Observations on retirement ... by a participant

joyfulguyApril 11, 2008

Greetings everyone,

While browsing through earlier copies of my favourite Canadian magazine dealing with personal financial matters, "Canadian MoneySaver", I found some information that I thought it worthwhile to share here.

There's a man who writes frequently there, who developed a system of investment over 10 years ago, based on a similar system in the U.S., that has someone buy several low cost stocks of major companies that pay high rates of dividend.

He has observed that a high percentage, in the neighbourhood of 85 - 90%, of managers of mutual funds don't succeed in producing better results than some of the market averages, despite their major claims to be smart managers of money.

His project has produced better rates of return, averaging about 14%, than several market averages, and better than most mutual funds, over the last 12 years, and he'd checked it back through several years before that.

One of the nice things about it is that one invests in individual stocks directly, so avoids paying the fund managers that annual fee ... that doesn't look so bad ... until a person realizes that s/he's paying them about the same rate on the investments that they administer as s/he pays income tax on that same income.

If you are of the opinion that any information that's more than about a week old is so outdated that it scarcely merits more than a moment's consideration ... you may want to pass the information that I'm about to give, giving it only a cursory glance ... for it appeared in the February 1999 issue of the magazine.

Here's what he said,

"Finally, a word or two about retirement. Since I am now, officially "retired" [ed: I think that he taught in University],and was "semi-retired" for three yeas before, it is a subject to which I have given some thought. And so have many others, mostly 'MonweySaver' readers and conference attendees, who have asked me about retirement planning. I have always answered along the lines of, 'Get a sound financial plan and stick to it', but now, since I am wintering in Florida and coming into contact with so many retirees, I wish to add something to this dictum. The people that I meet who are the happiest are those who have settled into a comfortable but simple post-materialistic lifestyle and have a purpose in life. Whether this is to volunteer their time to various charities, to improve their golf or tennis games, or simply to spend more time with their families, doing the things you believe holds meaning seems to be an essential part of retirement".

That makes a lot of sense, to me.

Good wishes for the coming spring days to you and yours.

ole joyful

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Speaking as someone who is not quite retired yet....those same principals hold true to the Working Joe. Don't wait until retirement to find meaning in your life. Enjoy each day as it comes! Have a lovely weekend, all!

Oops, didn't mean to show my Working Joe mentality with a foreign word like 'weekend.' Tee hee!

    Bookmark   April 11, 2008 at 11:26AM
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Hi neesie ... working Jane?

One of the nice things about retirement is ... that every day is weekend. "T G I F" is much less of a meaningful expression.

ole joyful

    Bookmark   April 16, 2008 at 5:04AM
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Aw, rub it in. Although it is Friday (and Payday!) at 4:22 so I am pretty happy!

Working Jane....

    Bookmark   April 25, 2008 at 5:23PM
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Hi again neesie (Working Jane),

When I worked as a personal financial advisor, one of my main goals was to help folks figure ways to make their income and assets work harder, with a view to working toward enjoying financial freedom, in addition to the (increasingly limited measure of) political and social freedom that has been our heritage.

How come we hear so much about the latter ... but so little about the former, in our society?

Here's a question ...

... if you had double (or four times) your current net worth ... would you feel a lot more freedom?

Would you sweat less in that case, should you suffer unexpected layoff (whether temporary or permanent)?

One of the goals, client willing, being to choose early retirement, should one choose that route. Or a simpler, less demanding, possibly self-managed business, with less stress and pressure.

I've several times suggested that every retiree couple should have a home-based business, as it allows one some beautiful deductions not available to employees - or regular retirees.

A tax-deductible dollar of expenditure is better'n a comparable non-deductible expenditure, every time.

Did you note that (was it chisue?) a couple who had a second home on Maui, who rent it out for much of the year, make trips there deductible, as they are going to oversee their part-time-income property?

When did you last make your travel to another experience in life/vacation make the trip deductible?

When I visit different areas of Canada ... if I hand out some cards related to my consultancy business ... travel/accomodation becomes deductible.

Enjoy your beautiful spring.

ole joyful

    Bookmark   April 25, 2008 at 10:41PM
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