Yearly Archives: 2019

TheGlobeandMail.com:

No single issue highlights the financial predicament of millennials like home ownership. Rising tuition costs and the growth in temporary work at the expense of permanent jobs are definitely challenges for young adults today. But the cost of houses outweighs them because it affects their financial well-being today, and in retirement. A poll to be issued by KPMG on Thursday lays out the problem in depressing detail. Millennials are eager to buy homes and bear the financial load, but they also recognize that the cost of home ownership will hurt their ability to save for retirement. Some will never afford a home, which means they won’t have a potentially valuable asset to deploy as part of their retirement plan.

Economist.com: “Even in a world of polarisation, fake news and social media, some beliefs remain universal, and central to today’s politics. None is more influential than the idea that inequality has risen in the rich world. People read about it in newspapers, hear about it from their politicians and feel it in their daily lives.”

AdvisorAnalyst.com:

“I always find this time of year to be self-reflective. Year-end provides a natural point for critiquing past performance and fitting it into a broader investing context. These holidays in particular have a way of foisting this perspective upon me, and with deep meaning. As a parent of two young kids, my holidays now kick off with Halloween. Perhaps stuck in this spirit, I find myself wondering: Why are we so scared?

I can’t seem to shake this sense that we live in a culture that’s scared. I see a number of signs across the economic, political, and investment landscapes that seem support this observation. To be sure, this is not universally true on an individual level. However, as a culture we seem to have lost our mojo, our swagger, and the confidence that fuels significant economic advancements.”

Throughout life we learn some valuable lessons we wish we knew earlier in life but of course, hindsight is 20/20. Unfortunately there are many things we learn in life that we can’t learn from traditional education. These so called life lessons have the potential to change our whole trajectory as an individual. This article posted by Leah Thomas highlights 7 lessons the most successful people master by age 35. The sooner you learn these, the more your life can benefit from them.

How do you invest successfully in the stock market? Answer: Buy low, sell high! Not a novel idea, but one that is consistently overlooked. More often than not, long-term investors are employing the opposite strategy – buying high and selling low – which typically results in an overly-anxious and underwhelming investment experience. Not to mention, a less desirable retirement lifestyle…

The concept of buying low and selling high is a strategy employed by target-date retirement funds. Here in Canada, many employers utilize these types of funds in their Defined Contribution Pension Plans offered to their employees.

In short, target-date retirement funds invest in a combination of stocks and bonds. The longer the duration to retirement, the higher the percentage exposure to stocks. The shorter the duration to retirement (or if in retirement), the higher the exposure to bonds. Over time, the fund automatically reduces the stock exposure and increases the bond exposure as the “target retirement date” approaches.

While invested in the fund, investors don’t have to worry about how it is being managed through daily, weekly, monthly, even annual volatility. The fund adjusts its weightings (percentage between stocks and bonds) automatically by increasing the stock exposure when the market drops and reducing the stock exposure when the market goes up. No timing the market. Just staying true to the target percentages of stocks and bonds.

This, my friends, is called “rebalancing” – an unemotional and simplest method to buy low and sell high. At The McClelland Financial Group, we employ rebalancing in the management of our clients’ portfolios. The only downside with target-date retirement funds is that they don’t necessarily accommodate its investors’ unique situations or timeframes. Through our investment management process, we can provide the flexibility of maintaining a more aggressive portfolio (if necessary) as the target retirement date approaches. Whether it’s a target-date retirement fund or regular rebalancing, buying low and selling high has never been easier.

We live in a society now that is heavily influenced by consumerism and what you have. Couple that with rising costs of living and it is no wonder that most Canadians are severely in debt. The article linked below looks at how much debt has impacted our society and puts the importance of paying down debt into perspective.