tag:blogger.com,1999:blog-5465015914589377788.post7946448172917899846..comments2024-03-20T09:32:16.592-04:00Comments on Michael James on Money: The Family Financial PlanMichael Jameshttp://www.blogger.com/profile/10362529610470788243noreply@blogger.comBlogger9125tag:blogger.com,1999:blog-5465015914589377788.post-67013686754084632152012-06-11T11:40:07.475-04:002012-06-11T11:40:07.475-04:00@AnatoliN: I spent quite a few years trying to ou...@AnatoliN: I spent quite a few years trying to outsmart the market. In the end I concluded that my efforts were futile. So I no longer think about individual stocks or the short-term future small caps or tech stocks; I just own the market and relax. You may make a different choice.<br /><br />As for bonds, the vast majority of commentators recommend owning some bonds, so you're in the majority. I don't advise anyone to follow my lead. I think that an all stock portfolio is right for my situation, but it sounds like it's not right for you.Michael Jameshttps://www.blogger.com/profile/10362529610470788243noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-10744282443089092962012-06-11T10:55:43.465-04:002012-06-11T10:55:43.465-04:00My thinking was to wait for the weaker small caps ...My thinking was to wait for the weaker small caps to go under and to buy into the rest. I am aware that I am facing slower growth, but with with lower risk. Would you still say "do not bother"? I am all ears.<br /><br />As to an all-equity portfolio - I have my concerns. Some sound hi-tech companies have not recovered their pre-2001 values. Holding them sounds like a "sell low" recipe to me, which can't be fixed even with a 3 years worth of cash. Since I am not capable to forecast which industry will be subject of the next bust, the only option I see is to buffer possible losses by bonds.AnatoliNhttps://www.blogger.com/profile/07937984526970646627noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-29847923497760939622012-06-11T10:09:06.425-04:002012-06-11T10:09:06.425-04:00@Patrick: Nice analogy. When I see someone pin d...@Patrick: Nice analogy. When I see someone pin down what they mean by the market recovering, it is usually something like waiting until prices rise 10% or 15% from their lows. This makes the "buy high" part of the plan more transparent.Michael Jameshttps://www.blogger.com/profile/10362529610470788243noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-60964141460218297852012-06-10T16:47:46.995-04:002012-06-10T16:47:46.995-04:00The market timing parts of this plan worry me. Wa...The market timing parts of this plan worry me. Waiting until the market "recovers" is like waiting until the prices at the supermarket "recover" after a sale.Patrickhttps://www.blogger.com/profile/16816252455472704262noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-23335742817938199072012-06-08T12:26:39.438-04:002012-06-08T12:26:39.438-04:00That's my plan as well - 3 years living expens...That's my plan as well - 3 years living expenses in cash/equivalent, and dial back my stocks when I get into my mid-late 50's (I'm 46 now). I'm hoping there will be some growth in the market in the next 10 years I can take advantage of. I've been through the dot com crash and the latest crash and did not sell, so I feel comfortable holding at 100% equities for now.Taranoreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-90810460897404528792012-06-07T13:24:20.297-04:002012-06-07T13:24:20.297-04:00@Tara: The main reasons not to have all equities ...@Tara: The main reasons not to have all equities or high equities is if you are close to retirement, unable to sleep at night with worry about a stock crash, or would panic sell during a stock downturn. I avoid talking too much about my personal life, but you can guess something about my age from the fact that I have two adult sons. I do plan to shift into fixed income investmetns at some point, but I haven't decided yet. At a minimum, I plan to have 3 years worth of living expenses in fixed income investments once I retire.Michael Jameshttps://www.blogger.com/profile/10362529610470788243noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-12777853456160405602012-06-07T12:47:14.315-04:002012-06-07T12:47:14.315-04:00It's nice to hear there's someone else out...It's nice to hear there's someone else out there with an all equities portfolio - whenever I mention that on finance boards I am roundly criticized for doing it all wrong. How old are you BTW, and do you plan to change your portfolio at some point to add other asset classes such as bonds, tips, etc?Taranoreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-76109483864187975472012-06-07T09:41:06.527-04:002012-06-07T09:41:06.527-04:00@AnatoliN: I just use spreadsheets to track my in...@AnatoliN: I just use spreadsheets to track my investments. Perhaps other readers have suggestions.Michael Jameshttps://www.blogger.com/profile/10362529610470788243noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-14770336471601806252012-06-07T09:33:39.890-04:002012-06-07T09:33:39.890-04:00In addition to my plan:
- I do intend to stay with...In addition to my plan:<br />- I do intend to stay within e-Series of TD index funds and let professional players watch my balance; iShares and Vanguard may come into picture for fine tuning, so far I have chosen e-Series out of pure convenience - I researched them already<br />- to find an "all-cap" index fund is a good idea, thank you<br />- thank you for bringing to my attention that in Canada real return bond funds are as volatile as any other bond funds, since they take inflation out of risk, while inflation in Canada is controlled by the state<br />- I will stay with TD webbroker service and avoid any employee pressure; previously I have bought back loaded funds with 2.5-3% MER and I will not repeat this error<br />- psychological pressure imposed by the need to invest into something falling will be significant, thank you for warning, - will have to work on it to sustain the balance, since whatever falls is deemed to rise <br />- we still have 20 years to save for retirement and my Excel exercise tells me that if my portfolio provides a 5% return I shall be able to focus on fishing during my 65-95 period. Modesty of this return expectation results from my plan to gradually increase portion of bonds closer to 65 in order to arrive at retirement with predictable amount.<br />- the 6-month reserve fund has less to do with our ability to find jobs and more with our desire to turn away from existing and future jobs if we choose so by whatever reason. As Don Draper said: You want me, but you can't have me. I intend to increase this fund closer to retirement to provide for flexibility in withdrawals from RRSP/RRIF and avoid clawbacks of OAS.<br /><br />Now question: would you be able to direct me to a good software to monitor my investments?AnatoliNhttps://www.blogger.com/profile/07937984526970646627noreply@blogger.com