tag:blogger.com,1999:blog-5465015914589377788.post218604565428098856..comments2024-03-20T09:32:16.592-04:00Comments on Michael James on Money: Money Rules for InvestingMichael Jameshttp://www.blogger.com/profile/10362529610470788243noreply@blogger.comBlogger15125tag:blogger.com,1999:blog-5465015914589377788.post-77217520601286326042014-12-12T23:39:23.594-05:002014-12-12T23:39:23.594-05:00@CanadianInvestor: Only time will tell whether mor...@CanadianInvestor: Only time will tell whether more expensive approaches to indexing produce enough higher returns to justify their costs. I've chosen to stick with cap-weighted indexes and rock-bottom MERs.Michael Jameshttps://www.blogger.com/profile/10362529610470788243noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-44767762049790679942014-12-12T20:41:19.991-05:002014-12-12T20:41:19.991-05:00Good detailed review, avoids slight temptation of ...Good detailed review, avoids slight temptation of buying the book.<br /><br />Re MER, As a default position for selecting funds, the lower the MER the better. That means buying cap-weight passive broad-market index funds. You won't go disastrously wrong. However, I think one needs to be able to, and may be able to,specifically quantify a justification for higher MER above the lowest available for an asset class and if one can do it, jump in. e.g. I think paying an extra 0.3 - 0.4% for low vol and fundamental weight (call it value and small cap tilt in disguise if you like, I don't care) Cdn equity ETFs ZLB and PXC respectively is worth it. I own them instead of XIC or any cap-weight ETF since both excess returns (+1.5%) and reward to risk measures show them to be superior in the long term.CanadianInvestorhttps://www.blogger.com/profile/05645767559302303541noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-56818239337454706672014-12-12T14:40:38.159-05:002014-12-12T14:40:38.159-05:00@Greg: Your experience seems to confirm that ROC i...@Greg: Your experience seems to confirm that ROC is penalty-free even when your child is in the first 13 weeks. Actually, in his comment Mike Holman just said ROC is unlimited; he didn't say that ROC wouldn't be penalized. I just reread Chapter 4 of his book and it says the same thing (ROC unlimited and no mention of penalties). <br /><br />In any case, if there were penalties for ROC during the first 13 weeks, someone somewhere other than Gail would have mentioned it. It seems quite clear that Gail got this wrong.Michael Jameshttps://www.blogger.com/profile/10362529610470788243noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-3868838784304427792014-12-12T13:04:09.404-05:002014-12-12T13:04:09.404-05:00Well, I took out $18,000 in the first semester for...Well, I took out $18,000 in the first semester for daughter #1 and $10,200 for daughter #2 in the first semester, limited to $5000 EAP in both cases, the rest contributions. No claw backs in either case. My understanding is except for the $5000 EAP limit, you can withdraw all of the RESP in the first semester. Note that one of the commenters disagreeing with Vaz-Oxlade is Mike Holman, who had just published a whole book on RESPs. http://www.amazon.com/The-RESP-Book-Registered-Education/dp/0986648906<br />Gregnoreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-7503042982161763162014-12-12T10:42:44.840-05:002014-12-12T10:42:44.840-05:00@Anonymous: That's a little harsh. I prefer ...@Anonymous: That's a little harsh. I prefer to think that reasonable people who seek correct answers can learn from each other. If I had been writing this blog a decade or more ago, I would have written many things that I no longer believe today.Michael Jameshttps://www.blogger.com/profile/10362529610470788243noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-16323593379939871092014-12-12T10:39:41.756-05:002014-12-12T10:39:41.756-05:00@P=NP?: I've learned a lot from Gail about ho...@P=NP?: I've learned a lot from Gail about how to help people who handle money poorly. But her advice related to investing makes me wonder how well she handles her own investments.Michael Jameshttps://www.blogger.com/profile/10362529610470788243noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-29852495936273990162014-12-12T10:35:57.990-05:002014-12-12T10:35:57.990-05:00@Paul: To be fair, I think the number of people in...@Paul: To be fair, I think the number of people in distressed situations that form Gail's demographic is quite a bit higher than the number of people who fit the demographic I usually address. But you're right that she doesn't seem to fare well when she ventures outside her wheelhouse.Michael Jameshttps://www.blogger.com/profile/10362529610470788243noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-66885556879266800002014-12-12T10:30:06.664-05:002014-12-12T10:30:06.664-05:00@Greg: I read through the post you pointed to and ...@Greg: I read through the post you pointed to and the disagreement seems to hinge on a single question. If you take some return of capital (ROC) from an RESP during the first 13 weeks of a new school program, will you forfeit any CESG grants? Two advisors in the comment stream say no, and Gail says yes. I poked around online for quite a while and my best guess is that ROC triggers CESG forfeiture only when the child isn't in school. If that's right, then this isn't Gail's best moment. But I can't say I'm certain. Maybe someone can point me to something definitive on this subject. I keep reading things like "If a refund of contributions is made at a time when a beneficiary does not qualify for an EAP, grants and bonds are clawed back." But I don't know if this applies when you've already taken out $5000 worth of EAPs in the first 13 weeks.Michael Jameshttps://www.blogger.com/profile/10362529610470788243noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-25241271597925636872014-12-12T05:27:10.762-05:002014-12-12T05:27:10.762-05:00I have read very little of her articles. She seems...I have read very little of her articles. She seems to be genuinely interested in enriching the personal finance of her readers. But she is mathematically challenged and peddles common sense wisdom backed by incorrect calculations/facts. Her core audience are people who are not financially literate and can't separate the wheat from the chaff. They literally take her advice and try to act on it. We'll never know how many decided against RESP (based on Greg's link above) or towards expensive mutual funds based on Money Rulesispeuqhttps://www.blogger.com/profile/17271555509021327726noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-71379854657691165512014-12-11T18:50:19.049-05:002014-12-11T18:50:19.049-05:00Nice that you call her out on the MER issues. She ...Nice that you call her out on the MER issues. She should stick to giving advice to people that are in distressed situations. Her form of advice is only good for a certain demographic. It's really the only thing she understands. Things like setting up money jars for different bills, and low cost food recipes. She gives me the impression that she puts the focus more on "any mutual fund investing" being better than not investing at all. She does not want to confuse her followers by explaining the effect of MER's.<br /><br />She should take a few minutes and try out Preet's MER calculator so she can see for herself and understand the long term effects of fees. Could it be she or others close to her are in the business of selling mutual funds? I haven't read the book but it sounds like the same tired arguments when you have this discussion with most any mutual fund "salesperson". <br /><br />It does not help when someone who has an audience as large as she does that trusts her advice, is misdirected like this. I have heard her on AM radio some nights I must disagree with some of her advice. Great for someone who can't budget themselves and is constantly in debt with 5 credit cards with balances on them. But, for individual people already investing that have some money sense, definitely not. paulhttps://www.blogger.com/profile/00050081178673700867noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-74936232154669179882014-12-11T18:19:54.518-05:002014-12-11T18:19:54.518-05:00Vaz-Oxlade is a bombastic entertainer first and a ...Vaz-Oxlade is a bombastic entertainer first and a finanical expert not so much. But don't you dare question her. Check this out http://gailvazoxlade.com/blog/?p=2190. She incorrectly claims you can only take $5000 out of an RESP in the first year. Search for "gail says" in the comments to see how she reacts to people questioning her on this. And there it is, more than 4 years later. No admitting she is incorrect or correcting her post. Gregnoreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-32114405665329672082014-12-11T14:08:54.363-05:002014-12-11T14:08:54.363-05:00It sounds like a little knowledge is dangerous.It sounds like a little knowledge is dangerous.Dave Liggathttp://liggat.orgnoreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-84511813180466288622014-12-11T13:47:32.925-05:002014-12-11T13:47:32.925-05:00Hard to believe anyone could be so ignorant and st...Hard to believe anyone could be so ignorant and still get published. Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-59503785296508511112014-12-11T10:31:26.105-05:002014-12-11T10:31:26.105-05:00@Anonymous: The non-investing parts of this book a...@Anonymous: The non-investing parts of this book are actually excellent. If you can't seem to get your finances straight or if you are trying to help someone who needs to shape up, Vaz-Oxlade offers many very useful insights.Michael Jameshttps://www.blogger.com/profile/10362529610470788243noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-78853907069915597532014-12-11T10:18:09.131-05:002014-12-11T10:18:09.131-05:00Sound like a pretty terrible book. I'll be su...Sound like a pretty terrible book. I'll be sure to avoid it.Anonymousnoreply@blogger.com