Episode 281: Lifecycle Asset Allocation, and Retiring Successfully with Justin King
The Rational Reminder Podcast
Tax Implications of Insurance Policies in Corporation Ownership
This chapter explores the tax implications of holding different insurance policies within a corporation, including life insurance, disability insurance, and critical illness insurance. It discusses the advantages of using pre-tax dollars to pay premiums and the concept of the capital dividend account. It also highlights the importance of personally owning disability insurance and the factors to consider when deciding whether to personally or corporately own critical illness insurance.
Today, we take a closer look at asset allocation through an empirical lens, by drawing on the work and data of Scott Cederburg and his new article ‘Beyond the Status Quo: A Critical Assessment of Lifecycle Investment Advice’. We unpack what the research tells us about how to establish the optimal mix of assets in a portfolio, the challenges of making the right decisions when you have volatile assets, and why it’s critical that you understand your level of risk tolerance. Next, in our Mark to Market segment, we unpack different types of insurance — like life, disability, and critical illness — and when you should own them personally versus making them the property of your corporation. We then review Justin King’s new book The Retirement Café Handbook: Nine Accelerators for a Successful Retirement before sitting down with the author himself to discuss the content of his latest work and his long-held interest in helping others optimize for retirement. Tuning in you’ll hear Justin share his thoughts on the role of choice, vitality, and joy when it comes to having a successful retirement, the nine accelerators he lays out in his book, and how to become the hero of your retirement story. In our final section, we wrap things up with some wonderful reviews from listeners and our book recommendations. To hear all of the captivating takeaways from today’s episode, be sure to tune in!
Key Points From This Episode:
- Breaking down asset allocation through an empirical lens; finding the right mix of assets in a portfolio, common challenges, and measuring risk. (0:02:12)
- The role of government pensions when considering asset allocation over one’s life. (0:09:10)
- Investigating whether volatility is risk; modeling the lifecycle of an investor and determining if (and when) it makes sense to shift into bonds over time. (0:11:27)
- Analyzing the data, modelling, and findings from the paper, ‘Beyond the Status Quo: A Critical Assessment of Lifecycle Investment Advice’. (0:14:02)
- The challenges of behaving well with volatile assets; advice on how to assess your risk tolerance, your ability to endure short-term declines, and more. (0:23:10)
- Our Mark to Market segment: unpacking different types of insurance and when you should own them personally or inside your corporation. (0:29:50)
- A quick look back at our conversation with Dr. Anna Lembke on the subject of dopamine. (0:37:58)
- This week’s book review: Justin King’s The Retirement Café Handbook: Nine Accelerators for a Successful Retirement. (0:39:33)
- Our conversation with Justin King on how to retire successfully. (0:41:19)
- Unpacking the nine accelerators in Justin’s book and where they come from. (0:45:44)
- How to get the most out of The Retirement Café Handbook. (0:55:47)
- Sharing some of the wonderful reviews we’ve gotten recently, plus our book recommendations. (0:59:28)
Links From Today’s Episode:
‘Beyond the Status Quo: A Critical Assessment of Lifecycle Investment Advice’ — https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4590406
Episode 224: Prof. Scott Cederburg — https://rationalreminder.ca/podcast/224 Episode 169: Prof. John Cochrane — https://rationalreminder.ca/podcast/169 Episode 250: Prof. John Y. Campbell — https://rationalreminder.ca/podcast/250 Episode 278: Juhani Linnainmaa: Financial Advisors, and the Cross Section of Returns — https://rationalreminder.ca/podcast/278
Episode 177: Dr. Anna Lembke — https://rationalreminder.ca/podcast/177
Anna Lembke — https://www.annalembke.com/ Dopamine Nation: Finding Balance in the Age of Indulgence — https://www.annalembke.com/dopamine-nation Justin King on LinkedIn — https://www.linkedin.com/in/justinking-retirement-planner-ifa/
Justin King on X — https://twitter.com/JustinKingCFP The Retirement Café — https://www.theretirementcafe.co.uk/
The Retirement Café Podcast — https://www.theretirementcafe.co.uk/podcast
The Retirement Café Handbook: Nine Accelerators for a Successful Retirement — https://www.amazon.co.uk/Retirement-Cafe-Handbook-Accelerators-Successful/dp/1739410300
Notes from Listener PDF —
Episode 30: Larry Swedroe — https://rationalreminder.ca/podcast/tag/Larry+Swedroe
Strangers in Paradise: How Families Adapt to Wealth Across Generations — https://www.amazon.com/Strangers-Paradise-Families-Wealth-Generations/dp/0615894356
Wealth 3.0: The Future of Family Wealth Advising — https://www.amazon.com/Wealth-3-0-Future-Family-Advising/dp/B0C9SHFSGM
Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582. Rational Reminder Website — https://rationalreminder.ca/
Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/
Rational Reminder on X — https://twitter.com/RationalRemind
Rational Reminder on YouTube — https://www.youtube.com/channel/
Rational Reminder Email — info@rationalreminder.ca Benjamin Felix — https://www.pwlcapital.com/author/benjamin-felix/
Benjamin on X — https://twitter.com/benjaminwfelix
Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/
Cameron Passmore — https://www.pwlcapital.com/profile/cameron-passmore/
Cameron on X — https://twitter.com/CameronPassmore
Cameron on LinkedIn — https://www.linkedin.com/in/cameronpassmore/
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