When you read an account of a topic like this, the writer usually starts with a story such as “when I was a child, we had no money” or “I always knew I wanted to be…”. I have no such story. I’m from a working-class family and my parents were practical, no-frills people. But I can’t say that I ever felt poor. I did recognize that some people had loftier lifestyles than us and it gave me something to which … Continued
One of the first signs that someone is considering changing advisors is when they ask me to review their investments and give them a second opinion. No two advisors will create exactly the same portfolio and every one of us brings a personal touch or a specific approach to things. That’s understandable and I wouldn’t criticize a portfolio because it’s not exactly what I would do. But what strikes me most often are not the individual holdings, but rather the … Continued
In my last blog, I explained how I deal with uncertainty by always being ready for anything. I argued that proper portfolio construction, aligned with the client’s unique needs, should leave them in a strong long-term position regardless of what is going on in the economy and in capital markets. Still, people often ask me what my outlook is and how I feel markets will perform over the next few months. It won’t surprise you that I try not to … Continued
So far, it’s been a tough year for investors. As of late August, major stock indices are down a fair bit and so are bonds. Globally balanced portfolios are lower by 10% to 15% year to date*. The common refrain in the financial media that I follow very closely is “uncertainty”. The talk is about how high-interest rates will go; how long will it take for inflation to come down; what will be the impact on the economy; how will … Continued
Research has produced something known as the Happiness Curve which measures our level of contentment at different ages. Based on my age, I should be at the lowest point of my life. Yikes! Happiness is relatively high from our twenties through our forties, but bottoms around age 55. It begins to increase again in one’s 60 and 70’s. That is certainly cause for reflection. The thing I find most interesting is that we are generally gaining financial strength by our … Continued
If you know me well, you probably also know a lot about my dad. I talked about him often. I’m very proud of him. He’s an old-fashioned gentleman, quintessentially humble, relentlessly supportive, incredibly resilient, and an all-around great guy. He’s a pleasure to sit and spend time with. I don’t know if there is anything I’m more grateful for than having him and my mother as parents. Born in 1923, he’s lived through the depression; lost both his parents in … Continued
I’ve been holding back on writing this blog and on using that title. Yes I know, it’s a bold statement. Sometimes, the market is lousy and the outlook bleak. But now is a good time to remember that it treats patient, long-term investors very well. I’ve been doing this work long enough to have been through several bad markets. The financial crisis of 2008 saw the worst stock market declines in a generation. The recent pandemic also threw markets into … Continued
Like a lot of people, I’m crazy about the daily online puzzle game Wordle. It involves guessing a five-letter word using a process of letter elimination. It requires you to start with any word. Everyone has their favourites. Some of mine are “early”, “point” and “yield”. I remember the first time I saw the word yield. I was a child and I was watching my mother bake cookies. At the end of the recipe, it said “yields two dozen”. My … Continued
A few weeks ago, I challenged the way financial planning graphs typically appear with smooth lines and steady, consistent results. Financial plans are formulated based on the assumptions we choose and on long-term averages. But life doesn’t work that way. One part of your plan that will be anything but smooth, consistent, and predictable, is the amount you will spend in retirement. Planning software will typically start with the amount of money you hope to live on at the beginning … Continued
My last article provoked a lot of feedback. It was about the way individuals who have created an exceptional amount of wealth view risk. I have often said that my role in helping people with their wealth is mostly about risk management. Finding the appropriate balance between risk and reward is arguably the most important thing I can do for them. But I find that people often have a narrow or flawed view of what risk is. Many people think … Continued