, 2009)

OnlyMyOpinion said:


> I am going to generalize: Some members have sufficient div income along with other sources to meet their retirement spending needs. Others have a fixed income ladder that supplements income while equity investments are left to (hopefully) grow for another 5 years or so. Still others tap into capital by selling sufficient holdings from a balanced porfolio as needed (perhaps using a variable percentage withdrawl method).





i like that word "withdrawl"

three brothers stroll into a saloon. Oldest has an oklahoma twang. Middle bro has a midwestern drawl. Taciturn youngest bro doesn't say much but orders a beer tap withdrawl.

.


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## OnlyMyOpinion (Sep 1, 2013)

There's withdrawl, with 'drawl',and then there's Buster!
View attachment 19186


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## Thal81 (Sep 5, 2017)

jman, what's clear from your original post is that you are already a DIY investor for a sizable portion of your investments and you are basically juggling a bunch of "good" options for what to do with your money.

The topic of your post says "income needed". I disagree. What you need is an investment plan and a withdrawal strategy. Hopefully your advisor can provide that, otherwise he is not worth his commission. Considering the experience and knowledge you already have, it wouldn't be far fetched for you to take over all your investments. However I understand this could be stressful at this point in your life. Thus, what I suggest you do is to shop for a fee-only advisor who can provide a retirement strategy that takes account of all your holdings.


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## Longtimeago (Aug 8, 2018)

I always find threads on this topic, in various retirement forums, totally disagreeable to ME.

I have one fundamental rule for managing my money in retirement. Never touch the capital. Also meaning, never risk the capital. For that reason, I do not believe in the stock market which regardless of what anyone says, is a gamble with your capital. If you were to go back and read posts in various retirement forums after the 2008 Great Recession, you will find all kinds of posts by people who watched their capital 'invested' (gambled) in stocks, plummet in value and their SWR (Safe Withdrawal Rate) strategy unworkable (withdrawing 4% of $500k from stock value is not the same as withdrawing 4% from a $300k stock value) as the income became insufficient, resulting in them having to take a job as a Walmart greeter. I kid you not.

You want income, what else matters, nothing? You want income, but NOT at the expense of risk, that does matter. So what you want is the maximum income you can get with the minimum risk you can find, at the same time. That's what everyone wants, the difference is in how they think the best way to do that is. Some people believe that there are 'safe' stocks and some people believe there are 'safe' SWRs. I don't believe in either. Tell that to the people who retired just before 2008 and became Walmart greeters.

I also don't believe in being able to predict 5, 10, 15+ years into the future. What may make sense in year 1 of your retirement may not 6 years later. I find that many people think they can come up with a financial plan for their retirement that will work till the day they die. If you look back at your life before retirement, what worked when you were 20 that still worked when you were 40 and what worked at 40 that still worked when you were 60? As the saying goes, 'man plans and the Gods laugh.' In retirement, you have to change your current plan as often as necessary, don't expect otherwise, it is no different than at any other time in your life.

So what provides a 'relatively' safe investment TODAY that will earn you income? Well, first you have to consider whether the income you expect is realistic or not. Even in times of record low interest rates as exist today, you can hope to be able to maintain a 3% return on your capital this year. Even GICs will get you that currently. If you want more than that, you are going to incur risk, it's that simple.

That's where people get into trouble. What I mean is, they want more income than they actually have capital to generate safely. Wanting more income doesn't mean you can have it. If someone has say $500k in investable capital, at 3% that would give you $15k income per year. If that is all the income someone had (no pensions) it isn't much is it. If you add say $15k from CPP and OAS it gets you to $30k which still isn't a lot but in fact many people can and do live on less than that. So that would be safe and doable.

The trouble is when you tell someone who has been living on $100k per year that they can only safely plan on living on $30k per year even though they have $500k investable capital, they don't like that answer. So they look at a plan that tells them they can earn more than the current safe % you can get or start withdrawing from their capital at a supposed 'SWR'. They start to incur risk. Whatever you decide to do, you have to weigh income vs. risk. The more income you insist on having the more risk you are going to have to take. 

So I go back to your original point. 'Income needed.' How much income is needed? That is a question worth wrestling with. The less you need, the safer and easier to get it can be. I use a formula of thirds. One third of income is for fixed costs, one third for discretionary spending and one third for savings. The savings one third is not for re-investing, it is for unexpected or just plain, 'just because I want to', expenditures. It is just savings sitting in a bank account or GIC. The one third discretionary is for travel etc. The first one third is of course self-explanatory. If everything goes to 'hell in a handbasket', we have a two thirds cushion we can lose and still eat well and heat our mortgage free home. At no time other than a government collapse (in which case it won't matter what any of us did with our money), is our capital at risk.


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## james4beach (Nov 15, 2012)

Longtimeago yes as you say, the stock market is a gamble, but every other aspect of finance is a gamble too. Bonds and GICs are a gamble because we don't know what interest rates will be in the future. Even though 3% may be enough today, we don't know what happens to a senior with GICs a decade from now. We don't know what inflation will be. Real estate is a gamble. Everything is a gamble.

Even if you say "put it all in a 5 year GIC ladder" you haven't escaped from the uncertainty of interest rates and inflation. Even if you put all your money in a 30 year government bond and just live off the coupon payments, there's still risks of inflation, federal default, and currency collapse. No matter what you do, there is risk.



Longtimeago said:


> At no time other than a government collapse (in which case it won't matter what any of us did with our money), is our capital at risk.


Government collapse isn't so rare, and doesn't have to be a big deal. Investors in Iceland, Greece, and Argentina who had foreign stocks and foreign currency/gold were protected somewhat. This low probability event should be rolled into an investor's strategy, in my opinion. Government collapse happens pretty often.

If you're avoiding foreign stocks due to a distaste for stocks, then you are also losing out on one of the big protections it offers you. You're trying to dismiss the government/currency failure risk by saying "it won't matter what any of us did" but you are wrong ... there _are_ ways to navigate around that, but you are missing out on those in your investment choices.

In other words, you haven't escaped from the risks. You are still gambling, but maybe you don't realize it.


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## fireseeker (Jul 24, 2017)

jman123 said:


> The only way I would qualify for the GIS is if I took most of my income from my TFSAs. I'm expecting that my RRSPs and LIRA handled by my adviser will produce me with the majority of my income needed.


Unless you're 71, you don't have to draw money from your RSPs and LIRA. In certain very specific cases it can be advantageous to leave your registered money alone so you qualify for GIS. Given that you already getting QPP (I think), this option may not be open to you.
I am in no way recommending this strategy. Just mentioning it as a theoretical option.

Further background:
https://edrempel.com/make-your-retirement-comfortable-with-the-8-year-gis-strategy/
https://www.moneysense.ca/save/investing/tfsa/key-to-rich-qualifying-for-gis-is-large-tfsa/


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## Beaver101 (Nov 14, 2011)

^


> I am in no way recommending this strategy. *Just mentioning it as a theoretical option*.


 ... theoretical as it is and what's the value in that? The problem with the theory in those 2 links is both authors thinks everyone has the same longevity to 100 or so.


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## Beaver101 (Nov 14, 2011)

Thal81 said:


> jman, what's clear from your original post is that you are already a DIY investor for a sizable portion of your investments and you are basically juggling a bunch of "good" options for what to do with your money.
> 
> The topic of your post says "income needed". I disagree. *What you need is an investment plan and a withdrawal strategy. Hopefully your advisor can provide that, otherwise he is not worth his commission.* Considering the experience and knowledge you already have, it wouldn't be far fetched for you to take over all your investments. However I understand this could be stressful at this point in your life. Thus, what I suggest you do is to shop for a fee-only advisor who can provide a retirement strategy that takes account of all your holdings.


 ... +1.


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## jman123 (Jan 28, 2015)

fireseeker said:


> Unless you're 71, you don't have to draw money from your RSPs and LIRA. In certain very specific cases it can be advantageous to leave your registered money alone so you qualify for GIS. Given that you already getting QPP (I think), this option may not be open to you.
> I am in no way recommending this strategy. Just mentioning it as a theoretical option.
> 
> Further background:
> ...


Thanks for the info on the GIS. Not sure it can apply to me. From reading these articles I probably wouldn't qualify.

My wife makes about $16K per year and , for 2019, I will probably working 3 months and I also get $10K / year from the QPP so maybe I'm too rich for GIS  

I see from the responses that , I guess, what you can expect to earn from your nest egg all depends on your risk level. I just figured a 4% return is at a "low" risk level.

Isn't that 4% a rule of thumb , although some people say 3.5% is the new one? 

I know that everyone is different. Some people need $40K/year , some need $100K but when people think of the amount they need to retire on some sort of rule of thumb is useful. no?


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## Longtimeago (Aug 8, 2018)

james4beach said:


> Longtimeago yes as you say, the stock market is a gamble, but every other aspect of finance is a gamble too. Bonds and GICs are a gamble because we don't know what interest rates will be in the future. Even though 3% may be enough today, we don't know what happens to a senior with GICs a decade from now. We don't know what inflation will be. Real estate is a gamble. Everything is a gamble.
> 
> Even if you say "put it all in a 5 year GIC ladder" you haven't escaped from the uncertainty of interest rates and inflation. Even if you put all your money in a 30 year government bond and just live off the coupon payments, there's still risks of inflation, federal default, and currency collapse. No matter what you do, there is risk.
> 
> ...


Maybe you missed the part of my response in which I said we can't predict the future and therefore trying to come up with an investment plan that never changes during your retirement is futile. Yet that is what many try to do and suggest to others.

Maybe you missed the part of my response where I wrote, "So what provides a 'relatively' safe investment TODAY that will earn you income?" and then also wrote, "Even in times of record low interest rates as exist today, you can hope to be able to maintain a 3% return on your capital this year. Even GICs will get you that currently."

So I am saying, stop trying to plan for the future, plan for today. ie. This year only. Next year you may or may not decide to go with another plan depending on the circumstances that exist at that point in time. There is no uncertainty of interest rates and inflation for THIS year. What risk do you see if you put your money in a ONE year GIC today? You know exactly how much it will pay out to you at the beginning of the next year. I'm not talking about 5 year GIC ladders at all. I was just giving an example of could be done with very little risk THIS year.

What everyone seems to want however is a plan that will also work NEXT year. So they are back to trying to predict the future instead of just saying, 'I know what I am doing this year and it is as risk free as I can get it. Next year, I hope to be able to come up with a plan that works as well as my plan for this year.' I don't try to plan for next year until next January 1. 

Theoretically (not everything starts/ends on January 1 obviously) On January 1, we sit down and work out our budget for the year. We know how much pension income we can expect to receive during the year and we know how much income our personal capital investments paid us by December 31 of the last year. We total those up and that is our expected income for the new year. Pretty simple really. The key is that our personal capital investment income is from LAST year, not the coming year. Think about it.

We then decide how to invest our capital for the coming year to provide income for the FOLLOWING year, not this year. Our income for this year is basically 'done and dusted' on January 1. Come December 31 again, we will see how much our capital earned us that will go to the FOLLOWING year's income.

Funny you should mention Greece. I lived there for some years. One year, after working out my budget for the coming year, I then had to decide where I was going to invest my capital for the following year. This was a few years (mid 90s) before Greece joined the EU and the Eurozone (not one and the same thing). In order to get their financial situation in a position that would be acceptable to the EU and for entry to the Eurozone, they were offering 1 year government bonds that paid 21%, yes 21%, that's not a typo. What's more, the bonds could be bought and held in foreign currency which eliminated any currency fluctuation concerns. So if you invested $1 CAD you got $1.21 CAD at the end of the year. Furthermore, the income was tax free in Greece if you were a resident in Greece, which I was. 

So I transferred a six figure sum from Canada to my bank in Greece and bought bonds. As a resident of Greece of several years by that time, I had a pretty good picture of what was going on in Greece and saw very little risk of the government failing during that year. In fact, I ended up renewing the bonds for 2 more years, by which time they had dropped to 15%. At the end of those 3 years, I moved all the money to the UK and invested in something else. I was then living in the UK. I am not adverse to 'foreign' investment at all, I don't know where you got that idea.

In the UK, I invested my capital in real estate for the next 6 years. That was something that I was familiar with from investing in Canada and was what put me in a position to retire in my early 40s to begin with. Commercial/Industrial real estate, not Residential. I got out of that in the UK, in 2006. Prices and income peaked in 2007 and of course collapsed in 2008. https://www.bloomberg.com/news/arti...es-of-commercial-real-estate-made-you-nothing

But in 2000 through 2005-6 there was very little risk involved if you put money in during those years. All real estate was in a bull run and as an aside, we bought a house in 2000 (to live in) and sold at a 125% profit in 2006. You pretty much couldn't fail to make money in real estate during those years, in the UK. It didn't take a genius to figure it out. However, I still sat down every year and made a decision for the coming year. I did not just put my money in something and then just expect it to be profitable forever more. You have to decide EACH year and that's all I am saying. 

Buying 'blue chip' stocks and then planning on a 4% SWR from that capital as a long term retirement plan, will only result in the best case in a reduced amount of capital each year until eventually you withdraw the last dollar. Hopefully and I find this hilarious, you die before that happens. I prefer to maintain or GROW my capital while still deriving enough income to live on each year. But that takes remaining versatile and actively changing your investment strategy every year to suit the situation that exists.


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## OnlyMyOpinion (Sep 1, 2013)

LTA, you have been incredibly lucky in your market timing (bonds, RE, etc.) over the years.


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## james4beach (Nov 15, 2012)

Yeah, LTA, I remember you describing those high yielding bonds before. You had a series of lucky trades (gambles) and you're reading too much into luck / random chance.

You are proposing an active trading strategy, effectively saying someone should strategically _trade_ continuously through their retirement based on opportunities of the day.


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## Longtimeago (Aug 8, 2018)

james4beach said:


> Yeah, LTA, I remember you describing those high yielding bonds before. You had a series of lucky trades (gambles) and you're reading too much into luck / random chance.
> 
> You are proposing an active trading strategy, effectively saying someone should strategically _trade_ continuously through their retirement based on opportunities of the day.


I can understand why someone might say I have been 'lucky'. However, I don't believe in luck and I don't play the slots or poker in Vegas. The only thing I ever bet on is myself. Yes, I am proposing an active trading strategy, what other kind is there? I mean, you aren't suggesting anyone should just invest and then never bother looking to see if it is doing well or not are you?

OK, I'm being a bit facecious with that last remark but seriously, this idea that you do something like buy blue chips and then just sit back and watch the money roll in is ridiculous. If someone does that, I would say that it is they who is going to need luck.

Here's the thing with being 'lucky' and 'opportunities' james4beach. There are opportunities all the time but unless someone is looking for them, they don't see them. When someone sees an opportunity and goes with it, that is not about 'luck'. I am not reading too much into luck/random chance, you are reading too much luck into simply managing investments. I find it insulting that someone would suggest I have just been 'lucky'. How about some credit for just being smart?

I bet on me and my ability to look at something and assess the probability of it doing well. As I wrote, I looked at those Greek government bonds (for example) and could see very little downside possibility. No currency fluctuation to be concerned about, no income tax, 21% return guaranteed. The only possible downside would have been if the government had collapsed *that year*. Just how much 'luck' do you think was involved in looking at that situation and making a decision to invest? I trust in what is between my ears, my brain and the logic and commonsense it gives me.

When people retire, there appears to be this common belief that what you then do is wait to die. That's putting it bluntly but it is in fact how many people seem to see it deep down. What is a SWR other than a plan to death? You withdraw from capital with the hope that it will last till you DIE.

People express a very similar view when they talk about moving in retirement. For example, they want to retire to a sun and sand paradise to 'live out the rest of their days.' Then they ask for where to find that place and move to Mexico or Costa Rica or wherever. They plan to 'snowbird' in Florida and buy a nice little double wide Park model trailer home in a golf course 'retirement community'. They are going to 'live out their Golden Years'. ie. their LAST years.

Retirement for many seems to be all about having a plan for those last years of their life. It's as if their real life was all before they retired and now that is ended and it is just about waiting to die. That's a pretty sad way to look at retirement don't you think?

Maybe it is simply because I 'retired' at 43 that I look at it differently. But to me there is only 'next'. When I 'retired' (I really don't like that word other than to indicate that someone no longer needs to work to earn an income), I had no idea what I was going to do 'next' but it certainly wasn't sit and wait to die. I 'hit the road' and bummed around Europe for a year plus before ending up in Greece where I never decided to stay, I just didn't decide to leave for 7 years. I had no idea how long I would be there or how I would earn income in the future. How could I have? I can't predict the future. But I had confidence that something would occur that would cause me to decide what was 'next'. Sure enough, it always does. That's not luck, that's just life.

Retirement is not about waiting to die, it is simply about the 'next' chapter in life. If it made sense to have an 'active trading strategy' in your 20s or 40s, why would it suddenly stop to make sense when you retire? Why on earth would it make sense to have a plan that counts on you dying to show that it was successful?


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## OnlyMyOpinion (Sep 1, 2013)

That's ok LTA, you can keep telling the tale about how well you did on 1yr 21% greek bonds because of your above average smarts. 
Actually, I've grown to enjoy your long-winded and entertaining posts. 

But the fact remains, no, you didn't bet on 'me', you bet on greek bonds that were risky by any standard, issued by a country whose economy, employment and debt were all in the shitter. You were lucky in spades. 

In Dec. 2011, Greek 1 year bonds reached a yield of 317%. We aren't asking why you missed such a golden investment opportunity though.

I believe James' point was that most retirees (again, you being the exceptional exception) no longer have the ability to easily make up large investment losses (no employment income to refill the tank). That would be why their investment strategy might change between their 20's and being retired. I didn't see anything about retirees just waiting around to die, except of course in your rambling and somewhat bizarre post.

Cheers


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## AltaRed (Jun 8, 2009)

There is an 'ignore' feature on this forum.


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## humble_pie (Jun 7, 2009)

Q: how to tell if you're a cmf forum bigot?

A: when you log in, there's nothing there


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## Longtimeago (Aug 8, 2018)

OnlyMyOpinion said:


> That's ok LTA, you can keep telling the tale about how well you did on 1yr 21% greek bonds because of your above average smarts.
> Actually, I've grown to enjoy your long-winded and entertaining posts.
> 
> But the fact remains, no, you didn't bet on 'me', you bet on greek bonds that were risky by any standard, issued by a country whose economy, employment and debt were all in the shitter. You were lucky in spades.
> ...


OnlyMyOpinion, why would you talk about Greece in 2011 when I was talking about 1995? Those two years are 16 years apart! I'll say again, the bonds had very little real risk THAT YEAR. Are you upset somehow that I was able to recognize that and in a position to take advantage of it? Would you prefer that somehow it had been a 'big gamble' and I was just 'lucky in spades' as you put it? What's with the seeming anger over someone seeing an opportunity and taking advantage of it?

In a sense, your comment re 2011 only proves my point about holding things long term. What worked in 1995 would not have worked in 2011 regardless of what percentage they were offering to pay. There was no 'golden investment opportunity' in Greek bonds THAT YEAR. 

What I am saying is you must make new decisions every year at least, no plan at any age is guaranteed to work beyond that.
http://time.com/money/4851375/can-y...rvive-a-stock-market-crash-heres-how-to-tell/


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