Short Takes: U.S. Equity ETFs, Index Investing Advantage, and more

There’s a whole world of retired people who play sports that I didn’t know existed until the last few years.  As I aged and was trying to compete with much younger athletes, I often wondered how much longer I could keep going.  A common mindset among older players is that they’ll have to give it up sometime, probably soon.  However, when I play sports with people my age and older, I see that I can keep going as long as I can stay healthy enough.

Rather than focusing on how much physical ability I’ve lost, I can focus on finding people who play at roughly the same level I do.  This has increased my motivation to do targeted exercise to keep my body healthy enough to play sports.  You’d think that staying healthy and strong would be motivation enough, but I find the deadline of completing rehab before an upcoming sports season much more motivating.

Here are some short takes and some weekend reading:

Justin Bender compares U.S. stock ETFs domiciled in Canada (e.g., VUN) to those in the U.S. (e.g., VTI).  He takes into account differences in currency exchange costs and foreign withholding taxes in different types of accounts.  This motivates the need to use Norbert’s Gambit for currency exchanges when using U.S.-domiciled ETFs.

Andrew Hallam presents evidence that “Over a period of 35 years, index fund investors earn 100 percent more money than those who buy actively managed funds.”

Robb Engen at Boomer and Echo evaluates his 2022 financial goals and lays out new ones for 2023.  I like that he sets targets for things he can control, such as how much he will save in various accounts from his income.  He doesn’t set targets for things he can’t control, such as investment returns, the price he’ll get when selling his house, or his overall net worth.  For others trying to follow Robb’s lead, it’s important not to run up debts on credit cards, lines of credit or elsewhere to meet savings targets.  If savings targets prove unrealistic, it’s better to re-evaluate savings plans than it is to bury yourself in debt.