Show cover of Build Wealth Canada Podcast

Build Wealth Canada Podcast

As one of Canada's youngest retirees at the age of 32, and after becoming mortgage-free at 29, Kornel interviews the top financial experts in Canada to help you optimize your investments, reduce your taxes, and help you accelerate your journey towards financial independence and early retirement. He also shares his own experiences and lessons learned in investing and as an early retiree and member of the FIRE (Financial Independence, Retire Early) movement to help you optimize your finances, specifically here in Canada.

Tracks

Should You Use Options In Your Investment Portfolio? How Do Options Work in Investing?
I always thought it would be neat to interview someone, that is actually part of the organization that runs the Toronto Stock Exchange. Most of us have the majority of our retirement savings in ETFs or stocks and so it makes sense to actually have some understanding of the exchanges here in Canada, how they work, and the relationships that exist between the brokerage that you use to actually buy your investments, the stock exchange itself, and the governing bodies and regulators that are there to ensure that investors like you and I are protected. To help us with this, I have Richard Ho on the show. Richard works for the TMX Group, which is the organization that actually runs the Toronto Stock Exchange, the Montreal Exchange, and other exchanges that we’ll learn about today, here in Canada. One of Richard’s responsibilities, is leading educational initiatives to help improve investor education, for Canadians like you and I.  One of the educational initiatives that I wanted to really highlight, is that Richard and his team have put together a free to enter competition, with a $10,000 grand prize, and 7 weekly prizes of $500 each. The competition revolves around investing using options. If you’ve ever wanted to learn more about what options are, and how they can be used to make money, definitely listen to this episode, but also take part in this free competition as it’s a risk-free trading simulation contest, with a lot of educational resources. The way that it works is that you have a virtual portfolio of $100k, and the question is: Can you strategize and trade options to earn the highest returns in hopes of winning the weekly cash prizes, a $10,000 grand prize and bragging rights as Canada’s Top Options Trader?  The contest runs for 8-weeks and kicks off on September 19, 2022. You can register for free here. There’s no entry fee, it’s just good education on the subject, and a way that you can try options as a tool in your investment portfolio, without actually risking any of your own real money.  So good luck, and now let’s get into the interview with Richard.  Our Expert Guest: I’ve invited Richard Ho, DMS, CAIA, FCSI, Director of Equity Derivatives and Customer Relationship Management at TMX Montréal Exchange, who is responsible for leading educational initiatives and partnerships with brokerage firms to discuss what makes this contest exciting, how it differs from past editions, and the educational component surrounding it.   Richard also collaborates on Option Matters, a Montréal Exchange blog whose mission is to help individuals increase their knowledge of the options market.  Resources Mentioned: You can enter the contest for free here (it runs from September 19th 2022 to November 11th 2022). More educational resources: Education on Options: optionmatters.ca Montreal Exchange Education Resources: m-x.ca/education Montreal Exchange Equity Derivatives & Options Education: m-x.ca/options The Montreal Exchange Main Site: m-x.ca/en The main TMX site (where all the Canadian exchanges are): tmx.com Questions Covered: To set the foundation, can you take us through the different exchanges here in Canada. For instance, most of us know about the Toronto Stock Exchange, but what are the other exchanges in Canada? and what do we need to know about them as Canadian investors? You are part of the TMX Group. Can you explain what the relationship is between the TMX Group, and these exchanges? And where can we go to learn more, for anybody that wants to dive deeper? Since the exchanges are such a critical component in Canada’s economy and our personal retirement savings, how are investors protected? I imagine there is a lot of government regulation and monitoring? Options have become a very popular topic lately, yet most of us haven’t been taught anything about them when in school. For somebody completely new to options, can you give us some detail on what options are, how they work, what type of investor they tend to be suited for, and where can we go to learn more about them? A lot of the investors on the show (myself included) are DIY, passive, total market index investors. Options seem like a tool that we can learn about and have in our arsenal, to use when needed.  What purpose can they serve for a passive do-it-yourself investor that typically just tries to buy the market as a whole using ETFs? And how much of a time commitment is it to learn how to do it properly? When it comes to the work that you and your team do, what are your actual goals or mandate? For instance, the TMX Group is a publicly traded company on the Toronto Stock Exchange, just like other for-profit companies, yet you don’t actually sell anything to DIY Canadian investors like myself, and I noticed that your team also produces a lot of educational content for Canadian investors like optionmatters.ca, and you even do contests and competitions to encourage investor education. How does all that work? Can you tell us more about the free-to-enter competition that you have coming up? For anybody that maybe doesn’t feel comfortable entering the competition yet, or is listening to this podcast episode months after the competition has already taken place, where can they go to learn more and access the different free investor education resources that you and the team have put together?  Can you take us through any basic options strategies that investors can try out, both during the contest and/or in real-life? Tell us again where we can go to access more of the free investor education tools that you have available, as well as where we can signup, for free, to the Options Trading Simulation Contest.
47:51 09/13/2022
Optimizing Investing Through Your Work - Employer Match, Defined Benefit, and Defined Contribution Pensions in Canada - Featuring Robb Engen from BoomerAndEcho.com
One question that I’ve been getting asked a lot, both from listeners of the podcast, as well as those in my investing course, is how to deal with and optimize any sort of investments through your work.  Typically, in Canada, when you work for a mid-size or large organization, you’ll either be part of a defined contribution pension plan, or a defined benefit pension plan.  We’re going to cover both types of pensions in this interview, and specifically, some of the things we’ll cover are: How should a pension factor into how you view your finances/investments? (And again, this is all going to be for both types of pensions, no matter which one you have). What should your portfolio look like with a pension (i.e. more equity than bonds?), especially depending on the type of pension that you have. How to factor a pension into an early retirement. The tax implications of potentially taking a buyout for early retirement (if that's an option) We cover all that, and much more in the interview (scroll down for the full list of questions).  Our Expert Guest: To help me with this, I have Robb Engen on the show, who is one of the most reputable fee-for-service financial planners that I know of in Canada.  He also runs one of the largest and most reputable personal finance blogs in Canada called boomerandecho.com.  He’s regularly quoted or featured in financial media such as the Globe & Mail, MoneySense, the Financial Post, CBC, and Global News. He used to actually work for a university here in Canada, where he had one of those nice gold-plated pensions, but ended up transitioning from that to becoming self-employed, so he had to go through this pension analysis himself first-hand on what to do when you have a pension, and then no longer wish to stay with that employer.  Because of his background, first-hand experience with pensions, and fantastic reputation in this space here in Canada, I thought he’d be a great fit for this episode, as he’s gone through these options and this analysis himself, so it’s not just some theory that we’re going to be talking about here. Resources Mentioned: Robb's Site: BoomerAndEcho.com Robb's Fee-for-Service Financial Planning Page: https://boomerandecho.com/fee-only-advice/ You can get your free Passiv account here: BuildWealthCanada.ca/free My guide on how to redeem your free premium account upgrade in Passiv is here: BuildWealthCanada.ca/passiv You can view the stock/equity side of my portfolio (what I invest in and how much of each ETF type I buy) here: BuildWealthCanada.ca/portfolio The account that I use for the safe part of my portfolio is here (I use the high-interest savings account, but they also do GICs if you are willing to lock in the money for a bit to get a higher rate): BuildWealthCanada.ca/safe Questions Covered: To start things off, can you take us through what the main pension types are for Canadians, and what are the key differences between them? How should the 2 different pension types factor into how you view your finances and investments? What should your investment portfolio look like, depending on the type of pension that you have? (ie. more equity than bonds if you have a defined benefit pension?) How do you factor in a pension into an early retirement? (for both pension types) What are the tax implications of potentially taking a pension buyout for early retirement? (if that's an option) Robb, you had a defined benefit pension when you worked at the university before becoming self-employed as a fee-for-service financial planner. Can you take us through how you decided between keeping the pension vs receiving the buyout? What are the pros and cons of each approach? When you have a defined benefit pension plan, your RRSP contribution room gets reduced. This begs the question of whether employees with good defined benefit pension plans should even bother with RRSPs. Let’s also tackle this question for those with a defined contribution pension too. Let’s talk about our investment options with the two different pension types. For people with defined benefit pensions, do they have any options in terms of how much to contribute, and what that money goes into? (ex. Something environmentally or socially conscious (ESG), something more aggressive, more conservative, etc?) For defined contribution pensions, you definitely have to pick what the money goes into but it can be overwhelming analyzing and choosing from the different investment options offered by the company that your employer has selected. When you speak to a client that is struggling with this, is there a certain process or approach that you suggest to them to help them decide on what investments to pick? I’ve gotten asked this a lot by students of my investing course so I came up with a process that I thought I’d share. Robb, feel free to jump in if you have anything to add or if you disagree on anything and that way listeners have a nice step-by-step process from both of us that they can use. Can you take us through some common mistakes that you see people do with the two different pension types? Thanks so much for coming on again Robb. We look forward to seeing you at the Canadian Financial Summit again this year as one of the speakers. Tell us again where we can see more of your, content, research, and learn more about your practice?
79:31 08/10/2022
Hybrid Investing: An Improvement on Passive Investing?
Long-time listeners of the show know that I am always on the hunt for personal finance and investing tools that actually work for us Canadians. Too often we hear about some great tool or resource and then it turns out that it’s only for those in the US. With that said, I wanted to bring on two CEOs today. The first is from a tool that I’ve been using and been hooked on for years now, which essentially automates any rebalancing that I have to do in my portfolio (so I don’t have to do the tedious data entry into a spreadsheet anymore to calculate how much of each ETF I have to buy every time that I have some money to invest). One thing that I recently noticed is that I almost never log into my Questrade account anymore, because I would much rather just buy the investments right within one tool for all our accounts, whether it’s my account, my wife’s account, or our kids’ RESP, instead of having to log in and out of each account and doing the trades and calculations manually. Our Guests: The tool and company that I’m talking about is Passiv. The CEO and our 1st guest today is Brendan Lee Young, and you can actually use Passiv for free, over at BuildWealthCanada.ca/free. They integrate with different Canadian Brokerages out there like Wealthsimple Trade for example, but if you’re a Questrade user like me, you actually get their Premium account for free, so that you can do the trades right within the tool and make your portfolio more tax efficient right from within Passiv. Our second guest CEO is Alex from Global Predications which is a tool that I just recently heard about that is now available in Canada. I’m in the process of trying it out now. Some of its main functionality is that it can help find risks and problem areas within your investment portfolio, give suggestions on how to improve your portfolio, and let you visualize your net worth using all your assets (instead of just your investment portfolio). And, if you want to check them out, their Canadian page where you can get a free account is here.  I thought we could have an interview to discuss some of the tools available to us Canadians, and as a bonus, what’s really neat is that Passiv actually has a way for you to share what investments you’re holding with others, so in this episode, I also provide a link to my portfolio in Passiv so you can see exactly which ETFs I buy, and what my asset allocation is in terms of bonds vs stocks, and in terms of geography (so how much I have in Canada vs US vs International). I hope you enjoy the discussion! Resources Mentioned: You can learn more about Passiv and get a free account here. You can also see my asset allocation and what ETFs I buy using Passiv here. Here is the Global Predictions page where you can get free access, specifically for Canadians. FYI, this page is specifically for Canadians so you'll find it more relevant than just going to globalpredictions.com (which is the US version). Thank You To Our Sponsor: Shopify A big thanks to Shopify for sponsoring this episode. You can get a free 14-day trial of Shopify here. Shopify, helps make it easier than it’s ever been to start, run, and grow your own business. There’s no need for you to know how to design or code, and I really love how Shopify makes starting your own business possible for anyone. You can start selling on Shopify today by going to shopify.ca/bwc where you’ll receive a FREE 14-day trial.
64:27 07/05/2022
Are You Holding the Right Bonds in Your Investment Portfolio?
When learning how to invest, we are consistently told to conduct our “due diligence” on the investments that we’re considering buying. Yet, almost all of us haven’t actually been trained on how to analyze the investments that we’re considering, so that we choose the ones that are right for our particular situation. To help remedy this, I thought it would be good to give listeners a bit of a training on how to actually interpret the figures and terminology that we see used here in Canada, when we’re considering purchasing an investment.  Now this is obviously a very large topic as there are many types of investments, so I thought we could start with learning how to understand bonds (especially bond ETFs).  We’ve definitely seen some drops in the market recently and I suspect many investors are wondering about holding bonds, if they are holding the right types of bonds, and how to actually interpret the data that you see when you’re looking up information about a bond ETF.  Guest Bio: To help me with this, I have Danielle Neziol back on the show. Danielle and her team actually created and continue to manage the largest bond ETF in Canada (and in case you’re curious, that ETF is ZAG from BMO ETFs which now has over $5.8 billion in net assets).  Danielle is the Vice President over at BMO ETFs, and I thought it would be great for us to actually get some training from her on how to interpret the facts sheets that we all see when we look up any type of bond ETF, no matter who the provider is. My goal is that this interview gives you the knowledge to be more confident in your investing, and hopefully helps relieve any anxiety that you may feel when it comes to choosing your own investments, or helping ensure that you are in the types of investments that are the best fit for you. Resources Mentioned: Danielle and her team host free weekly webinars where you can learn more about ETFs, as well as ask them your ETF questions. I've been a guest there several times and it really is a great resource for Canadian DIY investors. You can view past replays and sign up to attend the upcoming webinars for free here: etfmarketinsights.com Also, be sure to subscribe to the ETF Market Insights YouTube Channel where you can also see past recordings. Questions Covered: Investors place a lot of time deciding how much of their portfolio should go into bonds vs stocks. Yet, when it comes to bonds, there are several different types and they can each behave differently. Can you speak to the different types of bond ETFs out there, and what differences can we expect from them? Especially when it comes to changing interest rates and different economic climates? When examining all these different types, I can see it being overwhelming for some investors when they do a search and see dozens of different bond ETFs out there from all the different providers. One may begin to wonder whether they should pick and choose individual bond ETFs, or whether they should just hold one large aggregate bond ETF like ZAG which holds all these different types of bonds in a diversified manner. For those struggling with this question, what advice can you give? Does a rising interest rate environment like we are in now change how we should be thinking about bonds? Often when I see a model portfolio from a professional in the industry, the bond portion of the portfolio includes a bond ETF that contains only Canadian bonds. ZAG if I’m not mistaken also holds exclusively different types of Canadian bonds. Why is that, when with equities on the other hand, we want international diversification? One of Canada’s largest bond ETFs (ZAG) is designed to replicate the FTSE Canada Universe Bond Index. Is this index a standard that many other bond ETF providers are using as well? And for us index investors, how can we make sure that the ETF we choose is trying to replicate the correct index? When evaluating which bond ETF(s) to use for our investment portfolio, we should be looking at the fact sheets of those bond ETFs to get a better understanding of what they are and how they are likely to behave. Yet, most of us haven’t been trained on how to read these, especially in regard to what the different terms mean. I was hoping that we could go through a real-life bond ETF fact sheet and you could tell us what some of the less obvious terms mean, and what we should be looking for. Let’s use ZAG as an example. Listeners can go to BuildWealthCanada.ca/zag for anybody that wants to follow along: Weighted Average Term (year): Can you speak to what that is, and what impact does that have on what you can expect from the ETF? I think at the end of the day, a lot of investors what to know, “If I buy this bond ETF now, what kind of interest income can I expect to receive?” When we look at the fact sheet of a bond ETF however, we see three different percentages. There’s the:  “Weighted Average Coupon %” the “Annualized Distribution Yield” and the “Weighted Average Yield to Maturity”. What do each of these mean? And how can we interpret the numbers provided there? Next, we have two terms that apply to equity ETFs as well, and that’s “Maximum Annual Management Fee” and “Management Expense Ration” (the MER). Can you explain the difference between the two, and how should investors interpret these numbers when they see them on any ETF in the marketplace? What would you consider a higher vs low MER? 7. ETF fact sheets typically have an annualized performance section where they show how the ETF performed relative to its index. For ETFs that are looking to match the index, what would be considered a reasonable spread between the two vs a concerning number? 8. One page that seems especially critical to evaluate, whether evaluating a bond ETF or an equity ETF, is the “Holdings” page where we see all the investments that the ETF contains. Let’s pretend that you just pulled up a core bond ETF like ZAG and went to its holdings page. What would you look for and how would you analyze and interpret the data that you see there? (for anybody that wants to follow along, you can go to BuildWealthCanada.ca/zag and that will forward you there) and click on the holdings tab. Areas to cover: Sector allocation Geographic allocation Maturity Credit allocation Are there any other areas that you think are critical to look at, and if an investor is feeling overwhelmed by the large amount of bond ETFs out there and is getting into a bit of paralysis analysis, what would you recommend as their next step? 9. Can you speak to the relationship that bonds have with rising interest rates, and at what point do we start to take advantage of those higher interest rates in our bond portfolio to offset the drop in price that occurs when interest rates go up? 10. For anybody looking to learn more, can you tell us more about ETF Market Insights, the YouTube channel, and any other resources listeners may find helpful?
59:35 06/21/2022
Andrew Hallam: How to Invest and Spend for Happiness, Health, and Wealth
Today I’m extremely excited to have Canadian best-selling author, Andrew Hallam back on the show. His first book, Millionaire Teacher continues to be the #1 best seller in the Investment and Portfolio Management category on Amazon. He is one of the world’s most prolific financial wellness speakers and over the past 16 years, he has given hundreds of talks in over 30 different countries espousing research on financial wellness, sound investing and life satisfaction. He has been investing in the stock market for 32 years, having built a million-dollar portfolio on a schoolteacher's salary when he was in his late 30s. In today’s interview with Andrew, we cover the subject of how to achieve balance, and how to maximize your happiness, health, and wealth. We also cover what to expect and how to maintain balance after having hit your financial independence number. Lots of early retirees in the FIRE movement and traditional retirees continue to do some sort of productive paid work. Why is that, and is it realistic to never work again after you retire?  As you can imagine, generating some minor income after retirement, doing something you love, can drastically decrease how much money you actually need to retire from your day job, potentially letting you leave that job you may dislike or be bored with many years earlier.  Since Andrew is already financially independent, we dissect how Andrew has found that balance in his life between taking on meaningful and fulfilling work, and balancing that with leisure, health, and happiness. Questions Covered: 1. When a lot of people, myself included start their financial independence journey, the goal is to never work again and that becomes a major motivator to accumulate all those savings to be able to retire. Yet from my own experience and after interviewing many other early retirees, I've noticed a pattern where most if not all still end up doing some sort of productive work or something that could be classified as “work” even though they don't have to, since they've already reached their financial independence number. Did you have the same experience as you moved from the accumulation stage to the financial independence and retirement stage, and from your experience what have you found to be a good balance in your own life? 2. You've spoken with many other early retirees who I assume had a similar experience in terms of that progression from initially never wanting to work again and live a life of leisure permanently, versus eventually realizing that there needs to be a balance to achieve sustainable happiness. Have you noticed any patterns from those you've talked to in terms of how they were able to find sustainable happiness and what that balance was for them in order to achieve it? 3. After reading your book, it becomes very clear that health and longevity is something that is a high priority for you, and should be for all of us since what’s the point of accumulating all this wealth and retiring if you don’t live long enough to enjoy it.From the research that you’ve done, what have you found to be the best practices to maximize our health and longevity? Nutrition? Types of exercise and frequency? Cancer prevention? Stress control? Energy maximization? 4. In terms of maximizing happiness in retirement, is there a routine that you follow during any part of your day that works well for you? Or do you take a more fluid, go-with-the-flow approach, where things are more spontaneous? 5. Do you find that goal setting and trying to achieve growth and improvement in retirement adds to your happiness and fulfilment? Or do you take the approach of trying to just be happy with where you are, living in the moment, as opposed to continuously striving for more? 6. Please tell us again where we can learn more from you and get your latest book.
53:01 06/07/2022
Guaranteed Income For Life: How to Use Annuities in Your Investment Portfolio
When it comes to the safe portion of our portfolio, we’ve talked about GICs and high-interest savings accounts before, but one option that we haven’t talked about yet, is one that gives you guaranteed income for life, no matter what the markets are doing, and those are called annuities. So, I thought it would be good for you and me to get some annuities 101 knowledge under our belts, so that we can better understand what’s out there, what are the pros and cons of annuities, and so that we can better determine if they are something that we should look into further, based on each of our particular situations. To learn more about this, I thought it would be good to get our information from two different sources. The first, would be fee-for-service financial planners who don’t actually create or sell annuities, but are responsible for potentially using annuities as part of a total financial plan.  With that in mind, I’m definitely going to be asking financial planners that I interview in the future about annuities, so that we can get a holistic view and multiple perspectives on the subject. The other source of information that I thought would be good to interview, is an actual creator of annuities. This way we’re getting the information right from the source about how they actually work, their intent, the pros and cons, and how they can potentially fit as part of a financial plan.  To help me with this, I have Selene Soo on the show. She is the Director of Product Strategy and Development in the area of Wealth Management over at RBC. She has been there for over 17 years, and has been in the industry itself for over 2 decades, so she definitely has a wealth of experience and knowledge when it comes to annuities. I thought I’d pick her brain so that we can get a solid foundation on annuities, and one question that I’ve been extremely curious to ask someone like her that’s actually in the industry, is for those of us who don’t have a defined benefit pension through our work (for example, those of us that are not government works, teachers, police officers etc.), is there a way that we can get the type of guaranteed income for life in retirement that the government workers get, by using annuities? We definitely get into that question, plus a lot more. Thanks for tuning in, enjoy the learning, and now let’s get into the interview. 
39:51 05/11/2022
Rising Interest Rates, Variable vs Fixed Mortgages, and How to Take Equity Out of Your Home
In this episode, we cover the rising interest rate environment that we're currently in here in Canada, and how it can impact you financially. We also cover how to decide whether you should go fixed or variable on your mortgage in the current interest rate environment. Next, we cover the subject of how you can take out some of the equity that you’ve built up in your home, so that you can either use it to invest, or deploy it elsewhere (without having to actually sell your home). We also discuss the Smith Manoeuvre, which is a technique that you can use here in Canada to make your mortgage interest tax-deductible (and be able to invest a bit easier when you pay down your mortgage). All this and more on this month's episode.  Questions Covered:  For the first time in over 3 years, the Bank of Canada has started raising interest rates. What should we be considering if we have a variable rate mortgage or have debt that’s tied to the prime rate (like a home equity line of credit)? For Canadians that have their mortgage coming up for renewal in the near future, or those looking for a new mortgage, based on the current environment, what is the mortgage rate outlook for the coming year and how can those Canadians best decide whether they should go fixed or variable? From what you’re seeing, what is the real estate market outlook for this coming spring and the rest of the year? Is it likely to be a buyer's market or a seller's market? What kind of buying/selling environment should people be ready for if they are thinking of moving, buying/selling a house? Home prices have grown substantially over the years making many Canadians who already own a house pretty wealthy on paper, but much of that money or equity is tied up in the house, and I’m sure many of us would like to be able to use some of those gains either for investing, or other things. We’ve probably all heard of using a home equity line of credit (HELOC) to take some of that money out, but what are the other options available to us, and what are the pros and cons of using a HELOC vs these other options?  On the flip side, with the rising cost of living (we’re hearing about inflation a lot), cash flow is becoming a challenge for some Canadians, making it even more difficult to find extra cash to invest for their retirement, while also paying down their mortgage and other expenses. However, there are strategies to pay down your mortgage and invest at the same time. Can you explain this strategy to listeners that are in this situation? And what are the pros and cons? 
68:00 04/05/2022
Your Guide to All-In-One ETFs and Socially Responsible Investing
On this month's episode, we're going to discuss some of the most frequently asked investing questions that I receive. The first of these is helping you decide if you should just pick one ETF for your entire portfolio (these are referred to as asset-allocation ETFs), or if you should pick and choose multiple ETFs for your portfolio to fine-tune tune it based on your specific preferences.  We also talk about how to determine the asset allocation for your portfolio (the stock to bond mix), as well as how to determine how risky the ETFs that you're considering actually are. It turns out that there is an actual standardized risk rating in Canada to help you determine this which I think you'll find really helpful. Last but definitely not least, we cover socially responsible investing (also known as ESG investing) to help you decide whether ESG ETFs could be a good fit for your investment portfolio, and some things to be careful about and consider, when partaking in socially responsible investing by buying these types of ETFs. To help me with this, I'm thrilled to have Danielle Neziol back on the show. Danielle and her team actually create some of the most popular ETFs that Canadians invest in. She works for BMO ETFs which is the largest Canadian ETF provider in the country, so we're literally getting this information right from the source here which I'm always a big fan of.  Danielle and her ETF research team have put together a lot of free resources for Canadian DIY investors over the years, and because there are so many of them, I created a resources page where you can see them listed and access them easily.  They're all free, they're not affiliate links or anything like that, and you can check them out and start learning over at buildwealthcanada.ca/bmo Enjoy, a big thanks to Danielle and the team for putting these together and making them available free of charge, and now let's get into the interview. 
41:29 03/23/2022
How to Use Factor ETFs to Fine-Tune Your Portfolio + Market Update
Many listeners of the show (myself included) are total market index investors, where we just buy ETFs that are meant to represent the entire market as a whole, worldwide (as opposed to stock picking, or trying to speculate what will go up or down and investing based on that). After you’ve been index investing for a while though, it’s easy to begin to wonder whether you should customize your portfolio a bit further so that it’s more aligned with your particular situation, or so that it holds more of the types of companies that you want in your portfolio. When you start looking into this, you’ll quickly come across what is known as factor investing, which can be used to tweak your portfolio so that it holds more companies that contain specific attributes that you like. In this interview, we talk about the benefits of doing this so that you can better decide for yourself whether it’s worth the added complexity in your portfolio. We also discuss the risks that you need to be aware of if you partake in modifying your investment portfolio in this way, and we cover how you can analyze factor ETFs to find out which (if any) are the right fit for you. Of course, we also cover some of the different types of factor ETFs out there and what they mean, so that you can better decide about potentially incorporating them into your portfolio. Questions: A lot of the listeners of the show are total market index investors, where we just buy the market as a whole using the same core ETFs. What is the advantage of now also adding factor ETFs into our portfolio? What are the risks of incorporating factor ETFs into our portfolio vs just sticking with a total market indexing strategy? There are a lot of factor ETFs out there. How do we begin to analyze them as a DIY investors to find out which (if any) are the right fit for us? Are there any educational resources you can recommend? Would you consider factor investing to be “active” investing? When I spoke with your team in the past, it was mentioned that BMO believes that it is most optimum to have both passive and active investments within our portfolio. Interestingly, when I interviewed Vanguard in the past, they also had the same viewpoint (I wonder if that’s a common viewpoint among all the major ETF providers). Can you share why you think our investment portfolio should have an active component as opposed to just being 100% passive through total market index ETFs? When factor ETFs get launched, they don’t have a long history where we can, for example, stress test them by seeing how they performed during the 2008 financial crisis or the tech crash in the 2000s. If we want to see/simulate how that ETF would have performed in adverse market conditions, how would we go about doing that? I suppose we can use this approach for most new ETFs that get launched and that we want to evaluate? How is using factor ETFs different from just using active ETFs or mutual funds? Would it be fair to say that we can start with a broad, total market ETF approach, but then we can use factors to fine tune our portfolio for our specific needs? (i.e. To either increase potential returns at the cost of risk/volatility, or to reduce volatility/risk at the expense of lower expected returns?). Are there things that we should consider other than just looking at returns and volatility? In one of the BMO white papers I read, it was mentioned how one strategy is to go into and out of factors depending on the economic climate. For example, if we’re seeing slowing vs rising growth, or increasing vs decreasing inflation. However, most listeners of the show (myself included), I think prefer the set-it-and-forget-it approach where we don’t have to follow the economy, the different economic markers, or the markets. Instead, we would rather just have the same ETFs to buy every month with a piece of every paycheque, and just hold those ETFs long term until retirement. For those types of investors, should they just do total market index investing or can factors still be a smart tool to use, without having to analyze what economic climate we are in? Can we go through each of the different factor types and explain what they are? Where can we learn more about factor investing, and where can we get some of your free tools, white papers, and other resources? Resources: Free ETF Tools and Resources ETF Market Insights (Free resources, webinars, and Q&A) Factor Based Investing ETF White Paper BMO ETF Lookup, News and Resources: BMOetfs.com ETF Comparison Tool (for both: Non-BMO and BMO ETFs)
56:11 02/22/2022
How to Live Off Your Investment Portfolio With Best Selling Author Andrew Hallam
Today I’m extremely excited to have Canadian best selling author, Andrew Hallam on the show. His first book, Millionaire Teacher is currently the #1 best seller in the Investment and Portfolio Management category on Amazon. He has been investing in the stock market for 32 years, having built a million-dollar portfolio on a schoolteacher's salary when he was in his late 30s.  Over the past 16 years, he has given hundreds of talks in over 30 different countries espousing research on financial wellness, sound investing and life satisfaction. We cover a lot of areas in this interview, but since Andrew achieved financial independence in his 30s, I especially wanted to ask him how we Canadians can live off our portfolios long term, without depleting it prematurely (while also maximizing the income that we are able to withdraw).  We discuss what to do when it comes to our withdrawal strategy in different economic environments, and we discuss how one can best use the 4% rule, and how we can modify it, depending on what happens in the markets.  We also talk about one of my favourite topics, variable withdrawal strategies which help us maximize how much income we can take out of our portfolio every year (while not running out of money). Questions: For anybody that hasn’t read your books or is hearing about you for the first time, can you tell us a bit about yourself, especially when it comes to the world of investing, financial planning, and retirement? You're someone that has achieved financial independence many years ago and has had to learn how to live off your portfolio indefinitely in a sustainable fashion. Just to set the groundwork and for somebody that hasn't read your books before, can you tell us what kind of investments your portfolio consists of that has allowed you to do this and retire early? Do you have a system or process that you follow to determine how much money you can take out from your portfolio to live off of every year? (with the implied goal that you’re trying to maximize how much you can take out annually, while still having that amount be sustainable so that you don’t run out of money in the future). There are many withdrawal strategies that one can use to live off their portfolio. Apart from the one that you just mentioned that you do yourself, are there any other ones that you like or have found to work well for others? What are your thoughts on variable percentage withdrawal approaches? Ex. Taking out 4% of whatever the portfolio value is at the time, instead of more static approaches like the traditional “4% rule”. Before we get into more questions can you tell us more about your new book called Balance and where can we get it. When we spoke before the interview, you mentioned that sometimes when pursuing money and financial independence, we can actually fall into a trap and miss the point of why we pursue it in the first place. And in relation to that, in your book, you talk about how we need to be careful about how we define success, and how we need to strive for the goal of life satisfaction as opposed to just a high monetary figure within our portfolio. Can you speak to that bit?
56:24 02/01/2022
How to Make Sure You’re Covered - Optimizing Insurance in Your Financial Planning
If you’re working with a good certified financial planner here in Canada (a CFP), there are specific categories that they should be helping you optimize. According to FP Canada, which is the organization that issues the Certified Financial Planning designation (the CFP), there are 6 areas that should be covered, as they are critical to your financial health.  For your reference, the pillars are insurance and risk management, financial management, investment planning, tax planning, retirement planning, estate planning and legal aspects.  Today, we’re going to talk about the insurance and risk management pillar to help you optimize that, and my returning guest today is insurance expert, Laura McKay. Laura used to work as an actuary, and is now the Co-founder of PolicyMe.  One of the things that I REALLY like about PolicyMe, is that they have an incredibly useful tool on their site to help you determine how much, if any, life insurance you actually need.  What I found really sets it apart from the other online calculators that I’ve seen, is that it will actually honestly tell you, if you do not need life insurance.  Questions Covered: As the new year kicks off and we look for ways to optimize our finances, one important area when it comes to our financial health is insurance coverage and risk management.A big piece of this has to do with life insurance. In case somebody is on the fence or not really motivated to look into life insurance, can tell us why this should be on our radar, and what are the consequences of not having this type of insurance when we need it? Can you tell us more about what the role of life insurance is in financial planning? I suspect that one of the reasons that looking into life insurance isn’t often near the top of Canadians’ to-do lists, is that it’s perceived as expensive and as an additional cash flow drain month-to-month. Can you give us a ball-park range of what life insurance can typically cost us in Canada, and what things can we do (that we have control of), to get the absolutely lowest rates for the coverage that we need? Is there any innovation around insurance happening in Canada that we should be aware of, especially when it comes to making insurance more affordable?  I’ve definitely heard of Canadians getting some really slick and persuasive sales pitches to use permanent life insurance as an investment vehicle, in addition to the life insurance coverage that it provides. Often large tax savings are mentioned as one of the key benefits. Can you talk about the pros and cons of using a less expensive term life insurance policy to just cover our life insurance needs, vs using permanent life insurance like whole life or universal life to receive both life insurance as well as an additional investment vehicle (please define whole life and universal life insurance for anybody not familiar too). Of course now, with COVID being the big elephant in the room, I’m sure many Canadians are wondering whether COVID has impacted their life insurance in any way, and if they are in the process of getting life insurance, will they still receive the payout if the insured person in their family passes away due to COVID. How can we best ensure that we are covered if we get life insurance now, and for those that already have life insurance, what’s the best way to check that we're still covered? For anybody listening that does not currently have life insurance, how can we best determine if we actually need it for our particular situation? Whether we’re shopping around for a policy, or already have one, what kind of analysis can we do ourselves to evaluate the quality of a policy? Are there certain types of Canadians for which life insurance is especially critical? Personally, I've always felt a bit skeptical when asking somebody that sells insurance “How much insurance coverage I need?”. I’d think of it like asking a real estate agent how big of a house I need when their commission is obviously higher the bigger the house I purchase. With insurance, I find it often a similar story where the insurance expert that you are speaking to is maybe compensated more depending on how large the policy is that I buy, so there is an incentive for them to paint a story of why you need as much insurance as possible. For people like myself that have this concern how can we best determine how much insurance we actually need without having to take advice from someone that is financially incentivized to sell us as large of a policy as possible? Can you tell us where we can get more of your educational resources and what is a good next step for someone that thinks life insurance is something that should be on their radar, but either doesn’t have any life insurance, or is not sure if they have enough through their employer, or other sources?
54:44 01/25/2022
Lessons Learned After 5 Years of Early Retirement + Post Pandemic Small Business Update for Canadians
Today we’re going to have a two-part episode. Part 1 will be about the lessons that I’ve learned after being either fully retired, or semi-retired for the past 5 years. I definitely made some mistakes both during retirement and leading up to retirement; things that I definitely would have done differently if I were to do it all over again. I hope that by sharing these lessons, it’ll help you avoid them on your financial independence and early retirement journey, as well as give you some insights on what it’s been like to actually live off an investment portfolio as opposed to being reliant on a job. Part 2 of the episode will be some useful information for all the current and future Canadian small business owners out there: As COVID-19 restrictions loosen in many parts of the country and world, consumers are thinking differently about their needs/wants. During the pandemic, new habits and practices were formed, and altered how people do business. For small business owners, it also meant many changes along the way. In the interview, we tackle which of these practices are here to stay because they offered a good client experience? What types of businesses and experiences will Canadians seek out in a post-COVID economy? And what about the businesses that launched during the pandemic - what’s next for them? Resources: Join Our Free Live Retirement Planning Strategies Webinar: The free live webinar and Q&A on Retirement Planning Strategies is on November 24th, 2021 at 1 pm EST. You can sign up for free at buildwealthcanada.ca/retirementwebinar.  If you’re seeing this after the event has already taken place, you can still go to the link above to get the recorded version of the webinar.  Definitely join us live though if you can as that way you can get your questions answered, plus we’ll be giving away prizes during the webinar but you have to be on the live webinar to be eligible.  Excellent Resources for Canadian Small Businesses:  As mentioned in part two, this RBC page has some really useful education and free resources for Canadian Businesses, and they’ve partnered up with other businesses to get you additional discounts and bonuses. You can access all the information for free here: BuildWealthCanada.ca/rbc Free Assessment Call for Financial Coaching: The free assessment call mentioned in the episode is available here: buildwealthcanada.ca/call. This is part of the coaching program that I am currently going through with Enriched Academy.
69:36 11/02/2021
How to Save Money: Top Lessons From Teaching 100,000+ Canadians
Our guest today is Arian Beyzaei, the Vice President of Enriched Academy, one of the most successful companies to be featured on the show Dragon’s Den.  Over the past 6 years he has travelled around the country teaching students and entrepreneurs how to get smarter with their finances. He has presented to over 10,000 people and has been the keynote speaker for several corporations.  Arian has also been featured on the Financial Post, The Globe and Mail and many more providing personal finance tips and strategies. What’s really neat about Enriched Academy is that they are definitely one of, if not the largest financial literacy educators in Canada. They have over 100,000 students, so I thought it would be useful for Arian to share some of the top money saving lessons learned, after teaching that many students, here in Canada. In other words, what can really move the needle for all of us, when it comes to making a dent in our spending? What are the highest impact savings strategies that we should be focusing on, to really drastically increase the extra cashflow that we all receive month to month? Questions Covered: We talk a lot about increasing our wealth through investing on this show but a higher income, or return on investment, is only one component of growing our net worth. The other of course, is saving and not incurring unnecessary liabilities. To kick things off, why should finding ways to save money be on our radar? As opposed to us just focusing on maximizing our income and returns? When it comes to saving money on things that really move the needle in increasing our financial wellbeing, housing and transportation come to mind as the top areas to optimize. Can you give us some insights and advice on these two areas? While housing and transportation are definitely high priority areas due to their high price, another area that can have a large impact is those smaller but recurring expenses that we sign up for, which end up draining our cashflow on an ongoing basis. Can you give us your thoughts and strategies on those? While mortgage rates are relatively low these days, they are nevertheless a very large monthly cashflow drain for most Canadians. Can you talk about some of your favourite mortgage tactics to help us save money? If someone is looking for a little bit of extra income this year, without an enormous time commitment, do you have a favourite go-to’s that you found many Canadians can benefit from? When it comes to debt, how are Canadians doing vs the rest of the world, and what are your favourite strategies that we can use to lower the interest on our debt? Resources Mentioned In the Episode: The free tickets to this year's Online Canadian Financial Summit are here: http://buildwealthcanada.ca/summit The free assessment call mentioned on the episode is available here: http://buildwealthcanada.ca/call The Ultimate Phone Script PDF is available for free download here: https://buildwealthcanada.ca/script The financial literacy for kids educational program is available here: https://buildwealthcanada.ca/kids The Mortgage Broker mentioned on the episode (to get your mortgage questions answered for free) is available at: https://buildwealthcanada.ca/sean
79:26 09/18/2021
How to Be Your Own Money Manager - Passiv + Wealthica
Today we’re going to focus on how to best track your investments, as well as your net worth. This is of course critical, as you need this data to determine: 1. How much more do you need to be financially independent and retire? 2. Whether you are trending in the right direction(i.e. Is your net worth actually growing to get you closer to that early retirement and financial independence number?). Tracking your net worth and investments is no longer something that you have to do manually, by tediously entering your numbers from all your different accounts into a spreadsheet. You also don’t have to do that boring data entry over and over again, every time that you want an update. So for this episode, I brought on the creators of two free tools available to Canadians. The first is a net worth tracking tool called Wealthica. While the second is an investment tracking and automation tool called Passiv (which I’ve already been using for years to manage, automate, and get reports on my investment portfolio). Questions Asked: We’re going to be talking a fair bit about tracking our net worth in this interview, and how we can automate it. But before we get into that, how should we be defining “net worth”, and how do each of us actually benefit by tracking it? It used to be that in order to track your investments and net worth, you’d be stuck with whatever your banking or investment provider gave you, and oftentimes you had to use a spreadsheet to get a holistic view of all your accounts. It seems that now, we are transitioning to more open banking where that is no longer necessary. Can you speak to what’s been happening in regards to this, specifically here in Canada? For anybody that hasn’t heard of your tools before, can you each take us through what it does, especially when it comes to saving Canadians time, and helping automate some of the more tedious parts of being a do-it-yourself investor, and net worth tracking. Looking at your sites, there seems to be some overlap in terms of what you each provide. Can you take us through the differences between Passiv and Wealthica? Is there a specific type of investor that each tool is more suited for? One of the big developments that many of us have noticed is that your tools are now integrated with each other. Can you take us through what that means for us the end users? And how does that helps us be more efficient and save more time with our investments and net worth tracking?  Brendan, when I spoke with your team offline, they mentioned that users get more functionality if they use one of Passiv’s brokerage partners like Questrade. Can you speak to what users can and can’t do depending on which brokerage they are currently using? Some of us get nervous about using tools where we need to enter our login credentials for the different companies that we bank with or do our investments through. Can you talk about the technology that’s being used here to keep everything safe? And are we potentially breaking the terms of service with some of these institutions we bank with by entering this private information? Resources: You can click here to open up a free Passiv account (Questrade members also get the free upgrade to the Elite Member Plan.  You can sign up to Wealthica for free here. Free tickets to the Canadian Financial Summit: Sign up anywhere for free on buildwealthcanada.ca to get free tickets to the digital event once they are ready (the annual event is on September 22, 2021). Your Mortgage Questions Answered: Since it's real estate season here in Canada, we also mentioned our resident mortgage expert who can answer your mortgage questions for free. You can sign up for a free call here (there is no cost and no obligation to select any of the lowest cost mortgages that he's able to find in from the 60+ lenders that he monitors. Investing Course: The investing course was also mentioned in the intermission, which you can try risk-free for 60 days here. If you liked the episode sign up for free to receive all new episodes as they get released, news on giveaways, and the free guide on the Top 5 Personal Finance and Productivity Tools.
51:22 07/21/2021
The Best ETFs in Canada for 2021
Today we're going to cover the top ETFs in Canada, specifically for Canadian investors. These findings are based on 8 experts in this field who are part of the Best ETFs in Canada Guide which is published annually on MoneySense and written by the one and only Jonathan Chevreau. In this episode, we're going to talk about what the findings were with the creator of the guide, and one of the top Analysts from the panel. We will actually give you the ticker symbols of the top ETFs according to the panel of experts, and we will discuss why those particular ETFs were chosen, and go into detail about some of the nuances so that you can better choose which ETF is better for your situation. Each category has several finalists so it's important to know the caveats of how they differ so that you can choose the one that's right for you. This interview expands on what you will find in the text version of the guide, so use this interview as a supplement to the MoneySense written guide, which you can find at buildwealthcanada.ca/moneysense. If you liked the episode sign up for free to receive all new episodes as they get released, news on giveaways, and the free guide on the Top 5 Personal Finance and Productivity Tools.
75:57 06/16/2021
How to Get Your Will Done in 20 Minutes (and Why It’s Critical)
More than half of Canadian adults don't have a will which can cause additional legal costs, family conflict, and unnecessary legal battles.  Unfortunately getting a will done is very easy to procrastinate on as it can be a hassle to set up meetings with a lawyer, ask those difficult questions and be involved in all the back and forth that's required when setting up a will the traditional way by meeting with a lawyer face-to-face.  As many long time listeners of the show know, I'm a big fan of technology companies that help automate or at least make it a lot easier to do some of the more tedious but important things that we need to get done.  So in this episode, I'm excited to bring on Daniel Goldgut, a former tax and estate planning lawyer here in Canada, who together with his team over at epiloguewills.com has created a tool that you can use to get a will created in as little as 20 minutes. It's also a lot less expensive than what I paid to have our will done with a lawyer years ago before this tool existed.  We cover what the top mistakes are that Canadians do when creating a will, as well as how and when to properly update it when different events occur in your life.  We also cover designating a power of attorney and how to ensure that your will is actually legally enforceable here in Canada. If you want to check out the tool that Daniel and his team have built you can go to epiloguewills.com, and Daniel's been kind enough to also provide Build Wealth Canada listeners with a $20 discount if you choose to use the service. To get that just use the promo code BUILDWEALTH20. There's no affiliate or commissions for me on that, it's just a straight $20 off for all Build Wealth Canada listeners. Questions Covered: To start things off, why is having a will important, and what are the main negative consequences that we may encounter if we don't have one set up correctly? What are some of the most common or most critical mistakes that Canadians make when it comes to their will? and how can we remedy them? Before we go any further, for anybody that hasn’t heard of you or Epilogue before, can you give us a bit of a background on what you do? I saw an article on your company in the Financial Post about how Epilogue is the first online will platform to give its customers the option to include their RESPs in their wills (Registered Education Savings Plans). Can you speak to why that is important? I noticed you recently launched a free tool to create a Social Media Will. Can you talk about what that is, why it's important, and where can we go to have one created for free? When we hear about wills, we often hear about also designating a power of attorney. Can you explain what that is, and are there any other elements like the power of attorney that we should be aware of? When we set up a will, how can we ensure that it's actually legally enforceable, in case somebody ever challenges it in court? In what scenarios should we be updating our will? And what's the best way to do that? Whenever we do update our will, how can we ensure that the newest version of the will is what will get enforced? What are the pros and cons of using a tool like Epilogue vs hiring a lawyer directly? Are there any clauses that you think are especially critical to have in a will to prevent issues and conflicts in the future? How important is it to use an actual Canadian lawyer or service like yours, as opposed to using something from the US or another country, or one of those “create your own” will packages that we may see in a store or advertised on TV or online? How long does it actually take to create a will using Epilogue, and for anybody that doesn’t have a will or needs one updated, how can we get started? If you liked the episode sign up for free to receive all new episodes as they get released, news on giveaways, and the free guide on the Top 5 Personal Finance and Productivity Tools.
64:04 05/19/2021
How to Save On Taxes in Canada, Featuring Tax Expert Neal Winokur
Whether you’ve already done your taxes for the year or not, I wanted to dedicate this episode to the tax optimizations that you can do to save tax not only this year, but for future years as well.  To help me with this, I’ve brought on accountant Neal Winokur on the show. Neal is a Chartered Professional Accountant here in Canada, and he’s the author of the of the book, The Grumpy Accountant. You might have also seen some of his writing over at the National Post. He has been an accountant here in Canada for over ten years so I thought it would be great to pick his brain on what all us non-accounts can do to save money on taxes for this year and for years to come. You’ll also learn what we can all do, to ensure that we aren’t missing out on any credits and benefits that we are eligible for from the Government of Canada. Changes happen every year to the different credits and benefits that the government offers, so how can we ensure that we don’t miss out on any of the ones that apply to us, and that we aren’t leaving money on the table? So enjoy the episode, thanks for tuning in, and now let’s get into the interview. Questions Covered: 1. To kick things off, let’s start with the question on everyone’s minds, “How can we pay less in taxes?”. And more specifically, what are the tools that we Canadians can use, to pay less in tax? 2. For this episode, I primarily wanted to focus on how we can reduce our taxes on an ongoing basis (not just for this year), but before we do that, considering that taxes are due at the end of this month, is there anything new for this year that we need to know about, when filing our taxes by the end of April? 3. One of the things that I’m sure many of us wonder about every year, is “Are there some benefits, tax credits, and/or exemptions that we’re missing out on, resulting in us either receiving less money from the government, or paying more than we have to in taxes”. 4. What's the easiest way to screen the different credits and other Canadian government benefits to make sure we're getting all of the ones we’re eligible for? 5. How do you keep up to date on changes in tax laws? Is there something that we non-accountants can do to be informed as changes occur so that we can determine if they actually impact us? (i.e. any favourite resources) 6. Speaking of good resources, can you tell us more about your book and what we can learn from it? 7. Is there any low hanging fruit in terms of tax savings that you find Canadians sometimes miss? If you liked the episode sign up for free to receive all new episodes as they get released, news on giveaways, and the free guide on the Top 5 Personal Finance and Productivity Tools.
101:03 04/14/2021
Rising Mortgage Interest Rates + Real Estate Update For Canadians
With fixed mortgage rates finally beginning to increase in Canada, many Canadians are wondering whether they should be locking in their mortgage rate in case interest rates continue to climb. We also cover whether you can lock-in a mortgage rate now, and then have the option to renew at the lower rate if the interest rates continue to climb. And, while it’s easy to get fixated on mortgage rates whether you’re an existing or future home buyer, it is worth mentioning that the penalties for breaking a variable vs fixed-rate mortgages can be drastically different, and can also vary significantly from provider to provider. Which types of lenders tend to have the largest penalties? What can we expect in fees depending on the lender and mortgage type that we choose? We cover all that and more in this month’s episode. Also, the spring real estate season is now upon us with lots of Canadians looking to buy and/or sell their homes. Our resident mortgage expert takes us through what you can expect, and how COVID is impacting the real estate market in Canada. About Our Guest: Sean is the bestselling author of the book, Burn Your Mortgage. He bought his first house when he was only 27 in Toronto and paid off his mortgage in just 3 years by age 30. These days, Sean’s helping others burn their mortgages too, as an independent mortgage broker. Sean has offered to answer for free, any questions that you, the Build Wealth Canada listeners have. Links & Resources Covered: Free private Q&A with Sean What's your passive investing style? (Stream Kornel's talk from the Canadian Financial Summit) EQ Bank (The bank that I use with savings account interest rates up to 30x higher compared to other Canadian banks). If you sign up through this link, email me any confirmation that you receive from EQ to bonus@buildwealthcanada.ca and I'll email you my guide on the top ETFs in Canada, with an explanation of what I personally invest in and why. Questions Covered: When we spoke before the podcast, you mentioned that fixed mortgage rates are finally on the rise. What are the implications of that for Canadians who already have a mortgage, as well as those that are looking to get a new mortgage? The spring real estate market is coming up. For those looking to buy a home or a rental property, what do we need to know about this particular time of year in Canada? Seasonality is clearly a factor when it comes to Canadian real estate. Can you take us through what we can generally expect depending on the time of year that we choose to buy or sell a home or rental property? Anytime interest rates move I’m sure you get lots of questions from your clients on whether they should lock-in their variable rate mortgage, or if someone is getting a new mortgage, whether they should go variable or fixed. Based on the current interest rate environment and the new changes to mortgage rates, what sort of analysis should we be doing to determine the best course of action? COVID is of course, still very prevalent here in Canada. Are there any misconceptions about COVID and its impact on real estate that you think are worth clearing up? As we head into the 2021 spring real estate season, would you say that it’s more of a buyer’s market or a seller’s market? If you liked the episode sign up for free to receive all new episodes as they get released, news on giveaways, and the free guide on the Top 5 Personal Finance and Productivity Tools.
50:04 03/16/2021
Retired at 29: How They Did It In Canada (with 3 kids)
One of my favourite things to do on the show is to interview other early retirees, especially those in Canada to learn how they did it, and really dissect their journey to financial independence and/or early retirement.  No matter where you are on your financial independence journey, I truly believe that we can all learn from others that have done it, and so I like to view what they did as a case study where we can break down their journey into actionable parts that we can apply to our own lives.  There are after all many paths to financial independence, and so it’s valuable to know what those paths are so that you can pick and choose the components that are the best fit for you, and that are most aligned with your own goals. Our guest today is Réjean Venne. Réjean worked in the insurance industry for eight years before retiring at twenty-nine and becoming a full-time parent. Réjean and his wife Danielle, along with their three young children, live in Northern Ontario. They write regularly on topics related to parenting, health, mindfulness, and money. You can follow them at mindfulfamily.ca. Réjean recently published 5 Years to Freedom: A Canadian Guide to Early Retirement which documents his journey to financial independence.  In this interview, he’s going to take us through his early retirement story and how you got there, along with the lessons that he’s learned along the way which you can then apply in your own life to help you retire earlier. We’ll also cover how he was able to cut $53,000 in spending annually by retiring early, and how he and his wife were able to retire so early despite having three young kids which is often perceived as very difficult, due to how expensive many believe kids are. Enjoy the episode :) Questions Asked: Can you take us through your early retirement story and how you got there? As someone that’s been retired for 3 years now in their early 30s, what are some of the lessons you learned that could help aspiring early retirees or those that are new to retirement? Is there anything that surprised you after you became an early retiree? For example, were there any preconceived notions or assumptions of what you thought early retirement would be like, and then it ended up being something different? I find you and I are pretty unique in the early retirement space in Canada as we both got to early retirement utilizing passive investments like investing in index funds, but we also used rental properties to get us there. For me, passive index investing was a better fit so that’s all I do now, but for anybody that is debating using one of them or both of them, what’s been your experience in using these different vehicles? Knowing what you know now, if you had to start over to work your way towards financial independence and early retirement, is there anything that you’d do differently? Are there any mistakes that you made while early retired that we could learn from? You mentioned in your book that you don’t really budget in the traditional sense. Can you take us through how you managed your cash flows with your wife during the pre-retirement stage, and how you do it now in early retirement? How do you structure the withdrawals from your investment portfolio (including real estate) so that they are tax-efficient? Early retirement seems like an unattainable dream to many people, yet it’s surprising how attainable it can actually be when you crunch the numbers. One of my favourite parts of your book, was how you were able to cut $53,000 in spending annually by retiring early. Can you tell us a bit about how early retirement allows you to make such drastic cuts, and consequently how a lot of Canadians may actually be much closer to an earlier retirement than first meets the eye? You’re also retired with three kids, and kids are often seen as this massive expense that makes early retirement nearly impossible. Can you talk about how that’s not necessarily so, especially with the Canada Child Benefit that parents are eligible for Most of the early retirees I’ve talked to and researched built up large investment portfolios with the intention of never working again (myself included). But once they actually reached that financial independence number, they eventually ended up taking on some fun side projects that actually bring in an income. Therefore, they didn’t actually need as large of an investment portfolio as they initially thought, and if only they factored that in prior to retirement, they could have retired much earlier. Can you share your experience with this as it seems to be extremely common with early retirees, and Canadians can definitely retire much earlier if they actually include some anticipation of future side income like this in their early retirement plans. Through my research and own experience, I found that getting that sense of fulfilment can actually be a challenge for retirees when they no longer have to work. I know in your book you said that being a dad gives you that sense of fulfilment, but is there anything else outside of parenting that you find really helps in this regard? I find this answer might particularly be helpful for those retirees who either don’t have kids, or those who have kids, but the kids are out on their own now, and so they no longer require that large time investment. What are your goals and plans now? Especially now that the book is written. Links and Resources Rejean’s Book: 5 Years to Freedom: A Canadian Guide to Early Retirement Get 2.3% interest through the EQ TFSA and RRSP account. This high interest savings account is at 1.50% (up to 30x higher than other banks in Canada) Kornel’s Passive Investing Course Get your financial planning questions answered for free here. Get your mortgage questions questions for free here. Rejean’s Blog: mindfulfamily.ca If you liked the episode sign up for free to receive all new episodes as they get released, news on giveaways, and the free guide on the Top 5 Personal Finance and Productivity Tools.
74:53 02/17/2021
Optimizing Your Investments and Finances for the New Year and Beyond
Today we have Robb Engen on the show who is the creator of one of the most respected personal finance blogs in Canada over at Boomer and Echo. He’s been writing about personal finance and investing on the blog for more than 10 years, and he’s also a fee-only financial planner, where he helps Canadians achieve their financial goals through unbiased and objective advice. In this interview, you’ll learn: The most impactful financial decisions that we Canadians can make, to set ourselves up for success. The different components that you should look for when analyzing if there are any critical flaws in your investment portfolio. What a good investment portfolio structure is for somebody looking to retire early, and what withdrawal strategies to consider so that you don’t run out of money in retirement.  We cover all that and much more, during the interview. Links from the episode include: The EQ RRSP, TFSA, and Savings Account Robb's Site What passive investing style are you? (video presentation) Passiv (the tool that I use for tracking my investments and rebalancing) Here is the full list of all the questions we covered: With the new year kicking off, I’m sure many Canadians have a New Year’s resolution of getting their finances in order and optimized. What would you say are some of the most impactful financial decisions that we Canadians can make, to set ourselves up for success?  Which ones can we do ourselves vs having to seek out the help of a financial planner like yourself? I noticed that one of the things that you do as part of your financial planning practice are investment portfolio reviews. For anybody new to this, what is an investment portfolio review, and what are the different components that you like to look for when analyzing if someone has any critical flaws in their investment portfolio?What parts of the portfolio review can most Canadians easily do ourselves vs having to hire a professional like yourself for that extra level of optimization? For those that are working towards an early retirement, or are already there, is there a particular portfolio structure that you like?For example: A type of bucket strategy, or something different (ex. just doing a flat withdrawal from a balanced portfolio, etc.) When it comes to withdrawing from your portfolio in an early retirement, or a traditional retirement, which approach or approaches due you tend to prefer so that we don’t run out of money in retirement, but also so we don’t have too much money left to spend by the time we pass away (ex. 4% rule, 3-3.5% rule, VPW, something else?) With the record low interest rates that we’ve been experiencing, many of us Canadians are re-evaluating the fixed-income/safe portion of our portfolio. How do you approach the dilemma of buying a bond ETF for the fixed income portion of your portfolio, vs just putting that money towards a really high interest savings account which can give us higher interest than the bond ETF, plus then we also don’t have to worry about losing money if the interest rates go up in the future. Where can listeners go to learn more from you or hire you to get their questions answered?  
86:34 01/12/2021
How To Structure Your Investments For An Early Retirement
In this episode, we’re going to cover how you can retire early, or at the very least, semi-retire early so that you have more time for friends, family and recreation. My guest for this month is Mark Seed, who instead of rushing to achieve some giant investment portfolio number and fully retiring to never have to work again, he is instead taking what I believe, is the more efficient, sustainable and fulfilling approach of fully embracing an early semi-retirement, instead of a full stop early retirement.  Mark is very much a DIY Canadian investor like myself and has a lot of knowledge when it comes to financial planning here in Canada as he’s actually executing his own early semi-retirement. We have an absolute blast geeking out on these subjects in the interview, and I truly believe that by you listening in, you’ll get some really great actionable insights on how you can optimize your own financial independence and early retirement journey (to get there quicker). Questions: Where are you right now in terms of your financial independence, retire early journey? I consider you as part of the FIRE movement, but I know that you also have some problems with it. Can you take us through these issues or concerns? How are you structuring your portfolio for your early semi-retirement? Once you pull the trigger and quit your day job in a few years, what is the process and structure that you’re going to follow to allow you to live off your investments? (ex. VPW?) When it comes to living off your investments in full or semi-retirement, you and I are big fans of the variable percentage withdraw method. Can you talk about what that is for anybody that is not familiar, and why do you like this approach over a more static approach like the 4% rule? There are many different ways to structure a variable percentage withdraw strategy (ex. Using different spending floors and ceilings, incorporating it with a bucket strategy, etc.). How are you personally structuring your VPW process? How do you plan on dealing with sequence-of-returns risk in your early retirement? And for anybody not familiar, can you define what sequence-of-returns risk is? The last time you were on my podcast, I think you mentioned about potentially moving away from your dividend stocks in retirement, and focusing on just a total return approach, and maybe migrating your dividends stocks to passive, broad market index ETFs. What are your thoughts about that now? I’d like to stress to everybody watching and listening that when it comes to living off your portfolio in early retirement or early semi-retirement, there isn’t one silver bullet solution that’s perfect for everyone. So, a good process is that when you are approaching your financial independence number, start learning about all the different ways that you can structure your portfolio for your early retirement, and then pick and/or modify one so that it’s a good fit for you. Then share that with a good fee for service financial planner to get their take, as you really want a professional 2nd set of eyes on something like this before you pull the early retirement or early semi-retirement trigger. Do you agree with that approach Mark? Free 1 Year Subscription to Canadian MoneySaver Magazine: A big thanks to 5i Research for giving Build Wealth Canada listeners a free 1-year digital subscription to Canadian MoneySaver Magazine (Canada's largest personal finance magazine).  You can get the free 1-year subscription by signing up for free 30-day access to all of 5i’s investment research (there’s no credit card required, or anything like that).  When you signup for free, you'll receive access to over 70 company reports (perfect if you like to invest in individual stocks too), you’ll get 3 optimized model portfolios, and answers to over 90,000 investing questions, along with the ability to ask your stock and ETF questions directly to the 5i Research team of Analysts. The team at 5i don't sell any investments and they don't get any commissions or bonuses from suggesting stocks and ETFs. I've been using them for years as they are one of the VERY few companies in Canada, that are truly unbiased when it comes to their research and suggestions on stocks and ETFs.   You can get free 30-day access to all their research and resources over at buildwealthcanada.ca/research, and as I thank you for trying them out, you'll receive a free 1-year digital subscription to Canadian MoneySaver Magazine, Canada's largest personal finance magazine. I encourage you to check 5i out, it's a great place get some truly unbiased insights on your investments (especially if there is a ETF or stock that you’re considering, and you want an unbiased opinion from a professionally trained financial analyst that isn’t there to sell you anything. You get free access for 30 days, and you'll learn an absolute ton. Top ETFs in Canada Guide & Best High-Interest Savings Account: In this guide, I go over what I personally invest in, and why I invest in it. The investments that I talk about ​are literally where we have almost our entire net worth (apart from our house), and is what we are primarily living off right now in our early retirement. At the very least you’ll learn about some great ETFs to consider for your portfolio, and if you are new to ETFs, it’ll give you a nice list of some top ETFs to consider from the thousands that are out there.  The guide is available for free to any listeners that that use my special link to sign up for a free savings account with the bank that I personally use, EQ Bank.  The reason that I personally use EQ bank, is that they have one of the highest interest savings rates in Canada (up to 30 times more interest than other banks). It’s also free to sign up and keep an account with them, so you’re not paying a monthly fee like you do with many of the other banks out there. You also get unlimited transactions, unlimited Interac e-transfers, can take out your money at any time if you need it, and there are no minimum balances. Because of those reasons, I’ve been with them ever since they launched in Canada years ago, and it’s where I keep my entire emergency fund and spending money.  To get the free high-interest account and the free guide on the top ETFs in Canada, just go to buildwealthcanada.ca/eq, open the free account, and once you’re done, forward any email that you get from EQ to bonus@buildwealthcanada.ca and I’ll send you the full comprehensive guide for free.  Links and Resources Mark's Site: MyOwnAdvisor.ca We talked about several free tools that you can use to experiment with the 4% rule, and run analysis to see how sustainable your portfolio is in worst-case scenarios. Here are the different free tools that we talked about on the show: Cfiresim.com Portfoliovisualizer.com Firecalc.com Don’t miss future episodes, giveaways, and free in-depth guides by signing up for free to the Build Wealth Canada Newsletter.
83:53 12/02/2020
Your Questions Answered + Real Estate Update For Canadians
Today we’re going to try something a little different in that I’m going to split today’s episode into two sections, covering two different subjects:  First, we’re going to cover some questions that I’ve received from listeners of the show and from students of my investing course, so that you can benefit from the strategies and tactics too. These are specifically going to be in the area of investing. Next, we’re going to bring on my guest who is our resident mortgage and real estate expert and best-selling author, Sean Cooper. Sean will explain the real estate situation here in Canada so that you can stay informed on how real estate has been affected in these COVID times, whether you’re an existing home-owner that is concerned about the value of their home dropping due to COVID, or whether you are a renter looking to potentially buy in the future.  We cover questions like What should you know? And how can you maximize your chances of getting approved for a mortgage?  And whether you’re an existing or future home-owner, there have actually been some mortgage rule changes that recently took place here in Canada so you definitely want to be informed about those so that you can easily renew that mortgage when it’s time. Or, if you’re looking to buy, so that you can have a smooth stress-free process in obtaining financing for your property, instead of struggling and potentially missing out on your dream home due to financing issues, due to these new mortgage rules that recently got put into place. A Big Thanks To This Episode's Sponsor: RBC's Small Business Navigator Hub: For practical resources, advice, and offers, visit RBC's Small Business Navigator hub at buildwealthcanada.ca/hub. Business is anything but usual these days, and entrepreneurs are looking for support that goes beyond traditional banking to successfully re-open and manage their business. Now, they can access all of RBC’s practical tips, insights, money-saving offers and solutions to support their eCommerce, digital payments, payroll management, employee wellness needs and more – all in one place. To learn more, check out the RBC Small Business Navigator hub, available online at BuildWealthCanada.ca/hub. Resources: Get your mortgage questions answered for free by booking a meeting with Sean here. Get the real estate expense tool for free when it's released by signing up to the waiting list here. Topics/Questions Covered: Investing Topics: Buying near all-time stock market highs. Should you do it? Investing larger amounts of money: Buying-in all at once vs dollar-cost-averaging in. How much to focus on dividends in your investing. Socially responsible investing, and what to keep in mind before diving in. Real Estate and Mortgage Questions: Let’s talk about COVID and the real estate market. Are we seeing increases in home values? How are things if you're looking to buy vs sell? Is it a buyer's or seller's market? There have been some Mortgage Rule Changes recently here in Canada. Can you take us through them? What can we do that is within our control, to maximize the chances of getting approved for a mortgage, and getting the best terms and rate? With these record low interest rates that we’ve been seeing, many Canadians that are currently in a fixed-rate mortgage are wondering, is it worth breaking their existing mortgage, paying the cancelling fees, and then getting a new mortgage at the lower rate. Can you talk about the analysis that we should be doing to actually mathematically figure this out? What should we consider if we’re shopping around for a home right now, in Canada? Don’t miss future episodes, giveaways, and free in-depth guides by signing up for free to the Build Wealth Canada Newsletter.
77:54 10/29/2020
The Best Way to Diversify Your Income: Build a Business
Whenever we talk about investments, savings for retirement, and early retirement, the subject of diversification always comes up, and for good reason. We obviously don’t want all our eggs in one basket.  But what if we applied that concept to our income sources?  Just how diversified are your income sources? Is 100% of your annual income coming from just one source: your job? Obviously, that’s not very diversified.  One of the big things that the COVID-19 pandemic has taught us, is that our jobs are not actually all that secure.  Join us as we go over the best (and my favorite) way to diversify your income sources: By starting your own business. About Our Guest: Our guest today is Lori Darlington, a Vice-President in the Small Business Division at RBC. Because she works for RBC (one of Canada’s largest banks), she has access to an incredible amount of data on small businesses in Canada, and when you have that much data, studies and reports on Canadian small businesses, you start to notice certain patterns between the small Canadian businesses that succeed, vs the ones that don’t.  I wanted to ask what her findings were in regards to this so that you and I can structure and optimize our business in the right way, and not make some of the top mistakes that Canadian business owners tend to make. We also cover questions like how to get set up properly as a new or existing small business in Canada and much more. Links and Resources Covered: Lori and her team have put together some great free resources, over on their site here. One of my favourite sections, is the “Explore tools and services beyond banking” page, where they share other businesses and services that they found particularly helpful for helping small businesses thrive. I’m actually in the process now of going through it, and am particularly interested in the free business accounting software that they have on there. In Other News: Free Tickets to the Canadian Financial Summit Are Finally Here! The free tickets to the Canadian Financial Summit are finally available here. In case you’re new to the podcast, this is a free event, it’s 100% online so no travel required, and it’s specifically for Canadians. It’s taking place this October 15th, and I’m bringing on some of Canada’s top personal finance experts to share their best practices to help you retire early, invest better, lower your fees, pay less in taxes, and help you learn the best practices when it comes to personal finance and investing so that you can hit your financial independence number years earlier. Collectively, past guests of the Summit have been in hundreds of media articles from major news and financial publications in Canada such as the Globe and Mail, Financial Post, Global News, CTV, Yahoo Finance, and many, many more. I’ve brought on some big hitters this year like the creator of the TFSA, Kevin McCarthy, and the Warren Buffett of Canada, Peter Hodson, just to name a few. I hope to see you there, it’s free to attend, it’s all online, and you can register for free here..  Questions Covered: As the largest bank in Canada, I’m sure you have access to some really good data on small businesses in Canada, and the top mistakes and challenges that they tend to run into. Can you share some of these with us so that anybody starting or running a small business in Canada can hopefully better bypass some of these common mistakes?  For anybody starting a new business or already running a small business, what are the most important essentials and best practices to ensure that we are set up correctly from the banking side and government reporting side, so that we don’t end up getting in trouble during tax time, or run into money management issues because we aren’t properly set up? One of the pages that I really liked on your site was the “Beyond Banking” page where you list other companies that provide different services that small businesses need (like free accounting software for example), and then it looks like you were able to negotiate deals with some of these companies and give Canadians special rebates and discounts on their services. Can you talk about this page as well as some of the other free resources and tools that you have available on your site? (ex. Your Startup Cost, Cash Flow, and Loan calculators). With COVID-19, we are in a very unusual time for new and existing small businesses. I imagine there are many Canadians who after seeing all these job losses that take place, are considering starting their own business on-the-side to provide that extra cash-flow and give them that extra stability so that they aren’t fully reliant on their employer for all of their household’s income. Do you have any advice for new and existing small business owner as we (hopefully), continue to recover from COVID-19 as a country? With the thousands of small businesses that bank with you, I’m sure you’ve noticed some patterns between businesses that especially struggled during COVID-19, vs those that were able to minimize the negative impact that it had. Were there any lessons learned from the data and conversations that you’ve had, that can help us be better prepared for such storms in the future? (whether it’s another pandemic, or something like the 2008 financial crisis). There is a fair bit of aid available to small business because of COVID-19. If somebody has questions or wants to see what their business is eligible for, is it better to reach out to a bank like yours, or should they be reaching out directly to the government instead? Can you tell us more about where we can go to learn more, as well as any other free tools and resources that you have available for small business owners? Don't miss future episodes, giveaways, and free in-depth guides by signing up for free to the Build Wealth Canada Newsletter
33:44 09/22/2020
How To Increase Your Savings, Manage Your Money Better, And What Tools And Systems To Use
Today I have Jessica Moorhouse on the show, who is an Accredited Financial Counsellor, an award-winning blogger, the host of the ‘Mo Money Podcast, and the founder of the Millennial Money Meetup. You might have also seen her on CBC News, The Globe and Mail, The Financial Post, and many other news channels and publications here in Canada. In today’s episode, you’ll learn the highest impact actions that we Canadians can do to really make a dent in increasing our savings. We cover how to best manage your money and day-to-day cashflows, and the different types of tools and systems that you can use to help you manage your finances. We also talk about investments, and how Jessica actually invests her own money. Last but not least, I consider Jessica to also be a very successful entrepreneur, and so if you are considering starting your own business, or are looking for ways to take your existing business to the next level, we talk about how Jessica was able to grow her company so successfully, and what lessons we can learn from her, to propel our own Canadian businesses to the next level. Resources and Links Mentioned: Check out Jessica’s site and valuable resources over at: Jessicamoorhouse.com Get Free Tickets to the Canadian Financial Summit The top personal finance and investing tools guide mentioned on the episode can be received for free by signing up on the main page over at buildwealthcanada.ca. The how to invest videos mentioned during the show can be found at buildwealthcanada.ca/invest. That’s also where I can answer your investing questions. You can get your financial planning questions answered for free for 30 minutes by speaking with our resident financial planner John Kalos. You can get your mortgage questions answered for free by setting up a free call with our resident mortgage broker, Sean Cooper. Canada’s Top ETFs Guide & Top High-Interest Savings Account: In this guide, I go over what I personally invest in, why I invest in it. The investments that I talk about ​are literally where we have almost our entire net worth (apart from our house), and is what we are primarily living off right now in our early retirement. At the very least you’ll learn about some great ETFs to consider for your portfolio, and if you are new to ETFs, it’ll give you a nice list of some top ETFs to consider from the thousands that are out there. The guide is available for free to any listeners that that use my special link to sign up for a free savings account with the bank that I personally use, EQ bank. The reason that I personally use EQ bank, is that they have one of the highest interest savings accounts in Canada. At the time of this writing, they are anywhere from double, to over 30 times higher than most of the banks in Canada. It’s also free to sign up and keep an account with them, so you’re not paying a monthly fee like you do with many of the other banks out there. You also get unlimited transactions, unlimited Interac e-transfers, and can take out your money at any time if you need it, and there are no minimum balances. Because of those reasons, I’ve been with them ever since they launched in Canada years ago, and it’s where I keep my entire emergency fund and spending money. To get the free high-interest account and the free guide on the top ETFs in Canada, just go to buildwealthcanada.ca/eq, open the free account, and once you’re done, forward any email that you get from EQ to bonus@buildwealthcanada.ca and I’ll send you the full comprehensive guide for free. Questions Covered: As an Accredited Financial Counsellor, I'm sure you deal with many Canadians that are either struggling financially or would like to really amplify their savings so they can invest more, and eventually retire early.What would you say are the highest impact actions that us Canadians can do to really make a dent in increasing our savings, whether it's to pay off debt, save to buy a home, or have more to invest for retirement? When it comes to financial management and managing your day-to-day cash flows, what sort of system or process do you personally have in place and use? Is that a good starting point for those that are looking to gain more control over their finances? Or is there something simpler you recommend for those just getting started?  We all know that we should get our finances in order, optimize our investments and manage our money carefully, but we're all busy and it’s easy for things to slip through the cracks.When it comes to staying organized in your personal life, finances and business, are there any tools, systems and workflows that you depend on and that work really great for you? How do you personally invest your money and what's your thought process behind that decision?  (ie. Robo vs asset allocation ETF vs individual ETFs vs something else?) I notice you've done a fair bit of work and teaching with students. Student debt is a big concern for many so when someone is debating between paying off student debt vs saving for a home vs investing in their TFSA or RRSP, what's your stance and thought process on how they should decide which to focus on? (let’s do this from a qualitative and quantitative angle) I definitely see you as a successful entrepreneur, so let’s shift gears a bit and talk about your life as an entrepreneur, for anybody that wants to eventually work for themselves like you, or have a side-hustle to generate some extra income. As an entrepreneur, I find it’s really easy to take on too much and get burnt out. Reading your blog, I noticed you’ve run into this issue too. Do you have a daily routine that works well for you to balance business with personal time so that you don’t burn out? As a successful entrepreneur, I noticed that you work with a lot of big brands in your business. For somebody looking to start or grow their existing business, how do you personally approach such companies and close these deals?It’s obviously easier to do this once you’re established, so would your strategy change if someone is just starting out vs already having an established business? When it comes to partnering with the different companies/brands how do you determine what to charge them and what to offer them? You are in a lot of different channels and seem to have a pretty wide array of revenue streams for your business. What channels or projects have you found to be the best return on your time invested? How do you prioritize which projects/opportunities to work on? Thanks for coming on the show and where can listeners learn more from you? Don’t miss future episodes, giveaways, and free in-depth guides by signing up for free to the Build Wealth Canada Newsletter  
86:31 08/25/2020
How to Get the Lowest Rates by Optimizing Your Credit Score
Your credit score is a very important thing to manage as it lets you get the lowest possible rates on your mortgage, car loans, lines of credit, and any other debt that you may wish to take on now and in the future. In Canada, the best loans with the best terms are reserved for people with high credit scores. So, even if you don’t need any sort of loan now (like a mortgage, car loan, or a line of credit), it is something that you should keep an eye on and strive to improve, as you don’t want to be overcharged on interest payments if you ever do need some financing. Even though we no longer have a mortgage or any debt, I still use a free tool to monitor my own credit score, just to ensure that the best loans are available to me in case I ever need them, and to help protect myself against identity fraud. For example, if somebody got a hold of my credentials and tried taking out credit cards or loans in my name, I can quickly catch that and report it, instead of letting them gradually destroy my credit score over time. I like sharing the apps and tools that I personally use on the podcast and the free tool that I use to do all of this is called Borrowell. So today on the show, I brought on the CEO of Borrowell, Andrew Graham so that I can ask him some questions after using his tool for almost a year. We cover things like: How to increase your credit score The key things that can cause our score to decline How to read the credit report so you can see if there are any issues How to fix issues on our credit report that are negatively impacting our credit score and much more. Resources and Links Mentioned: The tool that I use to check and monitor my credit score for free is over at Borrowell. You can learn more about Borrowell Boost here. Free tickets to the Canadian Financial Summit: To get the free tickets, just sign up anywhere on the main page of BuildWealthCanada.ca and I'll email them to you once they are ready. Questions Asked: Your company offers free credit scores and reports from Canada’s largest credit bureau, Equifax. For anybody completely new to all of this, who is Equifax and why should we care?  To help further answer the question of why we should even care about our credit score; from your experience, how big of a difference have you seen in the interest rate offered to Canadians who have a low vs a high credit score? Many of us have heard about how if our credit score gets checked too much by companies, it can actually lower our credit score. This leads us to the subject of hard vs soft inquiries. Can you talk about what those are? If we need a loan and are shopping around, how do we ensure that we don’t get too many hard inquires? I’ve been using your tools for a while now and one of my favourite time-saving ones is how you automatically calculate our credit utilization score. Can you explain what that is and what credit utilization score we should aim for? Does our credit score improve the lower our credit utilization percentage is to 0%? Or do we really just need to ensure that we’re under the specific number? When we receive our credit report (whether it’s through you guys or someone else), what specifically should we be looking for and analyzing while going through it? I realize your tool actually does custom suggestions on how to improve our credit score once it pulls our information, but what are some best practices that anybody can apply when it comes to increasing our credit score? At what point is our credit score in that top tier where we are already getting the best possible rate and so it’s not worth the effort in trying to improve it any further? How important is it to close down accounts that we still have open but don’t use anymore? (ex. credit cards, lines of credit, etc.) If there is an error or discrepancy on our credit report, what’s the best recourse that we have as Canadians? Ex. do we contact Equifax? Do we contact the company that put that blemish on our credit report and ask them to fix it? If somebody has no loans and doesn’t use credit cards, is that actually bad if you ever do need a loan since lenders want to see that credit history? (ex. A homemaker where their spouse does all the purchasing and their debts are under the working spouse’s name?) I’m a big fan of online tools that help me optimize and manage my finances, and you guys have one coming out that I’m pretty excited to try out. Can you talk about the new Borrowell Boost app that you have and what it does? If you liked the episode sign up for free to receive all new episodes as they get released, news on giveaways, and the free guide on the Top 5 Personal Finance and Productivity Tools.
40:06 07/28/2020
Automating Your Investment Portfolio and Sticking to Your Plan
Today we’re going to cover how you can best automate the management of your investment portfolio, while still paying the lowest possible fees. We also share best practices when it comes to sticking to your investment plan. To help us discuss this, I have Brendan Wood on the show who is one of the founders of Passiv, a Canadian fintech company that builds tools for DIY investors. I’m a long-time user of their tools and they've saved me many hours of tedious work when managing my portfolio. So, I thought it would be great to have him on the show especially since Canadians can now get the premium features of the tool for free. Questions and Discussion Points Covered: I’m excited to share how I use Passiv because it’s saved me many many hours at this point and makes checking up on my investments super convenient. But, I’m curious to hear from you how others are using it. Are there certain features or use cases that you see being used most often? What are some of the new features that we now have access to and how should we best use them? Using limit orders vs market orders when buying investments? What's important to look at when examining the performance of your investment portfolio? Dealing with different currencies when investing. What is the cheapest way to convert currency if we want to buy US-listed investments? What is dollar-cost-averaging and your thoughts on using it, especially when the markets are volatile? The impact of COVID-19 on investors. What have you noticed? Investing during down markets. Speculating on markets vs specific companies, and what to do when getting a "hunch" as to where the markets are going.
104:22 06/23/2020
What’s the best type of loan for you? (and how to get the lowest rate)
In this episode, we cover the types of debt tools available to us Canadians, and how to get the lowest rate on them. In other words, what debt options do we have in our Canadian toolbox that we can potentially use, and what are the pros and cons of each? My goal for you is that by the end of this episode, you'll know what your options are in Canada so that if you ever do need a loan, you know exactly what's available to you, which types of loans have the lowest and highest rates, and which ones are the easiest and hardest to qualify for.  And Sure, we've all heard of mortgage and credit cards, but what other types of loans are out there that we could potentially use? Today's Expert: To help me answer these questions, our guest for this episode is Scott Satov. He’s a CA, a CFA, and the founder of LoansCanada.ca which was Canada's first and today’s largest online loan search and comparison platform.  So I figured, if we want to know what types of loans are available to us Canadians, then why not get the first and largest Canadian loan search and comparison provider to help us with this since it’s clearly their job day in and day out to know what’s out there. Links and Resources: You can do your loan comparison shopping over at Scott's company: LoansCanada.ca. They also have a lot of educational resources on the site so you can definitely learn a lot there, even if you aren't looking to immediately take out a loan. The top personal finance and investing tools guide mentioned on the episode can be received for free by signing up on the main page over at buildwealthcanada.ca. The how to invest videos mentioned during the show can be found at buildwealthcanada.ca/invest. Questions Covered: While ideally, we as Canadians want to have no debt, the reality is that most Canadians don't have enough money on-the-side to just buy a car or house with cash, or to fund some expensive unforeseen emergency (whether it's an expensive home repair, something medical that you have no coverage for, or something else). We've all heard of mortgages, but what are the other tools available to us, and can you cover the pros and cons of each along with which ones are the least expensive options here in Canada? What are the different things that are within our control that we can do, to get the lowest rates on loans? Most don't have the cash to buy a new or used car outright, so what have you found to be the best practices for getting the best loan for a new vs used car? Ex. Going through dealer vs the bank vs sites like yours that can pull the rates from different providers. If you need money for an important expense, have you found home equity lines of credit (HELOC) to be the least expensive way to raise the funds required? If someone isn't a homeowner and can't get a HELOC, what type of loan is the least expensive? How do you go about getting a loan and securing it against your car for example (or some other asset) so that it becomes a secured loan giving you the lowest rates? What are the most effective ways of building your credit score? If you have an average credit score, is it worth the effort to try to improve it? In other words, how large are the savings you can get if you do actually work on your credit score and improve it? What are your thoughts on debt consolidation? When should somebody consider it vs not?  What are your top strategies for getting out of debt? Especially for those that are struggling or feeling the pressure from the loans that they already have outstanding. If you liked the episode sign up for free to receive all new episodes as they get released, news on giveaways, and the free guide on the Top 5 Personal Finance and Productivity Tools.
67:09 05/21/2020
What Can You Get? COVID-19 Government Benefits and Major Mortgage Changes
There’s been a lot of new programs and initiatives put in place by the Canadian government due to COVID-19 to help you financially. In this episode, I’m going to take you through what’s out there so that you can make sure you don’t miss out on some free money or benefits that can really help you during this difficult time. I’ve actually gone through everything that I could get my hands on at the Canada Revenue Agency site, so this is all coming right from the source, and this episode’s intention is to save you a lot of time by helping you quickly learn what’s out there, whether you’re eligible, and help you make an efficient decision on which benefits to apply for, and which ones to make sure you receive. The 2nd part of this episode is going to focus on mortgages, the drastic changes in the interest rate that we’ve seen (which can of course heavily impact your mortgage payments and decisions), what’s happening right now as far as the real estate market is concerned, if you can take advantage of these lower interest rates by renewing your mortgage. We’re also going to cover the subject of deferring your mortgage payments, if for example you’ve lost your job and fear that you may not be able to pay your mortgage while we are all in lockdown due to COVID-19. Links & Resources Covered Chat with Sean for free to get your mortgage questions answered by entering your email at buildwealthcanada.ca/sean Check out Sean’s best-selling book, Burn Your Mortgage: The Simple, Powerful Path to Financial Freedom for Canadians. New Tool: Get Your Credit Score Checked for Free A big thanks to Borrowell for sponsoring the show and for building such a great free tool that we can use to check our credit score. It has saved me a lot of time when I want to quickly check the status of my credit score (for example, to ensure there has been no fraud or identity theft on my accounts).  You also obviously want to make sure your score is as high as possible for any mortgages or other loans that you end up applying for (to ensure you get the lowest rate and get approved).  Even if you aren’t looking for a loan, I encourage you to at least pull your report for free to help ensure that there are no unauthorized transactions on your accounts. As a best practice, you should be doing this kind of check at least annually.  Thanks again Borrowell for building a tool where we Canadians can finally get access to this data quickly and for free. Resources from the Episode: Top Tools and Resources for Financial Independence (for Canadians): All the top tools and sites that I’ve personally used to help us achieve financial independence in our early 30s. They’re also what we use now to optimize and manage our finances, and ensure that we’re paying the lowest fees while getting solid returns on our investments.  Canada’s Top ETFs Guide & Top High-Interest Savings Account: In the guide, I go over what I personally invest in, why I invest in it. The investments that I talk about ​are literally where we have almost our entire net worth (apart from our house), and is what we are primarily living off right now in our early retirement. At the very least you’ll learn about some great ETFs to consider for your portfolio, and if you are new to ETFs, it’ll give you a nice list of some top ETFs to consider from the thousands that are out there.  The guide is available for free to any listeners that that use my special link to sign up for a free savings account with the bank that I personally use, EQ bank.  The reason that I personally use EQ bank, is that they have one of the highest interest savings rates in Canada (they are currently offering 2% which is more than double what the major banks are offering). It’s also free to sign up and keep an account with them, so you’re not paying a monthly fee like you do with many of the other banks out there. You also get unlimited transactions, unlimited Interac e-transfers, and can take out your money at any time if you need it, and there are no minimum balances. Because of those reasons, I’ve been with them ever since they launched in Canada years ago, and it’s where I keep my entire emergency fund and spending money.  To get the free high-interest account and the free guide on the top ETFs in Canada, just go to buildwealthcanada.ca/eq, open the free account, and once you’re done, forward any email that you get from EQ to bonus@buildwealthcanada.ca and I’ll send you the full comprehensive guide for free.  Don't miss future episodes, giveaways, and free in-depth guides by signing up for free to the Build Wealth Canada Newsletter
66:09 04/16/2020
Market Declines: How to Deal With, and Coronavirus Impact
A lot has been happening with the significant stock market declines and coronavirus, so I’ve been getting lots of questions such as: How am I adapting our portfolio and investment strategy to these declines? Should we be buying into the market at these low prices or selling? Should we be waiting out for the market bottom and then buying? What are the other experts that I listen to and trust saying? With this episode, the goal is to answer these top questions for you. Now, of course, the health and the safety of your family is more important than the temporary performance of an investments portfolio, so that should be the priority. But since I’m not a doctor or medical expert, it doesn’t make sense for me to try to give you medical advice. So instead, let’s focus on what I do actually have expertise and experience in and shine some light on the investment and financial planning side of things. Enjoy the episode. New Tool: Get Your Credit Score Checked for Free A big thanks to Borrowell for sponsoring the show and for building such a great free tool that we can use to check our credit score. It has saved me a lot of time when I want to quickly check the status of my credit score (for example, to ensure there has been no fraud or identity theft on my accounts).  You also obviously want to make sure your score is as high as possible for any mortgages or other loans that you end up applying for (to ensure you get the lowest rate and get approved).  Even if you aren’t looking for a loan, I encourage you to at least pull your report for free to help ensure that there are no unauthorized transactions on your accounts. As a best practice, you should be doing this kind of check at least annually.  Thanks again Borrowell for building a tool where we Canadians can finally get access to this data quickly and for free. Resources from the Episode: Top Tools and Resources for Financial Independence (for Canadians): All the top tools and sites that I’ve personally used to help us achieve financial independence in our early 30s. They’re also what we use now to optimize and manage our finances, and ensure that we’re paying the lowest fees while getting solid returns on our investments.  Canada’s Top ETFs Guide & Top High-Interest Savings Account: In the guide, I go over what I personally invest in, why I invest in it. The investments that I talk about ​are literally where we have almost our entire net worth (apart from our house), and is what we are primarily living off right now in our early retirement. At the very least you’ll learn about some great ETFs to consider for your portfolio, and if you are new to ETFs, it’ll give you a nice list of some top ETFs to consider from the thousands that are out there.  The guide is available for free to any listeners that that use my special link to sign up for a free savings account with the bank that I personally use, EQ bank.  The reason that I personally use EQ bank, is that they have one of the highest interest savings rates in Canada (they are currently offering 2% which is more than double what the major banks are offering). It’s also free to sign up and keep an account with them, so you’re not paying a monthly fee like you do with many of the other banks out there. You also get unlimited transactions, unlimited Interac e-transfers, and can take out your money at any time if you need it, and there are no minimum balances. Because of those reasons, I’ve been with them ever since they launched in Canada years ago, and it’s where I keep my entire emergency fund and spending money.  To get the free high-interest account and the free guide on the top ETFs in Canada, just go to buildwealthcanada.ca/eq, open the free account, and once you’re done, forward any email that you get from EQ to bonus@buildwealthcanada.ca and I’ll send you the full comprehensive guide for free. 
31:40 03/18/2020
Our Early Retirement Story (and Lessons Learned from Achieving It)
I recently realized that I haven’t really provided an update on our early retirement story and more importantly, the lessons learned from it so far. Therefore my goal for this episode is to share with you what we did wrong and what I think we did right, that allowed us to achieve financial independence by the time I was 32. Please don’t interpret this episode as some sort of showing off, bragging, or an ego boost. I absolutely hate arrogance and hubris (it’s actually ones of my biggest pet peeves). Instead, the whole idea behind this episode is to give you some actionable insights based on our failures and successes over the years, so that you can hopefully learn from our experiences, apply them to your own financial independence, retire early journey and hopefully cut down the time that it takes you to get there. That’s it. New Tool: Get Your Credit Score Checked for Free A big thanks to Borrowell for sponsoring the show and for building such a great free tool that we can use to check our credit score. It has saved me a lot of time when I want to quickly check the status of my credit score (for example, to ensure there has been no fraud or identity theft on my accounts).  You also obviously want to make sure your score is as high as possible for any mortgages or other loans that you end up applying for (to ensure you get the lowest rate and get approved).  Even if you aren’t looking for a loan, I encourage you to at least pull your report for free to help ensure that there are no unauthorized transactions on your accounts. As a best practice, you should be doing this kind of check at least annually.  Thanks again Borrowell for building a tool where we Canadians can finally get access to this data quickly and for free. Other Resources: Top Tools and Resources for Financial Independence (for Canadians): All the top tools and sites that I’ve personally used to help us achieve financial independence in our early 30s. They’re also what we use now to optimize and manage our finances, and ensure that we’re paying the lowest fees while getting solid returns on our investments.  Canada’s Top ETFs Guide & Top High-Interest Savings Account: In the guide, I go over what I personally invest in and why I invest in it. The investments that I talk about ​are literally where we have almost our entire net worth (apart from our house), and is what we are primarily living off right now in our early retirement. At the very least you’ll learn about some great ETFs to consider for your portfolio, and if you are new to ETFs, it’ll give you a nice list of some top ETFs to consider from the thousands that are out there.  The guide is available for free to any listeners that that use this link to sign up for a free savings account with the bank that I personally use, EQ bank.  The reason that I personally use EQ bank, is that they have one of the highest interest savings rates in Canada (they are currently offering 2.45% which is more than double what the major banks are offering). It’s also free to sign up and keep an account with them, so you’re not paying a monthly fee like you do with many of the other banks out there. You also get unlimited transactions, unlimited Interac e-transfers, and can take out your money at any time if you need it, and there are no minimum balances. Because of those reasons, I’ve been with them ever since they launched in Canada years ago, and it’s where I keep my entire emergency fund and spending money.  To get the free high-interest account and the free guide on the top ETFs in Canada, just go to buildwealthcanada.ca/eq, open the free account, and once you’re done, forward any email that you get from EQ to bonus@buildwealthcanada.ca and I’ll send you the full comprehensive guide for free. 
29:17 02/11/2020