Short Takes: Asset Location, Adulting, and more
Here are my posts for the past two weeks:
Powerless Employees
The Year of Less
Here are some short takes and some weekend reading:
Justin Bender pulls his asset location rules together in an excellent post where he goes through an example of allocating your money across a TFSA, RRSP, and a taxable account. The calculations may seem complex, but I use a spreadsheet that does them automatically for me. That way, I only have to figure it all out once. Justin is right that DIY investors may do well to just keep the same allocation within each account for simplicity, but if you’re paying someone else to manage your money, you should expect them to get post-tax asset location decisions right.
Potato says that doing what you think adults are supposed to do is “cargo cult adulting.” It’s better to decide for yourself what being an adult means. I liked his example of some young people thinking they have to own a house before having kids. It’s true that I owned a house before having my kids, but my parents didn’t. In some decades, real estate is expensive, and in others it’s cheap. There’s nothing wrong with renting if you’re socking away some of the money you’re saving not having to pay for house repairs, property taxes, and other costs.
Big Cajun Man looks back at how a layoff from a decade ago hurt at the time but worked out well in the end.
Boomer and Echo describe the differences between group RESPs and self-directed RESPs. The better choice is obvious, but only after you understand how these plans work.
Powerless Employees
The Year of Less
Here are some short takes and some weekend reading:
Justin Bender pulls his asset location rules together in an excellent post where he goes through an example of allocating your money across a TFSA, RRSP, and a taxable account. The calculations may seem complex, but I use a spreadsheet that does them automatically for me. That way, I only have to figure it all out once. Justin is right that DIY investors may do well to just keep the same allocation within each account for simplicity, but if you’re paying someone else to manage your money, you should expect them to get post-tax asset location decisions right.
Potato says that doing what you think adults are supposed to do is “cargo cult adulting.” It’s better to decide for yourself what being an adult means. I liked his example of some young people thinking they have to own a house before having kids. It’s true that I owned a house before having my kids, but my parents didn’t. In some decades, real estate is expensive, and in others it’s cheap. There’s nothing wrong with renting if you’re socking away some of the money you’re saving not having to pay for house repairs, property taxes, and other costs.
Big Cajun Man looks back at how a layoff from a decade ago hurt at the time but worked out well in the end.
Boomer and Echo describe the differences between group RESPs and self-directed RESPs. The better choice is obvious, but only after you understand how these plans work.
Thanks for the inclusion this week, many times, events that seem horrendous (at the time), end up being for the best.
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