# Monthly Income Options



## newfoundlander61 (Feb 6, 2011)

Looking for suggestions on what type of income generating options are available to make approx $800-$900 dollars per month in a non-reg account. Amount to be invested is $300 thousand. Goal is to keep the $300 thousand safe (not loose any of the $300 thousand) but still be able to make $800 - $900 dollars per month off the investment that we take take out to supplement our current living and travelling.


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## like_to_retire (Oct 9, 2016)

newfoundlander61 said:


> .....Goal is to keep the $300 thousand safe (not loose any of the $300 thousand) but still be able to make $800 - $900 dollars per month


That's an impossible nut to crack, I'm afraid.

You want 3.2% - 3.6% with a guarantee of no loss of capital and monthly payout.. It doesn't exist.

There are monthly pay GIC's, but lower yield than your requirement.


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## AltaRed (Jun 8, 2009)

If the OP is not going to touch the capital (principal), he should not care whether the $300k goes up or down based on market prices any given week, month or year, as he is only interested in the $800-900/month of income draw. That is the mental leap the OP needs to make. Without coming to grips with that, I agree the 3.2-3.6% is currently out of reach.

If he can cross that bridge, then there are a wide range of options to generate that kind of income, e.g. a high income ETF from a number of sources... based on REITs, Dividend equity, Preferred shares, etc.


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## like_to_retire (Oct 9, 2016)

AltaRed said:


> If he can cross that bridge, then there are a wide range of options to generate that kind of income, e.g. a high income ETF from a number of sources... based on REITs, Dividend equity, Preferred shares, etc.


Yep.....

ltr


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## newfoundlander61 (Feb 6, 2011)

"he should not care whether the $300k goes up or down based on market prices any given week, month or year, as he is only interested in the $800-900/month of income draw. That is the mental leap the OP needs to make. Without coming to grips with that, I agree the 3.2-3.6% is currently out of reach."

That answers my question for sure.


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## My Own Advisor (Sep 24, 2012)

$300K should nicely churn out $12K per year (or more) in a basket of Canadian dividend paying stocks. No REITs and major tax headaches needed.

This $300K of capital will however go up and down but will/should increase in value via capital gains over time. There will also be dividend increases to crank up the $12K into more money over time.


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## canew90 (Jul 13, 2016)

My Own Advisor said:


> $300K should nicely churn out $12K per year (or more) in a basket of Canadian dividend paying stocks. No REITs and major tax headaches needed.
> 
> This $300K of capital will however go up and down but will/should increase in value via capital gains over time. There will also be dividend increases to crank up the $12K into more money over time.


Even after tax a portfolio of good DG stocks should generate $9,600 or $800 per month. Not too difficult to do IMO. Of course the $800 may not be spread evenly each month. Our dividends are 53% J/A/J/O 33% F/M/A/N and 13% M/J/S/D.


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## AltaRed (Jun 8, 2009)

While a 4% dividend yield is certainly achieveable, I'd default to 3.5% ($875/month) as a more realistic target. A Cdn dividend stock ETF will achieve that if the OP does not want to manage a stock portfolio - which I would not want to do at this point in the OP's lifestyle. Let someone else provide the oversight. XDV, VDY, ZDV, amongst others will deliver in that range at current ETF market prices.


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## like_to_retire (Oct 9, 2016)

newfoundlander61 said:


> Goal is to keep the $300 thousand safe (not loose any of the $300 thousand) but still be able to make $800 - $900 dollars per month off the investment ...


These are all great suggestions above, but how would this OP handle those Canadian Equities dropping in share price from $300 thousand to $180 thousand (-40%) during a bear market that could last for years?

ltr


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## AltaRed (Jun 8, 2009)

like_to_retire said:


> These are all great suggestions above, but how would this OP handle those Canadian Equities dropping in share price from $300 thousand to $180 thousand (-40%) during a bear market that could last for years?
> 
> ltr


Yeppers.....which is what I posted in my first post of this thread, and I mentioned the dividend option only because the OP mentioned about a supplement to living expenses and travel. Clearly this funding desire is not part of base (core) living expenses to avoid starvation and homelessness. The OP has to think that one through.


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## canew90 (Jul 13, 2016)

AltaRed said:


> Yeppers.....which is what I posted in my first post of this thread, and I mentioned the dividend option only because the OP mentioned about a supplement to living expenses and travel. Clearly this funding desire is not part of base (core) living expenses to avoid starvation and homelessness. The OP has to think that one through.


Is there any SAFE way to invest it to preserve capital? Not even fixed income options will do that because should inflation start rising than the value of the capital will depreciate. At least with stocks, and specifically DG stocks, one can obtain reasonable income and in the long term (say 10 years) one might expect the capital to rise in line with the income growth.

Look back through 2007 to 2017 for many of the good DG stocks. Many dropped 40% by Mar 2009 in value but recovered over the next 10 years. As for the income very few cut their dividend during the worst of it, some continued to increase.


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## AltaRed (Jun 8, 2009)

Depends on your point of view. Many seniors would argue that as long as the asset value they see on their monthly statement is the same, they have a safe investment. Inflation really does enter their minds. That is likely perfectly fine because if they don't have to tap into the capital, then for each year the real value is diminished by inflation, so too are the retirees one year closer to death. It is hard to argue against a GIC ladder in 'most' times for people reaching their best before date.


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## james4beach (Nov 15, 2012)

It's true that you can "hide" the current value, but that doesn't make the capital any safer. The reality is that drawing a steady stream of income (even just 3.5%) has some risk of depletion. Even if you hide the current value and never look at a statement, there is a risk that you will wake up one day in 30 years and find that the account is empty.

The only income that the 300K portfolio can produce without eating into 300K is what savings accounts and GICs produce, which is somewhere in the realm of 2.0% return = $6000/year.

If the OP demands more than 2.0% income production, then they will have to accept fluctuations of the capital. There is no other way. The good news, though, is that the investor can control how much fluctuation they are willing to accept.

For example, a portfolio of 80% fixed income (let's say GICs) and 20% stocks is much less risky than what people usually do. It's a highly conservative asset allocation. It can provide about 3.0% withdrawal forever, and not deplete capital. However it still comes with maximum drawdowns of about -15% meaning that you could see the 300K decline to 255K.

I'm just saying, it's a tunable problem. The investor can decide what level of risk they want to take on. Obviously, the more risk they're willing to take, the higher the expected returns and higher the possible withdrawal rate. Just as one example 80/20 is a fine allocation for a senior, has minimal risk to capital, and does support higher withdrawal rates than 100% GICs.


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## canew90 (Jul 13, 2016)

james4beach said:


> For example, a portfolio of 80% fixed income (let's say GICs) and 20% stocks is much less risky than what people usually do. It's a highly conservative asset allocation. It can provide about 3.0% withdrawal forever, and not deplete capital. However it still comes with maximum drawdowns of about -15% meaning that you could see the 300K decline to 255K.


Nice summary James, but I think you are stretching the 80/20 generating 3%. More likely 2.4% at the high end and very little growth of income over time. Never mind if there should be a correction which could change the withdrawal considerably.


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## AltaRed (Jun 8, 2009)

I may be making assumptions but I think the OP is simply trying to augment living expenses and travel with a $800-900/month income stream while 'protecting' $300k. This is clearly not the OP's total income nor total assets. Nothing more has been asked of this scenario, not even keeping up with inflation. Indeed, for most retirees, there is NOT a need for the income stream to keep up with inflation as expenses tend to start to decrease as one ages into their late 70s and certainly into one's 80s. Few people have the desire or health to travel by the time they reach their actuarial 'best before' date. By then, spending down one's capital could/should be part of the plan.


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## tygrus (Mar 13, 2012)

The only way to do this is not do it with financial instruments. A rental property is the only thing that can do this. 

Rent your basement out or your entire house while traveling part of the year. Put the $300k in a GIC.

People need to think of money differently. Here the OP is so concerned about losing his investment, he wants to find something to protect it while he loses to inflation which is running 5% or higher than any safe investment out there.


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## OhGreatGuru (May 24, 2009)

It can't be done if OP wants absolute security of principal. But it can be done with low long-term risk with any of number of balanced monthly income funds, if OP is willing to tolerate some fluctuation in asset value. RBC Monthly Income and TD Monthly Income come to mind. RBC is the slightly more conservative of the two. In a bad year they make some Return of Capital at year end to sustain payments. In a really bad year they have the right to suspend distributions. But neither fund has ever had to do this. And if OP is dependent on the income stream OP could still sell shares to make it up, even if at a capital loss.


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## james4beach (Nov 15, 2012)

canew90 said:


> Nice summary James, but I think you are stretching the 80/20 generating 3%. More likely 2.4% at the high end and very little growth of income over time. Never mind if there should be a correction which could change the withdrawal considerably.


I should clarify, I didn't mean it generates 3% but that the portfolio can last 50 years without total depletion. I ran the monte carlo sims again and can confirm that only 20% stock allocation can support 3.0% withdrawals-plus-inflation for 50 years without portfolio failure. But, the _real_ value of the portfolio declines pretty substantially.

AltaRed also points out, we don't even know if the OP means withdrawals adjusted for inflation and that's a critical factor. Different people have very different meanings when they say "preserve capital" ... some mean preserving the initial nominal value, others mean preserving the real value.



OhGreatGuru said:


> It can't be done if OP wants absolute security of principal. But it can be done with low long-term risk with any of number of balanced monthly income funds, if OP is willing to tolerate some fluctuation in asset value. RBC Monthly Income and TD Monthly Income come to mind. RBC is the slightly more conservative of the two.


I agree. Something like a 60/40 allocation (those Monthly Income Funds, or Mawer Balanced Fund) will do a good job at maximizing the ability to draw money out of the portfolio while also preserving the real value.


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## james4beach (Nov 15, 2012)

I'll post this again because it's not a well known result of the SWR studies, but the studies show that a high stock allocation is not necessary to achieve successful withdrawal regimes (including inflation adjustments). As the Bogleheads wiki says,



> generally speaking, the studies mentioned above together tend to suggest that *stock allocations anywhere between 20% and 80%* will keep retirees within their area where maximum sustainable withdrawal rates will be at their highest


And there's also a comment there that supports what I described about a 3.0% withdrawal scheme with only 20% stock allocation:



> Reduce withdrawal to 3% inflation-adjusted (no fees):
> Considering all allocations, the best success probability is 98%.
> That 98% success probability is achieved only with 0% stocks.
> A 97% success probability is achieved with any allocation from 20% stocks to 80% stocks.


Therefore, if a retiree is hesitant to take much risk with a high stock exposure, they can also do quite well with as little as 20% stock exposure and 80% in bonds/GICs. Recall that success/failure here refers to the portfolio not being depleted to $0, so this may not satisfy the OP's goal of preserving capital.


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## My Own Advisor (Sep 24, 2012)

I'm sorry....I fail to see how any retiree can "do quite well with as little as 20% stock exposure and 80% in bonds/GICs."

Even such a portfolio has huge risks since it would struggle to fight inflation should markets not rise for many years.

At the end of the day there is no magic bullet. You want capital appreciation? You're going to have put more of your money into equities (and risk price fluctuations or losses along the way). You want capital protection? You're going to have to put some of your money into fixed income (and deal with the fact that long-term growth won't be there).

This is not a new paradigm given we've been dealing with falling interest rates (and bond yields) for a decade. 

If the OP wants absolute security of principal - big gains won't be found. If someone knows I'd be happy to know too! 

It could be pursued like others have mentioned, with a balancing act of 60/40 or better still 70/30 stocks/bonds and/or going the monthly income fund route. But again, I suspect the OP needs to learn to deal with fluctuations in the capital. Whether your portfolio is worth $250K one year or $350K another year - I think most investors who struggle with their portfolio value should focus on an income-oriented approach vs. absolute capital drawdown.


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## AltaRed (Jun 8, 2009)

The OP didn't put any parameters around his/her scenario so we won't know until s/he posts again. The OP may be perfectly happy with the posted scenario in nominal terms, not real terms.


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## tygrus (Mar 13, 2012)

My Own Advisor said:


> If the OP wants absolute security of principal - big gains won't be found. If someone knows I'd be happy to know too!
> 
> .


MOA, the new paradigm in the future wont be about trying to make big ganes, or out do inflation. It will be about hanging on to what you have for dear life. The equities market is about to join the GDP forecasts and muddle sideways for a long time and the returns will be flat if not negative in real terms.


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## newfoundlander61 (Feb 6, 2011)

** Updated** 

I read all the posts and feedback again this morning and am thankful for all the help and information given. So here is my updated and current plan going forward.

Current Income and Investments:

*Income is net and monthly:*

Military Pension: $1,050.00
Work Income: $1,500.00
Wifes CPP: $255.00
Wifes OAS: $577.00

*Total net monthly income:* $ 3,382.00

Our home is being listed next month for sale and we move into our new apartment 1 Oct. Gives us some time to downsize and prep.

*Apartment cost* is $2000 per month and the only thing not part of that cost is food; RX, everyday stuff.

That will leave us with $1,382.00 monthly.

I plan on continuing to work for at least another 3 years till age 60 and at that point will make a decision on working still or not. My canadian forces pension is indexed at that time so the increase will likely be around $300 a month but not 100% for sure as it is based and calculated on a number of factors. I will start drawing CPP at age 60 as well so that will give me a monthly income boost of around $800 from both sources (just a guess).

*My current TFSA*: $63,000 in one fund - Mawer Balanced Fund MAW104, currently doing weekly auto purchases of $100.

I don't have an RRSP and my wife has not investments. 

Wifes age: 68
My age: 56

If we do not need to draw any money monthly from our house sale investments then we won't, which will likely be the case for part of the year.

*Option 1:*

Top up my TFSA and stop the weekly purchases when house money is put in bank.
Wfe opens a TFSA and puts in the max amount available since program started in a balanced or monthly income fund.
Each Jan we both put the max amount from our remaining house money that will be in a non-reg account into both our TFSA's to take advantage of the Tax free option.
Invest the remaining money in a non-reg account in dividend paying investments and draw money if and when needed.

** Thinking an RRSP is not the best option due to my age but I could be mistaken.

Opinions most welcome as always, one question is for doing taxes each year is it a good idea to try and focus on dividend paying investments due to the dividend tax credit rather than interest income which would be 100% taxable. Thanks again for any help.

Paul


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## Eclectic12 (Oct 20, 2010)

For the RRSP, unless age 71 is about to hit both of you in the face - IMO, the RRSP question is more about whether income will be lower when the $$ are taken out or whether there is a beneficial use for the tax return (ex. can't max TFSA, make RRSP contribution to put tax return into TFSA).


As for focus on getting more dividend income that benefits from the DTC, priority one should always be to be buying a good investment at a reasonable price. Getting the DTC but losing capital isn't all that helpful, IMO.


Cheers


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## dubmac (Jan 9, 2011)

I have been setting up my wife's 300K investment account as an income source for when we move into retirement, so I have some experience with some of this.

I set out to set up a 60/40 mix of income generating investment that would produce an income stream as we move into our later years. BTW - I am 57, and plan to work another 3-5 years. 

Here is a summary of what we hav, where we have it and what it produced. 

Fixed income: 

5 yr GIC ladder - each ladder rung is 20K. most GIC's have been in the 2.5-2.7% range. But these are going up to 3.25 with rising rates. We also have 20K in a Sunlife bond fund that produces an additional $40-60 per month.
All in we get around 2300-2400 per year from the GIC that has matured in the ladder, and an additional 700-750 per year from the bond fund: Total = $3100 per year as interest.

Equities & Mutual Funds: (All of these have been on a DRIP until we begin to require the funds produced as an income stream)

Stocks: Telus, TRP, BNS, SLF dividend payers contribute around 3000 per year
ETF's : CDZ, CYH, ZDV, ZRE contribute $77, 50, 30, 50 per month for a total of $185-200 per month.
MAW105 and MAW102 are both also in the account at 32K. These pay around 1-2% for a total of 4-500 each December.
Also have VWO (in USD) at 6K which contributes an additional 100 per year.

Last year the yield of the account was around 3%. Much of the income was tax-friendly as dividend income from cdn companies wheich helped.


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## AltaRed (Jun 8, 2009)

Eclectic12 said:


> For the RRSP, unless age 71 is about to hit both of you in the face - IMO, the RRSP question is more about whether income will be lower when the $$ are taken out or whether there is a beneficial use for the tax return (ex. can't max TFSA, make RRSP contribution to put tax return into TFSA).
> 
> 
> As for focus on getting more dividend income that benefits from the DTC, priority one should always be to be buying a good investment at a reasonable price. Getting the DTC but losing capital isn't all that helpful, IMO.
> ...


Given the OP's personal income is now about $30,600 per year, I don't know how effective RRSP contributions will be at this stage of life. Won't be much of a refund at MTR of circa 20% (not sure about NF tax rates). I think Newfoundlander has it about right. Max out TFSAs and put most house money into DTC eligible stocks in an ETF (recognizing Newfoundlander still must be comfortable with varying fluctuations in capital due to markets).


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## RBull (Jan 20, 2013)

^think NF61 lives in Ontario according to his SC sig. Better tax wise.

I agree take house money top up TFSAs and then unregistered with dividend stocks or even dividend ETFs after accepting capital fluctuations as a certainty. 

NF61, I don't know anything about Kingston rental costs but 2K a month seems like a lot of money and a high ratio to income for housing, not leaving a lot for all other expenses after leaving work, even considering house for dividends income. But maybe that's a priority for you.


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## agent99 (Sep 11, 2013)

Havent seen anything about preferreds, but there are split preferreds that are retractable. In other words you get back the pat value at maturity. The three I have current yield between 4.3% and 5.6% at present. Market prices don't fluctuate much, the shares are quite liquid and can be exchange traded without penalty. Maturity dates are usualy quite short - less than 5 years. There is some market risk. In 08/09, market value did drop along with everything else, but bounced back as investors snapped them up!

I currently own Partners Value, Premium Income and Dividend Growth. Good to have a basket of these rather than just one.

I presently am looking for a home for about $60k in unregistered that needs to generate income, so looking at, in part, adding to these preferreds. They do pay dividends, so can be tax efficient, but even after splitting income, we are at the OAS clawback, so looking at other options too.

Summary of split pfds: https://www.dropbox.com/s/2x5f7wm60odk7lv/split pfds.pdf?dl=1


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## agent99 (Sep 11, 2013)

RBull said:


> NF61, I don't know anything about Kingston rental costs but 2K a month seems like a lot of money and a high ratio to income for housing, not leaving a lot for all other expenses after leaving work, even considering house for dividends income. But maybe that's a priority for you.


I am sure NF1 has checked the local market and knows the rental rates. We live in same area - there are home rentals from $1000-$2500 for a 3 bedroom. It just depends on what standard you want.


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## RBull (Jan 20, 2013)

agent99 said:


> I am sure NF1 has checked the local market and knows the rental rates. We live in same area - there are home rentals from $1000-$2500 for a 3 bedroom. It just depends on what standard you want.


Yes, I'm sure you're right about checking. My comment on "priority for you" is implying a higher "standard" desired. It was my opinion it seems like a high amount for the household income, now and into the future, but it's their money. 

NF61 has mentioned "apartment" and I'm not sure if you're considering that when you write "home rentals" and a "3BR".


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## agent99 (Sep 11, 2013)

RBull said:


> NF61 has mentioned "apartment" and I'm not sure if you're considering that when you write "home rentals" and a "3BR".


I looked at all rentals. Houses, townhouses and good quality apartments are in the same price range. Of curse if money is important, you can get a basic 2BR apartment for not much over $1000. But after a house, kind of minimal.


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## tygrus (Mar 13, 2012)

Sorry to be blunt, but your strategy is deeply flawed. You are going to try to live another 25-30 yrs on $1300 per month?? You need to rethink this because thats poverty level in this country and no way to spend your golden years. You will basically just be staring out the apartment window for rest of your life.

If rentals are that expensive, you would be better off moving into your garage and renting your house out or getting someone in the basement then get a HELOC and invest that.


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## newfoundlander61 (Feb 6, 2011)

Eclectic12 said:


> For the RRSP, unless age 71 is about to hit both of you in the face - IMO, the RRSP question is more about whether income will be lower when the $$ are taken out or whether there is a beneficial use for the tax return (ex. can't max TFSA, make RRSP contribution to put tax return into TFSA).
> 
> 
> As for focus on getting more dividend income that benefits from the DTC, priority one should always be to be buying a good investment at a reasonable price. Getting the DTC but losing capital isn't all that helpful, IMO.
> ...


Income will be about $500 per month net lower, ball park figure based on what I make a month currently.


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## newfoundlander61 (Feb 6, 2011)

AltaRed said:


> Given the OP's personal income is now about $30,600 per year, I don't know how effective RRSP contributions will be at this stage of life. Won't be much of a refund at MTR of circa 20% (not sure about NF tax rates). I think Newfoundlander has it about right. Max out TFSAs and put most house money into DTC eligible stocks in an ETF (recognizing Newfoundlander still must be comfortable with varying fluctuations in capital due to markets).


I have thought about this and varying fluctuations is something we need to be accept to get any capital appreciation. I live in Ontario but my user name is my birthplace  I would love to go back to NFLD to retire but the medical system is down right terrible compared to Ontario.


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## newfoundlander61 (Feb 6, 2011)

RBull said:


> ^think NF61 lives in Ontario according to his SC sig. Better tax wise.
> 
> I agree take house money top up TFSAs and then unregistered with dividend stocks or even dividend ETFs after accepting capital fluctuations as a certainty.
> 
> NF61, I don't know anything about Kingston rental costs but 2K a month seems like a lot of money and a high ratio to income for housing, not leaving a lot for all other expenses after leaving work, even considering house for dividends income. But maybe that's a priority for you.


The $2k per month includes rent; parking; heat; hydro; insurance; tv; phone, & internet. Actual rent is $1,730.00 monthly, rounded up with some other monthly expenses.


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## newfoundlander61 (Feb 6, 2011)

agent99 said:


> I am sure NF1 has checked the local market and knows the rental rates. We live in same area - there are home rentals from $1000-$2500 for a 3 bedroom. It just depends on what standard you want.


Its a new building with all applicances included as well as a in-suite landry room with washer and dryer. This last one was a must for the wife, no going to a common landry room. Oh and I will be walking to work each day, 1km away. Will save some money on fuel.


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## newfoundlander61 (Feb 6, 2011)

"You are going to try to live another 25-30 yrs" My wife will but for me no chance based on genetics and all of the men in my family, maybe 70 at the most 
Your point is noted, mind you in 36 months my own pension income increases by $1,000 per month which will help somewhat.


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## humble_pie (Jun 7, 2009)

tygrus said:


> Sorry to be blunt, but your strategy is deeply flawed. You are going to try to live another 25-30 yrs on $1300 per month?? You need to rethink this because thats poverty level in this country and no way to spend your golden years. You will basically just be staring out the apartment window for rest of your life.
> 
> If rentals are that expensive, you would be better off moving into your garage and renting your house out or getting someone in the basement then get a HELOC and invest that.




the OP said his monthly income is presently $3,382, will increase by $800-1000 per month in a few years' time

the posted plan looks very healthy, with decently healthy figs imho


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## newfoundlander61 (Feb 6, 2011)

I do appreciate all the help and input, and realize in the end its a decison I have to make but this forum is very helpful with the overall plan for sure. At some point most of us will get to this point so different ideas and plans are great to read.


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## AltaRed (Jun 8, 2009)

humble_pie said:


> the OP said his monthly income is presently $3,382, will increase by $800-1000 per month in a few years' time
> 
> the posted plan looks very healthy, with decently healthy figs imho


The OP's monthly work income of $1500 will disappear at some point and the additional investment income will depend on what the house capital will generate (I'd suggest 3% yield on dividend stocks is as much as the OP should reach for). There will be OAS of course at some point too (CPP is integrated with military pension if I understand correctly so no net boost there). There isn't a lot of flexibility.


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## humble_pie (Jun 7, 2009)

newfoundlander61 said:


> ** Updated** ...




i think this plan looks excellent (was there an option 2 though)

max the personal TFSA & set up a maxed personal TFSA for missus newfoundlander with the house proceeds, then place balance of house proceeds in a non-registered account, goes option 1.

hi-dividend may be worrisome now because the solid quality payors are priced at record highs, while the non-solid high payors (enbridge, BCE) have recently lost market value. Former bedrock income stocks such as REITs & utilities now look a bit shaky in this era of rising interest rates.

wondering if you will be keeping the strict Mawer Balanced discipline in the maxed TFSAs? this has worked out well & provided comforting solidity over the past several years. 

perhaps a similar balanced mix would provide stability in the new non-registered accounts, the one(s) that will hold the remaining house proceeds. Roughly half well-chosen dividend stocks plus the other half in plain old HISA accounts at 2% or sometimes better, if you are willing to scoot the $$ around to take advantage of 3-6 month promotions.

non-financial topic: in the past newfoundlander has posted some extraordinarily beautiful photographs of wild birds. More wildlife would be so welcome here!


.


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## RBull (Jan 20, 2013)

newfoundlander61 said:


> The $2k per month includes rent; parking; heat; hydro; insurance; tv; phone, & internet. Actual rent is $1,730.00 monthly, rounded up with some other monthly expenses.


Thanks for the reply. That's a little better. G/L in your new place.


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## newfoundlander61 (Feb 6, 2011)

"wondering if you will be keeping the strict Mawer Balanced discipline in the maxed TFSAs? this has worked out well & provided comforting solidity over the past several years. " I like this fund as an all in on investment for my TFSA, may do the same with my wifes TFSA and reinvest the yearly profit to buy additional units. Topping up both of our TFSA's in Jan with the max and not touch either until necessary. Rest of money will go into a non-reg account. Will have to do some research for that account but still have until the fall to do it. Not planning on anything too risky like cannabis stocks etc. I have a mini list of some possible canadiates, we may not need to draw every month so we see how it goes.

PIMCO Monthly Income Fund
Any of the Phillips, Hagar & North Funds
Beutel Goodman Cdn Dividend D:
Steadyhand Income Fund 
Leith Wheeler Income Advantage Fund 
Mawer Funds, some are better than others but they have a couple of good ones.

Will have to be aware of fees as they add up over time.

Here is a shot of an Atlantic Puffin from my last summers trip back home.


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## newfoundlander61 (Feb 6, 2011)

"Fixed income:

5 yr GIC ladder - each ladder rung is 20K. most GIC's have been in the 2.5-2.7% range. But these are going up to 3.25 with rising rates. We also have 20K in a Sunlife bond fund that produces an additional $40-60 per month.All in we get around 2300-2400 per year from the GIC that has matured in the ladder, and an additional 700-750 per year from the bond fund: Total = $3100 per year as interest."

With GICS's when they come due at maturity are they converted to cash with interest and deposited into your account automatically or do you need to give specific instructions prior as to either let them mature or roll them over into a different GIC.


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## like_to_retire (Oct 9, 2016)

newfoundlander61 said:


> With GICS's when they come due at maturity are they converted to cash with interest and deposited into your account automatically or do you need to give specific instructions prior as to either let them mature or roll them over into a different GIC.


Rollover or no rollover is an instruction given at time of purchase. The agent will ask. 

If they don't ask, you have to specifically tell them. TDDI certainly asks every time.

Either way, if you can't remember if you gave instructions or not, you could phone before maturity and tell them your wishes.

ltr


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## AltaRed (Jun 8, 2009)

like_to_retire said:


> Rollover or no rollover is an instruction given at time of purchase. The agent will ask.
> 
> If they don't ask, you have to specifically tell them. TDDI certainly asks every time.
> 
> ...


Interesting. Scotia iTrade and RBC DI do NOT ask about rollovers to the best of my knowledge. They go to cash at maturity and should since all discount brokers are.. is order takers. They should have no right/ability to initiate a transaction (rollover) for you.


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## humble_pie (Jun 7, 2009)

newfoundlander61 said:


> Here is a shot of an Atlantic Puffin from my last summers trip back home.




what a spectacular photograph. This is professional quality plus. I'm in awe.


.


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## dubmac (Jan 9, 2011)

newfoundlander61 said:


> "Fixed income:
> 
> 5 yr GIC ladder - each ladder rung is 20K. most GIC's have been in the 2.5-2.7% range. But these are going up to 3.25 with rising rates. We also have 20K in a Sunlife bond fund that produces an additional $40-60 per month.All in we get around 2300-2400 per year from the GIC that has matured in the ladder, and an additional 700-750 per year from the bond fund: Total = $3100 per year as interest."
> 
> With GICS's when they come due at maturity are they converted to cash with interest and deposited into your account automatically or do you need to give specific instructions prior as to either let them mature or roll them over into a different GIC.


Yes - they are converted to cash (interest + Principle) on date of maturity.
I take the principle (20K) and invest at the highest rate compound GIC offered. I take the interest earned and invest into a dividend paying ETF. I am currently looking at preferred shares with the help of a few (AltaRed) on this forum. He has offered excellent insights.
BTW - lovely pic. I did some birding while in Galapagos 10 years ago - blue, red and Nazca Boobies where everywhere. Also spend a few nights at the Bellavista Cloud Forest Lodge (near Quito) and saw incredible, gorgeous jaw-droppingly beautiful hummingbirds. It was like Heathrow airport for hummingbirds! Consider it if you can - you would luv it!


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## Eclectic12 (Oct 20, 2010)

AltaRed said:


> Interesting. Scotia iTrade and RBC DI do NOT ask about rollovers to the best of my knowledge. They go to cash at maturity and should since all discount brokers are.. is order takers. They should have no right/ability to initiate a transaction (rollover) for you.


It will be interesting to hear how CIBC IE treats GICs. 

My co-worker was shaking his head as he is in progress of getting maturing GICs rolled out of his wife's RRSP/TFSA into her IE ones. She tried calling a month before maturity to get the GIC to be paid out where the response was "you have to call or make an appointment with less than two weeks to maturity - I can't do this for you now". Fortunately, when they missed the renewal date, it was no problem to break the GIC - they simply lost the tiny interest.


Cheers


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## humble_pie (Jun 7, 2009)

newfoundlander61 said:


> Here is a shot of an Atlantic Puffin from my last summers trip back home.






she (on the left): _*yea i got the invite to the royal wedding*_

he (on the right): _*gawhh*_




or maybe

she (on the left): _*It'll be on my tombstone, Here lies one who always maxed her TFSA*_

he (on the right): _*gawhh*_


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## CPA Candidate (Dec 15, 2013)

Depth of discussion here is insufficient because it has not made significant mention of taxes. At lower incomes, dividends are so much better than interest when you factor tax into the equation. This is as much of a tax planning issue as it is a finance issue.


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## newfoundlander61 (Feb 6, 2011)

One investment option that we have not dicussed is a annuity with some of the money? My wife has longevity genes in her family so would purchasing a annuity from IE: Sunlife, with a portion of the house sales say $250k using my wifes age of 69 based on the calculator on their web site would pay $15,882 before tax and $14,928 after tax. Monthly net would be $1,244.00 which would be hard to do with investing on my own. Would have $100k left to invest on our own. I am not set on doing this but is this a option to consideration or do most people stay away from this. Got the idea after reading an article from the MoneySense website. See link below:

http://www.moneysense.ca/save/retirement/annuities/everything-you-need-to-know-about-annuities/

They indicate there are several types of annutiies so its not cut a dry on setting one up. Read this also "They make little sense if you have an ample employer pension, since you already have the assurance of an income for life. " So this may be a good reason for me not to get one with a DBPP being paid monthly already.


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## agent99 (Sep 11, 2013)

I often look at Annuities, but even my wife (who has Scottish blood) can't see handing over a big sum to an insurance company. Those figures don't account for inflation, so after 20 years, that $15k won't buy as much - It might be worth about $9k in today's dollars.

How about investing in perpetual preferreds that pay, say 5%. $250k would produce $12,500 pa before tax. Taxation will depend on your income level, but because it's dividends, could be quite low. Need to run that scenario through a tax program like Studio tax. At the end, you still have all or at least part of your capital, depending on the market price of the shares.

I would be interested to hear from those more expert as to which perpetual preferreds would work best in such a situation. I am currently looking to add to our preferreds. This is what we have now (not in huge amounts - just trying to get a feel for pfds). Any suggestion welcomed. Perhaps the holdings in this fund report might be useful in creating a short list? https://www.dropbox.com/s/adjc0k3v5f1vqb4/MAPFAudit171231.pdf?dl=1

*Cumulative Perpetuals*
CU.PR.H (5.25% at par, currently 5.34%}
PWF.PR.E (5.5% at par, currently 5.54%

*Split Preferreds * (like bonds, mature every 5 years or so)
PVS.PR.B Currently 4.3%
PIC.PR.A Currently 5.67%
DGS.PR.A Currently 5.15%

*Rate Reset and Floating* pfds - Have no individual holdings at present.

Do have pfd etf ZPR - It along with other similar pfd etfs have yield just under 4% at present. MERs are in 0.5-0.6 range and they eat into the yields. ZPR has not been a good performer, but with rates going up, it may do better. IIRC, it holds mostly rate-reset pfds. There was a discussion about ZPR some time ago. But things have changed since then. http://canadianmoneyforum.com/showthread.php/35226-BMO-Preferred-Share-ZPR-vs-GIC-HISA


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## like_to_retire (Oct 9, 2016)

agent99 said:


> I would be interested to hear from those more expert as to which perpetual preferreds would work best in such a situation. I am currently looking to add to our preferreds. This is what we have now (not in huge amounts - just trying to get a feel for pfds). Any suggestion welcomed.


Can you comment on why you wouldn't just buy the common instead? 

That way you could enjoy both capital appreciation on the share price and dividend appreciation over time.

I suppose it depends on how much you value the pref's seniority over the common?

ltr


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## agent99 (Sep 11, 2013)

like_to_retire said:


> Can you comment on why you wouldn't just buy the common instead?
> 
> That way you could enjoy both capital appreciation on the share price and dividend appreciation over time.
> 
> ...


I am sure _you_ could answer the question 

In our _unregistered_ accounts, we already have our fair share of dividend paying common stocks. 
We have almost no fixed income. 
Preferreds would be used as pseudo fixed income, but benefit from lower taxation. 
They should also be less volatile than the common stock. 
Dividends will not be cut and if missed will eventually be paid (in the case of cumulatives). 
If we buy at or below par, so LESS chance of capital loss if called.
We would buy them for the long term cash flow and not be concerned about fluctuations in price. (We are well into retirement)


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## AltaRed (Jun 8, 2009)

agent99 said:


> I am sure _you_ could answer the question
> 
> Preferreds would be used as pseudo fixed income, but benefit from lower taxation.
> They should also be less volatile than the common stock.
> ...


My bold - think you mean capital gain. Preferreds should be less volatile than common stock but I believe only if A- (or perhaps BBB+) credit rating or above. Low investment grade or junk prefs are as bad as commons and may be worse in an insolvency (fewer advocates to work out a deal). FWIW, I hold some prefs as 'pseudo-income' so I am not arguing with you 

Most prefs issued these days are non-cumulative but I don't think it matters much. If the issuer is in trouble to pay pref dividends, their common dividends have already been erased and the stock is perhaps headed for zero. The upside is if a failing company is acquired, the acquirer will likely honor the full par value of the prefs and call them when possible.


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## kcowan (Jul 1, 2010)

+1
You have to do due diligence and if the common is in trouble, don't count on the pref for long. So you have slightly less short term risk and also gain. A few years ago, I read a study of Cdn Bank Prefs and the common outperformed them during every period. Such was the benefit of hindsight. While the pref guarantees the stated return, the common increased their dividend and also offered capital appreciation.


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## AltaRed (Jun 8, 2009)

kcowan said:


> +1
> You have to do due diligence and if the common is in trouble, don't count on the pref for long. So you have slightly less short term risk and also gain. A few years ago, I read a study of Cdn Bank Prefs and the common outperformed them during every period. Such was the benefit of hindsight. While the pref guarantees the stated return, the common increased their dividend and also offered capital appreciation.


And now that all the bank prefs are NVCC compliant, the regulator can force conversion of the prefs under certain solvency conditions such as common equity falling under $5/share, into commons pseudo-valued at $5 each, i.e. 1 pref = 5 commons. In reality, the converted prefs would follow the commons down to oblivion.


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## like_to_retire (Oct 9, 2016)

agent99 said:


> In our _unregistered_ accounts, we already have our fair share of dividend paying common stocks.
> We have almost no fixed income.
> Preferreds would be used as pseudo fixed income, but benefit from lower taxation.
> They should also be less volatile than the common stock.
> ...


Those are all good answers, and certainly the reasons I got into preferred shares originally, but back then they were much simpler. There were really only retractables and straights. Simple stuff, and although retractables are basically gone now, if I had stuck with straights I probably would have made out a lot better overall. I've kept good records for the last 12 years on my preferred shares and the results today are 2.6% geometric average total return. That's darn terrible. You would think that with all the gyrations and work I put in buying preferred shares I could make more than 2.6% a year.

A lot has to do with all the changes that have occurred over the years in the types of shares available. Fixed Resets have been a scourge. I certainly bought into the idea that interest rates would rise and that straights would suffer, so here's the solution, and definitely you want low spread variety so they won't get called. We know how that all worked out. Not good. Along with all the tier one capital Basel III requirements, deemed retractables, fixed resets with minimum rate on reset, Non-Viability Contingent Capital (NVCC1) rate resets that convert into common shares, and Non-NVCC bank rate resets, there's been a lot of jiggery-pokey to make decisions about over the years.

I often made the wrong call and as a result decided my poor performance could be much better with simple common stock. Over the last few years when the time was ripe I have eliminated about 20 preferred shares and now only own one. A sorry Enbridge Rate Reset that I will hold until the market decides Enbridge isn't going bankrupt. Then I will be completely done with that chapter of my investing career. I can tell you the commons I replaced the preferreds with over the last few years have done so much better than the prefs. Just sayin'.

ltr


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## Speculator (May 9, 2018)

like_to_retire said:


> I often made the wrong call and as a result decided my poor performance could be much better with simple common stock. Over the last few years when the time was ripe I have eliminated about 20 preferred shares and now only own one. A sorry Enbridge Rate Reset that I will hold until the market decides Enbridge isn't going bankrupt. Then I will be completely done with that chapter of my investing career. I can tell you the commons I replaced the preferreds with over the last few years have done so much better than the prefs. Just sayin'. ltr


Jarislowsky never buys prefs and doesn't recommend them as an investment. Good enough for me.


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## agent99 (Sep 11, 2013)

AltaRed said:


> My bold - think you mean capital gain. Preferreds should be less volatile than common stock but I believe only if A- (or perhaps BBB+) credit rating or above. Low investment grade or junk prefs are as bad as commons and may be worse in an insolvency (fewer advocates to work out a deal). FWIW, I hold some prefs as 'pseudo-income' so I am not arguing with you


Right - I did leave a word out. I meant LESS chance of capital loss. I fixed the post.

After reading ltr's post, I am not sure I should be buying ANY more pfds! But I guess some people are 

If I bought one or two more good quality perpetuals, yield of ~5% seems better than quality stock dividends or fixed income. I would of course forgo any gains (or losses?) that common stock might experience and could see loss in pfd prices if interest rates continue to increase. Not a real problem if to be held in perpetuity?

This could lead me to adding more split preferreds. I have three, but there are a few more with reasonable ratings & yield:
View attachment 18714


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## humble_pie (Jun 7, 2009)

AltaRed said:


> And now that all the bank prefs are NVCC compliant, the regulator can force conversion of the prefs under certain solvency conditions such as common equity falling under $5/share, into commons pseudo-valued at $5 each, i.e. 1 pref = 5 commons. In reality, the converted prefs would follow the commons down to oblivion.




i'm happy to see this info surface from time to time. I don't believe enough folks have got the memo yet on how recent legislative amendments mean that forced bank conversion of debt & even preferred shares could happen.

folks still tend to believe that the gummint will bail the banks if a global financial collapse occurs. But no, not going to happen. All will be on the shareholders' tab.


.


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## AltaRed (Jun 8, 2009)

humble_pie;1941098folks still tend to believe that the gummint will bail the banks if a global financial collapse occurs. But no said:


> Oh, our gov't will still bail out our big 5, maybe 6, banks to prevent their collapse BUT not until all shareholders are 100% fleeced first....and that is the way it should be.
> 
> Agent99: I followed a somewhat similar path to LTR with fixed reset prefs but pretty sure not anywhere near the depth and degree based on taking LTR's post literally. Back in 2013 or so, we were all convinced GOC5 just had to go up to 2.5% or better and thus there would be substantial CG opportunities, if not good reset yields. How could both of those things go wrong? Well, we know what the GOC5 bond yield curve did that past 3-4 years. It was a punishing lesson.
> 
> I think both fixed rate reset and straight perpetuals can have a place in the portfolio as pseudo-income. In reality, I suppose if I could count on a 5-5.5% yield on 100% of my portfolio until I fade into the night, I wouldn't have to spend another minute managing my portfolio. Just not going to happen though. Just like having all my eggs in a 5 year GIC ladder isn't going to happen either. Just can't give up the 'rush' of being part of the common equity stock market.


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## like_to_retire (Oct 9, 2016)

agent99 said:


> I am not sure I should be buying ANY more pfds! But I guess some people are
> 
> If I bought one or two more good quality perpetuals, yield of ~5% seems better than quality stock dividends or fixed income. I would of course forgo any gains (or losses?) that common stock might experience and could see loss in pfd prices if interest rates continue to increase. Not a real problem if to be held in perpetuity?


The perpetuals would certainly qualify for fixed income allocation, and would continue to pump out their 5% in perpetuity. But you would have to accept the loss on the share price as interest rates rise, and that's a loss that isn't recoverable if rates remained higher. 

I don't know if you can really qualify resets as a fixed income allocation though. I certainly remember many of my low spread resets had both their share price drop combined with an income drop of 40% when they reset. There's nothing fixed about that.

Myself, I gave into the lure of replacing that portion assigned to preferreds to equity. My equity allocation was inappropriately low, and the preferreds were giving me grief, so that's the route I went over the last few years. My allocation is basically 50/50 now. Some would still consider it conservative.

ltr


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## AltaRed (Jun 8, 2009)

like_to_retire said:


> I don't know if you can really qualify resets as a fixed income allocation though. I certainly remember many of my low spread resets had both their share price drop combined with an income drop of 40% when they reset. There's nothing fixed about that.


Why not? If you had a bond ladder or a GIC ladder, it would sure change in yield over time, and market prices (implied on a GIC). Fixed income does not mean a fixed yield forever.... only for a defined period of time. Prefs just are an oddball given they (most) don't have maturity dates.


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## like_to_retire (Oct 9, 2016)

AltaRed said:


> Why not? If you had a bond ladder or a GIC ladder, it would sure change in yield over time, and market prices (implied on a GIC). Fixed income does not mean a fixed yield forever.... only for a defined period of time. Prefs just are an oddball given they (most) don't have maturity dates.


Yeah, you're right, but on a sliding scale I think resets rank a lot lower than straights in their membership in the fixed income allocation. The reset can catch you up forever by producing a much lower fixed income output, combined with a share price that traps you into not wanting to sell and take a huge loss. These definitely advantage the issuer. A straight might suffer a loss of share price, but it keeps pumping its fixed income forever. The same as a GIC or bond, your income is fixed and then they give your money back. I put GIC's, bonds and perpetuals high on the fixed income qualifying scale. Junk bonds and resets, not so much.

ltr


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## humble_pie (Jun 7, 2009)

AltaRed said:


> Oh, our gov't will still bail out our big 5, maybe 6, banks to prevent their collapse BUT not until all shareholders are 100% fleeced first....and that is the way it should be.




in the remotest chance that it would be a single rogue bank failure among the big canadian 5 or 6, things could be patched together as you say. Damage would be contained to localized shareholders & converted former debt owners.

but imho the above is not what's likely to happen. In a global financial collapse, many/most of the big canadian 5s would go under. The CPPIB portfoiio would be destroyed by all the gutted positions. The savings of millions would be crushed. Millions more investing via funds & ETFs would be wiped out. It's impossible to forecast the degree of chaos, disaster, riots, social breakdown that would ensue.

who cares if remnants of former banks would manage to survive? many states - assuming a global collapse - would be moving towards army control anyhow. It's not a picture to paint in rose-coloured hues imho.

i for one happen to think that the odds of global financial breakdown are slimmish; but those odds are still greater than the odds of an isolated rogue being present inside one of the big canadian 5.


.


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## AltaRed (Jun 8, 2009)

I agree a global meltdown taking down all our banks is a more likely event than a single big bank failure. Still think the central banks and federal gov't would pump money into the system to avoid a complete seize up. Liquidity is the heart of the system. It may well be that NVCC compliance is more symbolic than practical....for that very reason, but at least shareholders should lose their investment first.


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## humble_pie (Jun 7, 2009)

AltaRed said:


> I agree a global meltdown taking down all our banks is a more likely event than a single big bank failure. Still think the central banks and federal gov't would pump money into the system to avoid a complete seize up. Liquidity is the heart of the system. It may well be that NVCC compliance is more symbolic than practical....for that very reason, but at least shareholders should lose their investment first.



yes you're right

still i think most folks aren't onto this info yet (about conversion of debt & senior issues into common stock which will immediately plunge in value) (if canadian banks go under many/most other publicly traded companies will go under as well) (far too nice a day here to even think about these kinds of scenarios)

but it's helpful to insert a word or 2 from time to time ...


.


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## james4beach (Nov 15, 2012)

You don't even need the banks to go under for shareholders to lose a lot. Citigroup and Bank of America didn't go under, but equity holders lost over 90% value. Big banks are highly leveraged institutions. In a serious downturn or credit contraction, they will start seeing enormous losses -- it's guaranteed by their nature. This would lead to undercapitalization, which will force the bank to issue more equity to raise capital. And the bank can make its way back to life, without a collapse or any giant catastrophe. The only catastrophe will be for shareholders.

Besides the tangible examples of C and BAC, look at DB which is currently undergoing this.

Of course the situation can be even more serious, and the bank can actually fail in which case various forms of liabilities will be converted to equity, which is also sure to be a catastrophe for existing shareholders. But my point is that it doesn't even take _that_ serious of a problem to severely hurt the equity. Just a standard economic slowdown will be dangerous enough for bank investors.

I limit my bank exposure to 20% of my portfolio, far less than the 40% weight in XIU. I just think the sector is going to eventually encounter problems when the Canadian housing market weakens.


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## Eclectic12 (Oct 20, 2010)

james4beach said:


> ... I limit my bank exposure to 20% of my portfolio, far less than the 40% weight in XIU. I just think the sector is going to eventually encounter problems when the Canadian housing market weakens.


OOH ... you raise good points to consider.

OTOH ... you limit your bank exposure to less than the 40% weight of XIU yet in other threads encourage people to buy the index as picking stocks (which helps limit bank exposure) is too much of a risk?

My head hurts less when I don't try to figure out your rationale versus what your encourage. :rolleyes2:


Cheers


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## james4beach (Nov 15, 2012)

Fair point. I think generally, using an index with a solid track record like XIU or XIC is better than trying to cobble together a portfolio of individual stocks. I always feel comfortable recommending XIU.

I also have a theory that XIU could be even better if it had equal sector weights. For my own portfolio, this is what I try to do by re-constituting XIU with a focus on equal sector weighting and replicating it with individual stock holdings. It's a weird activity that involves dissecting XIU and partially putting it back together. The exact steps in the procedure are quite important, including re-constitution.

So I still fall back to my broad advice of "just buy XIU" when in doubt. I _suspect_, though, one might do a bit better with equal sector weights (= less financials). This is easier said than done. ZLB and CDZ are two other funds that have much closer to equal sector weights that may be worth a look.

I continue to recommend XIU (tried and true) and CDZ (more equal weightings) to everyone.

I'd like to recommend ZLB (more equal weightings), but want to see a bear market, and the MER is a bit high.

I'm not sure I can recommend my XIU unpacking approach that gives equal sector weights, but it's what I do. Have 100K in this.


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## james4beach (Nov 15, 2012)

Maybe should add that the MER of CDZ is quite high too. However for people who insist on large dividends, I think CDZ is a good option both for its strong dividends and the more equal sector weightings.

Going back to the original question in this thread, someone could invest the 300K in CDZ and would indeed get about around $800 to $900 a month, exactly as desired by the OP. And better sector weightings/less financial exposure than XIU.

Downside is, of course, the exposure to stock risk and the possibility of dividends being reduced. Plus the higher MER of CDZ eats into returns.

Can't have it all


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## agent99 (Sep 11, 2013)

james4beach said:


> I continue to recommend XIU (tried and true) and CDZ (more equal weightings) to *everyone.*


Why do you feel that XIU fits EVERYONE? All investors from 20 to 100?

We can discuss our investing ideas here. But I don't think we should do any advising. Only those with proper qualifications should advise others on investing. Perhaps you are a qualified financial adviser? 

I don't own any etfs  But I did when I first started out.


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## james4beach (Nov 15, 2012)

Maybe I should rephrase that. I recommend XIU as a good vehicle to implement general Canadian stock market investment over $5 K, for anyone who has already decided to invest in Canadian stocks.

And the recommendation is a general one. There will always be corner cases and special situations that make it unsuitable for some individuals. Here are some of those special cases that might rule out XIU:

- the person is subject to US tax legislation and would end up having to report XIU as a PFIC
- the person makes incremental purchases of small amounts under $5 K
- the person is not comfortable using a discount stock brokerage

As for qualified credentials... I can recommend anything I want  I recommend lox salmon on a bagel. I recommend a brisk daily walk. I recommend XIU. I recommend being wary of qualified financial advisors who are just marketing products and getting kick backs. And I recommend being cautious of any recommendation from anyone.


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## AltaRed (Jun 8, 2009)

XIU for Canadian equity is a suitable* investment for any investor. Indeed, it is traded like SPY is in the USA for a wide variety of reasons by individuals, portfolio managers, and institutional investors alike.

* XIC is even better with a lower MER but is not traded nearly as heavily as XIU. A lot of people like the largest caps exclusively.


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## canew90 (Jul 13, 2016)

AltaRed said:


> XIU for Canadian equity is a suitable* investment for any investor. Indeed, it is traded like SPY is in the USA for a wide variety of reasons by individuals, portfolio managers, and institutional investors alike.
> 
> * XIC is even better with a lower MER but is not traded nearly as heavily as XIU. A lot of people like the largest caps exclusively.


"Buy etf's for diversification", but when approx 40% is financials and 20% energy (cyclicals) it doesn't seem too diversified, but concentrated. I'd rather pick my own holdings and allocation without adding the likes of Blueberry or Valeant.


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## AltaRed (Jun 8, 2009)

canew90 said:


> "Buy etf's for diversification", but when approx 40% is financials and 20% energy (cyclicals) it doesn't seem too diversified, but concentrated. I'd rather pick my own holdings and allocation without adding the likes of Blueberry or Valeant.


You might but perhaps millions of investors are better off with a CCP type passive portfolio. It is a small minority of investors that can DIY stock pick with any success. I personally know of only a very few who can do so and I know them from here or FWF. Most everyone I know has a commissioned or % of AUM advisor. I help a few other close family members with their portfolios and they are exclusively in ETFs or managed portfolios. They couldn't pick a stock, or manage a stock portfolio, on a solo basis. 

We should never recommend what we personally do... only what is likely best for the individual in question. That is the key danger of financial forums.


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## agent99 (Sep 11, 2013)

canew90 said:


> "Buy etf's for diversification", but when approx 40% is financials and 20% energy (cyclicals) it doesn't seem too diversified, but concentrated. I'd rather pick my own holdings and allocation without adding the likes of Blueberry or Valeant.


I agree. 

We had the XIU discussion at least once before after J4b had been pushing it. 

BTW, wasn't Nortel once about 45% of XIU? Dan Hallett spoke about it here: https://www.highviewfin.com/blog/explaining-xics-bi-polar-performance/ He mentioned the high commodity allocation at that time. And then there is the high Financial allocation. Not for the faint of heart?

It's interesting to discuss the pluses and minuses of owning various securities. No harm in stating what you personally do and why. But, I don't think amateur investors here should *recommend *investments to others.

Only time I have bought XIU or XIC, was when the TSX was in a strong uptrend. It didn't matter much what you owned, but you needed to be IN the market. Not the case now! But not recommending for or against owning either


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## canew90 (Jul 13, 2016)

AltaRed said:


> You might but perhaps millions of investors are better off with a CCP type passive portfolio. It is a small minority of investors that can DIY stock pick with any success. I personally know of only a very few who can do so and I know them from here or FWF. Most everyone I know has a commissioned or % of AUM advisor. I help a few other close family members with their portfolios and they are exclusively in ETFs or managed portfolios. They couldn't pick a stock, or manage a stock portfolio, on a solo basis.
> 
> We should never recommend what we personally do... only what is likely best for the individual in question. That is the key danger of financial forums.


What's the point of a Financial forum if one cannot express opinions and suggestions on investment strategies. I would never give specific advice, suggest one method is better than others (though I would say what I dislike), but do express what has worked for us and may be useful to others. Others do not have to agree or like the opinions expressed, but hopefully some may find the advice useful.


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## james4beach (Nov 15, 2012)

Right, someone may not like the work recommend, but at the end of the day the whole purpose of this forum is to share thoughts on investments, and even suggest things to each other.

Everyone reading this content has to take it with a grain of salt. For example people keep hammering away at me for having "too little in stocks" (I have 25% in stocks)... let's call that advice. I hear the advice, and I take it in context of where other investors are in their lives and how it fits into their big picture, but know it's not right for me for a variety of reasons.


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## peterk (May 16, 2010)

I don't have enough stocks... I want my money back James for your advice. :biggrin:


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## AltaRed (Jun 8, 2009)

james4beach said:


> Right, someone may not like the work recommend, but at the end of the day the whole purpose of this forum is to share thoughts on investments, and even suggest things to each other.
> 
> Everyone reading this content has to take it with a grain of salt. For example people keep hammering away at me for having "too little in stocks" (I have 25% in stocks)... let's call that advice. I hear the advice, and I take it in context of where other investors are in their lives and how it fits into their big picture, but know it's not right for me for a variety of reasons.


Yeah, I get what you say and what Canew90 just said but sometimes it seems the advice is 'to do this' or 'to do that' without due consideration for the factual situation of the individual asking for input. There are always a variety of options that are worthy of consideration given the specific circumstances of the individual doing the asking. For example, a novice investor should be no more into stock picking than a student driver should be on the autobahn.


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## Eclectic12 (Oct 20, 2010)

james4beach said:


> ... I think generally, using an index with a solid track record like XIU or XIC is better than trying to cobble together a portfolio of individual stocks. I always feel comfortable recommending XIU ...


I can recall both recommendations for XIU or XIC or similar ETFs as well as complaints about how leverage the banks are as well as how much of the index is banks. I am more observing than anything else but it seem strange that one would be doing both with nothing I recall indicating how to counter balance the heavy index weighting.




james4beach said:


> ... I continue to recommend XIU (tried and true) and CDZ (more equal weightings) to everyone.


Which seems strange when put beside the statements such as:


> *I limit my bank exposure to 20%* of my portfolio, far less than the 40% weight in XIU.


Unless you meant the total portfolio (i.e. cash/GICs, gold etc. where equity in general is kept at 25%), where having the equity portion at a higher exposure to banks.




james4beach said:


> ... And the recommendation is a general one. There will always be corner cases and special situations that make it unsuitable for some individuals. Here are some of those special cases that might rule out XIU:
> 
> - the person is subject to US tax legislation and would end up having to report XIU as a PFIC ...


Which raises the historical question of what methods you were using beyond asset allocation to limit the high index portions of banks/financial institutions before having to report XIU as a PFIC?
Or was the housing market so much lower when working in Canada that nothing was deemed to be needed to be done?

Just curious as to the progression over time. 




james4beach said:


> ... As for qualified credentials... I can recommend anything I want  I recommend lox salmon on a bagel. I recommend a brisk daily walk. I recommend XIU. I recommend being wary of qualified financial advisors who are just marketing products and getting kick backs. And I recommend being cautious of any recommendation from anyone.


LoL ... +1.

Some of those with qualified credentials have omitted key details (ex. the bank rep who recommended to my tenant a index linked GIC with a 10% per year cap) or similar.

As well, I would expect reader to do their due diligence, same as they should be doing for a bank rep, third party advisor or the guy offering a cheap deal door to door. :eek2:


Cheers


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## Eclectic12 (Oct 20, 2010)

peterk said:


> I don't have enough stocks... I want my money back James for your advice. :biggrin:


Shocking!!

You should get your money back plus five times it for damages!! :biggrin:

$0 x 6 = $0 ..... wait a minute! :confused2:


Cheers


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## agent99 (Sep 11, 2013)

AltaRed said:


> ... but sometimes it seems the advice is 'to do this' or 'to do that' without due consideration for the factual situation of the individual asking for input. There are always a variety of options that are worthy of consideration given the specific circumstances of the individual doing the asking.


Absolutely. Forums like this are read by newbies right through to old retirees like myself. Many just read and don't participate. James is young and single. No way he can or should "recommend" anything to "everyone".

Maybe any advice or recommendations should have the following byline (borrowed from J4B's post above) 

_*"Everyone reading this content has to take it with a grain of salt."*_


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## humble_pie (Jun 7, 2009)

AltaRed said:


> We should never recommend what we personally do... only what is likely best for the individual in question.



but here's the irony ... who are *we* to decide what is *likely* best for another individual? especially when the only acquaintance we have with said individual is via a cyber cipher whose internet persona might be a total fiction ...

me i've received some great ideas from cmf forum but always from people who said "This is what i specifically do. Here, let me describe it to you in detail."




.


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## AltaRed (Jun 8, 2009)

humble_pie said:


> but here's the irony ... who are *we* to decide what is *likely* best for another individual? especially when the only acquaintance we have with said individual is via a cyber cipher whose internet persona might be a total fiction ...
> 
> me i've received some great ideas from cmf forum but always from people who said "This is what i specifically do. Here, let me describe it to you in detail."
> 
> ...


I agree in the context of your comment of "This is what i specifically do. Here, let me describe it to you in detail." I do that in various degrees myself in my posts.

The bigger issue is how to best package responses to novices and neophytes where concepts of financial education and where to go to get it should be of more value. C'est la vie. I obviously hit a few hot buttons.


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## Jaberwock (Aug 22, 2012)

It depends whether you are prepared to do some work and learn how to select, track and occasionally trade individual investments. If not, then stick with ETFs or pay an adviser to handle your money - I mean a real adviser, not a mutual fund salesman.

If you do it yourself, then focus on stocks that regularly increase their dividends, that way you can protect yourself to some degree from inflation.

Banks and utilities should be a core part of your portfolio and will give you a dividend return of over 4%. You can add some REITs to get that %age higher, but keep in mind that REITs do not increase their dividends as often or as fast as banks and are more vulnerable to rising interest rates. 

To offset your interest rate risk you can add some rate reset preferreds. There is knack to picking these, there is a learning curve to climb, but you can balance your risk if you know what to look for.

Then top off your portfolio from other sectors with companies like CN, CDN Tire and other companies that pay lower dividends but still raise their dividend annually.


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## lonewolf :) (Sep 13, 2016)

If op is 63 or older might be able max out TFSA to use for cash flow. If able to collect CPP & or pension defer to late as possible. Have income @ zero so can collect max GIS which is something like 880 a month. CPP & pension will grow well living off OAS & GIS which will result in @ least 25% increase in monthly payout when pension & CPP are taken out @ latter date. The 300,000 needs to be invested in something that does not produce taxable income for safety I would probably put some in gold which is safer then the C dollar


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## newfoundlander61 (Feb 6, 2011)

House is being put on the market this weekend, listing price will be $349,000 it was purchased 7 years ago for $244,000. Will have a close date of 1 Oct to match the apartment date which is only about 1.5 km's away.


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## fireseeker (Jul 24, 2017)

Suggestion: If you don't need the money right on Oct. 1, it might be smart to close on Oct. 15, say. It will make your transition smoother and easier.


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## AltaRed (Jun 8, 2009)

I agree. It is usually a real ***** to have both things happen on the same date. Gives one time to settle, clean the house, etc. before having to hand over the keys.


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## newfoundlander61 (Feb 6, 2011)

Good idea about the close date, will dicuss that tomorrow evening when we sign the listing papers. We don't need to the have the money on the 1st, likely there will be a hold on the funds release by my bank regardless. A few years back I got a small inheritance of $44k that was certified from a lawer and it took 5 business days for the funds to be released by the CIBC, they said anything over $10k.


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## newfoundlander61 (Feb 6, 2011)

Sign went in the lawn at 4pm today, had a viewing a half hour later and an offer at 8pm, $9k under so we will counter back and take it from their. Very good start for the first day.


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## AltaRed (Jun 8, 2009)

newfoundlander61 said:


> Sign went in the lawn at 4pm today, had a viewing a half hour later and an offer at 8pm, $9k under so we will counter back and take it from their. Very good start for the first day.


I remember selling my last house with an offer the day after listing. It came in about 2% below list. I countered at $1000 below list to leave the message I was in no mood for playing games. I eventually sold at that price, but threw in a dining room table set that I didn't want to take with me anyway but the buyer obviously valued.


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## jargey3000 (Jan 25, 2011)

jeez....must be nice to be in that type^^^^ of market....


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## AltaRed (Jun 8, 2009)

jargey3000 said:


> jeez....must be nice to be in that type^^^^ of market....


It has nothing to do with the market. It has to do with pricing a property competitively in the first place from recent comparables and then holding pretty firm. Too often sellers will tack on 5-10% to 'go fishing' to see what they might land and then wonder why a property sits. They might catch an unaware buyer but the buyer's RE representative should be guiding them properly. Most often, an overpriced property will sit for 30-60-90 days or longer. 

I bought and sold a number of houses in my career. As a buyer, I never even looked at overpriced houses. It was a case of show me stuff that is competitively priced and that is where I'll put my energy. In the house we currently live in, I offered a one time 'competitive' (not low ball) price with a midnight expiry and told my realtor to send the message I had better things to do the next day. At about 11:30pm, the realtor called to say we had a deal as presented.

Selling houses is not a lot of fun. The family has to keep the property in 'show' condition (or should if they want a sale) and it gets really tiring doing that for 30 days or more. There is no need for excessive game playing. Houses we have owned have all sold within 30 days, some within the first week.


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## jargey3000 (Jan 25, 2011)

AltaRed said:


> It has nothing to do with the market. It has to do with pricing a property competitively in the first place from recent comparables and then holding pretty firm. ek.


stll.....it'd be nice to be a seller in a market better than this:
http://creastats.crea.ca/stjo/


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## AltaRed (Jun 8, 2009)

jargey3000 said:


> stll.....it'd be nice to be a seller in a market better than this:
> http://creastats.crea.ca/stjo/


I understand. I've "had" to sell (due to corporate moves) in slumping markets too from time to time. Twice it was significant...but that does NOT change the fact the market is the market, i.e. what it is today, and not what it was last year. Houses are a commodity subject to price changes due to supply and demand. Price them competitively and they sell. Prices do not always go up as we well know.


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## james4beach (Nov 15, 2012)

AltaRed said:


> Selling houses is not a lot of fun. The family has to keep the property in 'show' condition (or should if they want a sale) and it gets really tiring doing that for 30 days or more. There is no need for excessive game playing. Houses we have owned have all sold within 30 days, some within the first week.


Maybe it's because I'm a borderline millennial, but I still don't see the appeal of "house", especially the buying and selling part. Enriching these convertible-driving middlemen who take massive % transaction fees, easily to the tune of 20 K to 30 K flushed down the toilet just to sell a property.


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## AltaRed (Jun 8, 2009)

james4beach said:


> Maybe it's because I'm a borderline millennial, but I still don't see the appeal of "house", especially the buying and selling part. Enriching these convertible-driving middlemen who take massive % transaction fees, easily to the tune of 20 K to 30 K flushed down the toilet just to sell a property.


Buying and selling is not fun at any time. But when it has to be done, make the realtors work for it. 

FWIW, I rented a number of times while on ex-pat assignment, albeit always single detached houses. Being a tenant in SFH was the most liberating experience I had in all the years I have 'lived' in a house. Being an owner, especially now at circa 70 years of age, is a major burden.


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## like_to_retire (Oct 9, 2016)

AltaRed said:


> Being an owner, especially now at circa 70 years of age, is a major burden.


Really, how come?

ltr


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## AltaRed (Jun 8, 2009)

like_to_retire said:


> Really, how come?
> 
> ltr


Maintenance, upkeep, replacement, repair. I tire of all that ****. When I rented, for anything other than simple things like light bulbs and furnace/AC filters, I'd call the landlord.

But to be fair, it is also the upgrades and changes DW would like to have on an ongoing basis which makes the house a money pit. I cave on some things. Draw the line on other things.

That all said, we are seriously taking this thread way off-tangent. This has been discussed before in the RE section.


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## Eclectic12 (Oct 20, 2010)

james4beach said:


> Maybe it's because I'm a borderline millennial, but I still don't see the appeal of "house", especially the buying and selling part ...


Whereas I find it a great improvement over moving twice a year, having to wait on the landlord for fixes, noisy parties and/or neighbours and not being able to do what I want when I was renting.




AltaRed said:


> Buying and selling is not fun at any time ...


Never really had enough of a problem/irritation to be bothered about ... but maybe that's because I've bought twice and sold one.

Being a remote landlord OTOH ... that was a pain.


Cheers


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## james4beach (Nov 15, 2012)

Eclectic12 said:


> Whereas I find it a great improvement over moving twice a year, having to wait on the landlord for fixes, noisy parties and/or neighbours and not being able to do what I want when I was renting.


I haven't moved apartments in nearly 5 years, and the property manager always fixes everything. There was even a serious mold problem in my unit that required professional cleaning & restoration. It easily cost the property owner several thousand dollars. As for me, I lined up the maintenance for when I was leaving on a trip. When I returned, it was all beautifully fixed up.

If you're renting an apartment and moving twice a year, you're doing something seriously wrong. I lived at my last place for 4 years as well.

Then I think of my family members' experiences with houses: mice infestations, basement flooding, foundation that needs repairs, roofs that need repair, broken furnaces and hot water heaters. Argh!


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## like_to_retire (Oct 9, 2016)

james4beach said:


> Then I think of my family members' experiences with houses: mice infestations, basement flooding, foundation that needs repairs, roofs that need repair, broken furnaces and hot water heaters. Argh!


Landlords don't rent to someone out of the goodness of their heart. It's an investment for them, where the renter is footing the bill and the profit goes to the landlord. It just seems smart to own that home and be your own landlord, especially over the long haul. To me, it really comes down to inflation.

The greater inflation over time, the worse off the renter's situation becomes. With home ownership, you've frozen the present day value of the monthly loan, whereas rent just keeps going up with inflation.

Real estate in the form of a home is a different type of investment. If you don't assign the money to a home, then that same money must go to rent. In 30 years you'll still be paying that rent with compounded inflation working against you all the way. With home ownership, you've locked in the price the day you buy, and you'll pay the same amount through that 30 year mortgage and end up owning it. Whether it appreciates or not isn't that important - you now own it and you don't have the monthly payment to worry about, whereas the poor renter continues to pay and pay and pay at the rates of the day that have appreciated with inflation over 30 years. I look at the cost to rent a home today and my jaw drops. Maintenance on a home? - meh, it's nothing, I do it as a hobby. It's fun.

I retired when I was 55 and had paid off a 25 year mortgage. The reason I went through that forced savings program called a mortgage, is that I can live from 55 to hopefully 90 years old without any monthly rent. Zero. I can live on very little income as a result. Think how much rent I would have to pay over those 35 years of retirement. What if inflation rears its head. It will affect the renters - not the ones who cleared a mortgage by the time they retired.

ltr


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## kcowan (Jul 1, 2010)

AltaRed said:


> Buying and selling is not fun at any time. But when it has to be done, make the realtors work for it.
> 
> FWIW, I rented a number of times while on ex-pat assignment, albeit always single detached houses. Being a tenant in SFH was the most liberating experience I had in all the years I have 'lived' in a house. Being an owner, especially now at circa 70 years of age, is a major burden.


We have rented for 23 years after each owning forever before that. We are just lucky to have an understanding landlord and have always got what we wanted, sometimes a year late. Part of the benefit is that we cannot do wholesale remodelling which DW would be doing. We did some major work when we first moved in that has passed the test of time.


AltaRed said:


> Maintenance, upkeep, replacement, repair. I tire of all that ****. When I rented, for anything other than simple things like light bulbs and furnace/AC filters, I'd call the landlord.
> 
> But to be fair, it is also the upgrades and changes DW would like to have on an ongoing basis which makes the house a money pit. I cave on some things. Draw the line on other things.


Then 10 years we bought a place in Mexico and this enabled DW to have an outlet for her creative passions. Fortunately the renovation costs of Mexico are a fraction of Vancouver. So I always agree.

An important side benefit is that we can sublet our penthouse in Vancouver and the tenants have the numbers to call to get things done. We leave without any obligation to support them. We do not rent out the Mexico place.


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## AltaRed (Jun 8, 2009)

LTR has taken an overly simplistic approach to ownership costs but each person has their specific bias OR life experience. Kind of like discussing sex, religion and politics. Many older people who own their own home can no longer afford to stay in it due to increasing property taxes, utilities, etc. They are again house rich and cash flow poor going full circle from their first RE purchase experience. You'd think there would be a much bigger market for reverse mortgages because of that. 

IMO, Keith has more objectivity given he is experiencing both ownership and renting models on an ongoing basis. Ultimately, we each make our own choice based on personal preferences.


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## agent99 (Sep 11, 2013)

like_to_retire said:


> The reason I went through that forced savings program called a mortgage, is that I can live from 55 to hopefully 90 years old without any monthly rent. Zero. I can live on very little income as a result. Think how much rent I would have to pay over those 35 years of retirement. What if inflation rears its head. It will affect the renters - not the ones who cleared a mortgage by the time they retired.
> 
> ltr


We did the same thing. Paid off mortgage and all debt very early on. And happy that we could.

However, we don't really live rent free! We do have to pay property taxes, maintenance and utilities. Something like $14-$15k pa. Or $1200/month. I am sure some pay that all-in for an apartment. But not equivalent size or lifestyle, I agree. 

Thinking aloud. If we sold our home for say $500-600k, we could probably rent something quite nice using the capital and any income it spins off. But at end of the day, we wouldn't have much of the $500k left? I think we will stay here for a while yet!


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## OnlyMyOpinion (Sep 1, 2013)

agent99 said:


> ... Thinking aloud. If we sold our home for say $500-600k, we could probably rent something quite nice using the capital and any income it spins off. But at end of the day, we wouldn't have much of the $500k left? I think we will stay here for a while yet!


Yes, you would be creating taxable income (and potentially CG's depending on investments) from the currently 'sheltered' value of your principal residence - a value that should continue to grow tax-free at least the rate of inflation (and in some places much more). 

I believe you could consider your $500k-$600k to be a big TFSA, sheltered and growing.


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## AltaRed (Jun 8, 2009)

OnlyMyOpinion said:


> I believe you could consider your $500k-$600k to be a big TFSA, sheltered and growing.


With MERs exceeding 1% and perhaps as much as 3% on a rolling 10 year basis. Ownership advocates conveniently ignore property taxes, insurance, maintenance, replacements, upgrades, etc. 

Our operating costs easily exceed $10/year just for required fundamentals (taxes, insurance, utilities). Add amortized replacements and upgrades (renos) and that is yet another story.


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## like_to_retire (Oct 9, 2016)

AltaRed said:


> With MERs exceeding 1% and perhaps as much as 3% on a rolling 10 year basis. Ownership advocates conveniently ignore property taxes, insurance, maintenance, replacements, upgrades, etc.


As I mentioned in my earlier post, the landlord isn't renting their place out to be kind. They do it for profit. Your rent includes all the landlords expenses you mentioned of property taxes, insurance, maintenance, replacements, upgrades, etc. The landlord and the regular home owner make their money from capital appreciation over time, while the renter misses out on this profit.

When you first purchase a home, you're on an equal footing with the renters of similar properties. Over time, the homeowner looks back and laughs how little they paid for their property and how much it's worth today. They look at their mortgage payment and can't believe how much that payment seemed at the time. The renter doesn't get to enjoy that laugh because they're still paying the rates of the day forever. That ability to move whenever they want and the carefree attitude the renter enjoys is quite costly over time, not in a snapshot, but over time.

I guess we'll have to agree to disagree on this.

ltr


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## AltaRed (Jun 8, 2009)

like_to_retire said:


> I guess we'll have to agree to disagree on this.


You forget the landlord gets to deduct expenses and calculate CCA. That is an advantage a PR does not have. The landlord will often be barely cash flow positive AT renting, with the primary benefit being capital appreciation over time. I don't know anyone who would be motivated in being a landlord if it was not for the speculative capital appreciation bet. 

I'd be further ahead had I rented the house next door to us 6 years ago and had put the capital to work in the stock market instead. By quite a bit. Having said all that, DW wants a 'nest' so that is primarily why we own, and yes, I also enjoy the stability of staying here as long as I like, with the decision to move being ours alone. So there are indeed pluses to own. Economics is simply a 'maybe'. 

So yes, I agree with you that we will have to agree to disagree just like we all do in every other 'own vs rent' thread.


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## kcowan (Jul 1, 2010)

AltaRed said:


> So yes, I agree with you that we will have to agree to disagree just like we all do in every other 'own vs rent' thread.


Yes and you forgot to mention rent controls. I have lived in a rent controlled place for 23 years. Currently paying $4000 per month for a place worth $3.2 million. Utilities included.


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## like_to_retire (Oct 9, 2016)

kcowan said:


> Yes and you forgot to mention rent controls. I have lived in a rent controlled place for 23 years. Currently paying $4000 per month for a place worth $3.2 million. Utilities included.


hehe, yeah I agree that once you introduce the socialist skew of rent control into the equation, the math often favours the renter. Otherwise, not.

ltr


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## newfoundlander61 (Feb 6, 2011)

newfoundlander61 said:


> Sign went in the lawn at 4pm today, had a viewing a half hour later and an offer at 8pm, $9k under so we will counter back and take it from their. Very good start for the first day.


Counter went back at $349,000 the potential buyer came back with $345,000 and we accepted close date 15th October with 2 weeks to switch over to the apt. That will work as we have been getting rid of things starting back in April. Will have to some investment planning after our summer vacation to NFLD for the house money. Were are in a pretty good position, no debt and the pensions will pay for all our monthly fixed costs in the new apt.Plus I am still working with $1,500 net from that and my TFSA currently has a balance of $63k.


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## jargey3000 (Jan 25, 2011)

newfoundlander61 said:


> Counter went back at $349,000 the potential buyer came back with $345,000 and we accepted close date 15th October with 2 weeks to switch over to the apt. That will work as we have been getting rid of things starting back in April. Will have to some investment planning after our summer vacation to NFLD for the house money. Were are in a pretty good position, no debt and the pensions will pay for all our monthly fixed costs in the new apt.Plus I am still working with $1,500 net from that and my TFSA currently has a balance of $63k.


(pssst....dont getrid of your winter coats if you're coming to NL for a 'summer" vacation
currently about 2 here, possible snowbflurries tonight)


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## jargey3000 (Jan 25, 2011)

btw...nice job on selling the house...did you have any resistance on an oct closing date? pretty far off?

Tonight
Periods of rain mixed with snow
0°C
Periods of rain mixed with snow

how often do you hear of a softball game getting 'snowed-out' ? !!!


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## OnlyMyOpinion (Sep 1, 2013)

As a seller, if the closing is more than about 30 days off (whether preference of seller or buyer) my understanding is that a good-sized deposit is prudent. Greater assurance that the buyer is serious and will be less inclined to get cold feet, particularly if the market turns.


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## newfoundlander61 (Feb 6, 2011)

LOL, we always take coats with liners; rain jackets etc even in the summer. You drive an hours and the temp drops 10 degrees. Cape St Marys is a fav spot for us to do some photography has its own micro-climate.


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## agent99 (Sep 11, 2013)

Seeing we have a couple of Newfoundlanders here, I have an off-topic question. Have they built windfarms on The Rock? Newf61 would know that in our area of Ontario, we have one large windfarm, another smaller one well into construction (Wolfe & Amherst Islands) plus a smaller one on mainland. Less wind here than in NFL, I would think. But then not as much oil/gas.


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## jargey3000 (Jan 25, 2011)

i think there's a wind farm being proposed on the west coast of the island.
but like everything, i think its mired in some kind of controversy.


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## agent99 (Sep 11, 2013)

jargey3000 said:


> i think there's a wind farm being proposed on the west coast of the island.
> but like everything, i think its mired in some kind of controversy.


Thanks. I Googled it and it seems at present there are two smallish installations, 9 turbine/27MW each. And as you say, the St. Georges proposal seems to be stalled. NL does seems to be an ideal place for wind farms.

In our area, we have a 198Mw facility on Wolfe Island with 86 turbines. Another 26 turbine, 75MW project on Amherst Island will come on line in the Fall. There is another smaller 10MW installation with 5 turbines nearby. 

There were other projects being considered, but I think the Ontario government decided to cancel them. There was a lot of opposition from locals to all three.


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## AltaRed (Jun 8, 2009)

agent99 said:


> There were other projects being considered, but I think the Ontario government decided to cancel them. There was a lot of opposition from locals to all three.


Rightfully so. They use up land base, they are a blight on esthetics of our landscape and they kill birds by the millions. Besides, doesn't the government have to pay US utilities to take away excess power? 

Wind power seems to be beautiful only to the environmentalists cocooned in their urban condos, idealizing the world through their rose coloured glasses. It sure has not done anything for our natural landscape nor for our more rural folk.


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## newfoundlander61 (Feb 6, 2011)

http://www.poweryourknowledge.com/learningzone/resources/generation-wind/Wind-Wind_farms.pdf


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## agent99 (Sep 11, 2013)

AltaRed said:


> Rightfully so. They use up land base, they are a blight on esthetics of our landscape and they kill birds by the millions. Besides, doesn't the government have to pay US utilities to take away excess power?
> 
> Wind power seems to be beautiful only to the environmentalists cocooned in their urban condos, idealizing the world through their rose coloured glasses. It sure has not done anything for our natural landscape nor for our more rural folk.


I take it you don't like wind farms  Those are the usual arguments that opponents of windfarms use. You know, we can't use hydrocarbons for ever!

Actually solar panels hurt the land base a lot more than wind turbines. They totally cover the land rather than leave it free for grazing. Something like the effect of deforestation. We have both in our area,. 

Except on a rainy day like today, we look at wind turbines every day. I don't find them aesthetically displeasing, although the layout of some in our area looks a bit hodge podge. The solar panel farms are orderly, but in my view, more of a blight.

But all this should be in a different thread. I apologize for going off topic and will stop right now


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## agent99 (Sep 11, 2013)

newfoundlander61 said:


> http://www.poweryourknowledge.com/learningzone/resources/generation-wind/Wind-Wind_farms.pdf


NF61 - Can you see turbines from your new apartment?

Sorry - tried to delete this and add to previous post, but can't see how you delete a message here.


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## AltaRed (Jun 8, 2009)

agent99 said:


> I take it you don't like wind farms  Those are the usual arguments that opponents of windfarms use. You know, we can't use hydrocarbons for ever!


Let's put it this way. No one can any longer take wonderful scenery pictures of my childhood home along Highway 3 of Southwestern Alberta without freaking windmills blighting the photographs. I no longer visit the area due to the blight. Windmill after windmill and a freaking power line to each one. Wind power is a necessary component of renewable power but these bloody things should be out of sight in the wilderness somewhere.


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## OnlyMyOpinion (Sep 1, 2013)

At the risk of further derailing the thread, let's not even mention the large inefficiency of windmill power. 

And I wonder, when/how did we all decide _"we can't use HC's forwever"_? If the modern technology of windmills (oops ignore those 1800's farm-on-the-prairie windmill pictures) can be held up as our saviour, what is to prevent technological efficiencies in the recovery and combustion of HC's from allowing their clean use in the future? e.g. https://cleanresourceinnovation.com/about/


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## agent99 (Sep 11, 2013)

Another derailleur??  (I am working on the derailleur for my wife's bike.) For windmills etc, may be best to start a new thread or find one of the existing ones.


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## newfoundlander61 (Feb 6, 2011)

newfoundlander61 said:


> Counter went back at $349,000 the potential buyer came back with $345,000 and we accepted close date 15th October with 2 weeks to switch over to the apt. That will work as we have been getting rid of things starting back in April. Will have to some investment planning after our summer vacation to NFLD for the house money. Were are in a pretty good position, no debt and the pensions will pay for all our monthly fixed costs in the new apt.Plus I am still working with $1,500 net from that and my TFSA currently has a balance of $63k.


Well got a call from our realtor that the potential purchaser was turned down for a mortgage due to the new mortgage rules that came in effect a time ago. Go news is we have lots of time to still sell and we let 3 other potential buyers come through the house in the mean time. Good call by our realtor to do this.


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## AltaRed (Jun 8, 2009)

Yes, there will be other offers. I am surprised though that there was not some pre-qualification done so that the potential buyer know his/her limits.


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## newfoundlander61 (Feb 6, 2011)

After reducing the price from $349,000 to $339,00 we got multiple offers and it is sold as of now at $345,600.00. Offer came in this morning with no conditions of any kind. A buyer from Toronto who just sold their home their is moving to my town of Kingston. Not too shabby, paid $244,000 for it a few years back. Have until October to work on investments options.


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## jargey3000 (Jan 25, 2011)

nice! wish we were in such a market!


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## Dilbert (Nov 20, 2016)

jargey3000 said:


> nice! wish we were in such a market!


Yeah, but it’s all relative. You still have to buy something else. You should see the crap for sale where I live, going for $1M+ (SE Mississauga).


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## jargey3000 (Jan 25, 2011)

Dilbert said:


> Yeah, but it’s all relative. You still have to buy something else. You should see the crap for sale where I live, going for $1M+ (SE Mississauga).


https://www.point2homes.com/CA/Luxu...LocationGeoId=361557&location_changed=&ajax=1


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## AltaRed (Jun 8, 2009)

jargey3000 said:


> https://www.point2homes.com/CA/Luxu...LocationGeoId=361557&location_changed=&ajax=1


Absolutely crazy in a province of 525,000 slowly sliding into the economic abyss http://www.rbc.com/economics/economic-reports/pdf/provincial-forecasts/provtbl.pdf Some people must be very brave? to put that kind of money into St. John's RE.
As for those who think better times are ahead, they are to some degree as oil prices recover, but it also appears Muskrat Falls will be an albatross rather than the saviour https://www.theglobeandmail.com/opi...-from-a-127-billion-sinkhole/article37052291/


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## agent99 (Sep 11, 2013)

Dilbert said:


> Yeah, but it’s all relative. You still have to buy something else. You should see the crap for sale where I live, going for $1M+ (SE Mississauga).


Or you can rent, as NFLDR61 said he is going to. 

Quite a number of owners in the GTA move to our area and buy a nicer and perhaps more suitable home for less $$ once they retire. A way to crystallize equity in home while improving lifestyle.


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## agent99 (Sep 11, 2013)

jargey3000 said:


> https://www.point2homes.com/CA/Luxu...LocationGeoId=361557&location_changed=&ajax=1


Those are pretty high end homes. They would probably cost about same in NFLDER61s area (Kingston)

I know nothing about St.Johns RE, but looks like there is a supply of more realistically priced homes.

https://www.realtor.ca/Residential/...pertyTypeGroupID=1&CurrentPage=4&ZoomLevel=11


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## jargey3000 (Jan 25, 2011)

AltaRed said:


> Absolutely crazy in a province of 525,000 slowly sliding into the economic abyss http://www.rbc.com/economics/economic-reports/pdf/provincial-forecasts/provtbl.pdf Some people must be very brave? to put that kind of money into St. John's RE.
> As for those who think better times are ahead, they are to some degree as oil prices recover, but it also appears Muskrat Falls will be an albatross rather than the saviour https://www.theglobeandmail.com/opi...-from-a-127-billion-sinkhole/article37052291/


you've summed it up pretty good, alta...
as my poor mother used to always say:"there's no hope for this place"....


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