One of the most common things I hear from people (especially young adults) when they first sit down with me is some version of this:

“I feel behind.”

Behind financially.

Behind in their career.

Behind compared to friends, colleagues, or people they went to school with.

Sometimes they don’t say those exact words, but the feeling is there.

After more than thirty years working in financial planning, I’ve learned that this feeling is incredibly common. And most of the time, it has far more to do with comparison and expectations than with someone’s actual financial situation.

Usually, when people say they feel behind, they’re comparing themselves to others who seem further ahead or appear to have life more figured out. Underneath that comparison is often something deeper: a fear that they’ve made the wrong choices, missed an opportunity, or aren’t progressing the way they believe they should be by now.

If that sounds familiar, let’s start with something important:

Feeling behind financially is not a personal failure.

More often, it’s a response to unrealistic expectations and incomplete information.

The Financial Timeline People Think They’re Supposed to Follow

Many people grow up with an unspoken idea of how financial life is supposed to unfold.

Finish school.

Get a stable job.

Start investing early.

Buy a home.

Stay on track.

The problem is that modern life rarely follows such a straight path.

Careers change. Income often grows later than expected. Housing costs are higher. Debt loads are heavier. People return to school, change industries, care for family members, experience divorce, or spend years simply trying to establish financial stability before investing becomes a priority.

Yet the pressure to follow the old timeline remains.

As a result, many people assume they’re behind when they’re actually navigating circumstances that previous generations never faced in quite the same way.

What I’ve noticed over the years is that when people finally sit down and work through their finances properly, something shifts.

Whether it’s learning how credit works, creating a realistic plan, or simply starting to invest at a level they’re comfortable with, people often realize they’re not nearly as far behind as they believed.

The timeline stops feeling like a verdict and starts feeling like a starting point.

Why Financial Progress Often Feels Invisible

One of the reasons people feel behind is that early financial progress rarely looks impressive.

Learning about investing doesn’t create immediate results.

Building an emergency fund isn’t exciting.

Understanding taxes, debt, risk, and financial planning can feel slow compared to the success stories people see online.

But this quieter stage is where strong financial foundations are built.

Before investments can compound, understanding has to compound.

Early progress often looks like:

• Asking better questions
• Understanding risk more clearly
• Reacting less emotionally to money
• Making decisions with more intention and less urgency

None of these changes feel dramatic in the moment.

Over time, they become the difference between reacting to money and managing it confidently.

Comparison Distorts Financial Reality

Money comparisons are powerful, but they only show part of the picture.

You know your own doubts, fears, and financial uncertainties.

What you usually see from other people are visible milestones:

• Buying a home
• Taking vacations
• Talking confidently about investing
• Appearing financially secure

What you don’t see are the details behind the scenes:

• Family support
• Debt
• Financial stress
• Risky decisions
• Living paycheque to paycheque despite a high income

I’ve worked with people who looked completely successful from the outside but felt like they were failing.

I’ve also seen the opposite.

Someone might say, “I have a million dollars invested.” I don’t need to worry.”

But when we look closer, they’re spending $300,000 a year.

In that situation, one million dollars may not support the retirement they’re expecting. Realistically, they may need closer to four million dollars to maintain their lifestyle over the long term.

The conversation then becomes about aligning perception with reality.

I’ve also worked with people who save relentlessly because they’re convinced they’ll never have enough, sacrificing too much of their present life for a future they may never fully enjoy.

That’s why comparison can be so misleading.

Financial reality is almost always more complicated than appearances suggest.

Uncertainty Is the Starting Point

Many people believe they should wait until they feel confident before they begin investing or planning.

They want to wait until:

• They understand everything
• They earn more money
• They feel more prepared
• They feel less uncertain

But uncertainty is actually the normal starting point.

No one begins with complete clarity.

Markets are uncertain.

Life changes.

Priorities evolve.

When people come to see me for the first time, their concerns usually fall into one of two categories.

Some tell me they know very little about investing and need help understanding everything.

Those conversations are often the easiest because we simply take things step by step.

Others arrive with a great deal of financial knowledge. They can talk about derivatives, venture capital, investment products, and market trends. But despite all that knowledge, they struggle to connect everything into a plan that supports the life they actually want.

With those clients, I often say:

“Let’s start from the beginning. Let’s first understand your needs and then decide what tools make sense to get you there.”

Financial planning isn’t about knowing the most terminology.

It’s about understanding how all the pieces fit together.

Why Trying to Catch Up Often Backfires

When people feel behind, they often feel pressure to speed things up.

That’s usually when emotional decisions begin to creep in.

Over the years, I’ve seen people who would normally be cautious investors suddenly put significant amounts of money into speculative trends such as cryptocurrency, the marijuana boom, or overheated real estate markets.

Not because those investments fit a carefully considered strategy.

But because they felt they were running out of time and needed to catch up.

I’ve also seen people try to constantly time the market because they fear missing opportunities.

Most of the time, these decisions are driven by anxiety rather than strategy.

Progress made steadily, with understanding, is usually far more durable than progress driven by urgency.

Asking for Help Isn’t a Sign of Failure

Many people delay getting financial advice because they’re worried they’ll be judged.

They’re afraid they’ll be told they should already know more.

They’re embarrassed about mistakes they’ve made.

Or they’re worried they’re too far behind to fix things.

But asking for help isn’t an admission of failure.

It’s a decision to get clarity.

It’s a decision to understand your options.

It’s a decision to make choices intentionally rather than reactively.

Most people who build long-term financial stability don’t do it by guessing their way through.

They do it by seeking guidance, learning, and making informed decisions over time.

Financial Confidence Is Built, Not Inherited

One of the most important lessons I’ve learned is that financial confidence isn’t something people are born with.

Most people actually know more than they think they do.

They understand some of the tools. They recognize the terminology. They have pieces of the puzzle.

What they’re often missing is the ability to connect those pieces into a plan that reflects their goals, values, and circumstances.

Financial confidence develops through experience.

It develops through learning.

It develops through making decisions, adjusting, and continuing to move forward.

You don’t discover your risk tolerance by reading about it.

You discover it by living through market ups and downs and learning how you respond.

Confidence isn’t where people start.

It’s what they build.

One Last Reminder

If you’re feeling behind financially today, I would encourage you to pause and ask yourself:

Whose expectations are you trying to meet?

Often, the pressure people feel isn’t coming from their actual financial situation. It’s coming from an imagined timeline, a comparison to someone else’s life, or a belief that they should be somewhere different by now.

But financial lives rarely unfold in a straight line.

What feels like a delay often turns out to be preparation.

What feels like uncertainty often turns out to be flexibility.

What feels like being behind often turns out to be simply being early in the process.

After more than thirty years working with clients, I’ve learned that there is no single financial pace you’re required to keep.

If you’re learning, asking questions, and making deliberate choices—even slowly—you’re not falling behind.

You may simply be getting started in your own timing.

Financial confidence isn’t something people arrive with.

It’s something they build—patiently, thoughtfully, and with support.

Looking for Clarity?

As a fee-for-service financial planner, I work with people who want a clearer understanding of where they are today and which steps make sense to take moving forward.

Together, we look at your financial picture, your goals, and the decisions you face—without product sales or pressure.

If you’d like an objective, unbiased perspective on your finances, I’d be happy to start a conversation.

— Sabiha

The post Why Feeling Behind Is Normal (And What It Means for Your Money, Investing, and Financial Plan) appeared first on Ed Rempel.

Louise (not her real name) has far more money than she is ever likely to spend. She has always invested in equities and is comfortable with them. However, now at age 84, she is wondering whether she should invest more conservatively.

This is a case study about the “Multi-Millionaire’s Dilemma.”

Louise says:

“Many of my women friends have the same concern: Is my asset allocation suitable for me? Specifically, what proportion should I invest in GICs versus broad-market index ETFs? Tax efficiency is also a concern.”

In my latest blog post, video and podcast episode you will learn:

• What is the “Multi-Millionaire’s Dilemma”?
• How is Louise’s situation similar to the “Multi-Millionaire’s Dilemma”?
• What reasons might she have for investing more conservatively with GICs?
• What reasons might she have for staying invested in equities?
• How can understanding the odds of losing money and the potential for growth help her decide?
• What are the odds that her investments will be worth less at the end of her life?
• How much could they be down in a worst-case scenario?
• How much less is she likely to earn by switching from equities to GICs?
• How can she simplify her investments if she stays in equities?

CLICK THE LINK BELOW TO READ THE ARTICLE BY MARY TERESA BITTI:

Does this 84-year-old suffer from the ‘Multimillionaire’s Dilemma?’

Louise’s Story

At 84, Louise is looking to simplify her investment portfolio, minimize tax, and make sure she maintains her current lifestyle. This includes continuing to travel five to six times a year, albeit more locally than her past global adventures, and age in place in her home in Vancouver, bringing in any additional help she might need.

To this point, Louise has built and managed a portfolio largely composed of equities. About a year ago, she sold most of her stocks and now has $1 million in nine guaranteed investment certificates (GICs) in three different financial institutions currently paying out about 3 per cent every other month. She has $70,000 in dividend paying stocks, $80,000 in two equity exchange traded funds (ETFs), $220,000 invested in gold wafers, $110,000 in cash, $130,000 in a Tax-Free Savings Account and $110,000 in a Registered Retirement Income Fund, both also invested in GICs. 

Last year her annual income was $66,000 ($27,000 from an employer pension, Canada Pension Plan and Old Age Security, $3,000 in dividends and $36,000 in interest income from her GICs). Her largest expenses are monetary gifts to her family, 18 charities which include support of two Himalayan children, and personal costs. In total, she spends $10,000 a month to maintain her lifestyle. To meet shortfalls, she cashes in GICs.

“I am single with an independent Living Apart Together (LAT) partner and no children. I am not worried about leaving an estate and prefer to support people and causes while I’m alive,” said Louise, who is debt-free and in addition to her investments, also owns her condo valued at $900,000.

“I made a healthy portion of my net worth in the stock market, but as an octogenarian, I have to consider that I may not have enough time to recover from fallen growth positions in a downturn,” she said. 

“I am no longer concerned with FOMO. I just want reasonable placement of my investable dollars and simplification of my financial picture.”

To that end, she would like advice on what to do with her holdings in gold and whether or not she should stay almost exclusively invested in GICs or direct a portion to an all-in-one ETF or other investment. 

“Many of my women friends have the same concern: Is my asset allocation suitable for me? Specifically, in what proportion should I invest in GICs and broad index ETFs? Tax efficiency is also a concern.”

Ed’s Insights

Louise has $1,720,000 in investments and is 84. Moving to mainly GICs means her investment average return is down to about 3.2%/year – barely above inflation. Her money is parked. Average return only $55,000/year. It was almost $140,000/year average with investments growing in equities.

She only spends $66,000/year, so she won’t run out of money. She is in lower tax brackets, so tax-efficiency is only a moderate issue. Her income is comfortably below being affected by the OAS clawback and far above the level to be affected by the GIS clawback.

At age 84, if she is of average health, she has a 50% chance of reaching age 93 and a 20% chance of age 98. She should plan for at least 10-15 more years.

Bottom line: Louise has far more money than she needs and her life expectancy is likely 15 years or less. What investment allocation makes sense for her?

We call this the “Multi-Millionaires’ Dilemma”. We have seen it many times. Far more money than you will spend during your life. Continue investing for growth or switch to conservative?

Here are 2 possible ways to think about it:

Go conservative:

• She could decide to just avoid losing any money. Invest in GICs to avoid being down at the end of her life.
• Her portfolio is her security. I meet wealthy people that say, “I’m already rich. Why make more? I just have to avoid making a mistake and losing it.”

Continue investing for growth:

• She was comfortable with her equity investments, so she could choose to just keep the investments she had. The odds of her equity investments growing during her life are very high. Over the long run, equities have crushed everything else. If you look at the last hundred years, stocks have returned about 10%/year on average. She could easily live another 10-15 years or more. That is long enough for compounding to still matter a lot.
• Her money is her freedom. More money means more options in life. She can enjoy it or give more to her family or causes important to her.
• The “multi-millionaire’s dilemma” can be insightful. The classic version is this: She has far more money than she will ever need. If she was walking down the street and found a $100 bill, would she bother to pick it up? She does not need the money and it takes a little effort to pick it up. On the other hand, it’s easy to pick up and only takes a second. What would she do? Similarly (but not as simple), if she is comfortable with equities and highly likely to have them grow, why not?

General questions are often clearer when you see the numbers.

• What are the odds that her investments will be down at the end of her life?
• How much are they likely to be down in the worst-case scenario?
• How much less is she likely to make by switching to GICs from equities?

The “Max Loss” is per $1 million of her portfolio.

To understand this, if she lives 10 more years, the worst 10-year return in the modern stock market was a loss of 1.4%/year. If this worst-case happens, she would be down 14%, or $245,000. Her $1,720,000 portfolio would be down to $1,475,000. That is not a lot with the size of her portfolio.

In 10-year periods, the markets have been down only 3% of the time, so it is quite unlikely she would be down and not recover during the next 10 years. By being in GICs vs. equities for the next 10 years, the average return she could expect to lose would be about 5%/year (3% return of GICs vs. equity return conservatively 8%/year), or at least $860,000 in lost growth.

In 20-year periods, there has not been a loss. The worst case is a gain of 6.5%/year and she would gain $1,291,145 on each million she invests. The worst-case scenario is over 20 years is great news!

Looking at the numbers for 10 years or longer, the case for staying in equities is quite strong. She is likely to be $860,000 or more ahead with only a 3% chance of being down a little bit.

There is, of course, a risk that equities could lose more or make more than these figures. Nothing is guaranteed. But looking at expected returns based on history can make the decision much clearer.

For Louise, any option could be fine. It is up to her. Staying in equities when she was comfortable with them and can make far more could make sense. Avoiding any loss could also make sense.

If she stays with equities, she can simplify by buying one broad-based equity ETFs like the MSCI World Index or S&P 500, or working with a portfolio manager to look after it for her.

Ed

The post National Post article: Does this 84-year-old suffer from the ‘Multimillionaire’s Dilemma?’ appeared first on Ed Rempel.

Have you ever stopped and really asked yourself:

“What does money mean to me?”

As financial advisors/ planners, we spend so much time talking about returns, projections, and strategies that we sometimes forget the most important element in a financial plan — the client’s relationship with money.

Over the years, I’ve learned that before we talk about investments or retirement, we need to talk about meaning. Because money isn’t just numbers — it’s emotions, values, fears, hopes, and identity.

What Money Means to Me

Personally, money represents comfort and care — the ability to make life smoother not only for my immediate family but for my extended family too. It means being able to provide, support, and uplift. And if it means working harder or longer for that, I’m prepared to do it.

But that’s my meaning — and each person has their own.

What Money Represents to Different People

For some, money is:

• Power“I can do what I want. I’m in control. I’m strong.”
• Happiness: “If I have enough money, I can solve every problem.”
• Security: “My family and I are safe if our finances are safe.”
• Freedom: “Financial independence will give me the life I want.”
• Love: “Money makes relationships easier. People will value me more.”
• Respect: “I worked hard and earned this — I deserve recognition.”

None of these meanings are right or wrong. But they are important — because they drive decisions.

Why Understanding Money Values Matters

When we know what money truly represents for you:

• Your financial goals become clearer
• Your priorities fall into place
• Your behaviours make more sense
• And your plan becomes realistic rather than idealistic

Sometimes people chase goals that don’t align with their values at all. That’s when stress, guilt, or impulsive decisions happen.

So before planning, investing, or budgeting, it’s worth asking: Is the way I think about money actually practical? Does it support my life decisions — or sabotage them?

Money Is a Tool — Not the Goal

This is the most important part. Money is simply a tool — one that helps you create:

• Financial independence
• A comfortable lifestyle
• A buffer against uncertainty
• Opportunities for your family

But it’s not something we can control perfectly. And it won’t last forever unless we manage it wisely. Note that I say manage money — not “being debt-free,” “cash-rich,” or “asset-rich.”

Because proper management is what actually helps you reach your goals.

Three Principles I Live By and ask our clients to do so.

1. Make your money work for you.

Invest it wisely.

Don’t fear calculated risk.

Historically, staying invested through market ups and downs has always paid off.

2. Be your own advisor — but don’t go it alone.

Use experts who understand your values.

A good financial planner is like a money doctor:

they diagnose, treat, and guide with care.

3. Don’t let money ruin your life.

Don’t stress.

Don’t obsess.

Don’t compare.

Focus on your goals, your plan, and your journey.

And of course — Keep smiling.

Final Thought

Understanding your money values is the foundation of a strong financial plan. Once you know what money truly means to you, the rest becomes clearer: Your goals. Your decisions. Your path.

Money or wealth is not the destination. It’s just the vehicle.

The post What Does Money Mean to You? appeared first on Ed Rempel.

For more than 20 years, Unconventional Wisdom has been where I share financial planning ideas, strategies, and lessons I’ve learned from helping Canadians build better financial lives.

Today, I’m excited to introduce someone who has been a key part of our team for the last 8 years: Sabiha Mukadam.

Many of you may not know Sabiha, but she works closely with our full-service financial planning clients and has become an important part of helping them build and maintain their financial plans.

Starting next week, Sabiha will be publishing new articles and videos every Tuesday, while my Thursday posts will continue just as they always have.

Sabiha shares the same planning philosophy that has guided my practice for decades, and I’m confident the advice she provides is the same type and quality of advice I give. 

You’ll see many of the same concepts and ideas discussed on Unconventional Wisdom, but through her own perspective, voice, and areas of focus.

In my latest video, podcast episode and blog post, you’ll learn:

• Why Sabiha decided to start writing for Unconventional Wisdom
• The role she plays with many of our full-service financial planning clients
• Why confidence with money rarely comes from waiting until you’re “ready”
• What you’ll find in her new Tuesday articles and videos, including Youth Corner and Advice from the Sage Owl
• How her practical approach helps people make better financial decisions without feeling overwhelmed

One thing I’ve learned over the years is that financial planning really isn’t about money; it’s about your life. It’s about knowing what you want, avoiding costly mistakes, and having a financial plan that actually works when real life shows up.

That’s always been at the heart of what we do at Unconventional Wisdom and Sage Collaborative Financial Planning.

And that’s why I’m really excited to introduce Sabiha and this new space she’s creating here on the blog.

Sabiha and I have been working together for eight years now, and she’s a key part of our team. She shares the same philosophy I built my practice on, and she’s also the main financial planner working with our full-service clients, doing ongoing reviews of their financial plans and helping them build strategies that actually make sense for the life they want to achieve.

One of the things I really appreciate about Sabiha is how she approaches all of this from a practical, real-life perspective. Financial planning can get complicated fast, but she has a way of helping people feel more confident and less overwhelmed by the decisions they’re making. I’m confident Sabiha will give you the same quality and type of advice I would give.

Now, let Sabiha tell you a bit about what she’s hoping to do here.

Thank you, Ed.

What I’m really excited about is being able to share what I’ve learned over the years in a way that people can actually use — not just understand the theory, but apply it to their own lives.

One thing I hear all the time, whether I’m speaking to clients or young people, is some version of: “I’m just waiting until I’m a bit more ready.”

I always smile a little when I hear that because the feeling of finally being ready rarely arrives the way people think it does. What I’ve seen over and over again is that confidence usually comes from taking the first step, not from waiting until the steps feel easy.

A lot of what I’ll be writing about builds on the core strategies that Ed has been using for decades, but in a way that helps people understand how these ideas actually fit into real life.

Things like why starting early matters more than starting perfectly, how to think about debt and credit honestly — because there’s a big difference between the kind of credit that holds you back and the kind that helps you build something over time, and how the decisions you make today can shape your options down the road.

I’ll also be spending a lot of time in the Youth Corner because the earlier you understand the bigger picture about money, the more flexibility and freedom you create for yourself later on.

In Advice from the Sage Owl, I’ll be writing about financial planning and decision-making in a way that reflects the real side of these decisions.

Because, in my experience, the numbers are rarely the hard part. It’s the hesitation, the uncertainty, and the feeling of not knowing where to begin. That’s what I really want to help people with.

Well, we’re really looking forward to this.

It’s a big expansion of my blog. My posts will continue every Thursday, just as they always have, and we’ll be adding Sabiha’s posts every Tuesday.

Take some time to explore Sabiha’s articles. I think you’ll find them well worth the read.

Thank you.

Ed & Sabiha

The post A New Addition to Unconventional Wisdom: Meet Sabiha Mukadam appeared first on Ed Rempel.

Every week, someone tells me they want to retire by 40.

My first question is always the same: why?

The FIRE movement promises freedom decades earlier than traditional retirement. 

Online, it’s often presented as a fairly simple formula: save aggressively, invest consistently, and escape the workforce early.

But in Canada today, is FIRE actually realistic — or has it quietly become a strategy mostly for high earners, extreme savers, and people willing to take bigger risks than they admit?

I recently sat down with Canadian Press reporter Kumutha Ramanathan to discuss what I’ve seen from real clients pursuing financial independence and early retirement.

No hype. No fantasy projections. Just the math, the psychology, and the tradeoffs people rarely talk about honestly.

Here’s what we covered:

• The income level where traditional FIRE actually starts becoming mathematically possible in Toronto
• Why one popular version of FIRE may actually be harder than the original approach
• The Canadian realities most FIRE discussions barely mention
• What early retirees often discover emotionally after leaving work decades early
• The five biggest mistakes FIRE communities consistently make
• Why disciplined savers can still end up with portfolios that are too small
• The difference between needing income and needing cash flow
• The first thing I ask anyone who says they want to retire at 40

In my latest video, podcast episode and blog post you’ll learn my full answers from the interview, including the parts most FIRE discussions tend to leave out.

CLICK THE LINK BELOW TO READ THE ARTICLE BY KUMUTHA RAMANATHAN:

Financial Independence, Retire Early: The Math Behind the Viral Money Movement

The dream is seductive: retire in your thirties, ditch the commute, and spend your days on your own terms.

The FIRE movement — “financial independence, retire early” — has attracted millions of followers across Reddit threads and YouTube channels, promising that aggressive saving and disciplined investing can buy your freedom decades earlier than expected.

Yet for Canadian millennials staring down $2,000-plus rents and stagnant wages, the question is increasingly blunt: is FIRE genuinely achievable, or is it a strategy reserved for the already comfortable?

Here are my complete answers from an interview with Kumutha Ramanathan from Canadian Press. If you are considering FIRE, these extra details are quite insightful.

1. The traditional FIRE model assumes a savings rate of 50–70%. In a city like Toronto, or other expensive Canadian cities, where a one-bedroom apartment now costs upwards of $2,400 a month, is that number mathematically achievable for the average millennial — or is FIRE quietly a strategy reserved for high earners?

The traditional FIRE model in Toronto is for higher income people, frugal couples or people either living extremely frugally or doing extremely aggressive strategies. In all cases, FIRE is not easy and you need a plan to get there.

For example, an average Millennial in Toronto earns about $75,000, which means they bring home $60,000, or $5,000/month (assuming they will maximize their RRSP). To retire on a similar income in 20 years, such as starting at age 20 and retiring at 40, they would need to invest about $4,000/month, leaving only about $1,000/month. Rent alone for a one-bedroom is typically about $2,400/month, so that is not possible. It could be possible to live on $1,000 for all other expenses if you can find a way to live rent-free, such as living with parents. Most would consider this extreme. A single person would need to earn about $140,000/year to make it work by saving $4,000/month and retiring 20 years later on $75,000/year.

For a couple with both earning $75,000/year, they should be able to save $4,000/month, so traditional FIRE is achievable. They bring home $10,000/month total, pay $2,400 rent and save $4,000, which still leaves $3,600/month for all other expenses, which is not especially tight. Retiring on $75,000/year total (not each) before tax is a reasonable, but it is a basic retirement lifestyle.

It is possible to achieve FIRE with a quarter to one half the cash flow used for saving by doing extreme leverage. For example, live with your parents for 2-3 years and save $125,000. Then take a 3:1 loan of $375,000 and pay interest only, reinvesting the tax refunds. That can achieve FIRE in a total of 20 years with far less cash flow – say $1,000/month instead of $4,000/month.

2. Beyond traditional FIRE, variations like Coast FIRE and Barista FIRE promise a softer path to financial independence. Are these more realistic for the average Canadian, and do you see them being successfully implemented with your clients in practice?

Coast FIRE and Barista FIRE promise a softer path because you semi-retire by quitting your job, but take a job you consider easy, such as barista or mowing golf course lawns or consulting part-time, to continue to make income for quite a few years. Ideas like Barista FIRE make FIRE quite a bit easier, but we actually don’t see them often. Most don’t want to quit their job until they are confident they will never have to work again. Instead of having to work as a barista for 10-20 years, they can have more freedom by working 2-3 more years with their full-time job with a similar result.

Coast FIRE is actually harder. It assumes you get ahead of your goal and then can keep working and stop saving because your portfolio alone can grow enough. FIRE is hard to achieve. Getting quite a bit ahead so you can coast is even harder.

Some people who achieved FIRE do something they enjoy that might make some money. However, the very important difference is that if you have achieved FIRE, you do not have to work. You have the confidence to know you are financially independent. Barista FIRE means you need a side income for quite a few years.

3. FIRE plans rarely account for Canada-specific realities — reduced CPP payouts from decades of missed contributions, no employer health benefits for potentially 30 years, and TFSA and RRSP limits not designed for early retirees. How significant are those blind spots, and how do you address them in a client’s financial plan?

These are usually not significant factors. If you retire at age 40, CPP is still 20-30 years away. Paying your own medical costs is usually only $500-1,000/year, and buying a private basic medical plan is not much more. RRSP and TFSA limits combined are close to 30% of your income which is not enough, so FIRE means you are also investing non-registered or doing leverage. Borrowing to invest can be something like a super-RRSP because the payments are fully tax-deductible and support a significantly larger investment than contributing the same amount to RRSP. For example, $5,000/year can be a small RRSP contribution or a payment on a $100,000 investment loan. Both are a $5,000 tax-deductible payment, but one supports $100,000 of investments.

4. In your professional experience, do clients who achieve FIRE in their mid-to-late thirties tend to report satisfaction, or do you see patterns of regret around the experiences and relationships they deferred during the accumulation years in the name of saving?

We have only ever seen satisfaction from achieving a difficult goal, financial freedom and a ton of time freedom. The ones we see have a Plan and are confident they have enough. They don’t worry that they may have made a mistake.

When I ask retired people how long it took for them to get used to not going to work, the typical answer is very short – 2-4 weeks – just long enough to realize it’s not just a vacation.

5. There is well-documented research around the psychological toll of early retirement, including the loss of structure, professional identity, and social connection. As a financial expert, how much weight do you give to those non-financial variables when advising a client who is pursuing FIRE?

All of these are real issues whenever you retire. It’s not just your salary you lose. It’s also your routine, your identity and your regular social connections.

We find most people in FIRE have specific reasons they want more time freedom and most are married. We discuss it, but most have it mainly figured out. If they don’t, then we ask if they are really ready or if they should just work a bit longer.

Many FIRE people don’t stop working totally. You can’t watch Netflix all day. Many keep doing some parts of their job that they enjoy, do some consulting, have a side hustle, or they volunteer or have hobbies. These can be a huge help with these emotional issues.

6. You work with clients across different life stages. Do early retirees come back to you struggling, financially, emotionally, or both? Is returning to some form of work more common than the FIRE community likes to admit?

Many plan something part time for fun before they quit their job. We find it quite rare that they are struggling a year or more later. Most figure it out beforehand or realize it in the first few months. The ones we see have a Plan. It’s not like they quit their job and then realize they don’t have enough.

FIRE people tend to love the time freedom and the money freedom. It is great for your self-confidence. The majority feel they have moved into a new very exciting part of their life.

7. If a 28-year-old sat across from you tomorrow and said, “I want to retire by 40” — what would your honest, unfiltered advice be? And what is the one thing the FIRE subreddits and YouTube channels consistently get wrong?

The first thing is we ask why. They need a why for their personal motivation, because FIRE is not easy. Then they need a Plan. What is their specific goal, how big a portfolio do they need by when, and what is the specific plan to get there? The Plan tells them how much they need to invest and the rate or return they need to get there. It usually means they need to be all in equities to be confident of a high enough long-term return. It also tells them which strategies they need, which may involve borrowing to invest, since FIRE usually requires taking bold steps.

The 5 biggest things the FIRE discussions miss are:

1.      FIRE usually requires keeping your foot on the gas all the time.

2.      You need confidence in equities long-term.

3.      You need to focus on the size of their portfolio and tax efficiency (not just the rate of return).

4.      You will need cash flow not income.

5.      FIRE is not easy to achieve so you need a Plan and to really go for it!

For example, they want to get the full return of equities, so they buy index ETFs, but they buy several ETFs including some with lower expected returns, which means they don’t end up with the full return of equities. Or they are not confident in the long-term return of equities, so they add fixed income or gold or something defensive, which drags down their returns.

You get a larger portfolio either by long-term compounding or borrowing to invest. People trying for FIRE often have good rates or return, but small portfolios. Borrowing to invest, such as a 3:1 No Margin Call loan get you ahead much faster than focusing just on return, since you start with a dramatically larger portfolio. These loans usually only allow broad-based mutual funds or ETFs, which might mean you can get ahead faster by letting go of some niche high-risk investment and get the loan instead.

Many FIRE people feel they need income, such as dividends or interest, to finance their lifestyle, but they need cash flow. Income is taxable cash flow. They can get cash flow with “self-made dividends”, which mean you just sell a bit of your growth investments each month. This process allows you to hold your growth investments right through retirement and is very tax efficient.

Ed

The post Financial Independence, Retire Early: The Math Behind the Viral Money Movement appeared first on Ed Rempel.

Many Canadians with $1 million or more saved for retirement still feel financially insecure.

I see this all the time.

People work hard, save consistently, invest for decades, and build substantial portfolios, yet still aren’t sure they can retire comfortably.

In many cases, the issue is not a lack of money. It’s a lack of clarity.

Most people have never defined what they actually want their retirement lifestyle to look like or created a proper financial plan that shows how their investments, taxes, income, and spending all work together over time.

A financial plan is really a life plan. Once you connect the numbers to the lifestyle you want, retirement often becomes much clearer and less stressful.

In my latest article for Money PIP, I’ll explain:

• Why many Canadians still feel uncertain about retirement, even with significant savings
• The real question you should ask instead of “Do I have enough to retire?”
• Why retirement lifestyle matters more than generic savings targets
• How inflation, taxes, CPP, OAS, and withdrawal strategies affect your long-term income
• Why many people are financially independent earlier than they realize
• How a comprehensive financial plan can help give you confidence in your future

CLICK THE LINK BELOW TO READ THE ARTICLE BY VARSHA:

Why Does Retirement Feel Uncertain – Even with a Large Portfolio?

Canadians have followed traditional retirement advice for years. Work hard. Save consistently. Invest wisely. Pay off debt. Many households have done exactly that. Yet a surprising number still feel uncertain about retiring comfortably. How can you have confidence you will have financial freedom?

Financial planner and blogger Ed Rempel says this disconnect shows up in conversations with clients who appear financially prepared on paper but feel uneasy about the future.

“A lot of people actually have more than enough to retire,” says Rempel. “But they still feel uncertain because they’ve never figured out what their retirement lifestyle looks like or created a proper financial plan that shows the numbers will work.”

In Canada, retirement anxiety is common. A BMO survey from February 2026 found Canadians now believe they need about $1.7 million to retire comfortably, up from $1.54 million in 2025. At the same time, about 36% of Canadians say they are unlikely to reach their retirement savings goal.

Concerns about inflation also change how Canadians view retirement. An earlier survey by the same bank found that nearly 63% of Canadians say rising living costs have increased their worries that retirement savings will not last long enough.

Despite these fears, Rempel says households that seek financial advice are actually in better shape than they realize. The problem is not always a lack of savings. Usually, the issue is uncertainty about what those savings are meant to support.

“People ask, ‘Do I have enough money to retire?’” says Rempel. “The real question should be ‘Enough for what?’”

A financial plan is really a life plan – what is the life you want and will be able to afford? It should let you look at different lifestyles and investing strategies until you find one that is both a reasonable retirement lifestyle and reasonable for you to achieve.

For example, you may find that you are investing too conservatively or in a way that costs too much in tax for your investments to provide for you after inflation. A financial plan should allow you to ask, “What would it take to afford extras we want, such as more travel.”

Retirement numbers can feel abstract without a defined lifestyle attached to them. Some retirees plan to travel frequently, maintain two homes, or spend heavily on hobbies and family experiences. Others want a quieter retirement with lower costs. Without knowing what retirement will look like day to day, many people struggle to determine whether their savings will truly support their future.

Research suggests that this uncertainty is common. Surveys from the Canada Pension Plan Investment Board show that 59% of Canadians worry about outliving their savings. Simultaneously, people who work with a structured financial plan tend to report higher confidence about their long-term savings.

According to Rempel, a comprehensive financial plan is the only way to be confident that you will have enough for the lifestyle you want – and exactly what to do to achieve it.

It changes how people think about retirement by integrating investments, income, taxes, and desired spending into a single long-term plan.

“A strong investment portfolio is important, but confidence usually comes from seeing how everything works together over time,” he says.

Retirement discussions focus heavily on large savings targets. Headlines frequently suggest Canadians need more than $1 million to retire. Those figures can create anxiety, especially for people who feel they are falling short.

Yet these broad estimates rarely reflect the personal part of retirement spending. Someone who plans to travel extensively or support adult children financially may need far more than someone with modest lifestyle goals. Rempel says personalized planning reveals that a person’s actual retirement needs differ significantly from national averages.

“When clients see projections showing their income lasting for life, even after accounting for inflation, the uncertainty often disappears. They finally see how their savings translate into real income,” he explains.

Canada’s retirement system also adds more challenges. Government benefits such as the Canada Pension Plan and Old Age Security form a foundation for many retirees, but the timing of those benefits, tax considerations, and withdrawal strategies from registered accounts can impact long-term income and tax.

A good plan lets retirees model these factors over decades, rather than relying on rough estimates. That process can reveal how different choices affect financial security later in life. It can give you confidence in your future.

Rempel says many clients initially approach retirement planning with significant hesitation. Some believe they must continue working for several more years. Others fear that unexpected expenses or a market downturn could derail their plans.

Yet the results of a thorough analysis often surprise them.

“Once we map out their lifestyle and run the projections, a lot of people find they are already financially independent,” says Rempel. “The money was there all along. They just needed a plan that showed them exactly what to do and how it would last.”

The post Money PIP article: Why Does Retirement Feel Uncertain – Even with a Large Portfolio? appeared first on Ed Rempel.

Gas prices are up from about $1.30/litre to $1.75/litre across Canada this year. 

There is conflict in Iran. Markets are reacting to geopolitical uncertainty once again.

So what should investors actually do during times like this?

Should you move more conservative?

Or is reacting emotionally what hurts investors most?

In my latest video, podcast episode and blog post you’ll learn:

• If you go conservative, when do you buy back in?
• Does politics affect the markets much?
• When will a year not be an “uncertain time”?
• Does market timing work? What do studies say?
• What is the “Go Kart Strategy” of investing?
• The one way to time the market effectively.
• The good news and bad news of planning for retirement.
• What is the one thing most investors get wrong?
• Why you need to keep your foot on the gas to get the long-term market returns.
• What is Ed’s personal strategy?

If you go conservative, when do you buy back in?

• Going more conservative now based on news events is trying to time the market.
• If you sell because of some event, then you can only be ahead if you buy in at a lower point. What is your plan to buy in at a lower point – when things look worse?
•  Investors tend to sell when the trend is bad and buy back in when the trend is good, but that is usually when the market is at least 10-20% higher.
• You have to guess right twice – when you sell and when you buy back in.

Does politics affect the markets much?

• Numerous studies and long-term historical analyses from firms like Capital Group, T. Rowe Price, CFRA Research, and academic papers consistently show that politics has only minor and temporary effects on the stock market. Short-term volatility rises around elections due to uncertainty, but long-term returns are driven far more by economic fundamentals (corporate earnings, interest rates, growth) than by politics.

• Markets have delivered strong positive returns across every type of political environment.
• News is also increasingly unreliable. News media have found they get more viewers by telling one-sided stories and exaggerating to create fear than they do by having unbiased news.
• A Gallup poll released on October 2, 2025, found that only 28% of Americans say they have a “great deal” or “fair amount” of trust in the mass media (newspapers, television, and radio) “to report the news fully, accurately, and fairly.”
• Investing based on politics or news is not an effective way to invest.

When will a year not be an “uncertain time”?

• One of my pet peeves is the expression in many news stories – “We are in uncertain times.”
• When are times NOT uncertain?? Every year will always be an uncertain time!
• In 2026, we have gas prices and a war. Here are the issues from every past year this century:

Does market timing work? What do studies say?

• Studies across academia, investment firms (Vanguard, Morningstar, JPMorgan), and behavioral research (DALBAR) consistently show that market timing—trying to predict and act on short-term market moves—rarely works and typically reduces long-term returns compared to a simple buy-and-hold strategy.
• The core reasons are behavioral biases (buying high/selling low), the difficulty of being consistently right twice (on exit and re-entry), and transaction costs/taxes.
• You need unrealistically high accuracy: Nobel laureate William Sharpe’s landmark 1975 study (“Likely Gains from Market Timing”) found that a market timer must be correct ~74% of the time (right direction and on bull vs. bear periods) just to match the market after costs—far higher than random chance (50%).
• Individual investors “guess right” on market direction only about half the time (per DALBAR’s Guess Right Ratio), but the dollar impact of bad guesses far outweighs good ones.
• DALBAR’s Quantitative Analysis of Investor Behavior (QAIB) reports (tracking actual investor cash flows since 1994): Average equity investors lag the S&P 500 by 1–5%+ per year over 10–30-year periods due to poor timing. Example: With rolling 20-year periods, investors earned ~5.5% annualized vs. S&P 500 ~9.9%.
• For example, March, 2009 was the bottom of the Great Financial Crisis after a decline of about 45%. That month also broke a record with $20-30 billion in net redemptions of stocks. Investors sold massively at the bottom – the worst possible time!
• Morningstar “Mind the Gap” studies (latest 2025): Over 10 years, the average dollar invested in U.S. funds or ETFs earned ~1.2%/year less than the funds themselves (e.g., 7% investor return vs. 8.2% total return). This “behavior gap” equals ~15% of the potential return lost to timing.
• Bottom line: Buy-and-hold investors usually outperform those that try to time the market – by a lot!
• The saying is true: “Time in the market beats timing the market.”

What is the “Go Kart Strategy” of investing?

• I recently went Go Karting on a family cruise. Lots of fun with nephews, nieces & their kids.
• How do you get the best lap time with Go Karts? Keep your foot on the gas at full speed the entire time. Works everywhere except the sharpest curves.
• What should you do before the sharp curves? I used to think I should slow down by coasting before the curve and then cut the corner as close as possible. However, it took a couple seconds to get back to full speed after the curve.
• Then I found a faster way. Keep my foot fully on the gas the entire time, but pump the brake just briefly before the curve so I slow down but the engine stays revved to the max. Take the curve wider to get around the curve without skidding. Then hit the speed boost as soon as I start coming out of the curve.
• The secret is to focus on maximizing speed coming out of the curve, not on slowing down before the curve. Keeping the engine revved high and hitting the speed burst can mean one second after the curve I’m going faster than before the curve.
• Investing is similar. Investors tend to focus on how much to slow down before or during an event, instead of focusing on how to maximize the growth coming out of it.
• I call investing this way the “Go Kart Strategy”. Keep your foot fully on the gas the entire time and focus on maximizing the growth coming out of any market downturn.

The one way to time the market effectively.

• Trying to guess a high point in market is very difficult because most years are up. Large gain years are mostly followed by another gain. Gains are very common. About 75% of years are up.
• The one reliable market timing method is that large declines in the broad markets have always recovered. Large losses are rare. There have been only 4 years in the last 90 that the S&P500 was down more than 20%. Large losses have been only 5% of the time.
• Our “Market Timing Rule of Thumb”: Whenever the market is down 20+%, look for creative ways to find more money to invest.
• This is the one method I have found to work reliably. Getting this one right alone can mean you outperform the markets.

The good news and bad news of planning for retirement

• From writing thousands of Financial Plans, we see the good news and the bad news.
• Bad news: It takes more money to retire comfortably than you think.
• Good news: You can get there more easily than you think.
• For example, if you want to retire on $100,000/year, let’s say the government pensions will give you $20,000, so you need $80,000/year from your investments.
• To estimate how much you need, the “4% Rule” is a good estimate. I found in my detailed study about it that the amount you can reliably withdraw from your investments and increase by inflation for 30+ years is:

o   Equity investments                  4%/year

o   Balanced investments              3.5%/year

o   Fixed income                            2.5%/year

• Withdrawing 4%/year to give you $80,000/year plus inflation means you need $2 million in investments to retire, if you are high in equities.
• With more conservative investments, you need more than $2 million.
• $2 million is probably more than you thought. That is not a lavish retirement, but you need to be a multi-millionaire to afford it!
• The good news is that you can get to $2 million by investing only $1,500/month for 30 years. That is $18,000/year, which is about your RRSP room if you earn $100,000/year.
• In other words, in most cases, just maximizing your RRSP and possibly TFSA for 30 years is often enough to retire with the lifestyle you want.
• That is probably easier than you thought.
• But you need to average the long-term return of the markets.

What is the one thing most investors get wrong?

• To have the future life you want, you need to get the rate of return in your Financial Plan as a long-term average. If that is based on an equity return, you need to be fully in equities on average through your life – not just most of the time.
• You need to keep your foot on the gas to get the long-term returns of the markets.
• Your Financial Plan is based on the long-term average return. If you are not fully invested for long-term growth all or nearly all the time, you are likely to fall short.
• The one thing most investors get wrong is that they want to get the full return of equities, so they buy index ETFs, but they buy several ETFs including some with lower expected returns, which means they don’t end up with the full return of equities. Or they are not confident in the long-term return of equities, so they add fixed income or gold or something defensive, which drags down their returns.
• For example, if you invest in equities for 30 years but switch to fixed income or gold every 5^th year because of some event, you are highly likely to get lower returns. Or you hold 20% fixed income or gold or other defensive investment all the time. Your long-term average return with either of these methods is expected to be about 7%/year, instead of 8%/year for the market conservatively.
• Your retirement portfolio and retirement income end up 17% lower for life because you were not fully in equities for growth the entire time.

What is Ed’s personal strategy?

• Personally, I use my Go Kart Strategy.
• I have been 100% invested for growth for all of the last 35 years. I have owned no fixed income or defensive investments at any time – and I am quite sure I never will.
• I am standing on the gas pedal all the time.
• Plus, whenever the market is down 20% or more, I look for a creative way to take advantage of it. Do my annual investment sooner, or find extra cash to invest, or increase my leverage.
• If I can get more money into the market after a decline, then my personal return will be higher than the return of the investments themselves. Easy way to outperform!

Ed

The post Don’t Let Today’s Headlines Wreck Your Retirement appeared first on Ed Rempel.

Should you delay retirement… or are you closer than you think?

I was asked by the National Post to review the finances of a 62-year-old deciding whether to defer Canada Pension Plan and Old Age Security to 70, and whether to keep working longer.

Some of the answers go directly against what most people assume.

In this article, you’ll learn:

• How she can retire with only $700K+ and her pension
• Why she should defer Canada Pension Plan and Old Age Security because of her portfolio, and when the answer would be different
• Why she does not need cash for an emergency fund and can use a credit line instead
• Why she should not use investments to pay off her mortgage
• Why she should renew her mortgage as soon as she can
• Why an annuity can make her retirement less secure
• The difference between the yield of an annuity and the rate of return
• How she can provide reliable cash flow with minimal tax using self-made dividends

CLICK THE LINK BELOW TO READ THE ARTICLE BY MARY TERESA BITTI:

Should Caroline, 62, defer CPP and OAS until age 70, or even delay retirement entirely?

Financial Plan

Caroline wants to retire in 3 years at age 65 with an income of about $88,000/year before tax. This should give her the same after tax cash flow as she is making now with a salary of $102,000, since she won’t have to pay into her company pension, CPP or EI after she retires.

Good news! To do this, she needs a portfolio of $735,000. She is projected to have $737,000. She should have exactly enough so that she should be able to retire when she wants with the lifestyle she wants.

It is generally advisable to have 10-20% extra to give her a margin of safety, and she has no margin of safety. However, she should be okay to maintain her lifestyle for life.

This assumes that her RRSP and TFSA are 100% equities, but her advisor LIRA is more conservative in a balanced portfolio with a lower return. Her current mortgage payments should pay off her mortgage in 21 years.

Caroline needs this type of planning. She has enough to retire with the lifestyle she wants, but does not know it. She is still wondering whether to delay retirement. A financial plan is the only way to be able to retire confident that you will always have enough for the lifestyle you want.

Questions

She is prepared to take on a part-time job after she retires, but would prefer not to have to work at all. She’s just not sure that will be possible. “Should I delay retirement?” she asked, before stating “I’d retire next year if I could.”

She should be able to retire without having to work and not have to delay her retirement.

She plans to supplement her employer pension by drawing down her registered investments and start taking CPP and OAS at age 70. “At that point, there won’t be as much in my Registered Savings Plan, which should help minimize tax. Is this a good strategy?”

In Caroline’s case, deferring CPP & OAS to age 70 is a good strategy, but it won’t save her tax. Deferring to age 70 gives her an implied return of 6.8%/year, which is likely a bit higher than her investment returns, since quite a bit is in the more conservative balanced portfolio. If all her investments were 100% equities, then she would have a 10% margin of safety in her retirement goal and she could then start CPP & OAS at age 65, since her higher return investments should provide more than the pensions.

Her RRSP & LIRA and CPP & OAS are all taxable, so the deferring will not change her taxable income. Her opportunity to save tax is if she takes some of her income every year from her TFSA and less from her RRSP. She should keep some TFSA in case of emergencies, so she should not take too much of her TFSA.

For an emergency source of funds, she should apply for a credit line secured on her home and an unsecured credit line now while she is working. She can keep these through retirement to use for cash emergencies. This can allow her to use more of her TFSA for cash flow and perhaps keep only $25-50,000 in it.

She has about $14,000 in remaining RRSP contribution room and $16,000 in TFSA contribution room. “Should I continue to fund my RSPs? My TFSA? Or should I pay down my mortgage more?” asked Caroline, who would also like to know how soon she should start looking to renew her mortgage, which matures next year. She is concerned interest rates may start to rise because of the war in the Middle East and all of the geopolitical uncertainty.

Caroline brings home about $5,500/month now which is about the same as she is spending, so she probably is not able to save much. She is in a slightly higher tax bracket now while working than she will be in during retirement, so she should maximize her RRSP room first, even if she has to withdraw from her TFSA to do it.

Her mortgage rate is lower than her investment returns over time, so she should only make the minimum mortgage payments and not do any prepayments.

Generally, banks allow you to renew up to 3 months early if you renew with the same bank. Today’s rates are lower than her 5.45% mortgage, so she should renew as soon as the bank allows.

She should not worry about the geopolitical issues in the Middle East, since they are likely to be short term and should be resolved long before her mortgage comes due. She would pay a penalty to renew now instead of next year, so she can wait until next year and renew when she can to avoid the mortgage prepayment penalty.

Caroline also wonders if she should consider putting her investments into an annuity before she retires. She likes the idea of receiving a regular income stream. If not an annuity, she’d like to know the best way to generate dividend income. 

Annuities are invested more conservatively and have an estimated rate of return inside the annuity of about 4%, which is much lower than her investments. They may quote a yield about 6.7% today, but the yield is the cash flow she would get including her principal amount. The yield is not the rate of return. She would have to work part time for a few years if she decides to invest in an annuity.

Annuities would make her retirement less secure because the income is too low to provide for the life she wants.

The best way to get dividend “income” is with “self-made dividends”, which means just selling a bit of her investments every month for her lifestyle. This gives her a mix of capital gains and the return of her capital, which is taxed lower than actual dividends. Actual dividends are fully taxable immediately, unless she invests only in Canada where returns are generally quite a bit lower than global or US equities.

“Self-made dividends” are better than actual dividends in every way. She would pay less tax, be able to decide the exact cash flow and timing she would get, and she could invest globally for the best risk/return, instead of having to invest entirely within Canada.

Caroline actually needs cash flow, not income. Income is taxable cash flow. She needs a reliable source of cash flow with ideally very little tax.

Ed

The post National Post article: Should Caroline, 62, defer CPP and OAS until age 70, or even delay retirement entirely? appeared first on Ed Rempel.

You’ve worked hard, built up a few million dollars, and now you’re seventy-five, retired, and staring at your portfolio wondering — do I really need to keep riding the stock market rollercoaster? 

Or is it finally time to play it safe?

That’s the multi-millionaire’s dilemma, and it’s a lot more common than you might think.

We have seen it many times. Far more money than you will spend during your life. 

Continue investing for growth or switch to conservative?

In my latest video, podcast episode and blog post you’ll learn:

• What is the “Multi-Millionaire’s Dilemma”?
• Why consider going conservative?
• Why consider continuing to invest for growth?
• What is the maximum that equities are likely to be down at the end of your life?
• What are the odds equities are down over periods of 5, 10, 15 or 20 years?
• How much growth are you likely giving up by switching from equities to GICs?
• Can the numbers make this clearer?
• What is your money for?
• Why Ed will be 100% equities his entire life.

Multi-Millionaire’s Dilemma

“Multi-Millionaire’s Dilemma”: You have far more money than you will ever need. You are walking down the street and find a $100 bill. Would you bother to pick it up?

You don’t need the money and it takes a little effort to pick it up. On the other hand, it’s easy to pick up and only takes a second. What would you do?

Similarly (but not as simple), if you are comfortable with equities and they are highly likely to grow, why not stay invested for growth?

This post is about people that have been investing in equities, are comfortable with it, and now have a portfolio far larger than they will need for the life they want – even if they live unexpectedly long. However, they are getting older and their life expectancy is 5 or 10 or 15 years.

What investment allocation makes sense?

Why consider going conservative?

You turn on the news, watch your account drop twenty percent in a few months, and suddenly the math feels different. Why have the emotional stress? At seventy-five, do you have time to wait for the market to come back?

Your portfolio is your security. I meet wealthy people that say, “I’m already rich. Why make more? I just have to avoid a mistake and losing it.”

That’s where conservative investing starts to look appealing. Just switch everything to GICs or bonds so you so you don’t lose money. You can avoid being down at the end of your life.

Why consider continuing to invest for growth?

The case for staying in stocks is pretty simple on paper. Over the long run, equities have crushed everything else. If you look at the last hundred years, stocks have returned about ten percent a year on average. Even if you’re seventy-five, you could easily live another fifteen or twenty years. Twenty years is long enough for compounding to still matter a lot.

Plus, if you have five million dollars, even a bad decade in the market isn’t going to wipe you out. You’re not living paycheck to paycheck — you’re living off a portfolio most people would kill for. Why give up that extra growth just because you’re older?

Your money is your freedom. More money is more options in life. You can enjoy it or give more to my family or give more to causes important to you.

Bonds mean you pay a lot more tax and they can lose money by getting killed by inflation. Keep investing tax-efficiently to make at least more than inflation – and hopefully a lot more.

Equities can support you living comfortably. You can get a reliable, tax-efficient cash flow from your equity investments with self-made dividends by just selling a bit every month. It’s a monthly deposit of the amount you choose to your bank account – just like a salary. Let your money keep growing to feel safer about your lifestyle.

You have been comfortable with equity investments for many years, so just keep the investments you have. The odds of your equity investments growing during your life are quite high and it can be a lot more money. The math of compounding is amazing.

Can the numbers make this clearer?

Those are the 2 main arguments. Many people make this decision based on their gut.

However, questions like this are clearer when you see the numbers.

• What is the worst-case scenario? What is the maximum that equities are likely to be down at the end of your life?
• What are the odds that equities are down from today at the end of your life?
• How much growth are you likely giving up by switching from equities to GICs or bonds?

Here are the numbers based on calendar year returns in the modern stock market (since 1935). They show:

• How much of a decline has the worst-case scenario been?
• What is that in dollars for every $1 million you have?
• What are the odds that equities are down at the end of your life?
• How much growth are you giving up by selling your equites to buy bonds or GICs? Equities should conservatively make 8%/year, and GICs or bonds about 3%/year. The table shows simple math excluding the compounding, assuming you spend or give away the money.

Here is a short version:

To understand this, let’s say you believe you have 10 years left to live. The worst 10-year return in the modern stock market was 1.4%/year. If this worst-case happens, you would be down 14%, or $143,000. Your $1 million portfolio would be down to $857,000. The worst-case is not really down a lot with the size of your portfolio.

In 10-year periods, the markets have been down only 3% of the time in the modern stock market, so it is quite unlikely you would be down and not recovered during the next 10 years. That is not a 3% chance of the worst-case scenario. It is a 3% chance of being down at all.

By being in GICs vs. equities for the next 10 years, the average return you could expect to lose would be about 5%/year (3% return of GICs or bonds vs. equity return conservatively 8%/year). Losing 5%/year is $50,000/year, or $500,000 in lost growth over 10 years. This does not include compounding. It assumes you spend the $50,000 or give it to your kids or charity every year. An extra $500,000 is a good number and gives you more freedom.

Looking at the numbers for 10 years or longer, the case for staying in equities is quite strong. You are likely to be $500,000 or more ahead with only a 3% chance of being down a little bit.

What about 5 years? If you are quite sure you have less than 5 years left to live, then a worst-case scenario could be being down 37% or $370,000 at the end of your life. The risk of being down at all based on history is about 12% – still low, but not irrelevant. The most likely scenario is that you would be missing out on $250,000 or more of growth.

The worst-case loss of $370,000 is larger, but it is very unlikely. The $250,000 growth is the average growth you are likely to lose. The markets have tripled in 5-year periods, so the maximum growth could be much higher, but it’s best to look at most likely outcomes.

Looking at the numbers for 5 years, the case for staying in equities is less strong, but still there. You are likely to be $250,000 or more ahead with only a 12% chance of being down a little bit plus a very low chance of being down quite a bit.

There is, of course, a risk that equities could lose more or make more than these figures. Nothing is guaranteed. But looking at expected returns based on history can make the decision much clearer.

The truth is that any option could be fine. It is up to you. Avoiding any loss could make sense. Staying in equities when you are comfortable with them and can make far more could also make sense.

It is always worthwhile to look at the numbers. Understand the risks, how likely they are, and how much growth you would lose. The numbers can make it a lot clearer for you.

What is your money for?

When we talk with people that have more money than they will ever spend, they are usually equity investors and have been for many years and are comfortable with equities. They usually have a bigger purpose for their life than just enjoying it.

It is wise to plan to have enough money to maintain your desired lifestyle, even if you live much longer than expected – and even if you have major unexpected expenses later in life. Have a comfortable margin of safety so you don’t have to worry about money.

What if you have much more than that? If you will never spend your money, then it goes to your estate or whoever you give it to. The money you won’t spend won’t be wasted. It’s smart to still be smart with that money.

We talked with people that invest conservatively to feel safe with their money. They expect to live 5 or 10 more years. All the money they won’t spend will go to their kids. Meanwhile, all their kids are investing in equities. When they pass away, their conservative investments will go to their kids who will mostly invest it in equities.

In other words, your extra money is probably really your children’s money and should be invested smartly to help them in the future. That probably means investing with a longer-term time horizon for long-term growth.

Why Ed will be 100% equities his entire life.

I will always invest 100% in equities for a few reasons:

1. I’m a huge believer in humanity, continuous growth and free enterprise, and I want to participate in it. The stock market is where we see human ingenuity and ambition, and new technologies that improve our lives. And the stock market has provided high, reliable growth over longer periods of time through history. It is the most reliable, high-growth asset class – which is why it is most effective for retirement planning.

For me, even if I knew for a fact I have only one year left, 73% of years are up, so staying invested in equities is still the best choice.

2. I fight aging every step of the way. I have so much to live for. I’m in the best longevity programs I can find and in better shape than 15 years ago. I believe that medical science will figure out how we can start living decades longer in 10 or 20 years.

I would not accept it if doctors told me I have an incurable disease with only a short life left. I would be searching for any options, including experimental treatments all over the world. I would fight it until the end – which means I could easily live longer than expected.

3. How many years you have left is uncertain. What happens if you live much longer than you think? You can believe you have only 5 years left and look at the numbers on the table to see what makes sense for you. But what makes you think you have only 5 years left? That is usually doctors telling you what happens on average – if you have an average lifestyle and don’t do anything unusual to help yourself. The average years left doctors tell you means half of people live longer. There are constantly new medical discoveries. You can look after your health and improve your odds.

4. My money is not just for me. I have family to leave it to and a charitable foundation that will get much of it. The longer I am in equities, the more money is likely to go to all these causes that are important to me.

I hope these numbers can help you make an informed decision in your life. But as for me, I will always be in equities.

Ed

The post Multi-Millionaire’s Dilemma: Stay in Stocks or Go Conservative After Retiring? appeared first on Ed Rempel.

Most Canadian families with kids who have disabilities are missing out on the RDSP.

It’s one of the most generous programs we have — but a lot of people who qualify for it either don’t know about it or don’t use it properly.

In my latest article with Business News This Week, I break down:

• How $1,500 can get you $3,500 in grants (that’s $5,000 total)
• Why some families can get up to $1,000/year — even without contributing
• The key age rules (these matter more than you think)
• Why RDSPs are usually best invested for long-term growth
• The big withdrawal mistake that can cost you grants
• How RDSPs fit with TFSAs and RESPs

If you qualify, this can make a big difference over time.

CLICK THE LINK BELOW TO READ THE FULL FEATURE HERE:

How RDSPs Can Help Canadian Families

Families in Canada who have kids with disabilities don’t know about the financial tools that are available to them. One powerful tool is the Registered Disability Savings Plan, or RDSP. An RDSP is a savings account that provides long-term security for people eligible for the Disability Tax Credit. While the concept might seem complicated at first, knowing the basics can help families take full advantage of its benefits. 

Ed Rempel, a financial planner and blogger in Toronto, says too many families miss out. “A lot of people qualify for the Disability Tax Credit but don’t use RDSPs,” he explains. “An RDSP is a generous savings vehicle that helps parents give their children something extra for the future.” He notes that even small contributions can accumulate over decades thanks to the government’s support and long-term investment growth. 

With an RDSP, funds should stay in the account until the beneficiary turns 60. This way, contributions and investment growth can accumulate for decades. The Canadian government adds to these savings with generous grants and bonds. If your family income is less than $114,750, you can contribute just $1,500 and get a Canada Disability Savings Grant of $3,500. That is more than double your contribution! The maximum lifetime grant is $70,000, which you can get with 20 years of contributions of $1,500.

If your income is over $114,750, then you only contribute $1,000 and get a grant of $1,000. Meanwhile, the Canada Disability Savings Bond offers up to $1,000 just for having your RDSP open, even if you can’t contribute, which can be very helpful for low-income households.

To open an RDSP, the beneficiary must be under 50, have a Social Insurance Number, and qualify for the Disability Tax Credit. Contributions can be made by parents, grandparents, or others, and can continue until the beneficiary turns 49. While there’s no yearly contribution limit, the lifetime contribution cap is $200,000.

Because the account is meant to grow for decades, the investment strategy is a big consideration. A lot of financial planners, including Rempel, recommend investing primarily in equities. “Since RDSPs are long-term by design, holding equities fits my philosophy. It lets the money grow more over time, giving beneficiaries a stronger financial foundation.” The goal is to let the money benefit from the power of compound growth, which can increase the total amount available when the funds are eventually accessed.

RDSPs are designed to be a retirement income for disabled people. There are significant penalties if you withdraw within 10 years of your last contribution, so if you contribute until age 49, you should not start withdrawing until age 60.

Families should also understand the rules around withdrawals. Contributions can be withdrawn at any time, but government grants and bonds are subject to a 10-year repayment rule. If funds are withdrawn early, grants and bonds received in the past 10 years might have to be repaid up to 3 times the withdrawal amount. The RDSP is supposed to be a long-term savings account, not a short-term fund, so families must plan accordingly. 

Maximizing the benefits of an RDSP extends beyond opening an account. Families should try to start as early as possible and contribute regularly. The government’s matching grants and bonds can grow a lot over time. Even moderate contributions, when combined with the grants and bonds and invested effectively, can grow into a significant amount by the time the beneficiary reaches 50 or above.

Coordination with other financial planning is also essential. Because RDSP funds typically cannot be used until later in life, the account complements shorter-term savings tools like TFSAs or RESPs rather than replacing them. Planning contributions around other financial goals helps families meet immediate needs while building long-term security.

Professional guidance can help individuals understand the technical rules of RDSPs. Financial planners can advise on contribution timing, investment strategies, and withdrawal planning. “Even though the rules can seem complex, the benefits are worth it. Families who set up and contribute to an RDSP are giving their children a financial advantage they would not otherwise have,” Rempel concludes.

For families with kids who qualify, the RDSP provides long-term security and opportunity. By starting early, contributing consistently, and investing wisely, families can create a powerful financial resource that supports their loved ones for decades. In the long run, this kind of planning can offer peace of mind, knowing that children with disabilities will have access to resources that help them live with independence and dignity.

Ed

The post Business News This Week article: Ed Rempel From Toronto Explains How RDSPs Can Help Canadian Families appeared first on Ed Rempel.