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Couch potato investing for the last 14 years - tracking my progress

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  • Oct 20th, 2020 1:44 pm
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Deal Addict
Nov 4, 2007
1489 posts
570 upvotes
Toronto
oldspice wrote: Thanks, makes sense. So if you have some room to put in bonds, should they go TSFA or RRSP? I could put international equities in non-reg and then bonds in TSFA or RRSP?
I don't think there are hard and fast rules that apply to everyone. Bonds could potentially be put anywhere. You could argue that Bonds fixed income will not grow as much as equity capital gains, so if you put them in RRSP, you will be taxed less in the end. However because Bond income is taxed at a higher rate than capital gains, there is an argument to put them in TFSA, where all returns are completely tax free. In RRSP it's just taxed deferred.

I personally have my bonds in my RRSP along side US Equity ETFs. Due to mandatory RRIF withdrawals, having bonds in there allows you to option to cash out Bonds or Equities depending on the current market when you retire. If a particular year is a Bear market, you can cash out your Bonds to satisfy the minimum RRIF withdrawal and not have to touch your equities at a loss. In Bull market years, you can do the opposite - ie Cash out Equities instead. Having both Bonds and Equities in your RRSP give you this flexibility. This doesn't apply to TFSA as you are never forced to take money out in a given year.

Finally, because Bonds over the long run will grow less than Equities, I prefer to leave just equities in my TFSA, so it can grow as much as possible completely tax free.

EDIT: There is a case to put Short-Term bonds in your TFSA. This is if you think you will need that money in the short term to fund a vacation, house purchase, emergency fund, etc. In that case having Bonds there will give you the same flexibility outlined above. I personally keep my emergency funds separate in cash within High Interest Savings Accounts.
Jr. Member
Nov 25, 2013
174 posts
101 upvotes
Could anyone recommend any US listed ETFs equivalent to VCNS or VBAL (at least 40% - 60% fixed income)? My mom likes to keep some USD and she has had it invested in the RBC Monthly Income Fund US$ (mer is about 1.6%) so I'm looking to switch to an ETF with a lower MER.

I searched online and i found the iShares Core Conservative Allocation ETF (AOK) but wanted to see if anyone on RFD has better recommendations. Thanks!
Newbie
Jun 30, 2019
88 posts
103 upvotes
serious9 wrote: Started investing in 2016, I am 100% stock 0% bonds. Maintain equal portion between US/CAD/INTL.

I have been waiting for this day to happen. Many people said to have bond allocation because one does not know how they will react to a 20-40% decline in portfolio.

I lost over 80k in the last few weeks. Will be buying more units every 2 pay stubs as I have over the past few years. Hold on tight friends.
Just giving an update to this message I sent during the recent market downturn. I did not sell my holding and held on tight. I continued to invest throughout the downturn and now our family net worth ended up growing 50k higher than the previous market peak before the pandemic affected the markets (basically a 50k growth in family net worth over 3-4 months).

I hope everyone here continued to invest did not sell off their holdings. Our portfolio is currently 100% in stocks split between CAD/US/INTL indexes. This was the first time my wife and I experienced a severe market downturn (started investing in 2016). Since we have mentally survived with a 100% stock portfolio, we feel confident that we should be able to mentally stick the course with the same allocation for the foreseeable future.
Deal Addict
Oct 25, 2007
1461 posts
308 upvotes
Mississauga
serious9 wrote: Just giving an update to this message I sent during the recent market downturn. I did not sell my holding and held on tight. I continued to invest throughout the downturn and now our family net worth ended up growing 50k higher than the previous market peak before the pandemic affected the markets (basically a 50k growth in family net worth over 3-4 months).

I hope everyone here continued to invest did not sell off their holdings. Our portfolio is currently 100% in stocks split between CAD/US/INTL indexes. This was the first time my wife and I experienced a severe market downturn (started investing in 2016). Since we have mentally survived with a 100% stock portfolio, we feel confident that we should be able to mentally stick the course with the same allocation for the foreseeable future.
Congrats man.. i started in mid 2017 but 60E40B (VAB/VCB/VUN/XEC/XEF) and slowly moved to 80E20B.
Did not sell anything but bought in around 70k during 1st/2nd dips...
now i checked my portfolio is 450k (total invested 400k over 3 years).
I wish i could have bought in more during 3rd or 4th dip but bit late before it took sharp v-turn.

Well overall happy to see the portfolio is in green with +50k profit across 3 years of investing as a newbie.

Btw..what do you have in your portfolio? only ETFs or individual sotcks?
[OP]
Deal Addict
Oct 1, 2006
2109 posts
1706 upvotes
Montreal
jaye23 wrote: Could anyone recommend any US listed ETFs equivalent to VCNS or VBAL (at least 40% - 60% fixed income)? My mom likes to keep some USD and she has had it invested in the RBC Monthly Income Fund US$ (mer is about 1.6%) so I'm looking to switch to an ETF with a lower MER.

I searched online and i found the iShares Core Conservative Allocation ETF (AOK) but wanted to see if anyone on RFD has better recommendations. Thanks!
AOK/AOM looks like good options for you. I am not aware of a Vanguard all-in one ETF for the US.
[OP]
Deal Addict
Oct 1, 2006
2109 posts
1706 upvotes
Montreal
serious9 wrote: Just giving an update to this message I sent during the recent market downturn. I did not sell my holding and held on tight. I continued to invest throughout the downturn and now our family net worth ended up growing 50k higher than the previous market peak before the pandemic affected the markets (basically a 50k growth in family net worth over 3-4 months).

I hope everyone here continued to invest did not sell off their holdings. Our portfolio is currently 100% in stocks split between CAD/US/INTL indexes. This was the first time my wife and I experienced a severe market downturn (started investing in 2016). Since we have mentally survived with a 100% stock portfolio, we feel confident that we should be able to mentally stick the course with the same allocation for the foreseeable future.
Happy to hear that and thanks for sharing.
Newbie
Jun 30, 2019
88 posts
103 upvotes
mkannuri wrote: Congrats man.. i started in mid 2017 but 60E40B (VAB/VCB/VUN/XEC/XEF) and slowly moved to 80E20B.
Did not sell anything but bought in around 70k during 1st/2nd dips...
now i checked my portfolio is 450k (total invested 400k over 3 years).
I wish i could have bought in more during 3rd or 4th dip but bit late before it took sharp v-turn.

Well overall happy to see the portfolio is in green with +50k profit across 3 years of investing as a newbie.

Btw..what do you have in your portfolio? only ETFs or individual sotcks?
I only have basic low cost ETF indexes. XAW mostly and the corresponding Canadian ETF index in non registered accounts.
Jr. Member
Nov 23, 2014
145 posts
33 upvotes
East York, ON
How hard is it to file a T1135? I'm thinking of soon moving my Canadian ETFs to the US ETFs (in US dollars) to get a better MER, among some other things. Just want to know how much work this is each year to do? Size of portfolio is large so will meet the 100k min.

Would this paperwork hassle, preclude me from owning over 100k in USA ETFs directly? I'd save on MER I guess.
Sr. Member
Nov 4, 2015
822 posts
612 upvotes
Ontario
oldspice wrote: How hard is it to file a T1135? I'm thinking of soon moving my Canadian ETFs to the US ETFs (in US dollars) to get a better MER, among some other things. Just want to know how much work this is each year to do? Size of portfolio is large so will meet the 100k min.

Would this paperwork hassle, preclude me from owning over 100k in USA ETFs directly? I'd save on MER I guess.
It's not that difficult. There's even a simplified method if your cost is below $250k.

https://www.canada.ca/content/dam/cra-a ... 35-19e.pdf
Deal Fanatic
Feb 4, 2015
5939 posts
2432 upvotes
Canada, Eh!!
RichRFD wrote: It's not that difficult. There's even a simplified method if your cost is below $250k.

https://www.canada.ca/content/dam/cra-a ... 35-19e.pdf
oldspice wrote: How hard is it to file a T1135? I'm thinking of soon moving my Canadian ETFs to the US ETFs (in US dollars) to get a better MER, among some other things. Just want to know how much work this is each year to do? Size of portfolio is large so will meet the 100k min.

Would this paperwork hassle, preclude me from owning over 100k in USA ETFs directly? I'd save on MER I guess.
Pretty straight fwd.

If holding all with same brokerage then really easy as can group all together.
.......
July 13, 2017 to October 25, 2018: BOC raised rates 5 times and MCAP raised its prime rate next day each time.

2020: BOC dropped rates 3 times and MCAP waited and waited to drop its prime rate to include all 3 drops.
Newbie
Jun 11, 2020
1 posts
You claim your salary was $ 60K a year at the start but you managed to save $ 114K in the third year?

Something doesn't add up.
[OP]
Deal Addict
Oct 1, 2006
2109 posts
1706 upvotes
Montreal
Hi @JoelS62706

The $114k is from 2012 which is my 7th year not third. As I stated in this thread previously I have stock options from my employer which vested in 2012, 2016 and 2019. Because of this my savings rate were very high in these years.
Deal Fanatic
Jan 21, 2014
5059 posts
2683 upvotes
It's mid year mark, how is your portfolio YTD OP?
[OP]
Deal Addict
Oct 1, 2006
2109 posts
1706 upvotes
Montreal
mkl38s wrote: It's mid year mark, how is your portfolio YTD OP?
NW: -11K YTD
Portfolio: -4% YTD
NWJULY2020.png

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