Long time reader Garth asked for my opinion on Wade D. Pfau’s essay Eight core ideas to guide retirement income planning .  Pfau is a smart guy and it’s no surprise that his article is excellent.  I do have some thoughts around the edges, though. “Play the long game” Pfau starts with an important point: “A retirement income plan should be based on planning to live, rather than planning to die.” This means that making sure you have enough money in old age is more important than trying to squeeze out as much money as you can in early retirement.  But we’re not asking you to sacrifice now.  By taking reasonable steps to protect your much older self, you’re freed up to spend a reasonable amount early in retirement without fear of running out of money.  Pfau lists six steps toward playing the long game which I’ll translate into the Canadian context. Delaying starting CPP and OAS As long as you have some savings to live on and you’re in reasonable health, delaying the...

Alts are all the rage now, at least among the people trying to sell them.  But every time I look into an alternative investment class and then back away from the details for a 1000-foot view, this is what I see:

It’s challenging enough to figure out how much you’ll want to spend at the start of retirement.  Even more challenging is deciding how your spending will change as you age.  These choices make a big difference in how much money you’ll need to retire.  They also shape the spending options you’ll have available throughout retirement.  Here I explore the good and bad parts of common wisdom on retirement spending to arrive at my own spending plan for retirement.  Spoiler alert: the “go-go, slow-go, no-go” narrative is good marketing, but it has cracks. Two extremes Some people focus on the early part of their retirement.  They want as much money as possible available early on while they’re still young enough to enjoy it.  They seem to think of their older selves as a different person who they care less about than their current selves. Others focus on their older selves and worry about running out of money at some point.  These people usually spend far...

When Canadians are just getting started managing their own investments at an online broker, their pre-existing ideas create a lot of confusion.  Here I go through several of the most common misconceptions I encounter in a conversation format. Novice Investor:   Ok, so I’ve opened a TFSA with my online broker, and I’m ready to put my $50,000 in. Michael James:   Great.  We just have to transfer the money to your new TFSA from some external account, like a chequing account at your bank.  Just a few clicks and we’re done.  The money will be there in a day or two. NI:   Wow! That was easy. So, we’re all done? MJ:   Not quite.  All we’ve done is fill your TFSA with dollars. NI:   That’s all I did with the TFSA I used to have at the bank.  It’s closed now. MJ:   Yes, but that TFSA was just a savings account earning a little bit of interest.  You said you want to put this $50,000 away for the long term in an all-in-one ETF. ...

I finally pried open my wallet to pay for improved email delivery of my posts to email subscribers.  I tried to remove ads and include the entire post in each email.  We'll see if I succeeded or not.

Many aspects of personal finance have changed in the 36 years since The Wealthy Barber classic book first appeared.  To update it, author David Chilton had to not only do an extensive rewrite, but he had to come up with new advice.  He did a great job of making The Wealthy Barber  2025 update fully relevant to Canadians today.  Chilton takes important topics that are usually dry and hard to understand and brings them alive in an entertaining story format. But this book is much more than just a fun take on personal finances; the advice is excellent.  Chilton gives insights you won’t find elsewhere.  The book is like a course on personal finance requiring no previous knowledge, and even discussions of insurance and wills are funny and compelling enough to be page-turners. The bulk of the book is a set of financial lessons mainly aimed at Canadians between 20 and 45.  The early chapters introduce the characters, make it clear that the lessons require no ...