# The joys of retirement. Version 2.0



## Longtimeago (Aug 8, 2018)

Hi fellow retirees, I hope this post finds you well and enjoying your retirement. I have a relatively simple question for you to answer.

As a retiree, what do you find the joys of retirement to be?

Some of my own are:

Not having to make appointments at a time not convenient to you. I never make an appointment before noon for example.
Not having to go to work.
Not having to set an alarm clock.

Being able to start off on a vacation on any day of the year.
Being able to not return from a vacation until you choose to do so. For example, I once left expecting to be gone a month or two and didn't return for 7 years.
Being able to decide to do anything you want on any day you want.

Note to non-retirees:
This thread is not one on which you can comment unfortunately as you are not retired yet, but you are welcome to read about all the joys of retirement that you may have to look forward to when you do retire. Have a nice day at work.


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## STech (Jun 7, 2016)

Longtimeago said:


> Note to non-retirees:
> This thread is not one on which you can comment unfortunately as you are not retired yet, but you are welcome to read about all the joys of retirement that you may have to look forward to when you do retire. Have a nice day at work.


Marginally better than the other thread, but still a big fat #fail. 

Good luck trying to stop me and other "clueless" non-retirees from commenting


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## Ag Driver (Dec 13, 2012)

I've seen a lot of dick heads on this forum over the years, but LTA might be clueless as to who takes the cake. 

Best of luck in retirement. You must be a real treat to have a conversation with over coffee.


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## STech (Jun 7, 2016)

Ag Driver said:


> You must be a real treat to have a conversation with over coffee.


And that's only if he allows you to converse with him.


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## lightcycle (Mar 24, 2012)

Can't wait for v3.0 to come out.

Don't keep us waiting!


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## STech (Jun 7, 2016)

In version 3 he'll tell us he realizes his lack of tact and manners, and is taking some time to learn.


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## peterk (May 16, 2010)

Guys, there is great wisdom and humility that can be learned by silently reading about LTA's low-budget, aging-nihilist lifestyle.

If only you would shut up and listen, instead of making snarky retorts, then you too could one day live a life of meaningless pleasure and die alone on a beach next to to your sandcastles.


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## Beaver101 (Nov 14, 2011)

One clueless CMFr has already enjoyed reading Ernie's book(s) so won't further comment on the further joys of retirement (v#) being posted:
https://www.amazon.ca/Joy-Not-Working-Unemployed-Overworked/dp/1580085520


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## kcowan (Jul 1, 2010)

Here is an excerpt from Forbes:
*How to get joy out of retirement*
*Mentor, teach, or volunteer to share your knowledge and wisdom
*Engage with others and stay social
*Be open to taking risks
*Practice being enthusiastic, grateful, and satisfied
*Notice the good things every day
*Laugh more, especially at yourself
*Like more, love more, and give more
*Search for, find and pursue your true passion

Article from 3 years ago

There are more suitable places for this topic since most forum participants are still working. I would suggest the Early Retirement Forum:
early-retirement.org
Here is a sample search
Good luck with your own search.


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## Longtimeago (Aug 8, 2018)

lightcycle said:


> Can't wait for v3.0 to come out.
> 
> Don't keep us waiting!


Yawn, some people are so easily baited that it hardly seems worth the bother sometimes. 

Lightcycle, I suspect that if I posted a version 3.0, they would be unable to resist responding once again but really, the amusement factor has been exhausted already.


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## lightcycle (Mar 24, 2012)

So, no v3.0 then?

Colour me disappointed. V2.0 was riveting!


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## Frank Drebin (May 10, 2015)

Not retired, commenting. Its great not being in my 60's, or later!

I work shiftwork and all of these benefits I get to enjoy as well.


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## Just a Guy (Mar 27, 2012)

My lifestyle would say I’m retired and have been for years. As usual though my life doesn’t really fit into traditional definitions. I’d say the things I enjoy are spending time with my kids, enjoying hobbies (mine happens to be playing monopoly with real houses), watching sports, especially when my kids are playing, enjoying the outdoors, sitting by the fire, cooking and basically doing whatever the heck I want to when I want to.


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## nortel'd (Mar 20, 2012)

Retired 6 years ago. 
I see some of myself and some of my husband in the article https://www.nextavenue.org/living-with-newly-retired-spouse/ mentioned in Rob Carrick’s Globe and Mail PERSONAL FINANCE COLUMN - “A lot less money, a lot more husband” - posted July 23. 2019 

First three years of retirement were great. We traveled with our pets and we/I had a lot of fun visiting family and friends together.

Christmas of 2015 my husband read Jonathan Cahn’s “The Harbinger” and “The Mystery of the Shemitah” from cover to cover. From then on he became a prepper and has chosen to become more and more home bound. My retirement has taken on a whole new meaning. 

He no longer wants to do things he does not enjoy doing. However, he is very supportive and lets me birdwatch and sightsee with my friends, our daughter and her family, and my sisters while he stays home and takes care of the pets.


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## Longtimeago (Aug 8, 2018)

Frank Drebin said:


> Not retired, commenting. Its great not being in my 60's, or later!
> 
> I work shiftwork and all of these benefits I get to enjoy as well.


LOL, how about the benefit of not having to work for a living?


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## Mechanic (Oct 29, 2013)

Not having to work is the ultimate goal if I am not mistaken.


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## cainvest (May 1, 2013)

Mechanic said:


> Not having to work is the ultimate goal if I am not mistaken.


Yes but that can also mean having the option to do work you like as instead of work you don't.
Of course for many that means no work at all.


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## Frank Drebin (May 10, 2015)

Longtimeago said:


> LOL, how about the benefit of not having to work for a living?


There will be plenty of time for that when I'm retirement age. For now I will enjoy being in the prime of my life and raising a family.

I do hope that when I am retired I have enough meaning in my life that I don't need to come online and try to troll folks in a lesser financial situation than myself. 

You came expecting envy and you left receiving pity.


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## like_to_retire (Oct 9, 2016)

cainvest said:


> Yes but that can also mean having the option to do work you like as instead of work you don't.
> Of course for many that means no work at all.


_"Option"_ is the key word in your statement.

Option to do work is what I see as the real definition of retirement. 

When you call yourself retired, I think you should be able to nothing all day, every day, and still be able to afford to live. Then, if you want to do work that you enjoy, you're still retired.

But I read so many of these FIRE stories where the people really don't have the option to not work - they just do work they might enjoy. But they can't do nothing for the rest of their life and still live. They need to work. That's not retirement to me anyway.. 

ltr


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## Frank Drebin (May 10, 2015)

nortel'd said:


> Retired 6 years ago.
> I see some of myself and some of my husband in the article https://www.nextavenue.org/living-with-newly-retired-spouse/ mentioned in Rob Carrick’s Globe and Mail PERSONAL FINANCE COLUMN - “A lot less money, a lot more husband” - posted July 23. 2019
> 
> First three years of retirement were great. We traveled with our pets and we/I had a lot of fun visiting family and friends together.
> ...


That article is hilarious. Its a good reminder to enjoy the journey because sometimes the destination isn't what you think it is.


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## jargey3000 (Jan 25, 2011)

Frank Drebin said:


> There will be plenty of time for that when I'm retirement age. For now I will enjoy being in the prime of my life and raising a family.
> 
> I do hope that when I am retired I have enough meaning in my life that I don't need to come online and try to troll folks in a lesser financial situation than myself.
> 
> You came expecting envy and you left receiving pity.


surely you must be joking, Frank...


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## Frank Drebin (May 10, 2015)

like_to_retire said:


> _"Option"_ is the key word in your statement.
> 
> Option to do work is what I see as the real definition of retirement.
> 
> ...


Humans are really meant to work till they are not able. No one in their 40's just "retires" and does nothing with their life. They have to find something to fill their time besides golf and travelling. Retirement is for those that are "done" working for a living, and are typically retirement age (55+)


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## like_to_retire (Oct 9, 2016)

Frank Drebin said:


> Humans are really meant to work till they are not able. No one in their 40's just "retires" and does nothing with their life. They have to find something to fill their time besides golf and travelling. Retirement is for those that are "done" working for a living, and are typically retirement age (55+)


And you totally missed my point.

ltr


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## cainvest (May 1, 2013)

like_to_retire said:


> When you call yourself retired, I think you should be able to nothing all day, every day, and still be able to afford to live. Then, if you want to do work that you enjoy, you're still retired.


Slight difference in wording works for me. If you work but don't need too then you're financialy independant but not retired.


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## Frank Drebin (May 10, 2015)

jargey3000 said:


> surely you must be joking, Frank...


I am serious, and don't call me Shirley.


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## Frank Drebin (May 10, 2015)

like_to_retire said:


> And you totally missed my point.
> 
> ltr


No, I get it. 

Retiring = retiring from the workforce, no longer working, don't have to or can't any more.

Independently wealthy = the option to do the above, but still able/willing to work.

You can be independently wealthy if you have a small income stream but even smaller expenses.


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## Mechanic (Oct 29, 2013)

Always someone with a chip on their shoulder, lol. I'm going to go work....on my fishing skills for a few hours.


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## cainvest (May 1, 2013)

Frank Drebin said:


> I am serious, and don't call me Shirley.


lol, classic!


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## like_to_retire (Oct 9, 2016)

Frank Drebin said:


> I am serious, and don't call me Shirley.


OK, that's fair, let's be frank.

ltr


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## Just a Guy (Mar 27, 2012)

Personally, I don’t believe in gambling. I know I’m alive today, can’t say the same about tomorrow until I get there. Certainly wouldn’t want to be wrong and die doing something I didn’t enjoy. 

Have a buddy who owns his own company, he was talking about looking forward to retiring so when he hits 65, and his body is all broken down, he can start “enjoying” life and all he’s worked for.


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## Zipper (Nov 18, 2015)

Hey Shirley come back in 40 years after you can afford to retire and tell us what you really think.


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## Frank Drebin (May 10, 2015)

Zipper said:


> Hey Shirley come back in 40 years after you can afford to retire and tell us what you really think.


I apologize if I offended any retired folk with my replies in this thread.


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## Longtimeago (Aug 8, 2018)

Frank Drebin said:


> There will be plenty of time for that when I'm retirement age. For now I will enjoy being in the prime of my life and raising a family.
> 
> I do hope that when I am retired I have enough meaning in my life that I don't need to come online and try to troll folks in a lesser financial situation than myself.
> 
> You came expecting envy and you left receiving pity.


Why is it that some younger people always seem to think they know better than their elders? 

You know Frank Drebin, those like me who are older than you, have in fact been where you are now. You on the other hand have not been where we are now. So you could say that your perspective is based on 50% of the information, while our perspective is based on 100% of the information.

If you were financially independent now, you could do whatever you want to do now such as be in the prime of life and raise a family. If you continued to be financially independent, you could continue to do whatever you want regardless of your age. Now tell me what there is about that that you don't understand? Or why you think you have to wait till 'there is time for that' in regards to the joys of being retired? If you were retired now, at your age, you could enjoy all the joys of being retired now and into the future. 

What you are really admitting is that there are some joys you enjoy now while working but that there are other joys that you will have to wait till you retire to enjoy. What you are not proving is that it would not be better to no longer have to work for a living for you now. When someone retires in their 30s or 40s etc. they simply reach financial independence earlier than others. As Mechanic simply says, "Not having to work is the ultimate goal if I am not mistaken." and is correct in that statement. We work because in this world we have to, in order to live. Being financially independent is also about financial freedom. You don't currently have that yet somehow seem to think you have more than those who do have that at your age. 

I think you really do need to learn who to look to for inspiration and what you could aspire to. You don't have to 'envy' anyone or have 'self-pity' because you aren't there yet, but I would suggest to you that you might have something to learn still about why having financial independence is the goal to have.


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## Longtimeago (Aug 8, 2018)

cainvest said:


> Slight difference in wording works for me. If you work but don't need too then you're financialy independant but not retired.


Actually, the commonly used phrase is having 'FU money'. When someone is financially independent and chooses to do some kind of 'work' for pay but can at any time they choose, simply tell the boss/employer, 'FU'.

By your definition, I have actually retired 4 times as since I first retired, I have chosen to do some things in return for money, just because I felt like it. But I have always had FU money which meant I could stop whenever I chose to. That is in fact what I did each time. Get involved in something interesting that paid me money and go with it right up until it was no longer enjoyable and not a day longer. Fortunately, in each case, it was not actually necessary for me to tell anyone FU, I just had to tell them, 'see ya later.' 

So have I been retired for 30 years or only say 25 if I deduct the times when I was doing something for money? Does it really matter? All that matters is that I haven't had to do anything I didn't want to (in terms of work) for 30 years now.


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## cainvest (May 1, 2013)

Longtimeago said:


> So have I been retired for 30 years or only say 25 if I deduct the times when I was doing something for money? Does it really matter? All that matters is that I haven't had to do anything I didn't want to (in terms of work) for 30 years now.


I guess one can retire more than once! 
You're right though, doesn't really matter what you call it ... doing what you want to do is what really matters.


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## cainvest (May 1, 2013)

Longtimeago said:


> Why is it that some younger people always seem to think they know better than their elders?


Because age doesn't guarantee wisdom/knowledge. Just beause someone is older does not, by default, make them smarter than you.


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## Just a Guy (Mar 27, 2012)

When I was raising my kids, I thought my ultimate goal would be if they were raised never having to work. That didn’t mean I gave them a small fortune, they don’t expect one even. They respect that I built my money, so it’s mine, not theirs sometime in the future. 

So, I realize that my dream for them is pretty much impossible out of the gate. However, my oldest got his first summer job paying $65k/year. It was explained its basically a 4 month job interview for next year when he graduates. When he got the job, he bought his first rental property, with plans to buy many more after school is over and he gets the job, he also gets a substantial raise since its permanent and not a summer job. He’s also going to get into stocks. His job is pretty much secure for life, judging by his coworkers, pay is very good, but he probably won’t stay long term...

Looking ahead, he’s probably on track to be a multi-millionaires, and financially free, by the time he’s in his mid 20’s. Imagine doing whatever you want for 60+ years of your life instead of maybe 20 in your twilight years...

It may not have been as perfect as I hoped, but it’s pretty darn good.

My next oldest is also on this track and, it wouldn’t surprise me if the two team up and take over a small city or something. 

The last two are significantly younger, but seem to be on track as well, but it’s too early to really tell.


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## Just a Guy (Mar 27, 2012)

cainvest said:


> Because age doesn't guarantee wisdom/knowledge. Just beause someone is older does not, by default, make them smarter than you.


When I was 17, I once got into an argument with a guy who was 34. He was demanding respect from me because he was “older”. I shut him down pretty quick when I pointed out I was 17 but, when he was 14 he became a drug addict and had only been “sober” for the past year and a half...he had no recollection of life between those two points, so technically he was only 15 and a half to my 17. The only respect he deserved was that he managed to survive over half his life without killing himself and that didn’t amount to much considering his choices.

I’d put any of my kids up against many adults when it comes to investing, running a company, being efficient, solving problems, etc. They may not always be smarter, but I bet they could hold their own.


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## Frank Drebin (May 10, 2015)

Longtimeago said:


> Frank Drebin said:
> 
> 
> > There will be plenty of time for that when I'm retirement age. For now I will enjoy being in the prime of my life and raising a family.
> ...


Your antagonistic and childish first post in this thread wrote you off as a mentor figure to me, regardless of your financial situation and/or life choices.

I've been around long enough to see that financial freedom is often a combination of circumstance and choice, is it possible to be financially independent at 35-40? Sure but not without some extreme circumstances or choices. Does one put off having children because it delays their financial goals? Everyone has different priorities. My choices and circumstances have me pacing to a very comfortable retirement at 55. Could I have done better? Sure, but I'm comfortable with my lot in life and I'm only willing to sacrifice so much today in order to enjoy tomorrow.

For me, I've been given the opportunity of having a very high paying job for the little skill that I have. My goal for the next 15 years is to build as much wealth as I can so that I may be in a position to help out my children if they aren't as fortunate with house prices and income as I was, and hopefully to give them an even bigger leg up than my parents gave me.

Retiring is great. Taunting others isn't.


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## Mechanic (Oct 29, 2013)

55 was a great age to retire, for me. I thought long and hard on that point. I was in a position to do it a few years earlier but just couldn't get my head comfortable with the idea of being "too young". Situations presented themselves and I actually ended up quitting my business ventures at 55. I then spent a couple of years working on a few projects that I never seemed to have time for, before finding a nice spot to live and enjoy life. We never know how long we have, so it is difficult to determine what is your "retirement point". Knowing you will not run out of resources plays a big part and it is nice to get to enjoy some reward for hard work, i have yet to meet anyone who says they wished they had worked longer..


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## afulldeck (Mar 28, 2012)

Mechanic said:


> i have yet to meet anyone who says they wished they had worked longer..


I know at least 5 people, who are early in their 70's and have more than enough money to retire but continue to work. They do it because they enjoy it and they don't think work as a burden, rather they view it with excitement and they love the engagement. All are self employed, all don't play politics. One is planning to go back to university to study for a PHD in Engineering Physics in two years....


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## NotJustDreaming (Oct 20, 2013)

Interesting. 

I find different perceptions of what a term means quite fascinating. 

My definitions of:

FU Money - you’ve accumulated enough money to say FU at any time in your job and just quit and then suastain yourself for a lengthy time with no money worries. FU Money is not long term and self-sustaining retirement. It’s more like a super charged emergency fund. 

Financial Independence - you’ve accumulated enough money to meet all your spending needs on an ongoing and long term basis. You’re financially independent from having to work. Perhaps you’re till working but don’t have to, or it’s your passion, or you’re ‘too young’ to retire. You’re a gentleman of leisure. 

Retired - you’re not working and don’t intend to work or need to work. 

A retired person is financially independent (or can’t work but scraping by or the aged-out person also scraping by). A financially independent person can be retired when they’re not working and don’t intend to. 

Going back to work makes you FI again. Or if you’re just supplementing your income and you’ve aged out, somehow (though you’re working) you’re still retired. Yes, I think maybe I’m old fashioned.

Both retired person and financially independent have FU Money. 

FU Money is only financially independent if you are. That is, you are financially independent. And only retired - if you are.

I’m not the Internet Retirement Police. Though I do love that term. 

Fascinating stuff.


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## Longtimeago (Aug 8, 2018)

cainvest said:


> Because age doesn't guarantee wisdom/knowledge. Just beause someone is older does not, by default, make them smarter than you.


Yes age does not guarantee wisdom or greater knowledge but nor does youth guarantee you will only interact with those older than you who do not have wisdom or greater knowledge. All any age does is guarantee your perspective will be dependent on your wisdom and knowledge. Having said that, if two people have a reasonable amount of intelligence and a reasonably varied life experience, you can reasonably expect the older of the two to know more and be wiser than the younger one.


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## Longtimeago (Aug 8, 2018)

Frank Drebin said:


> Your antagonistic and childish first post in this thread wrote you off as a mentor figure to me, regardless of your financial situation and/or life choices.
> 
> I've been around long enough to see that financial freedom is often a combination of circumstance and choice, is it possible to be financially independent at 35-40? *Sure but not without some extreme circumstances or choices.* Does one put off having children because it delays their financial goals? Everyone has different priorities. My choices and circumstances have me pacing to a very comfortable retirement at 55. Could I have done better? Sure, but I'm comfortable with my lot in life and *I'm only willing to sacrifice so much today in order to enjoy tomorrow.*
> 
> ...


My bolding.

See those are your perceptions but it does not make them correct. From my perspective they are in fact obviously incorrect. I had no 'extreme circumstances' in my younger days or made any 'extreme choices'. Nor did I ever 'sacrifice today in order to enjoy tomorrow' at any time. So how then do you balance that with your perceptions?

You may want to believe it takes 'extreme circumstances and choices' and that someone 'sacrifice today in order to enjoy tomorrow', but that is all it is, a belief which in turn is of course simply an opinion, not an objective fact. 

There's a saying, 'you can't see there from here' and that is all I read in what you say. You can't see how it can be done without extremes and sacrifice but I am hear telling you it can and people do it all the time. I know, I have as they say, 'been there, done that'.


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## cainvest (May 1, 2013)

Longtimeago said:


> Yes age does not guarantee wisdom or greater knowledge but nor does youth guarantee you will only interact with those older than you who do not have wisdom or greater knowledge. All any age does is guarantee your perspective will be dependent on your wisdom and knowledge. Having said that, if two people have a reasonable amount of intelligence and a reasonably varied life experience, you can reasonably expect the older of the two to know more and be wiser than the younger one.


Ok then ... we both agree that your previous blanket statement is incorrect.


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## kcowan (Jul 1, 2010)

cainvest said:


> Ok then ... we both agree that your previous blanket statement is incorrect.


Yes his current statement seems to be *reasonably* correct.


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## Longtimeago (Aug 8, 2018)

cainvest said:


> Ok then ... we both agree that your previous blanket statement is incorrect.


What 'blanket statement' specifically are you referring to cainvest?


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## Frank Drebin (May 10, 2015)

Longtimeago said:


> My bolding.
> 
> See those are your perceptions but it does not make them correct. From my perspective they are in fact obviously incorrect. I had no 'extreme circumstances' in my younger days or made any 'extreme choices'. Nor did I ever 'sacrifice today in order to enjoy tomorrow' at any time. So how then do you balance that with your perceptions?
> 
> ...


Alright, I'll humble myself. What would be your advice for someone to be on the fast track to financial freedom? We are doing the slow and steady method of living below our means, paying off all debt, and passively investing in index funds.


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## OnlyMyOpinion (Sep 1, 2013)

Frank Drebin said:


> Alright, I'll humble myself. What would be your advice for someone to be on the fast track to financial freedom? We are doing the slow and steady method of living below our means, paying off all debt, and passively investing in index funds.


I'd be interested in that advice as well Frank.
No extreme circumstances or choices (i.e. not plain-assed good luck or timing) and no sacrifices. Do tell.


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## Just a Guy (Mar 27, 2012)

Well, my 19 year old just bought a rental. He’s still in school, will refinance it for more than he paid for it, so he’ll look for a second one. The property should clear about $500-$700 in profits each month. He has plans to invest in stocks as well, but he’s lined up for a well paying job on graduating. From what I can see, he’ll be a multi millionaire before 30.


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## Frank Drebin (May 10, 2015)

Just a Guy said:


> Well, my 19 year old just bought a rental. He’s still in school, will refinance it for more than he paid for it, so he’ll look for a second one. The property should clear about $500-$700 in profits each month. He has plans to invest in stocks as well, but he’s lined up for a well paying job on graduating. From what I can see, he’ll be a multi millionaire before 30.


How does a 19 year old (or anyone for that matter) making 100k a year become a "multi" millionaire within a decade? Like, what is the actual roadmap that you could see him following?


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## Just a Guy (Mar 27, 2012)

Well, last year I personally bought 7 properties 100% financed making up about 9k/year in rent. You do that for a decade, the first properties are getting paid off, and you build equity. The 70k place he bought appraised at 150k, so on paper he made 80k just by buying it.

It may be a multi-millionaire on paper, but you can always borrow against the equity and he still has the cash flow. This also doesn’t include his stock investments. When wealth starts to build, especially in real estate, it can grow exponentially 


I can project this because I do this and have been for decades. I’m doing this as a hobby, my kid, who’s been brought up in this as normal, wants to do it more seriously than me.

He just told me, if he gets the job after he graduates next year the wage will be $40-50/hour to start, plus benefits and raises fairly common as you learn more divisions.


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## kcowan (Jul 1, 2010)

Just a Guy said:


> I can project this because I do this and have been for decades. I’m doing this as a hobby, my kid, who’s been brought up in this as normal, wants to do it more seriously than me.


Congratulations JAG! It looks like he will improve on the plan.


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## Just a Guy (Mar 27, 2012)

My next oldest also seems to be going that route. My real estate lawyer already had a talk with them about co-habitation agreements and pre-nuptial agreements because she could see where they want to go. The two may team up, that would be formidable. 

I’m pretty proud of how they are turning out. I expect they will work for years, but they will do it on their own terms. It was my goal to have them develop a passive income early so that they could live pretty free.


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## Prairie Guy (Oct 30, 2018)

Frank Drebin said:


> Humans are really meant to work till they are not able.


That used to be the case years ago...people had to work every day just to eat. Only the very smallest percentage of people could avoid that. And, of course most people died before they were 40 so they never reached what we consider a retirement age.



> No one in their 40's just "retires" and does nothing with their life. They have to find something to fill their time besides golf and travelling. Retirement is for those that are "done" working for a living, and are typically retirement age (55+)


Of course you need something to do. I retired at 53 and am busy every day...sometimes it's golf or travel but I also have several other interests that take up my time. I like helping friends and family with reno projects, I'm currently undergoing a large renovation of my house (doing almost everything myself), I play in several bands, I exercise regularly, my GF has a cabin that we use, etc. 

A lot of working people seem to think that all retired people do is golf or travel  but maybe some of them don't have any hobbies or other interests that they could spend more time on if they retired. All retirement does is give you more time to do the things that you already like doing, so if you have no interests outside of going to work then maybe retirement isn't for you.

I've been retired for 3.5 years and am enjoying every minute of it. My days are as full or empty as I choose them to be but one thing is certain...I will NEVER return to a job.


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## Longtimeago (Aug 8, 2018)

Frank Drebin said:


> Alright, I'll humble myself. What would be your advice for someone to be on the fast track to financial freedom? We are doing the slow and steady method of living below our means, paying off all debt, and passively investing in index funds.


There is nothing wrong with what you and millions like you are doing Frank Drebin. It just isn't the way to achieve early retirement. I have always told people that the path to early retirement is simple, it just isn't necessarily easy. The path is simple, spend less than you earn and invest the difference wisely. It is the 'wisely' that most people don't really grasp.

You admit to having got the first part right but also admit to "passively investing in index funds." Look at the Investment section of this forum and what do you see, stocks, bonds, TFSAs, REITs, etc. All passive investments where you hand your money to a third party and expect them to do the work for you. While that can make you money, it is limited in what you can expect it to earn you. Now tell me this, why are there rarely any threads on their about DIRECT investing? 

Direct investing is where YOU do not rely on a third party to do the work for you. Suppose you said to yourself, 'I will not invest in anything that does not pay me a 10% return on my investment.' If you did that, NONE of of those passive investments would be likely to meet that single criteria. What then would it force you to do? Answer, you would have to look for other means of investing and I will suggest to you that it would bring you to directing investing.

There is also a Real Estate section of this forum but again, if you look at it, what do you see? Primarily threads about buying a house or condo and renting it out. That is the path Just a Guy has taken and it has worked for him. So that is one form of DIRECT investing and you can look at it and say, 'I will not invest in anything that will pay me less than 10% return' and expect to meet that criteria. But it is only one of countless forms of direct investing. It's not the path I chose as I had no desire to be a landlord. Just a Guy was obviously willing to put up with that until he could grow his portfolio large enough to no longer need to deal with tenants directly any more.

Richard Branson started out selling records by mail order, Warren Buffet started out with a few pinball machines, I did my first real 'deal' buying in with a couple of others, in an old warehouse and turning it into a 'Business Centre' (a fancy name for shared office space). None of these things were 'extreme' or required 'sacrificing' anything. They just needed an opportunity to be seen and acted on. 

I like a quote by David Murdoch, "to do the impossible, you must see the invisible." You can read a bit about him here: https://www.businessinsider.com/twe...2010-12#david-murdock-net-worth-27-billion-14

Actually, it isn't about the 'invisible' really, they are visible if someone just looks. Nor does it mean everyone has to become a billionaire, a mere few million is enough for most people to retire early on if they want to. Nor does it require working 80 hour weeks etc. I've never worked hard in my life and truth be told, no doubt far less than many people do. I don't like working, I'm lazy in that regard. So part of my solution was to find ways to make money without actually having to work hard. It's all in which way you view the problem that you want to solve. I won't invest for less than 10% return, I won't invest in anything that requires me to work hard. That now makes 2 criteria that must be met.

Finding opportunities is again simple but not necessarily easy. You just have to see the opportunity, simple. Often, the opportunities arise out of what you know about already. A guy who lives flying, starts a flying school. That was Albert Ueltschi and he eventually sold the business to Warren Buffet for $1.5 Billion. A guy who sold hair care and cosmetics, going from hairdresser's shop to hairdresser's shop invested $700 in 1980 to start making his own products (with a partner). That is John Paul Dejoria. Ever heard of him, he's worth over $4 billion today. A guy sold ties for a living until he decided to start designing and selling his own. His name is Ralph Lauren.

Besides looking at what you know, there are sometimes opportunities that arise out of who you know. That was the case for me. My first direct investment in that old warehouse was as a result of a conversation with an acquaintance who was in the commercial and industrial real estate business, as a salesperson. He saw this property, knew he could buy it at a 'fire sale' price. He had also just seen a property that had been turned into one of the first 'Business Centres' in Canada and he saw an opportunity to do the same thing with the warehouse. He just didn't have enough money and needed some investors to go in with him. My relationship with him up till that point had been as a 'friend of a friend'. That first conversation took place at a house party. I didn't have to go to any 'extreme circumstances' to see that opportunity, I just had to SEE it when it fell into my lap.

Now we come to the real crux of why some people do better than others when it comes to investing and that is RISK. There are two kinds of risk, real and perceived. Real risk can to a great degree be quantified and analyzed while perceived risk cannot. Most people 'perceive' great risk and that is as far as they get. It's called FEAR. People fear losing more than they desire winning and it stops them dead. An opportunity to invest say $5k may come up but the first thing someone thinks is, 'I could lose the whole $5k'. 

Interestingly, a study done on entrepreneurs found that as a group, the difference was not in their ability to see an opportunity others could not, the difference was in how they perceived risk. Simply put, they didn't perceive any real risk. It doesn't mean they did not look at the 'real risks' involved in something, they just didn't succumb to the 'perceived' risk of losing.

I used to do some rock climbing. You know, up a cliff face with ropes and carbiners, etc. In that activity, everyone falls sometimes. But if you are using the right equipment and 'protection', all that happens is that you fall a distance and then the rope stops your fall and you survive. Intellectually, you know that you will not die. But every climber knows that there comes a nanosecond in time when you KNOW you are about to fall. At that point in time, you have very real fear of dying, you can't help fearing it.

If at that moment in time, someone were to say to you, 'make this decision and you will not fall', you could make any decision you were asked to make, without hesitation. Why, because the fear of dying would outweigh any other fear that making the decision might raise in your brain. 'I might lose $5k' vs. 'I might die' is not comparable. So that is my personal way of dealing with a difficult decision. I simply ask myself, 'will this kill me?' and I mean it literally. If it won't kill me, it's not the end of the world if I get it 'wrong'. 

Fear of failure stops most people from doing a lot of things. I have lost money as well as made money on some investment decisions I have made. But you only have to get it right 51% of the time to be a winner as I'm sure someone said. But until you make that first decision to take the risk, nothing is going to happen. Play it safe and slow, you will probably get to the goal eventually. But if you say, 'I want to retire in 10 years from now', the only way that will happen is if you take some risk and ignore fear.


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## Just a Guy (Mar 27, 2012)

One of the things that is going to slow him down is his “paying off his debts”. Debt is a tool which, used properly can greatly enhance your ability to earn money. Real estate is founded on debt, margining also. You don’t have to go crazy, but if you can use the same money over and over again to buy more and more assets, your earning power increases dramatically.

For example, if you had 100k and bought one house debt free, you may make $1000/month. If you put 20% down on 5, and had mortgages (debt) of 400k, you could be collecting $5000/month minus expenses. Plus people would be paying of 400k of real estate for you. In 20 years you’d have 500k of real estate, still earning 5000/month as opposed to 100k earning 1000/month. 

This is all very realistic numbers, not taken to the extreme my system does. Banks are very friendly to these levels of debt. 

One should also not be tempted, in my opinion, to leave a lot of equity in your house. It’s dead money. A heloc, allowing you to access the funds, let’s you borrow (and write off the interest) to buy other assets (stocks, bonds, real estate, businesses, etc.). Instead of the money sitting there doing nothing but protecting a loan for the bank, it can be conservatively earning you funds.

Also, take advantage of government funds. Want your kids to go to school for free? Take the child tax credits and such and open an resp. Automatic 20-25% bonus right off the top. Some provinces add even more. Put that in a conservative investment portfolio and your kid could easily get an undergrad degree...heck mine could probably go as long as they want, but my investment strategy is better at returns. I’ve still got years of contributions I can make as I only have one collecting. 

Also, the money can be used for almost anything...say a downpayment on a 3 bedroom condo in a trendy area. 

As for retiring early, I can’t really say when I was forced to retire, it was really early. I say forced because I got injured and couldn’t work anymore. My first few years of early retirement were very difficult. I had most of my debt paid off (I’d been living debt free for several years before that, but had just upgraded my house, started having kids, etc), and a tiny bit of savings, and I’d just gotten my first rental...it wouldn’t have lasted long had I sat around and done nothing. First thing I did, before the banks found out I was done working, was put myself another 100k in debt by buying a second rental. The two made enough profit to pay my mortgage each month and left us keep the house. 

I made other investments, using up our savings, for a heloc and eventually a third rental, ran up debt for living expenses and waited for the investments to start bearing fruit. It wasn’t an overnight thing to be sure. 

I remember the time when my debts and assets actually balanced out...I could sell everything and be even, even keep the house paid off....but I didn’t do it. I realized if I did, I’d have no source of income going forward. I had to spot rust my strategy long term. Don’t know how long it took, but surprisingly, as I said before wealth tends to build exponentially, I had a part time contract which I took because I had to but hated....I looked at my portfolio for the first time in a long time and realized I made more in a day from it than I did from the month long contract. 

I finished up the job, said nice things to the guy who helped me by giving it to me (never burn bridges) even though I didn’t like him or the job, and went on to fix up my life. I paid off all my debts, increased my real estate holdings, which I really enjoyed and made into my hobby, rebuilt my company making it work without dependants on me personally, started other companies, and played with my stock investing strategy of buying stuff I knew when it was on sale (it’s worked really well for me, but there aren’t a lot of opportunities). 

Long time ago is very correct in the biggest factor is fear.

I know many people who want to get into real estate. I’ve helped many find a great property, negotiated for them, offered to help get them started...but in the end, they usually back away. I can only thing of a handful who’ve ever pulled the trigger and actually bought, out of hundreds I’ve helped over the years. Everyone wants the money, very, very few are willing to do what they need to to get there.

My kids will do very well in investing because they were raised in the environment where it’s normal. They have no fear of it, they’ve seen things work, they've seen the downtimes. For them it’s the same as parents going to work, they see it as normal. They know how to evaluate, they know what’s required. They know it takes work and doesn’t happen overnight, but they also know it works.


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## cainvest (May 1, 2013)

Longtimeago said:


> But until you make that first decision to take the risk, nothing is going to happen. Play it safe and slow, you will probably get to the goal eventually. But if you say, 'I want to retire in 10 years from now', the only way that will happen is if you take some risk and ignore fear.


I would agree that higher risk *can* get you there faster but the odds are against you from my viewpoint. However, if good direct invest opportunities come your way it might be worthwhile to investigate them.

Of all the people I know in the group of entrepreneurs, direct investors, stock traders, real estate owners, only a very small percentage have really done well and are able to retire early. On the other side, all my doctor, dentist and CEO type (and other very high level management in a big company) friends are well set to retire early (or whenever they feel like it) after say, 20+ years of working. So by far the largest percentage of people I'd consider well off and able to retire early with significant funds to enjoy retirement are those with really high paying jobs. 

Of course the story always comes up about the one stocker trader guy I worked with who made millions in just over a year and could retire at 25 but little is said about the many others that lost 5-6 figures trying similar things lol.


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## Just a Guy (Mar 27, 2012)

I find many people define higher risk based on opinions rather than reality. 

For example, if we look at my son’s property, a three bedroom apartment in a good area, bid city, for 70k which should rent well over $1200/month, how many people can really call that risky? Sure one can go into stories of nightmare tenants, but how many people do you know who hate their jobs, their boss, their coworkers, etc?

How many people really have job security? How many have control over their lives? 

My son can drop the rent in bad times, he can pick his tenants, he can choose to upgrade it or not...

My son doesn’t find being a landlord risky because, as I said before, it’s as normal in our house as getting a job is in others. 

I’d also point out that, out of all the people I know, no one gets as wealthy from a paycheque as the ones who’ve done it in other ways, nor as fast. Plus, most doctors I know worked a long time past retirement, and there are a lot in my family. Also, many have sizeable investment portfolios. 

Remember, you’ve been brought up your whole life being told, go to school, get a job and retire...you’ve rarely been told, build up passive income, invest, start your own business...

Those are “risky” because no one does it, whereas everyone gets a job. Safety of the herd.


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## cainvest (May 1, 2013)

Just a Guy said:


> I’d also point out that, out of all the people I know, no one gets as wealthy from a paycheque as the ones who’ve done it in other ways, nor as fast. Plus, most doctors I know worked a long time past retirement, and there are a lot in my family.


Many doctors do but on very limited hours and that's their choice to work, many are financially independant in their 40-50s.

My neighbor, in his 40s, does what you do (owns/rents houses) plus he also is a direct investor in busnesses and he's doing ok but far from retirement so that method isn't always a "rags to riches" story.


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## Just a Guy (Mar 27, 2012)

Not all entrepreneurs are successful, not everyone is cut out to be a landlord or an investor. Having said that, the ones who’ve gotten there the fastest in my experience, didn’t do it from a paycheque. Nor did they stop once they got there. Some became angel investors, many repeated their success...those are the true entrepreneurs. Luck can get you there once, skill will let you repeat.


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## birdman (Feb 12, 2013)

Just a Guy would you please advise how you manage interest rate risk and did you go through this during the early 1980's when the prime rate peaked at 22.75%. I was in the business those days and saw many very wealthy people lose everything. One was that comes to mind was well paid professional with outside interests and there was no way he could afford paying 24% interest on his 2 million dollars plus mtge. Furthermore, the securing property dropped by 50%. Had lots of other clients who purchased newer and more expensive houses and delayed selling their existing house as it would be worth $50,000. more in six months. The only trouble was is that both of the properties dropped 50% in very short order and he ended up going bankrupt. Lots of other who purchased and leveraged properties only to lose everything when rates skyrocketed. Granted, I don't see this happening in todays environment but nobody expected it then as well. The foregoing are just 2 of many that come to mind. If I recall correctly mortgage rates were only around 17% or so. It was so sad seeing people struggling with this unmanageable debt.


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## Just a Guy (Mar 27, 2012)

I lived through the 80’s and didn’t buy anything. The rise in interest rates didn’t happen overnight. We are a long ways from 22%, in fact about 10% of that rate right now. Also, I buy property that’s already discounted for a correction. A here bedroom for 70k is less than a brand new truck. Plus, my interest rates are locked in for 5-10 years. You’re worried about something that happened 40 years ago...maybe fear what happened in the 1930’s then. The world is vastly different today. 

Remember, I’m one of the few here who is concerned about rising interest rates, but at the prices I buy, I’ve got very little fear. My rental rates can absorb a large spike and my average purchase price is well below 100k. I’m involved in the industry daily, I’ve got my finger on the pulse and am willing to change my strategy on a dime. 

By the time we hit your fear scenario most of my properties will be paid off. 

You don’t go blindly into investing. You adapt to the opportunities. Back in the 80’s you could get savings bonds at almost 20% return. These last few years have been an excellent time to buy real estate and many people missed out. My stock strategy is to buy during crashes when others are panicking because of losses. 

When I buy, I run numbers not for today, but for the future. I’m not a gambler, when I started I couldn’t afford to be wrong, all My investments are very conservative. Lots of room to handle increased costs, and I don’t get many losses. I’ve missed many a fad get rich quick opportunities, but I’ve also done very well. 

Does that make sense?


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## birdman (Feb 12, 2013)

Yes, it makes sense and that is actually what I figured you would say. Certainly agree that there is no expectation of those high rates in the forseable future but if we do get into a rising rate scenario it can be difficult for a younger person starting out and who has just entered the market. I guess one could always do some stress testing on their own to see what would have if rates doubled. Mind you, doubling from 8% to 16% is a lot more than doubling from 3% to 6%. Myself and a buddy owned a couple of houses we paid 50,000. each for and which carried themselves. Got pretty frustrated with tenants that were late for rent, never looked after the yard, and then took there time leaving when evicted. Then, there we were with our spouses painting, gardening, etc and preparing for another tenant. Also, appliance breakdowns and locating replacements was a pain. This is all happening when you are furthering your career, shuffling your children around to their activities, and keeping up the house. Busy times. Mind you, those 50,000. houses are now worth 500.000. plus. Anyways, somehow it all worked out and I retired at 55.


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## Just a Guy (Mar 27, 2012)

It’s not free money, you have to work for it. It’s just a lot less work than a job and it pays much better in the long run I’ve found.


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## Frank Drebin (May 10, 2015)

Just a Guy said:


> I find many people define higher risk based on opinions rather than reality.
> 
> For example, if we look at my son’s property, a three bedroom apartment in a good area, bid city, for 70k which should rent well over $1200/month, how many people can really call that risky? Sure one can go into stories of nightmare tenants, but how many people do you know who hate their jobs, their boss, their coworkers, etc?
> 
> ...


I have one rental property but it hasn't been the best investment. Its a SFH where the bulk of the returns will have to be in the form of appreciation rather than cash flow.

You mind sharing where one can buy a property for 70k and rent for $1200 a month? At least give a radius of 50 miles? The closest thing I've seen to this is my brother in law who bought a 2br condo in a bad part of Edmonton for 106k a few years back. He was getting in the neighborhood of $1100 a month (less now) in rent but he was constantly dealing with evictions and midnight moves due to it being in a less than desirable place in the city. Now he's joined the condo board to push off a $30k levy to replace the roof and siding on the building.

That is one of the best cash flowing properties in the city, that I've heard of, and even with a 20% down payment its only cash flow positive about $275 a month before you account for opportunity cost of the down payment, property management fees, maintenance and vacancy.


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## Just a Guy (Mar 27, 2012)

Go back through some of the threads, I’ve posted properties in every major city except gta and gva several times. Or go on mls and look for yourself. I’m getting tired of doing the work to point out they do exist, just to be told a week later they don’t. There may not be a lot of them, but they do come up. Its not like they are waiting around just for you to buy. You have to look in this bull market.

You could call up a realtor and have him send you properties which match a search criteria and you’d get the listings as soon as they hit the market. 

Since you mentioned it, I believe Edmonton actually had quite a few places that were affordable the last time I looked.

I’m always amazed at how many people want me to do all the work for them.


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## Frank Drebin (May 10, 2015)

Just a Guy said:


> Go back through some of the threads, I’ve posted properties in every major city except gta and gva several times. Or go on mls and look for yourself. I’m getting tired of doing the work to point out they do exist, just to be told a week later they don’t. There may not be a lot of them, but they do come up. Its not like they are waiting around just for you to buy. You have to look in this bull market.
> 
> You could call up a realtor and have him send you properties which match a search criteria and you’d get the listings as soon as they hit the market.
> 
> ...


I will check on your threads. I look from time to time and nothing touches those numbers. I was wondering if you bought wholesale or something, as your prices are about 30%-40% less than MLS value.

But I will do some reading on your post history. Always willing to learn all that I can.

Btw I am in the same line of work as your son. Got my first class a couple summers ago.


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## Just a Guy (Mar 27, 2012)

As I said there aren’t a lot. The 8 I bought last year was a record for me. Usually it’s under 5 and that’s looking across canada.


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## Longtimeago (Aug 8, 2018)

cainvest said:


> I would agree that higher risk *can* get you there faster but the odds are against you from my viewpoint. However, if good direct invest opportunities come your way it might be worthwhile to investigate them.
> 
> Of all the people I know in the group of entrepreneurs, direct investors, stock traders, real estate owners, only a very small percentage have really done well and are able to retire early. On the other side, all my doctor, dentist and CEO type (and other very high level management in a big company) friends are well set to retire early (or whenever they feel like it) after say, 20+ years of working. So by far the largest percentage of people I'd consider well off and able to retire early with significant funds to enjoy retirement are those with really high paying jobs.
> 
> Of course the story always comes up about the one stocker trader guy I worked with who made millions in just over a year and could retire at 25 but little is said about the many others that lost 5-6 figures trying similar things lol.


See there you go doing what most people do. Where did you determine there was 'higher risk' involved? I certainly didn't say anything about that. What I said was you have to take the risk of losing. But that is more often than not a perceived risk, not a real risk. 

When I was asked to invest $50k in that warehouse I spoke about, what was the real risk? I wrote that it was available at a 'fire sale' price. The guy telling me that was in the commercial and industrial real estate business. It was his job to know that kind of thing. There was no question as to the real value of the property being more than that. Two brothers had taken over the family business after their father died and just wanted to sell and grab the money. We could have bought and held till we were able to sell it at a higher price. Evaluating the real risk at that point indicated that there was ZERO risk in buying if we chose to flip the property.

But the guy also had the idea of turning it into a Business Centre. That required some additional investment to renovate and then start up the business. So in that stage, you could say there was SOME risk, but how much? The idea of a centre where one man companies could have an office and a mailing address etc. Or where a company could have a 'branch office' in a city where their local representative could have office space was a new concept. Analyzing that, it didn't take much to see that it had real potential to work. So risk yes, but 'higher risk', higher than what? Buying stocks and bonds? 

I owned stocks in 1967 and flew to Calgary from Toronto on a Sunday, it was October 18. On Monday, I went out doing business for the company I worked with and returned to the hotel around 11 pm after having dinner with a client. I went to the bar for a night cap and from the TV above the bar, I learned that I had just lost 20% of the value of my stock portfolio. Do you think anyone owning stocks on October 18th, thought they were involved is something of 'high risk'. I'm sure everyone including myself would probably would probably have told you they were investing in something with 'lower risk' than buying a warehouse and starting a Business Centre. Yet we all lost 20% in a day!

Worst case with the warehouse deal looked like this. Investment after renovations, $100k including running costs for the first year after minimal rental income. That's for each of 4 investors. So, if business isn't working out, time to bail out. Property bought for $2 mil (with mortgage) at fire sale price. Realistic selling price $2.4 mil. Net loss/gain, ZERO. The real risk as I said can be analyzed but the perceived risk cannot. That happens is that people perceive risk that is not necessarily there and just as you did cainvest, they talk about that perceived risk as if it were a fact, like a 'higher risk'.

Investing in that warehouse was no 'higher risk' than investing in the stock market. I haven't bought a stock since that day in 1987, I learned my lesson. Some you win, some you lose but you don't do either if you aren't in the game. I am firmly with Just a Guy in the camp of the belief that, 'no one ever got rich from a paycheque.' Nor does it apply only to becoming 'rich'. You may not want to really be 'rich', you may just want to retire early with a comfortable income of whatever you personally define that to be. But rich or early retired it amounts to the same thing. It ain't gonna happen from a paycheque.

https://www.inc.com/jeff-haden/the-awful-truth-about-getting-rich-that-no-one-wants-to-hear.html


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## cainvest (May 1, 2013)

Longtimeago said:


> See there you go doing what most people do. Where did you determine there was 'higher risk' involved? I certainly didn't say anything about that. What I said was you have to take the risk of losing. But that is more often than not a perceived risk, not a real risk.


Some are higher risks and higher risks are normally related to making money fast! 

I also said "if good direct invest opportunities come your way it might be worthwhile to investigate them". 
Of course if ones does not know how to evaluate the risk potential, well ... good luck!



Longtimeago said:


> I am firmly with Just a Guy in the camp of the belief that, 'no one ever got rich from a paycheque.' Nor does it apply only to becoming 'rich'. You may not want to really be 'rich', you may just want to retire early with a comfortable income of whatever you personally define that to be. But rich or early retired it amounts to the same thing. It ain't gonna happen from a paycheque.


Sorry ... total BS there! 

A friend of mine retired in his late 30's, earned a paycheque and made his money in the markets.
Another paycheque earner friend retired in his 40's, they drive their van all over the world just travelling.

I earn a paycheque, could have retired years ago at 50 ... could have earlier if I had a real lazy, low cost lifestyle. Also, if my primary goal was to retire early I could have "back loaded" my life and done it 10 years sooner but that balance wasn't for me.


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## Just a Guy (Mar 27, 2012)

In your first example, you admit he made his money in the market...not by a paycheque, you don’t mention how wealthy you’re second example is, other than they travel, your final example, being yourself, you admit to being frugal in order to retire...

Not really supporting your point of getting wealthy from a paycheque...I suppose it depends on if you think a couple hundred thousand is wealthy, a couple million, or maybe in the billions...


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## cainvest (May 1, 2013)

Just a Guy said:


> In your first example, you admit he made his money in the market...not by a paycheque, you don’t mention how wealthy you’re second example is, other than they travel, your final example, being yourself, you admit to being frugal in order to retire...
> 
> Not really supporting your point of getting wealthy from a paycheque...I suppose it depends on if you think a couple hundred thousand is wealthy, a couple million, or maybe in the billions...


Nothing about getting rich but rather LTA's point about not being able to retire early from a paycheque, think you missed that.

Add: BTW, if by "Not really supporting your point of getting wealthy from a paycheque" you mean never doing anything with it, then yes ... likely difficult to retire early unless you get a really well paying job. My point was more of what a mainstream person does with their money with typical savings/investments.


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## Longtimeago (Aug 8, 2018)

cainvest said:


> Nothing about getting rich but rather LTA's point about not being able to retire early from a paycheque, think you missed that.
> 
> Add: BTW, if by "Not really supporting your point of getting wealthy from a paycheque" you mean never doing anything with it, then yes ... likely difficult to retire early unless you get a really well paying job. My point was more of what a mainstream person does with their money with typical savings/investments.


I think you are trying real hard to not see the point.


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## cainvest (May 1, 2013)

Longtimeago said:


> I think you are trying real hard to not see the point.


Ok ... what's your point?


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## Eclectic12 (Oct 20, 2010)

IMO, the


> no one ever got rich from a paycheque


 must have some qualifiers built in that have not been spelled out.

Otherwise - finding examples don't seem to be all that hard.

Manny Muchado ... $10 million a year (baseball player)
Nick Sabban .... $8.3 million a year (NCAA football head coach)
Over 60% of the top 100 Canadian CEOs ... at least $1 million a year


Definitely not everyone collecting a pay cheque ... but clearly some based on their pay cheque have been paid enough to be rich.


Cheers


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## OnlyMyOpinion (Sep 1, 2013)

^+1. Yes, those saying it can't be done on a paycheck are assuming everyone is paid like they were.


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## Just a Guy (Mar 27, 2012)

Those are good examples, but I don’t know any of them personally. I do know a couple of CEOs that are living paycheque to paycheque though even making a small fortune. Lots of toys. 

I did say I don’t know anyone who got rich off a paycheque. I do know a lot of rich people though.


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## sags (May 15, 2010)

A paycheque provides the "seed money" for people to invest in stocks, real estate, collectibles or anything else.

Banks won't lend people money for a business "idea". They require some history of an existing successful business before they open up their wallets.

What is one of the first questions the "sharks" on television ask ? How much is your company earning today ?

Unless the business shows some orders, sales, an ability to grow.........they aren't interested.

It is impossible to create any "passive income" without seed money. Money doesn't fall out of the sky.


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## Just a Guy (Mar 27, 2012)

Yes mr. Expert. 

We all know about your investment expertise and experience...

Don’t listen to people who never actually had a job in their life. Or have large passive income streams. 

There are those who do, and then the union guys with their hands out.

If you believe you can, or you can’t, you are probably right.


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## sags (May 15, 2010)

As to low priced real estate, I agree there is some available but it is in less than desirable areas or nowhere near any employment opportunities.

I also doubt low priced units can earn the same $1200 a month rent that is required for a much nicer unit in a better area.

There were a bunch $50,000 apartment units in an old 3 story walk up building for sale in our city. 

The rents were listed at $650 a month. The buildings were in the worst area of the city and were likely candidates for bugs and constant police visitations.

Maybe investors could make a dollar on those units, but that may be unlikely if the building has to be fumigated or major repairs are required.

One can also assume the building owner knows the market value of the units they are selling.

Real estate is location, location, location but also is market driven pricing.

If a person wants to buy a cheap home..........head west to a small village/town in rural Saskatchewan. 

There won't be any jobs available but you can watch the tumbleweed blow past from the front porch.


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## Just a Guy (Mar 27, 2012)

Right Mr. Expert. How many properties do you own again?

You, of course have looked at every major city in Canada as well in your evaluation.

Why do you even bother to post...all you ever say in uninformed opinions.

People like you make it easy for people like me to make money because you stay out of the market.


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## Eclectic12 (Oct 20, 2010)

sags said:


> A paycheque provides the "seed money" for people to invest in stocks, real estate, collectibles or anything else ...


For those who make use of it, sure.

Either way ... some of examples make enough on salary alone to be rich, given time and avoiding money traps aka toys.




sags said:


> ... Banks won't lend people money for a business "idea". They require some history of an existing successful business before they open up their wallets.


It's a tougher to do but my friend has had money lent based on the idea. More money lent when the idea showed results/profits.

It isn't that simple though as people with a ten year history of making money have been turned down simply because the banker wasn't comfortable and rumors were spread. 


Cheers


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## sags (May 15, 2010)

Just a Guy said:


> Right Mr. Expert. How many properties do you own again?
> 
> You, of course have looked at every major city in Canada as well in your evaluation.
> 
> ...


Apparently you don't know lenders require detailed business plans or what that would entail.

But then why would you ? You just sit down for a friendly chat with the local bank manager and walk out of the bank with wheel barrels full of cash.


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## Eclectic12 (Oct 20, 2010)

^^^

Of course JAG has a chat and gets the cash he wants ... the bank's books for his properties show how he has " ... history of an existing successful business ..." that they want.
They can look over the info on the latest property purchased and know they have an asset to potentially get some money back from.

Now if JAG was trying to finance a diamond mine in Nunavut or a deep sea fishing venture then there would likely be a need. Or not, if the banker felt that everything JAG does turns to gold.


Cheers


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## sags (May 15, 2010)

That doesn't answer the riddle of how those assets used for collateral were obtained with no money, no assets, and no paycheque.


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## Just a Guy (Mar 27, 2012)

Sags, as eclectic 12 says, it does depend on what you’re asking money for, and what you have to back it up.

My original company started as a break even business, meaning I made enough money from day one to fund it. Not a hard concept if you have a plan. 

Most mortgages are a nice little chat, not with the managers but the mortgage people. “Hey, I’ve got a clear title property I bought with the equity I built up in others, I’d like a mortgage so I can repay the equity takeout and do it again. If you pay the appraisal, I’m sure you’ll find it’s worth more than I paid.” The track record really helps, the major problem I run into now is I have too many, the banks have limits that change all the time...sometimes it’s a dollar value of real estate, sometimes it’s a physical number of doors (this one really pisses me off as an apartment is treated he same as an apartment building in this standard). 

When I went for a business loan, sometimes they’d just add a line of credit onto my account, no questions asked, on my first company they did it without me actually asking. Never used it in 20+ years. Successful company, making money, the bank wants you to get into debt if possible. 

I did have a business plan written off when I bought a commercial property for one of my companies, and the banks did use it to approve the $500k+ loan, but the property was the collateral...I again bought it for a very good deal.


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## Just a Guy (Mar 27, 2012)

sags said:


> That doesn't answer the riddle of how those assets used for collateral were obtained with no money, no assets, and no paycheque.



My 19 year old son just bought himself a 3 bedroom condo, 100% financed. The banks trip over lending a student money. So, to answer your question, smart shopping and hungry banks. He had a good paying summer job, but only for 4 months, so it didn’t help. The property appraised at 150k, it’s in a trendy neighbourhood with farmers markets on Thursday a block away, public transit, trendy shops and restaurants...which can’t be of course. 80% LTV gave him more than enough to buy it. 

You know the difference between him and sags, he doesn’t make things up, he actually went and talked to the bank. I didn’t even have to co-sign which surprised me. I admit, my realtor and I actually found the property, but he had to pull the trigger on his own. 

Reality is quite different from makeup land sags.

I imagine he could apply for a student loan which would easily give him a downpayment on a property as well.

For a 70k property, he could have put the downpayment on a credit card. His student one, which came with his student account was 10k.

So, three ways to get started with no money, no assets, no job...and we haven’t even gotten creative yet.


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## sags (May 15, 2010)

So you are saying the bank performed an appraisal on the home before your son took ownership ? 

Then the bank financed 80% of the $150,000 appraised price, despite the actual sale price being considerably less, perhaps $120,000 ? 

That provided for the 100% financing of the $120,000 purchase price and 20% equity to the $150,000 appraised value for your son ?

They did this for a 19 year old student with no income, no job, no money, and no assets ? Who do they expect will be making the mortgage payments ?

I would have to say that bank is heading for a financial disaster.


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## Just a Guy (Mar 27, 2012)

The appraisal is part of the mortgage have bought property before right? Claim to have, but this is pretty basic stuff here. 

My son only paid 70k, he also didn’t take out all the equity he could, only 80k, he qualified for 120k, but didn’t need the money as he doesn’t want to buy a second one until next year and it hurts his cash flow. 

It’s a rental property, he certainly won’t be making the mortgage payment.

Almost any idiot can get a car loan for 70k these days, do you really think a bank is in financial distress over 80k? Especially backed by real estate as opposed to a car?

You really need to get out in the real world. Imagine where you could have wound up instead of being a former union guy begging for more government handouts.

Should have listened to real people instead of the voices in your head, then you May have gotten ahead.


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## sags (May 15, 2010)

I would say good luck to your son, but he doesn't need any luck. He already has some of the bank's money.

I should say good luck to the bank and I hope taxpayers aren't expected to bail them out someday.


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## Frank Drebin (May 10, 2015)

Just a Guy said:


> My 19 year old son just bought himself a 3 bedroom condo, 100% financed. The banks trip over lending a student money. So, to answer your question, smart shopping and hungry banks. He had a good paying summer job, but only for 4 months, so it didn’t help. The property appraised at 150k, it’s in a trendy neighbourhood with farmers markets on Thursday a block away, public transit, trendy shops and restaurants...which can’t be of course. 80% LTV gave him more than enough to buy it.
> 
> You know the difference between him and sags, he doesn’t make things up, he actually went and talked to the bank. I didn’t even have to co-sign which surprised me. I admit, my realtor and I actually found the property, but he had to pull the trigger on his own.
> 
> ...


I've had a much different experience, especially lately when it comes to purchasing a rental property. My wife and I are in a much better financial situation than your son and its not easy to get approved for a rental property. They are looking at 3 years of income via T4, and lease agreements on our current rental. Everytime I've purchased a home they look for proof of funds for the down payment (ie not being able to use a line of credit for a down payment).

Back in 2009 when I was able to flip a property it was crazy easy to get approved. Insane. But things are much tighter now.

What institution did your son get the loan with? Shoot him a text when you get a minute, I'm curious to know which Canadian bank has these lax rules in 2019. Also, which city did your son buy in?


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## sags (May 15, 2010)

_Almost any idiot can get a car loan for 70k these days, do you really think a bank is in financial distress over 80k? Especially backed by real estate as opposed to a car?_

That is a bad example for a comparison.

The auto manufacturers guarantee the loan for the lender. The automakers decide the lending criteria that will qualify......credit scores, incomes etc.

The banks have no loss exposure at all. They earn a fee from the automakers for administering the loan. They don't issue auto loans for 0%-2% financing on their own.

The automakers don't have much loss exposure either. They may sell a vehicle for $70K but it didn't cost them $70K to build it.

There may be a $20K profit built into the vehicle for the manufacturer, so the default math favors them. 

If a person buys the vehicle and pays $800 a month in payments for 2 years and then defaults, the customer has paid almost $20K off the loan principal.

The built in profit margin of $20K + $20K paid off the principal, means that in a worst case scenario the auto company can sell the vehicle for $30K and not lose any money.

Then they will take the customer to court for the balance of the loan, which restores their profit margin on the sale.

Auto loans are entirely different than mortgages, where the bank is taking all the risk and has no built in profit margin to soften the blow of a default. 

In the scenario you present the bank is severely exposed to losses, due to their generous appraisal and lending standards.


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## Plugging Along (Jan 3, 2011)

I know SAGS and JAG have challenges in how they communicate with each other. I am jumping in to take out some of their history bias, as I do think there is some good information.



sags said:


> You just sit down for a friendly chat with the local bank manager and walk out of the bank with wheel barrels full of cash.


Once you have shown a good history with the bank, you don't even have to walk in the bank nor have barrels of money. In fact, you or your family just needs to have a good history. In my case the first place I bought, I used my sibling's long time mortgage broker. I called, said who I was, and provided our numbers, and it was no problem. Subsequent properties, we have just had a phone call, and have been approved over the phone with some rough numbers. 



sags said:


> That doesn't answer the riddle of how those assets used for collateral were obtained with no money, no assets, and no paycheque.


My examples above were all based on having a decent down payment. However, my good friend does a lot of real estate and does flips primarily and some rentals. They finance a 100% as JAG has indicated. They asked us to go in with them. I called my broker to see if this was even feasible. The answer 'No problem, just let me know when you are ready'.

We didn't go through with the deal because some personal things happened in both of our lives that required different attention. However, the process is essentially you find undervalued properties. This is difficult to do in my city, hence why friend finds 'fixer uppers' because there are more of those than truly undervalued. You finance it for the 80% cost of place, then she takes out a line of a credit to pay for the renos, and then refinance or sell. There is a little detail that I am missing. They would usually next somewhere between $40-100 for 3-9 month period this would take and was doing this 2-3 times a year. This was why they wanted to go in with us because we have a similar mindset and they expand. 

I wont lie, I was a little nervous about this idea, but it's primarily that I haven't done it myself. Since I have a friend that I trust and am learning more about the process, I am willing to go in and do this. We are both looking for opportunities and for us to get through some of the personal challenges, which hopefully will be soon. 



sags said:


> I would say good luck to your son, but he doesn't need any luck. He already has some of the bank's money.
> 
> I should say good luck to the bank and I hope taxpayers aren't expected to bail them out someday.


The people I have seen do this well, are often the biggest taxpayers. They are the ones bailing out the social services programs.


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## Just a Guy (Mar 27, 2012)

As opposed to a property which appraised at double the loan? A place which rents for $1300-1500/month (how much income does a car generate?). Get serious sags. Quit with the sour grapes. 

The bank hires the appraiser by the way, if anything the results are low to favour the bank. 

They can foreclose on a property, garnish the rents, etc.

The bank is well protected in my son’s case. 

There is literally no risk for the bank in this case, your statements look even more childish than usual. 

Oh, someone out there is making money in a way I wouldn’t try...very risky for everyone. Taxpayers unite. Stop this practice. Everyone needs a union job or it’s not fair. 

Face it Sags, it’s a good deal, and not everyone needs to be a union beggar to survive.


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## sags (May 15, 2010)

Your son hasn't even bought the home and already it's value has doubled ?

As Frank Drebin said........share the good news on which banks are ripe for the pickings.


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## sags (May 15, 2010)

Sorry Plugging Along, but if those people making all that money flipping houses need your money for anything, you might want to ask yourself why.


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## Just a Guy (Mar 27, 2012)

He had his choice of scotia, TD, or BMO. In the end he went with TD as he was banking there already. 

You know, this isn’t really new stuff...there are books written about how to do this.

https://www.amazon.ca/Buy-Rehab-Ren...eywords=Brrrr&qid=1564587768&s=gateway&sr=8-1

Http://Www.mindsetfinance.com/

You seem to think I’m making this up...search for brrrr on the internet. It’s a common strategy, lots of people doing it.


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## sags (May 15, 2010)

Yea.......flipping and making easy money was quite the rage back in the day.

But then reporters discovered that those television shows where people bought and flipped homes for profits were all fake.

Many of the promoters of similar real estate schemes went out of business or went to jail for fraud.

And I recall a couple of posters on CMF who were around for awhile talking about how they were going to make their fame and fortune buying under priced homes and flipping them.

One of the posters even had a Youtube channel explaining his "system". 

Unfortunately, the last video I saw was the banks had refused to provide funding for a second rental property.

The banks declined because he didn't have sufficient income to service the debt aside from rental income. Apparently rental income solely isn't sufficient.

I don't think he makes videos anymore.


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## Just a Guy (Mar 27, 2012)

Yes mr. Expert, no one ever makes money flipping houses. It’s all a conspiracy theory. The only way to earn money is be a union employee. Everything else is a scam...

You’re quite the broken record. 

I’ve flipped houses before, done right you can easily make six figures in a short time. I do agree though, having done it, that many of those shows skipped over things like realtor fees, financing fees, etc. By my experience, many of those shows couldn’t have been profitable. But, that doesn’t mean you can’t make money flipping.


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## Eclectic12 (Oct 20, 2010)

sags said:


> Yea.......flipping and making easy money was quite the rage back in the day.
> But then reporters discovered that those television shows where people bought and flipped homes for profits were all fake ...


Not sure it ever was easy ... but just because media had/has faked it so they can make money in their business doesn't change that some are still making a living at it and some are dabbling when the right property comes along.

Sounds similar to those looking to buy stocks on sale who don't buy unless they find an opportunity. :biggrin:




Just a Guy said:


> Yes mr. Expert, no one ever makes money flipping houses ...


Come to think of it, this message sounds like the financial industry's messages about how DIY investors can't make money investing in stocks without their knowledgeable, fairly priced help.:rolleyes2:


Cheers


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## sags (May 15, 2010)

Dont't take my word for it.

Head on down to your local bank and tell them you don't have a job, you have no savings, you have no downpayment, you have no assets and you want to borrow 100% of the price of a home and you will pay the debt back with the rental income.

See how it works out for you.


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## Eclectic12 (Oct 20, 2010)

Now you are are being silly ... or are too busy trying to support your view to read what was written.

Flipping came up with the statement that:


> My examples above were all based on *having a decent down payment*. However, my good friend does a lot of real estate and does flips primarily and some rentals. They finance a 100% as JAG has indicated.


Your blanket response was that flipping only made money in the old days where what's on TV is fake. If you really wanted to focus on those starting out - it would have made more sense to refocus the discussion by pointing out that those with a decent down payment are not the ones you want to focus on. 

When was the old days that flipping was all the rage and presumably everyone made money at it?
Six months ago? One or two years ago? Five years ago? Ten years ago?


Cheers


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## Just a Guy (Mar 27, 2012)

Flipping works best in a bull market. Lot harder to do in a bear. That being said, it all comes down to how much you pay initially, what your costs are, can you stay on budget and how well do you know what the market will Pay when you’re done. 

On my flips, we hit our sale price which we initially predicted exactly. Probably because I’m watching the market everyday. Since I purchase in bulk, flips do require different materials than a rental (flips are nicer than rentals) I could get excellent prices on things. Like I built an oversized garage for less than 5k in materials. Going into the hardware stores and replacing a 16x7 door ($1300) with two 9x7 doors ($350 each on sale) is one example. Replacing the windows and doors with stock products also saves a lot. 

Finally finding a house with good bones that’s cheap is important. Some of the flips we did, the house was basically written off, we’d get the place for lot price. 

P.S. sags, it worked out fine for my son. Maybe you should try it yourself. It’s been working out for me for decades. I suppose you’d actually have to go into an bank and actually ask...but it’s better to just say it’s impossible and hold out your hand waiting for the government to give you money.

Serious question, have you ever tried to do anything or do you always talk yourself out of it first?


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## Plugging Along (Jan 3, 2011)

sags said:


> Dont't take my word for it.
> 
> Head on down to your local bank and tell them you don't have a job, you have no savings, you have no downpayment, you have no assets and you want to borrow 100% of the price of a home and you will pay the debt back with the rental income.
> 
> See how it works out for you.


If you are going to pick and choose comments out of context to only suit what you want, then I do not see there is a conversation here. You are only looking to validate your views and cannot persuade by fact or logic. So you are correct, YOU will never make any money on real estate. I hope others are able to use their critical thinking skills to help them decide if other investment options are for them.


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## sags (May 15, 2010)

What does buying homes to flip using your assets, cash, or down payments have to do with the premise of buying homes with no assets, no down payment, and no job ?


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## Just a Guy (Mar 27, 2012)

I gather you’ve never taken post secondary, or your kids either. When I went, the banks used to have booths at registration where they offered student loans and car loans. 

Only a fool would think an 80k truck loan is safer, more secure and better than an 80k 3 bedroom apartment. Personally I’d never lend money on a car. I’d probably finance a rental property though depending on the numbers. 

I was at TD today and they had an ad that said children who don’t understand financial matters grow up to be adults who don’t understand and wind up living at home.


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## sags (May 15, 2010)

Then I guess the banks and automakers are fools, because that is exactly what they do.

You never wondered why getting a mortgage for real estate is much more difficult than getting a car loan ?

We bought a new car just a few months ago, and the financing was approved in less than 5 minutes.

As you have said, a mortgage for an $80K property required an appraisal.


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## Just a Guy (Mar 27, 2012)

What a union guy...

So, you’d take your personal (silly question, I know you’d never invest in anything) finances and finance a depreciating asset like a truck which is immediately worth 30% less the second you sign the papers, over real estate that generates revenue..and historically keeps its inflation adjusted value. Unlike a car which generally goes to near zero value in 10 years. 

Shall we mention that insurance doesn’t always even cover the full replacement value of a car if you wreck it right away, unlike real estate that is.

One of the reasons for the appraisal is because many fools overpay for real estate. There is no manufacturer’s suggested retail price. Real estate is open to fraud, look at the Vancouver money laundering scam where people overpaid for properties to launder money. It’s a slow way to do it, but people do. Happens with used cars too. 

Not only that, but you’re trying to defend the idea as good and sound.

You give the term greater fool an example to put in the dictionary. I can see why you need things like UBI and government handouts. 

I pity your kids and their financial future if you are their example.


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## sags (May 15, 2010)

Vehicles depreciate regardless of how they are paid for. 

1) A person can take their own cash out of investments and buy the vehicle and the vehicle will still depreciate and they will lose any gains from their investments.

2) Or, if the interest rates are near 0%, a person can pay cash by paying monthly and keep your money invested. They would also be paying with future dollars that are worth less (inflation).

3) Insurance.......buy "top up" insurance. It isn't expensive at the time of purchase.

4) As to buying a vehicle or a rental unit, it depends on what your needs are. 

We need vehicles. We don't need a rental property and there is a risk the property would drop in value in the short term we owned it.

Younger people with a long life ahead of them should buy a home. I have already argued that over 25 years home prices have always gone up.

The same can't be said for old people with a short time frame.


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## sags (May 15, 2010)

As to investing, our private pensions have already earned us $800,000 combined since we retired, and will continue to pay out as long as one of us is still breathing.

The professionals in our pension funds invest for us. We collect every month. Now that we are collecting CPP their professionals invest for us. We collect every month.

Our money is tucked away in nice safe GICs. Our days of worrying about investing for the future are long gone. We are living our future.


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## Just a Guy (Mar 27, 2012)

We were talking about financing a car vs. A rental unit...you changed it to purchasing because even you probably realized financing a car is a loser idea from the lenders end. You can’t defend financing a money losing asset over a money generating asset that’s is inflation protected...so you change the subject...yeah, if you’re old, buying a rental isn’t a good idea...don’t look over at the topic I was trying to defend over there and looking like a fool because I used to build cars. 

You’re very lucky someone else managed money for you. What does that work out to 400k each for a lifetime of savings? Wow, that must work out to what, 10k/year? That’s almost the rent we collected from the 8 properties we bought last year this month. As I said, I pity your kids if you’re their financial example.


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## ian (Jun 18, 2016)

Our rule of thumb has always been never to finance a depreciating asset or a consumable (unless the rate was 0%).


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## sags (May 15, 2010)

Real estate in Alberta has become a depreciating asset and it can be a big one for some people.

Garth Turner shares the story of a couple in Calgary, Alberta that got caught up in it.

The place cost $3 million to build and is assessed at $1.6 million........ouch.

https://www.greaterfool.ca/

Anyone taking on 100% mortgage debt for a property in Alberta are going to owe more than the property is worth, and the bank may decide they want the difference upon renewal.

The couple are now trying to "crowd fund" their way out of the mess.

Anyone wanting to take a chance........they are selling 105,000 tickets at $35 each.......plus GST.

https://www.boldstok.com/


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## Just a Guy (Mar 27, 2012)

Unless you buy with the correction priced in. Tell me would you rather have a three bedroom apartment in a trendy area or a truck? Both cost 70k. The apartment rents for $1500 (three students, $500 each), who cares what it will sell for. What fool would sell an asset that makes $18,000 on a cost of 70,000. Who cares if it drops to 35,000 when it makes 18k? Even if the rents drop, your costs are less than half the rent. 

We’re talking from an investment perspective of course.

By the way, what would Garth say about your investments? There are stupid investors and buyers all over the place. Finding stories about them isn’t hard. Doesn’t mean smarter people do the same thing.


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## sags (May 15, 2010)

You are right.

What fool would sell an asset that makes $18,000 a year on a cost of $70,000 ? 

But some fool did sell it to you.


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## Just a Guy (Mar 27, 2012)

Bank foreclosure

There’s a two bedroom listed in the same building right now, private seller, 120k.


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## sags (May 15, 2010)

That comparison would prove the bank sold it for far less than market value and committed fraud against the homeowner in default.


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## Eclectic12 (Oct 20, 2010)

sags said:


> As to investing, our private pensions have already earned us $800,000 combined since we retired, and will continue to pay out as long as one of us is still breathing.
> The professionals in our pension funds invest for us. We collect every month. Now that we are collecting CPP their professionals invest for us. We collect every month.
> 
> Our money is tucked away in nice safe GICs ...


So how much was put in by you from salary, how much did the company put in and did the company ever have to dump in more money to make up for shortfalls?
There's way to much happening under the hood to think this is a great investing example.

There is also the safety net that the employer has to make up any shortfalls.


For a millennial who is only offered RRSP matching by their company (i.e. no pro fund managers, no safety net) - what's the point of knowing that your pensions are a boon?





sags said:


> ... Garth Turner shares the story of a couple in Calgary, Alberta that got caught up in it.
> The place cost $3 million to build and is assessed at $1.6 million........ouch.


Wow ... the first couple who have rental properties and avoided over paying for RE is ignored and your evidence that RE is bad is a couple who build their dream home and are only accidental landlords because they can't sell?

Talk about cherry picking!





sags said:


> ... What fool would sell an asset that makes $18,000 a year on a cost of $70,000 ?
> But some fool did sell it to you.


LoL ... we don't know if the seller:
1) is a landlord (probably not where the numbers work this favorably) 
2) bought twenty plus years ago for maybe $10K 
3) has been transferred to another province for work
4) is an executor liquidating to pay the beneficiaries for the deceased owner
5) is divorced where they need to the cash to payout their ex-
6) has been admitted to the dementia floor of their local nursing home where the POA's live a couple of provinces away
7) ... any of lots of other reasons


You are assuming all sellers are saavy land lords, see the potential and are able to make the income.


Life is far more complicated than that ... particular with those who don't want to be land lords being in the market place.

Cheers


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## Just a Guy (Mar 27, 2012)

sags said:


> That comparison would prove the bank sold it for far less than market value and committed fraud against the homeowner in default.


Nope, it was listed on mls for nearly a year. Originally listed much higher (well over 100k), we were the only offer. The market was dead last year. This year stuff is already selling for more across the country.

Last year was very unusual, we had no competition on any of our offers, places sat for almost a year, it was an incredible buying opportunity...haven’t seen anything like it in decades. The one bedroom and a den for 45k was another example. The bank negotiated, came back with 50k final offer...my realtor said we had to take it as it was a final offer and people don’t go below that. I said, offer 45k since there’s no competition what do we have to lose? They blinked. There’s a private unit in the same building, one bedroom, currently listed at 85k the last I checked. 

But thank you for making up another good story. You really should look up the definition of fraud, also the duties of a bank when selling a foreclosure...reality is so much different than your make up world, I wonder how you interact with it when you venture out.


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## sags (May 15, 2010)

Good reasons to sell perhaps.......but not good reasons to sell a home appraised at $150,000 for $70,000.

If the unit was a foreclosure and the bank appraised the home for $150,000......why did they sell it for $70,000 ?

Sorry.......doesn't add up.


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## Eclectic12 (Oct 20, 2010)

sags said:


> That comparison would prove the bank sold it for far less than market value and committed fraud against the homeowner in default.


You are confusing a power of sale with a foreclosure.

In a power of sale - the bank has to get FMV, a realtor is used, the borrower is still on the hook for losses but gets any gains if there is a surplus.
In a foreclosure - the borrower is off the hook, the property is sold at auction and the borrower keeps any surplus.

https://www.canadalend.com/blog/power-sale-ontario/





sags said:


> Good reasons to sell perhaps.......but not good reasons to sell a home appraised at $150,000 for $70,000.
> If the unit was a foreclosure and the bank appraised the home for $150,000......why did they sell it for $70,000 ?


You haven't heard of banks (or companies for that matter) hating dead money, especially where there hasn't been any interest, while they are on the hook for utilities/property taxes etc.?

Why are car dealers offering discounts for last year's cars that haven't sold yet?


Cheers


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## Just a Guy (Mar 27, 2012)

The banks want it off their books. I don’t know how many times they tried to sell the property and pulled the listing because it expired. I could pull a history if anyone worth the time asked. Until the unit is sold, it sits on the books as a loss. If it was cmhc insured, they can collect the difference and make up the losses. 

Banks still hire realtors, list it on mls and only come in at the end to sign the papers. With no offers in almost a year, the banks will look favourably on any offers to clear up the books.

I love the fact that you keep trying to convince yourself that none of this happens...when it happens everyday. You must really hate missing all these types of opportunities to try so hard to say it’s impossible. But managed to save up 10k/ year as a union guy...probably half your money, so a 5k return over what 20-40 years...

I can’t lie though, I’ve used you as an model for my kids many times...I tell them all your stories and investment advice. They get a lot out of it...and not just laughs.


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## sags (May 15, 2010)

Not in Canada.

_*Once the lender has control either way*, they hire a Realtor who provides the lender with a comparable market analysis. The lender also obtains an independent appraisal. The lender will often use the appraisal and set the asking price at or close to the appraised value.

*Since the lender is mandated to get fair market value, they must prove in court that the home was properly marketed and seen by enough potential buyers to achieve a final accepted offer.* A lender cannot accept an offer that is substantially lower, especially in the beginning, as there will not be enough proof that the lender attempted to obtain fair market value. As time passes and based on showing and market activity, the lender may lower the asking price every two to six weeks.

As the lender reduces the price, many buyers wait for the price to go even lower. Unlike many sellers, a lender will continue to reduce the price on a foreclosure until they get an offer. However, eventually the price is ripe enough that someone will make an offer. Depending whether the lender is the title holder or conducting the sale through a court order determines whether the offer requires court approval, or not. _

https://www.canadianrealestatemagaz...-strategies-canadian-foreclosures-183305.aspx

So the premise of the story is that the bank appraised the property for $150,000 and the highest offer was $70,000.

Then they loaned out $80,000 based on a home they could only sell for $70,000.

And then they stuck the homeowner in default with any losses on the sale.

Yea, that sounds about right.


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## Just a Guy (Mar 27, 2012)

Not many foreclosures go through court approval...probably only about 10% from what I’ve seen. 

Other than that, your post tends to support what everyone but you said. Price is set and drops until someone makes an offer...that is then fair market value.

Same argument I make when I appeal my property taxes...the city said it was worth more, I point out I bought it off mls, hard for them to argue.


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## sags (May 15, 2010)

_I can’t lie though, I’ve used you as an model for my kids many times...I tell them all your stories and investment advice. They get a lot out of it...and not just laughs._

That is good. Tell them this story for a touch of reality in their lives.

My son and his ex wanted to buy a home together and he asked me what was involved. I told him they needed a down payment first and then think about it.

Not so.......says my son. I read online that you can buy a home with no money down. I told them to go and give it a try.

They made an appointment and went to the bank. They came back shortly after with sad faces. They told us to come back when we had a down payment, he says.

Yea, that is how the real world works.


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## sags (May 15, 2010)

Just a Guy said:


> Not many foreclosures go through court approval...probably only about 10% from what I’ve seen.
> 
> Other than that, your post tends to support what everyone but you said. Price is set and drops until someone makes an offer...that is then fair market value.
> 
> Same argument I make when I appeal my property taxes...the city said it was worth more, I point out I bought it off mls, hard for them to argue.


So it wasn't a quick deal. It wasn't someone in a divorce who badly needed the money. It wasn't beneficiaries of an estate who wanted the money now.

It was a slow grind downwards for months or years until the price reached less than 50% of the appraised price and all during that time there were no interested buyers.

How did the bank come up with that appraisal and what in the world would make the property worth more than $70,000 after all that ?


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## sags (May 15, 2010)

Whatever, I am done with this discussion as it is heading nowhere.

It isn't my job to educate the world, but the postings on a financial forum should at least be somewhere in the realm of accuracy which is why I have continued these useless debates.

Someone else can take over if they want. Otherwise I think this forum will slide downhill in concert with the quality of the information posted.


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## Just a Guy (Mar 27, 2012)

downpayment is relative. 

For example, if you appraise a property at 150k, and get an 80% LTV mortgage, you technically have a 20% downpayment. 

You could also finance the downpayment, for example use a heloc or credit card. 

Of course, you go into any bank and ask for a 100% mortgage, they’ll laugh you out of the place. You go in and ask for 100% financing and they’ll find a way if your credit is good, perhaps an unsecured line of credit. 

You see, when my kid went to the bank, he had the benefits of someone who actually knew something about how to do things as opposed to a guy who didn’t. So, my son got the loan, and yours didn’t. 

The benefits of a financial education as opposed to ignorance. 

Yes, my 8 year old really likes to see how uneducated some people are in reality. Even they know how to get a loan, invest and make money...they currently run a vending machine at my business...they track sales, inventory, price shop on products...they could probably teach you quite a bit if you’d ever listen to those who do things.

As to how it can appraise realize that real estate isn’t a market like stocks. Each unit is sold and priced individually. The fact that my kid bought a property for 70k doesn’t mean every property now sells for that price. The way an appraisal works is they send out someone who looks at what comparable properties are selling for. Just because he got a steal, doesn’t mean that others aren’t selling for more. As I said, there’s a 2 bed in the same place listed at 120k. If it sells to someone, then the unit is worth more. Even the city said that three beds are worth more...they didn’t drop the assessment to 70k, but they did drop it to 100k from 150k because it’s hard to argue with a sale price.


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## Just a Guy (Mar 27, 2012)

sags said:


> It isn't my job to educate the world


Boy, do you ever take that seriously too.


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## Frank Drebin (May 10, 2015)

Just a Guy said:


> downpayment is relative.
> 
> For example, if you appraise a property at 150k, and get an 80% LTV mortgage, you technically have a 20% downpayment.
> 
> ...


I think you're full of ****. Not completely full of ****, but your stories are purposefully vague and lack details, and those provided seem to change. First you say your sons property was assessed at $120k, then $150k, now its $100k. Earlier in this thread you said you bought 7 rental properties, now its 8. First it rented for "well over $1200" now its $1500, which seems awfully high for a place valued at even $150k, let alone a place that stood on the market unsold for a year.

And a lot of your information just seems incorrect. No banks (Especially TD) would allow you to finance your down payment through an unsecured LOC or credit card. Anyone who has applied for a mortgage in the last 20 years knows this.

I'd be glad to be proven wrong a link to the same property that is in your sons building, or a similar property in the area. Or even the name of the city. I will humbly apologize, but for now your posts reek of BS.


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## Just a Guy (Mar 27, 2012)

The city assessment was higher, I appealed it and got it lowered. The bank appraised it at 150. 

I bought 7 properties, my son bought 1, combines that makes 8 last year in my family. Technically I didn’t buy 8.

Rent isn’t based on purchase price, it’s based on rent for an area. 

Last I checked $1500 was “well over” $1200, yet still affordable, 3 students paying $500 each. It’s in a trendy area, a farmers market is a block away once a week, all sorts of cool restaurants, and shops, easy transit to schools. 

If you read carefully you’ll see there are no contradictions. 

As for loans and banks, go into a bank and see for yourself. I’m not the only one on this board to do this, you’ll see others have done it as well.

I even linked to two published books on this same process but, liked free to disbelieve what you want, it doesn’t harm me, it just keeps you out of the market. 

Oh, and by the way, the last time you asked for a city, I believe I even responded that Edmonton had several listings. Not my son’s city, but I also said to look on mls, I find properties in every major city except gta and gva. They may exist there, but it’s not worth the effort for me to look. They’d be very rare. 

You really need to read more carefully.


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## Frank Drebin (May 10, 2015)

Just a Guy said:


> The city assessment was higher, I appealed it and got it lowered. The bank appraised it at 150.
> 
> I bought 7 properties, my son bought 1, combines that makes 8 last year in my family. Technically I didn’t buy 8.
> 
> ...


I've been to a bank, I own a rental property and have applied for a second one. I'm an ideal borrower, high income/NW, great credit, no debt. I know you're full of crap. You've provided zero helpful information in this thread, seriously, a link to a RE book?

Which city has apartments that rent for $1500 a month and that sell below $150k? Better yet, which Province? I need to know this.


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## Just a Guy (Mar 27, 2012)

Rental rates and housing prices are completely unrelated. Any real landlord knows that. 

As for rent, I suppose it’s easier for me to google than you. 

https://rentals.ca/national-rent-report

I suppose what you really want, considering how lazy you seem to be on research and reading, is for me to find a property for you, negotiate the price, finance it for you, get a renter and manage it for you...but then you probably still wouldn’t believe it. 

I’ve met too many like you and sags. Just stay out of the market if you think it doesn’t exist. 

As for financing, if you actually read what I do, instead of skimming at best, you’ll see I buy my properties outright and refinance them...the downpayment issue is completely different on a clear title property. That being said, my son was still able to borrow the downpayment in other ways. 

Maybe it’s because the banks knows me, maybe it’s because he’s a student and banks throw money at students, I’m not sure, but where is the benefit to me lying, and how is it that other people on this board have said they’ve done the same things? Maybe you think I’ve got multiple logins?

Tighten up your tinfoil cap then.


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## Frank Drebin (May 10, 2015)

Just a Guy said:


> Rental rates and housing prices are completely unrelated. Any real landlord knows that.
> 
> As for rent, I suppose it’s easier for me to google than you.
> 
> ...












Tell me what city Just a Guy. What city can you buy a property for less than $150k and rent it for $1500/month.

Just type it out. Its not hard, its probably less than 10 letters.


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## Just a Guy (Mar 27, 2012)

Try this, probably way too complicated for you, only 3 letters...

Any major city in Canada, outside of Toronto and Vancouver. 

Now go to a little know (to real estate guys) site called realtor.com and type in a search like I have many times. Not every city has a property that matches every day, but over the year something will come up. 

Oh, and why not stick to Edmonton, which you’ve managed to ignore actually searching, so I went on mls, searched Edmonton, apartments, under 150k...

https://www.realtor.ca/map#ZoomLeve...Center=53.544692243879794,-113.49092670000005

Didn’t count or drill down but there are more than 100 non-existent properties matching the search. 

If you go to the rental.ca link in my last post you’ll see a one bed rents for over 1000, and a two bedroom is $1327 in Edmonton. 

Of course, I admit I made a fake mls site and the rental.ca site just to Bs people who may actually want to do some research. Total time I spent looking was less than 2 minutes to fake prove you wrong. 

Wonder what I’d find if I did other cities...

Oh look, 1 in Hamilton...shall I select another random spot? 6 in London. 

You know why I found these? Little secret...I looked. 

The smell may be coming from the orifice below your nose. Imagine what would happen if you and sags actually researched before posting.


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## Frank Drebin (May 10, 2015)

None of those rent for over $1100 a month. 

Anyways, good news: we have one thing in common. We both know you're full of ****.


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## sags (May 15, 2010)

Nobody is questioning if there are cheap properties to buy. Nobody is questioning if people pay $1500 a month rent.

People are questioning if cheap properties can fetch $1500 a month rent...........and if the bank will loan 100% financing to someone with no income or job.

You posted a link to cheap properties in NW Edmonton.......for some reason they are all in NW Edmonton, and here is a link for rental rates in NW Edmonton.

https://www.kijiji.ca/b-apartments-condos/edmonton/north-west/k0c37l1700203

It appears people can pay $1200 a month rent for a lot bigger and nicer unit in NW Edmonton than the cheap units. There is a gorgeous 3 bedroom townhouse for $1250 a month.


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## Just a Guy (Mar 27, 2012)

Frank Drebin said:


> None of those rent for over $1100 a month.
> 
> Anyways, good news: we have one thing in common. We both know you're full of ****.


Care to prove this? Your opinion is meaningless.

Sags, I’ve already said my son doesn’t own in Edmonton. So his rent and Edmonton’s has no correlation.

Also, the map was covering greater Edmonton, not just NW, but keep trying.


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## Just a Guy (Mar 27, 2012)

As was posted in another thread, you can lead an investor to opportunities, but you can’t make them think.

Believe what you want, I’ll continue to do what I do and make money while you and sags whine. Neither of you is worth the time.

My kids are well on their way to financial freedom before hitting their 30’s, sag’s can’t buy a property, but there’s always the basement. I’m sure franks kids will rival sags in their achievements, they have such inspirational parents.

Believe it or not, your opinions won’t affe my, or my family’s lives in the least...can’t say the same for your families.


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## Frank Drebin (May 10, 2015)

The more posts I read the more convinced I am that j.a.g off doesn't own a single property. He really doesn't have a clue what he's talking about.


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## Frank Drebin (May 10, 2015)

Just a Guy said:


> As was posted in another thread, you can lead an investor to opportunities, but you can’t make them think.
> 
> Believe what you want, I’ll continue to do what I do and make money while you and sags whine. Neither of you is worth the time.
> 
> My kids are well on their way to financial freedom before hitting their 30’s, sag’s can’t buy a property, but there’s always the basement. I’m sure franks kids will rival sags in their achievements, they have such inspirational parents.


 hope they don't turn into habitual liars like their dad. Your son won't last long as a power engineer in this job environment telling lies like his daddy does. 

He's probably embarrassed of your behavior. I would be


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## sags (May 15, 2010)

I hear you Frank, but don't let it bother you. We know what we know.


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## Just a Guy (Mar 27, 2012)

Not a power engineer, keep making thing up sags, I mean frank. Never said power engineer, but thanks for proving, once again you can’t read. Feel free to prove I’m lying here, it should be easy just go back and quote it...you can’t, because I’m not the one of us lying. 

Care to prove none of the 200 properties listed, not sure how you evaluated all of them in the 30 seconds between posts, can’t rent for good money?

I think I’ll go short some fertilizer stocks while the two of you are alive, they don’t stand a chance. 

Anyways, I think I’ll follow some advice that was given to me by several other members...


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## Frank Drebin (May 10, 2015)

sags said:


> I hear you Frank, but don't let it bother you. We know what we know.


 just saying out loud what everyone is thinking. 

It would be so easy to validate his claims but he doesn't.


I knew he was a liar when I read his first post about his power engineer son being a multi millionaire inside of a decade.

I know plenty of re investors. It's a long game unless you catch a bubble.


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## Longtimeago (Aug 8, 2018)

You know, anyone is entitled to an opinion, no matter how wrong they might be.

When I decided at age 35, that I wanted to retire as soon as possible and came up with a plan to do so in 10 years, many people told me things like, 'yeah sure you will.' Then I achieved that financial goal in just 7 years. I suppose those people who didn't believe it was possible just changed to saying, 'who'd a thunk'. I also suppose they kept on working for a paycheque and hoping they would be able to afford to retire at age 65. 

Let's suppose Just a Guy is indeed a 'liar' (shouldn't use of that word get people banned from this forum by the way). What would it prove if that opinion of Just a Guy was correct? Would it prove that no one can make a lot of money in real estate? Would it prove anything at all worth proving? 

I retired in my early 40s after just 7 years of going from next to no savings and spending as much or more than I earned, as most people do. I suppose someone could say I was lying about that and it might make them feel better when looking at their own situation, expectations and ambitions. But it wouldn't make them right. Like I said, everyone is entitled to an opinion regardless of how wrong they are.


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## cainvest (May 1, 2013)

Longtimeago said:


> You know, anyone is entitled to an opinion, no matter how wrong they might be.
> 
> When I decided at age 35, that I wanted to retire as soon as possible and came up with a plan to do so in 10 years, many people told me things like, 'yeah sure you will.' Then I achieved that financial goal in just 7 years. I suppose those people who didn't believe it was possible just changed to saying, 'who'd a thunk'. I also suppose they kept on working for a paycheque and hoping they would be able to afford to retire at age 65.


My old neighbors, avid lottery players, won the lottery twice in one year and retired. Once the main prize, second time was only 5 figures but both winnings made it more than enough to retire on .... who'd a thunk? Should I start buying lottery tickets?

Point being, just because you set a goal doesn't mean you'll achive it ... some do but most don't.
On the flip side, you can't win if you don't play. 

As to the quality of unverifiable internet forum material I think this quote from House MD works.
"It's a basic truth of the human condition that everybody lies. The only variable is about what."


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## sags (May 15, 2010)

Perhaps in a general discussion forum it wouldn't matter, but as CMF is a financial forum I think accuracy is necessary or the forum would be of little value.

I also don't agree that working for a paycheque isn't a good way to pay for retirement. We worked for a paycheque for 40 years and retired at age 55 with full pensions.

There are lots of schemes and theories that promote easy money and early retirement, but few of them ever pan out in reality.

Ponzie schemes and scams rely on people's hopes and dreams for an easier path to financial independence than often is available or attainable.


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## AltaRed (Jun 8, 2009)

I didn't know the auto business hired individuals at age 15? Maybe you mean 30 years with the 85 factor on rich pension schemes?


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## Mechanic (Oct 29, 2013)

A buddy has been looking at properties in Edmonton for investment as rentals. 3 bedroom condo/apartment type properties near university etc but they are in the 7-800k range. I told him he can get properties under 100k in Edmonton to rent and he made some comment about "slumlording" not being for him. Haha. This thread is entertaining but seems to have gotten off the rails a bit.


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## sags (May 15, 2010)

AltaRed said:


> I didn't know the auto business hired individuals at age 15? Maybe you mean 30 years with the 85 factor on rich pension schemes?


GM hired people as young as 13. They worked on the "boys line" in Oshawa. We also had quite a few people hired at age 16 -20 . Some lied on their applications.

Lots of people retired in their 40s on a pension with a 30 and out pension. Their pensions were enhanced with about $900 a month extra until age 65.

My buddy retired with the full 30 and out pension, full health benefits plus $70,000 in cash and a $25,000 voucher for a new GM vehicle.

He got the best deal offered. After the retirees were gone, GM chopped the pay, the benefits and the pensions.

PS. I should note that GM wasn't being generous in their gestures towards retirees. We discovered later that all the payouts were coming out of our pension fund.

It is one of the reasons the fund became underfunded for awhile and the government later ceased the $1,000,000 commuted value offers.

It is back to 100% + full funding now.


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## AltaRed (Jun 8, 2009)

sags said:


> GM hired people as young as 13. They worked on the "boys line" in Oshawa. We also had quite a few people hired at age 16. They lied on their application.


OMG! Child labour! Where are the protestors that should be shutting down the auto industry, or at least bringing them to justice? Thank goodness at least the Oshawa plant is going away. We need to work on closing the other plants as well.


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## Just a Guy (Mar 27, 2012)

To me it shows that a 13 year old is capable of replacing Sags...I’m surprised they don’t start even younger.


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## Longtimeago (Aug 8, 2018)

sags said:


> Perhaps in a general discussion forum it wouldn't matter, but as CMF is a financial forum I think accuracy is necessary or the forum would be of little value.
> 
> I also don't agree that working for a paycheque isn't a good way to pay for retirement. We worked for a paycheque for 40 years and retired at age 55 with full pensions.
> 
> ...


I take it you think that proves working for a paycheque is equal to working for yourself. Umm, I worked (some might say not very hard work) for roughly half as long and retired. So I would disagree that working for a paycheque for 40 years was a 'good way' to pay for retirement. 

Why don't we put it to a vote? Those in favour of working for 40 years to retire, raise your hands. Those in favour of working for 20 years, raise your hands. 

No one is promoting any 'schemes and theories that promote easy money and early retirement' sags. Or 'ponzie schemes and scams', what is being written are REAL examples of real people. 

Here's the thing sags. You worked for an employer for 40 years and retired. I worked for 20 years and retired. I can understand why it might upset you to think about that difference but however upset it makes you, it does not make the facts go away. I started out working for an employer, just like you. The difference is when I got to the point that I realized I could earn more working for myself, I started doing so.

Just accept that some people are more capable of earning money for themselves than others are. For some, an employer and 40 years are the only practical route. I accept both of those realities, why can't you?

If someone wants to retire early, a union job at GM etc. is not the fastest way to get there. There may or there may not be a faster way for an individual if they look at alternatives. All that is happening here is people are being shown alternatives do exist and that SOME people are capable of doing so.


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## Longtimeago (Aug 8, 2018)

AltaRed said:


> OMG! Child labour! Where are the protestors that should be shutting down the auto industry, or at least bringing them to justice? Thank goodness at least the Oshawa plant is going away. We need to work on closing the other plants as well.


No need AltaRed, they will be closing down soon enough on their own. There are too many superior products on the market now. The writing has been on the wall for the 'Big Three' for a long time now.


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## ian (Jun 18, 2016)

Just as well. As a taxpayer I am fed up with our tax dollars being used to subsidize the likes of GM, Chrysler, etc. It seems that subsidies have increased over the years and the number of jobs has decreased. Ontario (and others) need to get in the game.....we are moving very quickly to a new economy. The days of leaving high school and getting a higher paying union job w/benefits for life has long gone. Though some people still do not realize this.


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## Just a Guy (Mar 27, 2012)

Gee, no more subsidized union jobs. No wonder sags is pushing for UBI, it’s a replacement for subsidized union jobs that his kids need to survive. They certainly don’t know how to provide for themselves.


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## ian (Jun 18, 2016)

In the eighties we lived in Vancouver. There was a downturn. A friend of ours was a union carpenter. He spent more than half his time on EI because he refused to take a non union job. He was unemployed for half of his working life throughout his career. I believe he ended up in a low paying retail job. 

Another friend worked for a shipbuilding firm-lots of layoffs. He left, went back to school for two years while his spouse supported him and the children, graduated from BCIT and immediately got a job with a future. I worked in IT sales. Salary and commission. I traveled to places in the interior to sell where some of my competitors would not or did not go. My earnings stayed the same but I worked much longer hours to make it work. The downturn eventually passed. I remained in the same business and enjoyed a very lucrative career. 

The thing is you have to work smart and always move forward. You cannot stand still and expect everything to come your way a la nanny state. Those days have passed us by. You need to bob and weave, be prepared to be a life long learner and understand that you may change jobs and career paths numerous times in your working life. Or learn to work on your own account.


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## sags (May 15, 2010)

The "self employment" ideas I have seen on this forum are lacking in substance or credibility and are often old schemes that are being retreaded.

I know people who own successful businesses and I know how much work they put into them. Most businesses fail or don't earn a living. That is just the way it is.


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## sags (May 15, 2010)

Given how much money GM saved the government in payments from the Ontario Pension Guarantee Fund ($1000 per month per employee for life), unemployment insurance benefits and all the tax revenues since the reorganization........I would say that GM "bailed out" the government.

They certainly bailed out the Harper government who sold the GM shares to make it look like they had a balanced budget.

GM is strong and selling lots of vehicles. High ratings in consumer reports and the pension fund is fully funded........good times for GM.


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## sags (May 15, 2010)

There are still lots of unionized jobs with pensions but if people decide not to work in those fields, they make their own bed.

I suspect the "self employed" make up a big segment of the growing number of retirees collecting OAS/GIS.

Personally, I advise young people to seek out unionized jobs and they won't be sorry.

I have never met anyone who didn't like receiving their DB pension, but I have met a lot of people who wish they had one.


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## cainvest (May 1, 2013)

sags said:


> I have never met anyone who didn't like receiving their DB pension, but I have met a lot of people who wish they had one.


A few of my friends with union jobs no longer have DB pensions, they've switched over to DC now.

DB pensions appear to be going away ...


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## cainvest (May 1, 2013)

Longtimeago said:


> You worked for an employer for 40 years and retired. I worked for 20 years and retired.


I work and could have retired after 20 years of employment, no DB or DC pension plan either.


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## AltaRed (Jun 8, 2009)

Times will change when private industry with unionized work forces can no longer compete. Global trade will make it so. But that is another story for another time.


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## ian (Jun 18, 2016)

I certainly like my DB pension. That is not the issue going forward though.

The reality is that very few people now, and in the future, will remain with the same employer for their entire working lives. Many people who anticipate having several private sector employers during their career very much prefer a DC pension and it is to their benefit.

For fossils like me who put in 25 years with one employer the DB plan was ideal. It's value increased substantially over the last five employment years.

You cannot judge the preference for a DB pension based on our generation's working lives. You need to look at it's benefit to those now entering the workforce or those mid career who anticipate multiple career or employer changes. The one exception might be those employed in the public sector.

I have a BIL who did not have a DB. Instead, he had DC's and he always did the max contribution to his RRSP. He has a very comfortable retirement. I have a SIL who never saved a dime. She has nothing for her retirement other than CPP/OAS/GIC. She spent every dime she had and more. Is suspect that the money she spent on credit card interest could have funded a retirement! 

Sure, many people with DB envy wish they had one, but how many of those people had the foresight or the discipline to save for retirement. My sister has a DB. But she paid in slightly under 7 percent of her salary by the end of her career and another five points to CPP. Know any of those DB envy types who saved like that???


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## Just a Guy (Mar 27, 2012)

I’m pretty sure my monthly passive income puts any DB pension to shame, don’t know why one would want to work for 40 years to get a few scraps. Need more money in the future with your pension, tough. With passive income, add a few more revenue generators. Have some government subsidized job for 40 years, living off the government teat, who cares about self respect and pride in actually earning your money. Just hand over a bit more, maybe some UBI so You can afford to retire. It’s just the grandkids’ money, you’ll be long dead and they’ll be broke as union jobs and government money dry up. 

Maybe I could talk my grandkids into housing the homeless...they’d then live off the other kids government subsidies...on second thought, it’s probably better to rent to a reliable tenant who can take care of themselves without the government.


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## sags (May 15, 2010)

I heard the same...."unions are disappearing" since I started working. 

As long as the different levels of the public service are so large and the fastest growing segment in the economy, I think unions will still be around for awhile.

Last I saw in 2012 there were 4 million people working directly for different levels of government. There are millions more who work in jobs that support the public service.

There are about 200,000 people working in mining, quarries, and the oil and gas industries combined....... Some employees are unionized.

There are about 130,000 people who work in the auto industry, and it is the largest contributor to Canada's GDP.......Some employees are unionized.

It is clear the biggest industries employing the most people and contribute the most to the GDP are often unionized, so I don't think unions are fading away just yet.


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## ian (Jun 18, 2016)

Sags....just take a look at the auto industry. How many unionized workers are there in Canada today compared with 10 or 20 years ago. This is no surprise to anyone. Emerging countries have better educated work forces than in the past and significantly lower labour rates. It takes far less man hours to produce a car today than it did ten years ago...and the product quality is much improved for it. The writing is on the wall despite what Jerry Dias may say. If you are uncertain take a look at what happened to the auto industry in Australia. 

Unions will always be here. The growth in our economy, current and future, is not based on unionized manufacturing or resource extraction jobs. It is based on IT, high tech, knowledge based, and emerging industries that are non union. The public sector will be unionized and there is growth in the unionized health care sector. But hardly enough to overcome the declining membership in those traditional unionized occupations. 

The percentage of union members is decreasing. Even the NDP is feeling the financial crunch. The number of low paying no benefit service industry jobs is increasing. This should ring alarm bells for parents and anyone involved in education. I see this this in spades over the past 40 years as I have visited in laws in Peterborough. It has only increased over the past ten years. There are not many good paying private sector union jobs there any more, nor are there even many for those willing to drive to Oshawa. It is no better in parts of the Golden Horseshoe either.

We oldies are living in the past. There has been masses of change in past ten years and this change will probably continue at an exponential rate.


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## sags (May 15, 2010)

You are assuming people aren't going to rebel against the trend. I would beg to differ and already see a rebellion building. 

I expect to see a resurgence of unionism by workers who are fed up with the status quo. These are the economic conditions that created unionism and history will repeat itself.

Or maybe the people will offload the responsibility not on unions but on politicians and demand changes to the tax structure so that benefits flow from the public coffers.

A Universal Guaranteed Basic Income is progress in that direction.


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## ian (Jun 18, 2016)

What are you suggesting. That they take out the automation and robotic equipment in Oshawa and then go back to making the old trash that pushed the likes of GM and Chrysler into bankruptcy. Or that we stop with the knowledge based industry trend and go back to hammer and tong. If we do that, in 10 years Mexico will outpace us in the high tech space.

You cannot turn back the clock. There will be a problem if the Universal Basic Income ends up being higher that what the typical service industry pays. It will be like the UK twenty-thirty years ago when the biggest industry was the `dole`. The end of the UK`s glory days.

I do not think that it is the Governments fault that people don`t save enough or prepare for retirement. It is like blaming the Gov`t for having a mouthful of cavities because failure brush or floss. People need to look in the mirror instead of blaming everyone else or expecting the Gov`t to do for them what they should have done for themselves.


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## Mechanic (Oct 29, 2013)

Self employment isn't for everyone. It takes a lot of time, sacrifice and hard work to get ahead. Investing in the business and other assets is critical to ensuring a comfortable retirement. Anyone expecting to retire and live off CPP is in for a rude awakening. I took my CPP at 62 but it doesn't give much, around $650 a month.


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## sags (May 15, 2010)

ian said:


> What are you suggesting. That they take out the automation and robotic equipment in Oshawa and then go back to making the old trash that pushed the likes of GM and Chrysler into bankruptcy. Or that we stop with the knowledge based industry trend and go back to hammer and tong. If we do that, in 10 years Mexico will outpace us in the high tech space.
> 
> You cannot turn back the clock. There will be a problem if the Universal Basic Income ends up being higher that what the typical service industry pays. It will be like the UK twenty-thirty years ago when the biggest industry was the `dole`. The end of the UK`s glory days.
> 
> I do not think that it is the Governments fault that people don`t save enough or prepare for retirement. It is like blaming the Gov`t for having a mouthful of cavities because failure brush or floss. People need to look in the mirror instead of blaming everyone else or expecting the Gov`t to do for them what they should have done for themselves.


I don't envision a scenario of going back to old production methods, but people will turn back to unionism if the alternative is worse.

Who would have forecast the day when either of a pair of socialists would defeat the current President ? (Either Sanders or Warren would defeat Trump).

What do you think will happen when millions of people become unemployed for a lack of jobs ? There is nothing on the horizon that will replace all the lost jobs.

Even those at the forefront of technology recognize that people will require money to support themselves, regardless of where it comes from.


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## ian (Jun 18, 2016)

Our economy is booming. We currently have the lowest unemployment level in DECADES, notwithstanding the manufacturing layoffs over the past three years in Ontario and Quebec. New jobs in new industries and technologies are being created. As well as in advanced IT. 

The issue is that different skills and different attitudes are required. So if someone does not have a marketable skill, trade, education etc the message is go back to school and get one or end up in a lower paid service sector job. There will probably be more employed at this level than in the past. Will there be a revolt. Yes there will, some people who are actually concerned about their future job prospects and earnings will revolt by waking up, going back and acquiring the skills and training necessary to move themselves forward. Just like many others have done in the past, but in different economic situations. 

Lots and lots of opportunity in Canada for everyone as long as they go out and grab it. It does not magically happen by osmosis or by Government decree. It takes hard work, time, investment, and initiative. As in the past, others will stumble along, living only for today, unwilling to invest in themselves . Those are the ones who will no doubt turn around and blame the Government for their misfortune.


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## sags (May 15, 2010)

Going back to school and retraining is for young people, but it is a concept that gets batted around frequently as a solution for middle to older aged adults who are out of work.

I don't think high tech skills are something you teach someone who is older. They didn't grow up using the technology the young use today.

I consider myself fairly literate about computers having owned once since my first Radio Shack Tandy computer in the 1980s. I invested in domain names, once I understood them but it was too late to get the good ones worth a lot of money to businesses. I developed 40 websites using the website builder tools on the internet.

But still, I know I would struggle.

When I retired I thought I would get a nice job as a dispatcher for Rogers Cable. I got an interview and they hired me to start. I went in the first day and this guy is working 3 computer screens with incoming service requests, a couple of desk phones, a couple of cell phones, and an intercom while dealing with drivers coming in and out of his office.

He was expected to handle all this plus know where each cable technician was working and what they were capable of doing so he could dispatch them to the next job.

I sat there for about an hour and watched and then stood up and said see ya..........this isn't for me.

I don't think retraining is the likely future, although there is a lot of talk about it.

I think it is far more likely that people will demand the government pay them not to work. That I believe is where we are heading,... right, wrong or indifferent.


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## sags (May 15, 2010)

There are many who believe there will be a tax on productivity rather than work. Governments need revenues and if people aren't working their budgets don't work out very well.

In order to maintain a consumer spending driven economy, consumers need money. Governments will provide that money from taxes on productivity (robot taxes).

It is pretty much the only way it can go from here. Governments need votes to survive, and the voters will have demands.


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## ian (Jun 18, 2016)

Sags...you are living in the past. While you comments may well encompass our generation they are not reflective of what younger people face.. Those entering the workforce now, and over the past five or ten years will have an average of four or five employers and three or more different careers. That is one reason why younger employees who find themselves in this environment prefer DC over DB pensions. They are portable.

Employers are hiring people who have demonstrably shown their work ethic and their ambition by finishing certain courses of post secondary education. They want people that can learn, are flexible, and who they can teach. I am in my late sixties. In my working life after leaving graduating had four employers and three/four different career paths. Two of them had absolutely nothing in common with each other. I do not think that I am very different than others out there. But I was willing to grab opportunities that involved risk, relocation, and little or no job protection. They were all rewarding in some manner and the last two were very lucrative. The challenge is the jobs that are lucrative/rewarding and that offer opportunity for growth are often those that have little tenure. You are judged purely on your performance. That is the real world.

Money/wealth does not grow by going round and round between Government and consumers. It is a stimulant to be sure but hardly the recipe for a healthy, growing economy that offers opportunity to our children. It grows from such things as resource extraction, productivity gains, technological advances/research/new products. You cannot sit around and expect the Government to build a life for you. I have a few nieces and nephews like that. Too lazy to take up or complete any post secondary training, unwilling to leave small town Ontario and their mother's skirts. They have no future other than insecure service or retail positions. Not the Government's fault. Why should my tax dollars support or encourage that?


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## Just a Guy (Mar 27, 2012)

ian said:


> You are judged purely on your performance. That is the real world.


I’m sure you can see why some people won’t like acknowledging that kind of reality...why they need UBI to save them and their children.


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## Longtimeago (Aug 8, 2018)

Annual Performance Reviews as conducted by most companies really are a joke. In my own experience what I found was that by working only about half the time I could achieve as much as my peers working full time in terms of productivity. At Annual Reviews I would be given the maximum 'raise' allowed within the 'salary scale'. I was happy enough to go along with that right up until I made the largest sale in the history of the company I was working with at the time. My reward was the maximum raise the 'salary scale' allowed and dinner out with the company President, his wife and my girlfriend at the time. That's when I saw the light so to speak.

I asked to be put on straight commission and my income went up far beyond any 'percentage band' of salary increase which is the usual way companies pay people. While the usual system works for the average worker, it does not reward the higher than average worker beyond the 'average'. But as ian noted, "*[The challenge is the jobs that are lucrative and that offer opportunity are those that have little tenure. You are judged purely on your performance. That is the real world.]*"

Most people will not take that risk. They don't expect themselves to be able to perform above average and in truth, are afraid their performance will fall below average. They prefer the safety on an average pay cheque that is NOT based on their performance, only on their attendance.

If a company actually paid all their workers based on their performance, you would have people in the 'same job' earning very different pay indeed. The system is designed to the average and to reward that average. Some workers are overpaid and others underpaid for what they produce. When you hear a story of someone being told by his 'peers', 'hey slow down, you're making us look bad', those are not fantasies, that actually happens all the time. Slow down to the 'average', we all get paid the same. And yes, the Union guarantees we will get paid the same. So who does the system and Unions work well for? The under or average achiever or the higher achiever? That answer is obvious.

In my last few years of working, I operated as an independent consultant. I would sometimes consult for companies that did 'Annual Performance Reviews'. The first questions I would ask the company's management was, 'Suppose you have an employee who comes in late, leaves early, takes days off when you know he isn't sick and is in fact off playing golf, basically is obviously only working half the time and yet is producing as much as peers working full time, how would you rate his performance? How much will you pay him? The same as his peers? If not, why not? What are you measuring, his performance or his attendance?' 

This opening of the topic of 'How to Conduct a Performance Review', as you can imagine, led to some raised eyebrows to say the least. It wasn't anything like they thought the topic was going to be about. But it also usually led to some interesting discussion. Like, if this hypothetical employee is producing as much as his peers in half the time, what would he produce if we paid him twice as much and asked him to work full time? Or why are we paying those who take twice as long to produce the same amount, as much as we are paying them? Or, which average of performance do we want to have, the lowest common denominator or the highest possible? Who decided what the average should be? 

The blame for low productivity cannot all be put on the shoulders of the workers and/or Unions. Yes, the underachievers have a vested interest in keeping the average low, but Management is often equally to blame in that they do not reward based on performance even though they say they do and conduct, 'Annual Performance Reviews'.


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## ian (Jun 18, 2016)

Our annual performance reviews were primarily based on results. Did you meet and/or exceed your sales results. If so, by how much? In sales management....did your team meet and exceed their sales target? How many reps made the numbers, how many did not. In regional management...did you meet your quarterly and annual revenue, profit, sales, and customer sat targets. Do you have a succession plan and is it realistic. Who are your top performers and bottom performers and do you have plans for both. What are the span of control stats for your managers. These were all measurable. Lots of fluff in between but it all came down to performance. At the end of a fiscal year everyone went from hero to zero.


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## james4beach (Nov 15, 2012)

ian said:


> Those entering the workforce now, and over the past five or ten years will have an average of four or five employers and three or more different careers. That is one reason why younger employees who find themselves in this environment prefer DC over DB pensions. They are portable.


Mid 30s guy here. I can attest to this; I view every job as temporary. There is no such thing as a permanent long term job. I can only think of a handful of friends who've had solid long term employment. Everyone else I know, including in the energy sector, has had quite long periods of unemployment due to layoffs and poor business conditions. It's normal now.

Everyone is constantly hopping between jobs; we have to. We have to learn to manage our own money. I'm currently working on consolidating some DCs into my own RRSP to more efficiently manage it. 

But the modern economy is leaving many people behind. I am in the category of "young, tech-skilled people who are able to relocate" and I am very lucky to be in that group. I know that many other people are NOT in that situation. Do you think a 40 or 50 year old, non-technical person who lives in a town and is not able to relocate to a city is going to do well in this kind of economy?

It's ridiculous to think that every working person in Canada is capable of being retrained into technology. And then there's the issue of where the jobs are, if the person can relocate (many people cannot).

The current economy leaves many people at huge disadvantages. In fact I'm even concerned for myself, because I won't be young forever, and the pace of change in technology is very disturbing. This is not something a person can realistically keep up with, and many jobs of today will be automated into oblivion.


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## sags (May 15, 2010)

People get a skewed view when they work for small employers with few employees.

The idea that a large company with tens or hundreds of thousands of employees would sit down with each one and conduct a pay and benefits review isn't realistic.

Corporations choose to negotiate with unions to set the pay and benefits for a number of years. Those companies aren't interested in doing it any other way.

It has been my experience that salaried employees in those same companies who are subject to such reviews due to smaller numbers, are invariably unhappy with their pay, benefits and reviews. It isn't a secret that the most disgruntled and unhappy employees in large companies are middle management salaried employees and the annual reviews they receive from the bosses slightly above them is a major cause of it.


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## sags (May 15, 2010)

Of course you also have your major corporations who don't want either union negotiations or to conduct pay and benefit reviews with their non-union employees.

They just set the pay and leave it there. Take it or leave it. Walmart would be a good example of that kind of corporation.


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## ian (Jun 18, 2016)

Sags, I believe that you are mistaken if you think all large employers, multinationals treat their employees poorly when it comes to wages and benefits.

Walmart might night be a stellar employer but it comes down to supply and demand for labour. I worked for some of the largest multinational IT firms. They paid well, the benefits were excellent, and we were treated well. And, in certain cases where skill levels were scarce wages increased accordingly to attract talent. That does not mean that there was no outsourcing or downsizing as the industry migrated from emerging to mature. There was plenty of both. But the termination settlements were fair-far better than those of our counterparts in the US. Most people that I knew who got laid off, transitioned, etc. ended up with as good or better positions both inside and outside the industry.

I certainly do not prescribe to the belief that all union based employers treat and pay their employees well and those in the non union sector treat their employees poorly. It just is not so. However, I am not in any way anti-union and I believe that employers often get the unions that they deserve. Most union contracts are negotiated successfully by good unions and good employers. We only tend to hear about the less successful negotiations/outcomes.


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## Longtimeago (Aug 8, 2018)

sags said:


> People get a skewed view when they work for small employers with few employees.
> 
> The idea that a large company with tens or hundreds of thousands of employees would sit down with each one and conduct a pay and benefits review isn't realistic.
> 
> ...


On another thread, a poster planning to take an extended leave writes this, "I’m not worried about any knock to career progression, as my job is unionized and seniority based,"

Try looking at what that says to someone like me sags. It says performance will not get someone else a step up ahead of this guy. So where is the incentive for someone to produce more than anyone else? 

That makes it very clear that for an under performer or average performer, that job may be fine but for anyone who out-performs their peers, that job is not the job to have. Can you see that sags? 

The only people who complain about a Performance Review are those that get a bad review OR those that in fact realize that they are not really being reviewed on performance. The first because they have been rated as average or under average, the second because their superior performance has not in fact been acknowledged over that of the first two.


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## nortel'd (Mar 20, 2012)

Longtimeago said:


> The blame for low productivity cannot all be put on the shoulders of the workers and/or Unions. Yes, the underachievers have a vested interest in keeping the average low, but Management is often equally to blame in that they do not reward based on performance even though they say they do and conduct, 'Annual Performance Reviews'.


I agree ….Annual Performance Reviews as conducted by most companies really are a joke.

Employee review's where I worked for 30 happy years were introduced 5 years before I retired. As indicated in the footer of every page, the forms were a cut and paste version an American company used for their employees. :encouragement:


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## Mechanic (Oct 29, 2013)

Never been a fan of unions. I had a good job early in my career that was closed shop so you had to be in the union to work there. The union in that case was a small one and never really had much effect on our work environment. At a later stage I moved countries and worked at a utility corp where there was some kind of employee association that you had to be a member of. The biggest issue there was their work ethic/pace of work, which was very slow and lazy and I hated it. My supervisor told me I was making them look bad by completing work ahead of expectations and I told him that the methods/practices they were using were very archaic and there were much more modern and effective techniques for certain procedures that were cost effective, as well as time saving. It was so bad that at one point I was literally 5 minutes away from finishing a job and they wanted me to leave the job to get cleaned up to go on break. I wanted to finish the job and said I didn't mind losing 5 minutes off a break so I could be finished with it, as it was very involved. Didn't go down well. Only job I ever lost, lol. They said my probation period was unsatisfactory and to be honest, it was the best thing that could have happened. I started working for myself and never looked back, best move ever. Working for yourself is the ultimate performance based employment imo. The supervisor is retired on his pension and I think the other guys are still there. Working at such a leisurely pace is so numbing for anyone with drive and ambition.


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## sags (May 15, 2010)

Performance reviews are well within management rights. They can and do implement performance reviews in unionized work forces all the time.

My wife and I had them every year for 30 years. Most unionized companies are large corporations or the public service and they have the latest work performance evaluation tools.

The concept of such "report card" reviews is to find ways to enhance each employee's job performance based on many metrics.

Performance evaluation reviews are conducted primarily by first line supervisors and the employees they administer.

Deciding pay and benefits according to the potentially biased views of a superior leaves a lot to be desired and is a poor way to conduct business.


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## ian (Jun 18, 2016)

Here is the difference sags. In a union environment there are performance reviews. I accept that. But when it comes time to downsize, layoff, whatever, candidates are typically selected based on seniority and NOT on whether they were graded as an A performer or a C performer.
A very high performer with less seniority would be out the door much earlier that a poor performer with seniority. Is this not correct?

I worked for a large IT vendor. The industry, and my employer had been downsizing since the 90's as industry moved to maturity. Our PR were worthwhile in the mid 80's. But by the late 90's and into 2000's they were worthless. BUT...when it came to downsizing the employees at the bottom end of the performance scale were the first on the list.....regardless of seniority. By the mid 2000's most of the employees were first rate. Why...because the slackers had been let go. Everyone was on edge and knew that downsizing was part of the industry so mostly everyone performed at a high level.


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## james4beach (Nov 15, 2012)

Performance reviews can be very biased. It is a mistake to think that performance reviews can accurately assess who is a "slacker".

I have seen several cases where performance reviews just were intended as a paper trail (cover-your-***) documentation to back up management's preconceived beliefs about someone. This is quite dishonest because it means the documents are a _fabricated_ paper trail to confirm an existing belief.

Having worked in supervisory roles, I know first hand that "stories" about people get established, and then form a *persistent bias* among the managers. These stories can be formed hastily, perhaps from insufficient real history, superficial judgements, or even due to personal agendas (such as personal conflicts or even petty disagreements). The point is that once these stories and biases are formed, they generally persist for the entire tenure of the worker and follow them around from one supervisor to the next. The person is screwed.

An employee suspecting bias or prejudice should keep records of evidence that there is a preconceived belief, along with copies of the reviews. It could well be that the performance reviews are meaningless, and just trying establish a paper trail to fire them.

In fact it wouldn't surprise me if the practice of performance reviews, originating in the dear old USA, is primarily about protecting the company when they fire someone and the person sues them for wrongful dismissal.

As nortel'd says, they are mostly a joke. It is indeed, an American thing. The company I worked at in Toronto never had them until a giant American company acquired the small company, and then (over the following 5 years) destroyed what remained of the company.

Intel is a tech giant that is notorious for this performance review stuff. The review process is extremely hostile and stressful for the employees. Intel's approach is to constantly rank and then fire the "bottom" employees. It's actually done to make an example of them, and instill fear in the remaining employees and make them work harder. Intel is _constantly_ sued by ex employees, often reaching out-of-court settlements for many _years_ worth of salary[1]. The CEO who innovated this brilliant technique has published books on it, and other MBAs respect him tremendously. The MBA world loves this.


[1] reference: I worked in a state with a huge Intel work force, and had several friends who were Intel veterans and ex Intel managers. It's really disgusting what Intel does.


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## Beaver101 (Nov 14, 2011)

^ +200%.


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## Just a Guy (Mar 27, 2012)

You can’t hide deadwood anymore than you can fake intelligence. If you can’t spot the slackers, you haven’t opened your eyes. YOu don’t need a performance review. 

As for IBM’s fire the bottom 10%, it’s hard to score that low if you’re at all competent. It wouldn’t inspire fear in most people, because most people aren’t in the bottom 10%. If you’re afraid, it probably says more about you than the system.


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## Beaver101 (Nov 14, 2011)

^ So instilling and managing with fear much like dictatorship is the way to go for corporate America .. how democratic! What a win-win situation. Btw, you don't even have to fire the bottom "10%" to save a bundle, you can get away with less than "1%" right from the top and $$$,$$$,$$$,$$$s will be saved.


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## Longtimeago (Aug 8, 2018)

It's amusing how those on opposite sides of an issue have a very different view of 'Utopia'.

We live in a real world, not Utopia and in the real world all kinds of inequalities exist. I may outperform you and should be fired last but I also piss off the supervisor so he fires me first. That's the real world boys and girls. Giving individual examples of where something 'unfair' has happened from either perspective, means nothing. That's the world we live in.

What does seem to make sense to me however is to KNOW what kind of world you actually live in and NOT expect to be treated according to YOUR version of 'fair' and 'right'. If you work for someone else, the ONLY perception of what is right that matters is their perception, not yours. So you better make sure you know what their perception is and that it is that perception that will decide your fate.

There are a lot of people in Oshawa right now that absolutely believe they have been treated unfairly by the employer. They have also just learned whose perception of 'fair' it is that matters. They should have known that already and should have been prepared for what could come. It boggles the mind how anyone working for GM Oshawa could not see the writing on the wall before now and yet many of them do genuinely seem to have not done so.


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## ian (Jun 18, 2016)

james..the treatment of employees in the US can be far different than those in Canada. I saw this throughout my career when it came to downsizing. In Canada it was not unusual for a senior employee with long service to negotiate a termination package of 18-24 months based on salary, benefits, and incentives. Counterparts in the US were getting as little as three to six months. Senior regional directors with sales. P&L responsibility etc and who had 20 plus years. It was the same with a number of firms in the IT industry that I was familiar with. The treatment of unvested stock options was also less advantageous to US employees who were terminated.


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## Userkare (Nov 17, 2014)

Just a Guy said:


> As for IBM’s fire the bottom 10%, it’s hard to score that low if you’re at all competent. It wouldn’t inspire fear in most people, because most people aren’t in the bottom 10%


But in any group, there's always a bottom 10%, no matter how competent they are; it's just math.

As a Nortel manager, we went through an exercise call 'quartiling'. Employees in the entire department were categorized into one of 4 groups based on behaviour and outcomes. Top left quadrant was for high output individuals who demonstrated a behaviour that was beneficial/helpful to the whole department. The bottom right quadrant was less productive individuals who just did their job, and not stand out.

It was a horrible experience to be forced to classify employees into the bottom right quadrant that would be the first to go in times of layoffs. I did not like that part of the job, and having to argue with the other managers to champion my own people.


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## ian (Jun 18, 2016)

Agree. We had to do it. Just as worse was when you had to tell a manager that he/she was no longer had the manager title because of span of control but he or she still had to do the job and had the responsibility.

When I left, one of our challenges was promoting individual contributors to first level mangers. Often no increase in pay, more responsibility, longer hours, and the joy of managing employees. They either said no thanks or were looking outside the company. Or, they would take the promotion with the intention of adding to their resume and leaving the company.

The US firm used the ranking to get rid of employees with little or no separation dollars. That did not work in Canada because of our courts and past judgements . In Canada you had to go through the process of PIPs, written notices, the lot. The rules were even more onerous in some European countries like France, Germany, etc where they had workers councils. I was told at one point that US workers actually suffered when it came down to headcount reduction. It was less costly to cut a US employee than an employee of any other western country. They were the first to experience cuts.


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## Just a Guy (Mar 27, 2012)

Sorry, if 9 out of 10 employees are better at the job than you, then you’re dragging down the company. Sorry beaver, people like sags don’t get a free ride in the real, non union, world. I don’t want welfare from a company, I want production. 

True, there will always be a bottom 10%, and a company would probably benefit from trimming them and hiring better people. Status quo isn’t a solution. The bottom performers are usually very easy to spot, if they aren’t you can always delay things until they are. It’s not written in stone.


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## Beaver101 (Nov 14, 2011)

Just a Guy said:


> Sorry, if 9 out of 10 employees are better at the job than you, then you’re dragging down the company.


 ... your math and perspective are interesting ... so management is robotically mandated to eliminate 10% its pile of perceived deadwood from the company regardless of seniority, experience, contributions, etc. Ah, a new world of progressiveness or the new thinking outside of the box! 

I think using AI would be cheaper - hell, alot cheaper as we don't even need the flotsam top.



> Sorry beaver, people like sags don’t get a free ride in the real, non union, world.


 ... you know that unions were created for a reason? Perhaps, if you look on the flip-side (instead of continuously words-pounding sags), they may offer some work protection for the younger-generations? 



> I don’t want welfare from a company, I want production.


 ... needless to say if you were the "boss". Don't get me wrong, I have much respect for the self-employed. In particular, small businesses - a positive force for the economy. 

So I would ask where did unions started to derail from such that you view them as a liability?



> True, there will always be a bottom 10%, and a company would probably benefit from trimming them and hiring better people


... who determines who are "better" people to hire? Or perhaps to fire. Please re-read J4B's article about the inherent bias of these so called competent management. Also, management should keep in mind that they're also employees. Ie. what goes around comes around. 



> Status quo isn’t a solution. The bottom performers are usually very easy to spot, if they aren’t you can always delay things until they are. It’s not written in stone.


 ... again, please re-read J4B's post. Only things were that easy to do as you usually describe them.


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## Just a Guy (Mar 27, 2012)

beaver,

You’ve obviously never run a company, nor been in management.

yes, unions, when they were first really created, about 100 years ago, served a vital role. They eliminated child labour, improved working conditions, etc. However, that was 100 years ago. Today, they’ve gotten too powerful and the pendulum has swung too far. Today they protect deadwood, demand raises that cause company to close, etc. You have no choice to join a union or not. I’ve been in a number of union positions when I was a kid, I was always the one told I was making the rest look bad, and to stop doing that, work slower, take more breaks etc. You’ve obviously never had to deal with union protected deadwood. 

I had a contract with the government back when they were doing massive cutbacks. Anyone competent easily left for the private sector and got jobs. The people left were mostly deadwood. They were the ones who took credit for the work of underlings, the ones who spent time politicking their way up the ladder, etc. They were completely exposed once the top people left. Their goal, hang in there as long as possible and try to get a good buyout package. When they were eventually laid off, they were forced into retirement because no one would hire them.

My SIL used to be a HUGE union supporter. LOVED parties like the NDP, the works. Funny thing is, she eventually got promoted up to management and saw the other side of things. She couldn’t believe how much the union was abusing the system, how the employees were, etc. She despised unions from her new position. Of course, eventually, she went back to a union job, because of health issues. She has a lot of seniority, and takes a ton of time off, with pay, for health reasons. She knows she’s abusing the system and is collecting money for basically doing nothing, but it’s allowed so she takes advantage of it. Funny thing is, if you asked her, and she was still a manager, she’d fire herself in a second.

Yes, you can have bad managers who have bias opinions, they would probably be considered in the lower portion of managers, maybe even in the bottom 10%...their bosses should be taking care of that problem, or the system will. YOu seem to think managers are the top of the hierarchy, they aren’t by any means, they can be chopped too. 

As I said before, you can’t hide the deadwood, everyone knows who they are. You also seem to have missed my comment where I said, you don’t always have to fire people. We, as company owners, are not slaves to procedures, we have brains, we make choices everyday.

As for not wanting my companies to be welfare sources, I also don’t want companies I invest in to be welfare providers. I want my only to grow. If you ever owned a rental unit, and your tenant failed to pay you rent, would you allow them to stay there for years, or would you evict them? What about the managers of REITs, should they allow their tenants to not pay?

I suggest you get a job in a union then as a manager and see what the real world is like. You may be surprised.


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## Beaver101 (Nov 14, 2011)

^ I admit I have never had a corporation. But I did have run my own business so in effect I have had my own company and was my own manager. So I also admit no union was involved so I can't bash unions and their employees. And I'm well-aware of the dark-side of unions based on the stories I read and now a first-hand (or mouth) basis to.

So why would you suggest that I get a job in an union, then as a manager and see what the "real" world is like to be so I can be "surprised"? Or that I prove you are right 100% all the time, or simply being an unions-et-al hater? Like I'm an idiot too.

Let me summarize it or ask you this - re your admission:



> My SIL used to be a HUGE union supporter. LOVED parties like the NDP, the works. Funny thing is, she eventually got promoted up to management and saw the other side of things. She couldn’t believe how much the union was abusing the system, how the employees were, etc. She despised unions from her new position. Of course, eventually, she went back to a union job, because of health issues. She has a lot of seniority, and takes a ton of time off, with pay, for health reasons. She knows she’s abusing the system and is collecting money for basically doing nothing, but it’s allowed so she takes advantage of it. Funny thing is, if you asked her, and she was still a manager, *she’d fire herself in a second.*


 ... why didn't she?


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## Just a Guy (Mar 27, 2012)

> Like I’m an idiot too
> 
> ... why didn’t she?


She wasn’t her own manager?

Or did you mean why didn’t she fire people like her? Because they are protected by unions and seniority. 

If you’re asking why she doesn’t quit? She’s feeding from the trough on the dime of the taxpayer...yes, it’s a government job.

Another story about my SIL, she was once off for over two years, they had to keep her position open for her return. When she came back to work, hadn’t done a thing for over two years, they forced her to take her accumulated vacation days for those two years she didn’t work. So she took off something like 6 weeks starting the day she got back to “work”. Even she admits the union benefits are disgusting. Personally, I don’t know how she looks herself in the mirror each day. Can you imagine a small business having to pay two years to someone, plus hire a replacement for two years, then having to pay for 6 more weeks of pay and a replacement...what would have happened to your company had you had this?

The union I was forced into as a kid in school turned out to have taken a huge bribe and screwed it’s members at the negotiations. The members kicked out the union and formed a new one, but they were stuck with a very bad, long term contract. There was a union in my town who negotiated the closing of a lumber company after a two year strike. they did an “excellent” job for their members. On strike for two years only to get nothing. I’m sure there must be some good unions out there, the odds say they must exist, but I’ve never encountered one. Ever wonder why a lot of the original union jobs are now overseas?

As for why I’d suggest you get a job on both sides of the issue? So you have some knowledge about what you’re talking about as opposed to an uninformed opinion.

As for your business, how many employees did you “manage”, were they all excellent, did you ever fire anyone? Did you have some who stole supplies, worked less, distracted others, come in late, long lunches, left early, etc. If you didn’t that’s not all that unusual but, if you did, did you give them raises and promotions?


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