Build Wealth Canada Podcast

In this episode, we cover the types of debt tools available to us Canadians, and how to get the lowest rate on them. In other words, what debt options do we have in our Canadian toolbox that we can potentially use, and what are the pros and cons of each? My goal for you is that by the end of this episode, you'll know what your options are in Canada so that if you ever do need a loan, you know exactly what's available to you, which types of loans have the lowest and highest rates, and which ones are the easiest and hardest to qualify for.  And Sure, we've all heard of mortgage and credit cards, but what other types of loans are out there that we could potentially use? Today's Expert: To help me answer these questions, our guest for this episode is Scott Satov. He’s a CA, a CFA, and the founder of LoansCanada.ca which was Canada's first and today’s largest online loan search and comparison platform.  So I figured, if we want to know what types of loans are available to us Canadians, then why not get the first and largest Canadian loan search and comparison provider to help us with this since it’s clearly their job day in and day out to know what’s out there. Links and Resources: You can do your loan comparison shopping over at Scott's company: LoansCanada.ca. They also have a lot of educational resources on the site so you can definitely learn a lot there, even if you aren't looking to immediately take out a loan. The top personal finance and investing tools guide mentioned on the episode can be received for free by signing up on the main page over at buildwealthcanada.ca. The how to invest videos mentioned during the show can be found at buildwealthcanada.ca/invest. Questions Covered: While ideally, we as Canadians want to have no debt, the reality is that most Canadians don't have enough money on-the-side to just buy a car or house with cash, or to fund some expensive unforeseen emergency (whether it's an expensive home repair, something medical that you have no coverage for, or something else). We've all heard of mortgages, but what are the other tools available to us, and can you cover the pros and cons of each along with which ones are the least expensive options here in Canada? What are the different things that are within our control that we can do, to get the lowest rates on loans? Most don't have the cash to buy a new or used car outright, so what have you found to be the best practices for getting the best loan for a new vs used car? Ex. Going through dealer vs the bank vs sites like yours that can pull the rates from different providers. If you need money for an important expense, have you found home equity lines of credit (HELOC) to be the least expensive way to raise the funds required? If someone isn't a homeowner and can't get a HELOC, what type of loan is the least expensive? How do you go about getting a loan and securing it against your car for example (or some other asset) so that it becomes a secured loan giving you the lowest rates? What are the most effective ways of building your credit score? If you have an average credit score, is it worth the effort to try to improve it? In other words, how large are the savings you can get if you do actually work on your credit score and improve it? What are your thoughts on debt consolidation? When should somebody consider it vs not?  What are your top strategies for getting out of debt? Especially for those that are struggling or feeling the pressure from the loans that they already have outstanding. If you liked the episode sign up for free to receive all new episodes as they get released, news on giveaways, and the free guide on the Top 5 Personal Finance and Productivity Tools.

There’s been a lot of new programs and initiatives put in place by the Canadian government due to COVID-19 to help you financially. In this episode, I’m going to take you through what’s out there so that you can make sure you don’t miss out on some free money or benefits that can really help you during this difficult time. I’ve actually gone through everything that I could get my hands on at the Canada Revenue Agency site, so this is all coming right from the source, and this episode’s intention is to save you a lot of time by helping you quickly learn what’s out there, whether you’re eligible, and help you make an efficient decision on which benefits to apply for, and which ones to make sure you receive. The 2nd part of this episode is going to focus on mortgages, the drastic changes in the interest rate that we’ve seen (which can of course heavily impact your mortgage payments and decisions), what’s happening right now as far as the real estate market is concerned, if you can take advantage of these lower interest rates by renewing your mortgage. We’re also going to cover the subject of deferring your mortgage payments, if for example you’ve lost your job and fear that you may not be able to pay your mortgage while we are all in lockdown due to COVID-19. Links & Resources Covered Chat with Sean for free to get your mortgage questions answered by entering your email at buildwealthcanada.ca/sean Check out Sean’s best-selling book, Burn Your Mortgage: The Simple, Powerful Path to Financial Freedom for Canadians. New Tool: Get Your Credit Score Checked for Free A big thanks to Borrowell for sponsoring the show and for building such a great free tool that we can use to check our credit score. It has saved me a lot of time when I want to quickly check the status of my credit score (for example, to ensure there has been no fraud or identity theft on my accounts).  You also obviously want to make sure your score is as high as possible for any mortgages or other loans that you end up applying for (to ensure you get the lowest rate and get approved).  Even if you aren’t looking for a loan, I encourage you to at least pull your report for free to help ensure that there are no unauthorized transactions on your accounts. As a best practice, you should be doing this kind of check at least annually.  Thanks again Borrowell for building a tool where we Canadians can finally get access to this data quickly and for free. Resources from the Episode: Top Tools and Resources for Financial Independence (for Canadians): All the top tools and sites that I’ve personally used to help us achieve financial independence in our early 30s. They’re also what we use now to optimize and manage our finances, and ensure that we’re paying the lowest fees while getting solid returns on our investments.  Canada’s Top ETFs Guide & Top High-Interest Savings Account: In the guide, I go over what I personally invest in, why I invest in it. The investments that I talk about ​are literally where we have almost our entire net worth (apart from our house), and is what we are primarily living off right now in our early retirement. At the very least you’ll learn about some great ETFs to consider for your portfolio, and if you are new to ETFs, it’ll give you a nice list of some top ETFs to consider from the thousands that are out there.  The guide is available for free to any listeners that that use my special link to sign up for a free savings account with the bank that I personally use, EQ bank.  The reason that I personally use EQ bank, is that they have one of the highest interest savings rates in Canada (they are currently offering 2% which is more than double what the major banks are offering). It’s also free to sign up and keep an account with them, so you’re not paying a monthly fee like you do with many of the other banks out there. You also get unlimited transactions, unlimited Interac e-transfers, and can take out your money at any time if you need it, and there are no minimum balances. Because of those reasons, I’ve been with them ever since they launched in Canada years ago, and it’s where I keep my entire emergency fund and spending money.  To get the free high-interest account and the free guide on the top ETFs in Canada, just go to buildwealthcanada.ca/eq, open the free account, and once you’re done, forward any email that you get from EQ to bonus@buildwealthcanada.ca and I’ll send you the full comprehensive guide for free.  Don't miss future episodes, giveaways, and free in-depth guides by signing up for free to the Build Wealth Canada Newsletter

A lot has been happening with the significant stock market declines and coronavirus, so I’ve been getting lots of questions such as: How am I adapting our portfolio and investment strategy to these declines? Should we be buying into the market at these low prices or selling? Should we be waiting out for the market bottom and then buying? What are the other experts that I listen to and trust saying? With this episode, the goal is to answer these top questions for you. Now, of course, the health and the safety of your family is more important than the temporary performance of an investments portfolio, so that should be the priority. But since I’m not a doctor or medical expert, it doesn’t make sense for me to try to give you medical advice. So instead, let’s focus on what I do actually have expertise and experience in and shine some light on the investment and financial planning side of things. Enjoy the episode. New Tool: Get Your Credit Score Checked for Free A big thanks to Borrowell for sponsoring the show and for building such a great free tool that we can use to check our credit score. It has saved me a lot of time when I want to quickly check the status of my credit score (for example, to ensure there has been no fraud or identity theft on my accounts).  You also obviously want to make sure your score is as high as possible for any mortgages or other loans that you end up applying for (to ensure you get the lowest rate and get approved).  Even if you aren’t looking for a loan, I encourage you to at least pull your report for free to help ensure that there are no unauthorized transactions on your accounts. As a best practice, you should be doing this kind of check at least annually.  Thanks again Borrowell for building a tool where we Canadians can finally get access to this data quickly and for free. Resources from the Episode: Top Tools and Resources for Financial Independence (for Canadians): All the top tools and sites that I’ve personally used to help us achieve financial independence in our early 30s. They’re also what we use now to optimize and manage our finances, and ensure that we’re paying the lowest fees while getting solid returns on our investments.  Canada’s Top ETFs Guide & Top High-Interest Savings Account: In the guide, I go over what I personally invest in, why I invest in it. The investments that I talk about ​are literally where we have almost our entire net worth (apart from our house), and is what we are primarily living off right now in our early retirement. At the very least you’ll learn about some great ETFs to consider for your portfolio, and if you are new to ETFs, it’ll give you a nice list of some top ETFs to consider from the thousands that are out there.  The guide is available for free to any listeners that that use my special link to sign up for a free savings account with the bank that I personally use, EQ bank.  The reason that I personally use EQ bank, is that they have one of the highest interest savings rates in Canada (they are currently offering 2% which is more than double what the major banks are offering). It’s also free to sign up and keep an account with them, so you’re not paying a monthly fee like you do with many of the other banks out there. You also get unlimited transactions, unlimited Interac e-transfers, and can take out your money at any time if you need it, and there are no minimum balances. Because of those reasons, I’ve been with them ever since they launched in Canada years ago, and it’s where I keep my entire emergency fund and spending money.  To get the free high-interest account and the free guide on the top ETFs in Canada, just go to buildwealthcanada.ca/eq, open the free account, and once you’re done, forward any email that you get from EQ to bonus@buildwealthcanada.ca and I’ll send you the full comprehensive guide for free. 

I recently realized that I haven’t really provided an update on our early retirement story and more importantly, the lessons learned from it so far. Therefore my goal for this episode is to share with you what we did wrong and what I think we did right, that allowed us to achieve financial independence by the time I was 32. Please don’t interpret this episode as some sort of showing off, bragging, or an ego boost. I absolutely hate arrogance and hubris (it’s actually ones of my biggest pet peeves). Instead, the whole idea behind this episode is to give you some actionable insights based on our failures and successes over the years, so that you can hopefully learn from our experiences, apply them to your own financial independence, retire early journey and hopefully cut down the time that it takes you to get there. That’s it. New Tool: Get Your Credit Score Checked for Free A big thanks to Borrowell for sponsoring the show and for building such a great free tool that we can use to check our credit score. It has saved me a lot of time when I want to quickly check the status of my credit score (for example, to ensure there has been no fraud or identity theft on my accounts).  You also obviously want to make sure your score is as high as possible for any mortgages or other loans that you end up applying for (to ensure you get the lowest rate and get approved).  Even if you aren’t looking for a loan, I encourage you to at least pull your report for free to help ensure that there are no unauthorized transactions on your accounts. As a best practice, you should be doing this kind of check at least annually.  Thanks again Borrowell for building a tool where we Canadians can finally get access to this data quickly and for free. Other Resources: Top Tools and Resources for Financial Independence (for Canadians): All the top tools and sites that I’ve personally used to help us achieve financial independence in our early 30s. They’re also what we use now to optimize and manage our finances, and ensure that we’re paying the lowest fees while getting solid returns on our investments.  Canada’s Top ETFs Guide & Top High-Interest Savings Account: In the guide, I go over what I personally invest in and why I invest in it. The investments that I talk about ​are literally where we have almost our entire net worth (apart from our house), and is what we are primarily living off right now in our early retirement. At the very least you’ll learn about some great ETFs to consider for your portfolio, and if you are new to ETFs, it’ll give you a nice list of some top ETFs to consider from the thousands that are out there.  The guide is available for free to any listeners that that use this link to sign up for a free savings account with the bank that I personally use, EQ bank.  The reason that I personally use EQ bank, is that they have one of the highest interest savings rates in Canada (they are currently offering 2.45% which is more than double what the major banks are offering). It’s also free to sign up and keep an account with them, so you’re not paying a monthly fee like you do with many of the other banks out there. You also get unlimited transactions, unlimited Interac e-transfers, and can take out your money at any time if you need it, and there are no minimum balances. Because of those reasons, I’ve been with them ever since they launched in Canada years ago, and it’s where I keep my entire emergency fund and spending money.  To get the free high-interest account and the free guide on the top ETFs in Canada, just go to buildwealthcanada.ca/eq, open the free account, and once you’re done, forward any email that you get from EQ to bonus@buildwealthcanada.ca and I’ll send you the full comprehensive guide for free. 

Today we’re going to cover some of the top financial questions asked by Canadians, including the number one question, “Am I saving enough for retirement?”. The way we came up with these questions, is that as you may know, the fee-for-service financial planner that I use is John Kalos, and on my site, I have a page where you can sign up for a free 30-minute consultation with him.  And so, lots of the listeners of the show have met with John for free to get their questions answered and he then took the ones that were being asked most often, and we decided to do this episode on them so that everyone can benefit from them.  The top question was definitely “Am I saving enough for retirement?”, but he also addressed other top questions like “What investments should I be buying for each account (RRSP vs TFSA vs taxable accounts), and how much should I be buying of each?”. Enjoy the episode, and definitely feel free to ask him your own questions one-on-one over at buildwealthcanada.ca/john. When you sign up through that page, I’ve also set it up so that you’ll be automatically emailed a guide that I made on the top questions to ask your financial planner.  This can help you whether you’re looking for a new financial planner, or to test out your existing financial planner to make sure that there is no conflict-of-interest and that they really are as competent as they claim to be.  This is something that he’s making available on an ongoing basis so even if you are listening to this episode years from now, you can still go there to get some of your top questions answered, privately, and for free. Enjoy the episode. New Tool: Get Your Credit Score Checked for Free A big thanks to Borrowell for sponsoring the show and for building such a great free tool that we can use to check our credit score. It has saved me a lot of time when I want to quickly check the status of my credit score (for example, to ensure there has been no fraud or identity theft on my accounts).  You also obviously want to make sure your score is as high as possible for any mortgages or other loans that you end up applying for (to ensure you get the lowest rate and get approved).  Even if you aren’t looking for a loan, I encourage you to at least pull your report for free to help ensure that there are no unauthorized transactions on your accounts. As a best practice, you should be doing this kind of check at least annually.  Thanks again Borrowell for building a tool where we Canadians can finally get access to this data quickly and for free. Other Resources: Top Tools and Resources for Financial Independence (for Canadians): All the top tools and sites that I’ve personally used to help us achieve financial independence in our early 30s. They’re also what we use now to optimize and manage our finances, and ensure that we’re paying the lowest fees while getting solid returns on our investments.  Canada’s Top ETFs Guide & Top High-Interest Savings Account: In the guide, I go over what I personally invest in and why I invest in it. The investments that I talk about ​are literally where we have almost our entire net worth (apart from our house), and is what we are primarily living off right now in our early retirement. At the very least you’ll learn about some great ETFs to consider for your portfolio, and if you are new to ETFs, it’ll give you a nice list of some top ETFs to consider from the thousands that are out there.  The guide is available for free to any listeners that that use this link to sign up for a free savings account with the bank that I personally use, EQ bank.  The reason that I personally use EQ bank, is that they have one of the highest interest savings rates in Canada (they are currently offering 2.3% which is more than double what the major banks are offering). It’s also free to sign up and keep an account with them, so you’re not paying a monthly fee like you do with many of the other banks out there. You also get unlimited transactions, unlimited Interac e-transfers, and can take out your money at any time if you need it, and there are no minimum balances. Because of those reasons, I’ve been with them ever since they launched in Canada years ago, and it’s where I keep my entire emergency fund and spending money.  To get the free high-interest account and the free guide on the top ETFs in Canada, just go to buildwealthcanada.ca/eq, open the free account, and once you’re done, forward any email that you get from EQ to bonus@buildwealthcanada.ca and I’ll send you the full comprehensive guide for free. 

In this episode, we talk about how we can set our investments up so that we can live off them in retirement (whether it’s a traditional retirement or early retirement). We also cover the important subject of how to stress-test our investment portfolio so that we can help ensure that we don’t run out of money in our retirement. You can also use these tools to see (approximately) if you actually have enough to retire now (or to see how much more you need). New Tool: Get Your Credit Score Checked for Free A big thanks to Borrowell for sponsoring the show and for building such a great free tool that we can use to check our credit score. It has saved me a lot of time when I want to quickly check the status of my credit score (for example, to ensure there has been no fraud or identity theft in my accounts).  You also obviously want to make sure your score is as high as possible for any mortgages or other loans that you end up applying for (to ensure you get the lowest rate and get approved).  Even if you aren't looking for a loan, I ecourage you to at least pull your report for free to help ensure that there are no unauthorized transactions on your accounts. As a best practice, you should be doing this kind of check at least annually.  Thanks again Borrowell for building a tool where we Canadians can finally get access to this data quickly and for free.  Other Resources from the Episode: Top Tools and Resources for Financial Independence (for Canadians): All the top tools and sites that I’ve personally used to help us achieve financial independence in our early 30s. They’re also what we use now to optimize and manage our finances, and ensure that we’re paying the lowest fees while getting solid returns on our investments.  Canada’s Top ETFs Guide & Top High-Interest Savings Account: In the guide, I go over what I personally invest in and why I invest in it. The investments that I talk about ​are literally where we have almost our entire net worth (apart from our house), and is what we are primarily living off right now in our early retirement. At the very least you’ll learn about some great ETFs to consider for your portfolio, and if you are new to ETFs, it’ll give you a nice list of some top ETFs to consider from the thousands that are out there.  The guide is available for free to any listeners that that use this link to sign up for a free savings account with the bank that I personally use, EQ bank.  The reason that I personally use EQ bank, is that they have one of the highest interest savings rates in Canada (they are currently offering 2.3% which is more than double what the major banks are offering). It’s also free to sign up and keep an account with them, so you’re not paying a monthly fee like you do with many of the other banks out there. You also get unlimited transactions, unlimited Interac e-transfers, and can take out your money at any time if you need it, and there are no minimum balances. Because of those reasons, I’ve been with them ever since they launched in Canada years ago, and it’s where I keep my entire emergency fund and spending money.  To get the free high-interest account and the free guide on the top ETFs in Canada, just go to buildwealthcanada.ca/eq, open the free account, and once you’re done, forward any email that you get from EQ to bonus@buildwealthcanada.ca and I’ll send you the full comprehensive guide for free.  Roger's Amazing Educational Resources: Roger's Rock Retirement Club (applicable to Canadians) Roger's Main Site: Retirement Answer Man Roger's Podcast: Retirement Answer Man Podcast Free Monte Carlo Simulation Tools: To help ensure that you have enough to retire, we talked a lot about Monte Carlo analysis. Below are three tools that I use where you can run Monte Carlo simulations for free: cfiresim.com firecalc.com portfoliovisualizer.com Questions Covered: Let’s say you created a comprehensive financial plan with a client. You give them the green light to retire and they do so. A year later, we run into a 2008 scenario, or a large stock market decline. When you do your annual/semi-annual review with the client, what’s the process that you go through to determine if they are still okay, or if they need to make some adjustments? I’ve noticed that you’re a heavy user of Monte Carlo simulations to stress-test whether someone has enough to retire. For somebody that hasn’t heard of this before, can you explain what it is? There are free tools out there like Firecalc.com and cfiresim.com that let people run their own Monte Carlo simulations to see if they have enough to retire. Do you have any advice when using tools such as these? For example, are there any common mistakes that you see people do when using them? I noticed that not all financial planners and financial planning software do Monte Carlo stress-tests like do. The most common alternative that I’ve seen, is that in the financial planning software, the financial planner just enters what rates of return they expect the client to receive for the different years when doing the retirement projections. When using this alternate method, how should listeners of the show ensure that their financial planners are stress-testing their retirement projections to ensure that they still have enough to retire, even if they hit a major recession shortly after retirement? (i.e. They get hit by a bad sequence of returns) After listening to your podcast for years, I got the sense that you are a fan of the bucket strategy. Can you explain what it is, and can you talk about the default bucket strategy that you like to start with, and then how do you adjust it depending on the client? Do you subtract dividends/interest from that “annual expenses” figure when determining how much cash/fixed income to have? Do you have some sort of rule/process when it comes to refilling the buckets. For example: “If X happens in the markets then I’m selling off equities to generate cash to live from. If Y happens then I use a cash cushion or the bond portion and I refill it when markets are up by a certain percent”? How would your bucket strategy differ when dealing with a traditional retiree (ex. Age 65), vs an early retiree (ex. Age 30s or 40s) Do you have a preferred way(s) of helping clients deal with sequence risk? (please define it too for those that are new to this)  When you’re working with clients and strategizing on what should be in the fixed income/safe portion of their portfolio, how do you determine how much they should put into bonds vs a high-interest savings account vs GICs (GICs are the US version of CDs)? Are there certain rules or processes that you like to follow to determine this? A lot of the listeners of this show are do-it-yourself investors, and you’ve built a really great on-line community of do-it-yourself retirees as part of your Rock Retirement Club. Can you tell us more about the Rock Retirement Club, as well as a bit more about your podcast and where we can learn more from you?

Today we have insurance industry insider, Laura McKay on the show, who reveals some of the top tricks and tactics used in the insurance industry, to keep us overpaying.  She covers what to look out for, and what we can actually do on our end to make sure that we get the best rates possible, and aren't overpaying for insurance that we may not even need.  Laura used to work as an actuary, and is now the Co-founder and President of PolicyMe, which is a great tool for Canadians that you can use for free to see how much insurance you actually need. It also tells you if you are overpaying for insurance, or if you are underinsured and taking on a lot of unnecessary risk in case something was to happen to you. I also really like how it lets you comparison shop different insurance providers without having to fill out countless insurance forms for each individual insurance company that you want a quote from.  Enjoy the episode. You'll learn a lot of actionable insider information that can potentially save you thousands of dollars long-term. Resources from the Episode: PolicyMe's free tool to find out how much insurance you need and find out if you are overpaying or are underinsured. The tool also lets you easily comparison shop between different insurance providers to ensure you get the lowest rate. Top Tools and Resources for Financial Independence (for Canadians): All the top tools and sites that I’ve personally used to help us achieve financial independence in our early 30s. They’re also what we use now to optimize and manage our finances, and ensure that we’re paying the lowest fees while getting solid returns on our investments.  Canada’s Top ETFs Guide & Top High-Interest Savings Account: In the guide, I go over what I personally invest in and why I invest in it. The investments that I talk about ​are literally where we have almost our entire net worth (apart from our house), and is what we are primarily living off right now in our early retirement. At the very least you’ll learn about some great ETFs to consider for your portfolio, and if you are new to ETFs, it’ll give you a nice list of some top ETFs to consider from the thousands that are out there.  The guide is available for free to any listeners that that use this link to sign up for a free savings account with the bank that I personally use, EQ bank.  The reason that I personally use EQ bank, is that they have one of the highest interest savings rates in Canada (they are currently offering 2.3% which is more than double what the major banks are offering). It’s also free to sign up and keep an account with them, so you’re not paying a monthly fee like you do with many of the other banks out there. You also get unlimited transactions, unlimited Interac e-transfers, and can take out your money at any time if you need it, and there are no minimum balances. Because of those reasons, I’ve been with them ever since they launched in Canada years ago, and it’s where I keep my entire emergency fund and spending money.  To get the free high-interest account and the free guide on the top ETFs in Canada, just go to buildwealthcanada.ca/eq, open the free account, and once you’re done, forward any email that you get from EQ to bonus@buildwealthcanada.ca and I’ll send you the full comprehensive guide for free.  Questions Covered: Can you tell us a bit about your story and experience as an insider in the insurance industry, and what caused you to leave that standard insurance career path? One of the most common tricks that I’ve seen insurance providers use over the years, is making it sound like everybody needs life insurance, no matter what. What I found different about you guys, is that you actually do a great job explaining why not everyone needs insurance. Can you take us through what kind of person or family would need life insurance, and when they wouldn’t? Also, when can we get rid of life insurance so we can save some extra money every month? Another trick that I’ve heard about is companies telling young people to get life insurance even if they don’t really need it yet, because the younger you are, the lower your rates will be.  This can sound appealing as it’s a way to lock-in those low rates for decades. Can you talk about this strategy and is it worth it? For example, would someone be better off just taking the money that they would be paying to insurance, and instead investing it in their TFSA, RRSP, or paying off debt? One of the types of insurance that I see people get talked into is permanent life insurance. But, out of all the personal finance experts that I’ve talked to, I have yet to hear anybody recommend it (unless they sell it, in which case they do suggest it because they get paid a commission from it). Can you talk about permanent life insurance vs term insurance, what each of them are, along with the pros and cons of each one. One of the arguments that I’ve heard for permanent life insurance is that it invests some of the money that you pay them, and that money is able to grow tax-free. This sounds appealing as it starts to sound a little bit like a TFSA. How is this different though, than investing in a TFSA? When investing through a permanent life insurance policy, how do the fees and rates-of-return compare to instead doing index investing using low-cost ETFs or using a robo-advisor? One of the tricks that I’ve noticed you bring up on your site is how many insurance providers us the “x times income” rule. Can you explain what that is, and how you can end up paying for more insurance than you need if you let a provider use this rule? Obviously there are a lot of things that we can’t control that impact how much we pay for insurance, like our age. But, what are the things that we can control that can lower our rates? Under what conditions would someone’s premium change? For example, if somebody develops a heart problem after the person has already become insured. Would it be adjusted based on this new information? Should you disclose such things to your insurance company if it happened after the policy is already in effect? Another common trick I see, is companies not telling us when we no longer need that higher coverage. This makes sense of course as the larger our coverage, the more money they make from us. In what cases should we actually lower our coverage, and what’s the best process for doing so? (i.e. Kids out of the house, no more mortgage, No debts, other?) If you are a couple, what are the pros and cons of buying one joint policy vs buying two individual policies? Can you tell us a bit more about your tool and what you factor in when making those recommendations on how much we actually need? When you pull the rates from the different providers, how many different providers do you actually pull the prices from?   

Our guest today is Jason Heath, CFP who has been providing fee-only, advice-only financial planning since 2001 and is one of Canada’s best-known fee-only financial planners. He is currently a personal finance columnist for the Financial Post, MoneySense and is also a regular contributor to RetireHappy.ca. I’ve been reading his insightful financial planning articles on MoneySense for years, so I thought it would be great to have him on the show to discuss how we Canadians can optimize our investment portfolios.  We cover both phases: Before retirement when you're in the growth phase trying to retire early, and after retirement, once you’ve hit your number and want to make sure you don’t run out of money. Questions Covered: What do you think is the best way for do-it-yourself investors to determine their asset allocation in terms of what percentage of stocks vs fixed income to hold in their portfolio? Does the answer change depending on whether someone is working towards an early retirement vs already being retired? I find asset allocation questionnaires are far from perfect, as people's emotions and feelings about the answers can really change depending on when you ask them and how much they already know about investing. For somebody that is in or approaching an early retirement or traditional retirement, do you also base the percentage of their fixed income on some spending related rule? For example: That common advice to hold five years of living expenses as fixed income as that should ride out most recessions. When you're working with clients and strategizing on what should be in the fixed income/safe portion of their portfolio, how do you determine how much they should put into bonds vs a high interest savings account vs GICs? Are there certain rules or processes that you like to follow to determine this? For those that are retired, what are some of your favourite ways to manage the cashflow in retirement so that the retiree doesn't run out of money. For example, do you use some sort of bucket strategy? ex. Having equity, bonds, GICs and cash buckets then rebalancing and refilling those accordingly? I find that many investors who are new to investing, or are switching to do-it-yourself investing to save on fees, sometimes they get intimidated by now having to rebalance their investments. For anybody new to this, can you define what rebalancing is and what rule or rules do you have for yourself (and your practice) that determines when you rebalance? What are your thoughts about the increasingly popular Asset Allocation ETFs where the rebalancing is done for you? Are there any negatives about Asset Allocation ETFs that you think should be considered? What accounts are they best suited for? For somebody that is already retired and needs to use their investments for living expenses, how do you determine whether to sell off equities vs sell bonds or use cash or GICs? Do you have some sort of rule/process like if X happens in the markets then I'm selling off equities to generate cash to live from. If Y happens then I use a cash cushion or the bond portion? What are your thoughts on the 4% rule and are there any variable spending strategies that you like instead of using the 4% rule? If you could go back to when you first started investing, what advice would you give yourself? Resources from the Episode: Free tickets to the Canadian Financial Summit: I’ll be speaking again at the Canadian Financial Summit and I have free tickets for you. The entire event is online so you can watch it from anywhere, and it’s Canada’s largest personal finance conference. I’ll be there together with over 25 Canadian personal finance experts, and in my talk I’ll be speaking about how we optimized our investment portfolio before we retired, and after we retired. This way no matter where you are on your financial independence journey, it’ll at the very least give you some insights on ways that you can optimize your own investment portfolio so that you can retire early, or at least hit your financial independence number quicker. To get your free tickets for a limited time, go to: https://kornel–canadianfinancialsummit.thrivecart.com/2019-all-access-pass/   Top Tools and Resources for Financial Independence (for Canadians): All the top tools and sites that I’ve personally used to help us achieve financial independence in our early 30s. They’re also what we use now to optimize and manage our finances, and ensure that we’re paying the lowest fees while getting solid returns on our investments.  Canada’s Top ETFs Guide & Top High-Interest Savings Account: In the guide, I go over what I personally invest in, why I invest in it. The investments that I talk about ​are literally where we have almost our entire net worth (apart from our house), and is what we are primarily living off right now in our early retirement. At the very least you’ll learn about some great ETFs to consider for your portfolio, and if you are new to ETFs, it’ll give you a nice list of some top ETFs to consider from the thousands that are out there.  The guide is available for free to any listeners that use my link to sign up for a free savings account with the bank that I personally use, EQ bank.  The reason that I personally use EQ bank, is that they have one of the highest interest savings rates in Canada (they are currently offering 2.3% which is more than double what the major banks are offering). It’s also free to sign up and keep an account with them, so you’re not paying a monthly fee like you do with many of the other banks out there. You also get unlimited transactions, unlimited Interac e-transfers, and can take out your money at any time if you need it, and there are no minimum balances. Because of those reasons, I’ve been with them ever since they launched in Canada years ago, and it’s where I keep my entire emergency fund and spending money.  To get the free high-interest account and the free guide on the top ETFs in Canada, just go to buildwealthcanada.ca/eq, open the free account, and once you’re done, forward any email that you get from EQ to bonus@buildwealthcanada.ca and I’ll send you the full comprehensive guide for free.  Jason’s Site and Financial Planning Practice:https://objectivefinancialpartners.com/ Jason’s Articles on MoneySense: https://www.moneysense.ca/author/jason-heath/ Vanguard’s Asset Allocation Tool/Questionnaire: https://www.vanguardcanada.ca/individual/questionnaire.htm Vanguard’s Asset Allocation ETFs: https://www.vanguardcanada.ca/individual/indv/en/product.html#/productType=etf&assetClass=balanced

Today we have Meghan Chomut on the show who is a financial planner specializing in real estate for both your primary residence and rental properties. She has also personally done property flipping before so I thought it would be great to have her on the show to teach us some lessons and best practices that we can apply to both our primary residence (whether we are an existing or aspiring homeowner), as well as learn more about what to consider and look out for when deciding to invest in a rental property, or flip houses. I’m a former rental property owner and former landlord as well so we both share some of our lessons learned and give a realistic preview of real estate investing so that you can better decide whether it’s the right fit for you. Resources from the Episode: Top Tools and Resources for Financial Independence (for Canadians): All the top tools and sites that I've personally used to help us achieve financial independence in our early 30s. They're also what we use now to optimize and manage our finances, and ensure that we're paying the lowest fees while getting solid returns on our investments.  Have a mortgage question? Looking for the top mortgages in Canada? Get a free call with our mortgage expert Sean Cooper (you'll also get a free guide on what to look out for when choosing a mortgage). Canada's Top ETFs Guide & Top High-Interest Savings Account: In the guide, I go over what I personally invest in, why I invest in it. The investments that I talk about ​are literally where we have almost our entire net worth (apart from our house), and is what we are primarily living off right now in our early retirement. At the very least you'll learn about some great ETFs to consider for your portfolio, and if you are new to ETFs, it'll give you a nice list of some top ETFs to consider from the thousands that are out there.  The guide available for free to any listeners that that use my special link to sign up for a free savings account with the bank that I personally use, EQ bank.  The reason that I personally use EQ bank, is that they have one of the highest interest savings rates in Canada (they are currently offering 2.3% which is more than double what the major banks are offering). It’s also free to sign up and keep an account with them, so you’re not paying a monthly fee like you do with many of the other banks out there. You also get unlimited transactions, unlimited Interac e-transfers, and can take out your money at any time if you need it, and there are no minimum balances. Because of those reasons, I’ve been with them ever since they launched in Canada years ago, and it’s where I keep my entire emergency fund and spending money.  To get the free high-interest account and the free guide on the top ETFs in Canada, just go to buildwealthcanada.ca/eq, open the free account, and once you’re done, forward any email that you get from EQ to bonus@buildwealthcanada.ca and I’ll send you the full comprehensive guide for free.  Meghan Chomut's Site: A big thanks to Meghan for coming on the show. You can reach out to her and learn more about her over at www.meghanchomut.com. Questions Covered: When deciding to purchase a property whether for personal use or as an investment property, what components should we be factoring in that are critical when crunching the numbers? How should we do be doing the math on the mortgage amount to take? (instead of taking the top amount our mortgage specialist or bank says that we can afford) What are things that Canadians often forget to calculate? (on both home and investments properties that they are considering) When saving for a downpayment, where do you suggest Canadians keep that money (ex. High-interest savings account, GIC, and ETF, etc.) You’ve actually flipped a house before. Can you tell us about that experience, what did you learn, and what are the pros and cons of this approach to making money? What are the top mistakes Canadians make when it comes to flipping homes? To help reduce the chance of unexpected surprises when purchasing a home or investment property, what type of due diligence do you recommend Canadians do? How is the due diligence required different between a rental property vs a home that you actually live in? Many Canadians view the home that they live in as an investment. Is this the right way to think about it? What are your thoughts between going with a fixed vs variable mortgage and what analysis do you do to determine the right one?

Today we have Kristy and Bryce on the show who are Canada's youngest retirees. Kristy retired at 31 while Bryce was 32, and today I pick their brains on how they pulled it off, how they invest, and how they structured their investment portfolio to ensure that they never run out of money. Kristy and Bryce also just launched a book on how they retired early, and in it they share a repeatable step-by-step plan on how anybody can retire early. It's a very practical book, ​I ​really enjoyed it, and wish it was around when I started my FIRE (financial independence, retire early) journey.  The​ir​ book is called Quit like a Millionaire and I have some copies to give away to you as well. If you want to sign up for free to be entered into the giveaway, just click here and enter your name and email so I know how to reach you if you win. Questions Asked: Tell us your story and how were you able to retire in your early 30s? Tell us about your book. What's it about, who is it for, and how do we Canadians benefit from reading it?  What analysis did you guys do to determine if you have enough to retire and won't run out of money? Let's talk about the Trinity Study/4% rule. First, for anybody that hasn’t heard of it yet, can you explain what it is? What was your thought process around the 4% rule right before you quit your jobs to give you the courage to do so? (i.e. There are certain caveats, objections, etc. How did you deal with them mentally?) Now that you’ve been retired for several years, have your thoughts on the 4% rule changed in any way? I recall you guys writing about how you also use the FireCalc or FireSim calculators (which I’m also a big fan of). Can you explain to the listeners what those are and how you used them? These tools let you adjust certain variables. Are there any adjustments that you made that you think would be useful for Canadians to know about when they run their own calculations? (to get more realistic/accurate results) In your retirement, you use what you call “The Yield Shield” strategy. Can you explain what that is to everyone?   I got the impression that a lot of the others in the FIRE community who have pulled off an early retirement don’t focus on the yield the way that you guys do. The most common strategy seems to be to not focus on yield, and instead just withdraw 3.5-4% of their portfolio per year, by selling off investments when needed, as that’s what the Trinity Study proved to be sustainable (If I'm not mistaken, I believe Jim Collins, MMM and Justin do it this way for example).  What made you decide to create this Yield Shield strategy instead of just going for the simpler 3.5-4% withdraw rate and not worrying about the yield? To pull off the Yield Shield, you guys chose to invest in a few ETFs that aren’t as commonly talked about in the FIRE community. I’d love to get your take on why you chose those specific ETF and their weights: Let’s start with REITs. Why was your reasoning for adding these into your portfolio (5% weight)? What made you choose the ETF: XRE to get this coverage? What made you decide to add a Canadian Preferred Shares ETF into your portfolio (20% weight)? What made you choose the ETF: CPD to get this coverage? What about choosing corporate bonds (10% weight) with XCB? Lastly, what made you choose the Canadian Select Dividend (5% weight) with XDV? How did you change your portfolio from pre-retirement to retirement (if at all)? When did you start making that transition? (i.e. The day you retired, a year before, etc.)  Let's say we had a 40% downturn, something like another 2008. What would you do in that situation? Would you still withdraw some of your principal because the 4% rule factors that in? (Your yield would also likely decrease in this scenario so how would you address that?) What changes would you make (if any) within your investments? Your blog Millennial Revolution is easily one of my favorite blogs. How is your book different than the blog, where can everyone go to pick it up, and where can we all learn more from you guys? Links and Resources Mentioned: Quit Like a Millionaire Book Link Book Giveaway Top ETF Guide for Canadians (sign up for free at buildwealthcanada.ca/eq and send any email from EQ to bonus@buildwealthcanada.ca) Michael Kitces and Mad Fientist Podcast Episode on 4% Rule Our Favourite Retirement Calculators: FireCalc FireSIM Yield Shield Article