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How to invest on autopilot before I'm too old to deal with it or it's left to my spouse?
March 14, 2023
12:54 pm
Bill
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You're welcome, RetireEd. But this link has nothing to do with executors or estate settlement after death, my understanding was your concern was assistance while you are alive, POA, etc. Which is what the link will have information about.

April 9, 2023
3:41 pm
MonkeyClub
Central Alberta
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An alternative, which AltaRed mentioned (post 5), that i like is having an ETF(s) or basket of stocks (my preference) that are Canadian blue chip dividend growers that I hold pretty much forever and collect a portfolio average of 4-5% dividends regardless of the market. While not as autopilot as Annuities, it isn't much maintenance. Sure, would have to weed out a stock now and then and decide where to allocate the proceeds (a replacement or existing stock). It mitigates the sequence of returns risk and in the last decade+ dividend increases have generally kept up and in many cases outpaced inflation (although that may be more challenging for the next couple years or longer).

Presently, for diversification and more growth, I hold international ETF's in our RRSP's and some REIT's and dividend growers in my TFSA. And we have 3 years income needs in HISA/GIC's.

In the future, when I need or desire to reduce/simplify the maintenance burden, I'm thinking of disposing of the international securities and REIT's and either purchasing an Annuity or a ladder of GIC's, or both. In the meantime I have begun educating my wife and progeny on dividend investing and the strategy

Certainly, for this to work the dividends must be sufficient to fill in the funding gap that government and 3rd party pensions leave. Another plus, in taxable accounts dividends are taxed very favourably when taxable income is below about $100-120k (and 0 ~ 2.5% tax (Prov. dependent) when net is below about $50k).

April 9, 2023
4:49 pm
Bill
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I agree with your first paragraph, that certainly has worked in the past few decades. Plus once you've paid the few bucks of commission on purchase of blue chips there are no further yearly fees or costs to reduce your return. Note that grossed-up dividend income later can make you hit seniors' benefit reduction thresholds (e.g. OAS clawback) earlier than regular income.

And educating your wife and progeny is key if the concern is who is going to manage my finances when I no longer can? Hopefully one of your progeny will be able to do that for you.

April 10, 2023
3:56 am
RetirEd
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Again, Bill, I have no family, progeny or otherwise. A few consistent yield stock in an ETF is very attractive to me, but I have foundered on the mechanisms of choosing a broker (ideally one who is available by phone or in a convenient office), picking an ETF, or understanding the whole grossing up and distribution thing.

I have a copy of "Exchange Traded Funds for Canadians for Dummies," but it's very specific, not regularly updated and doesn't leave me feeling I know what's going on. The book was a freebie do don't diss me for a bad choice. Hey, how would I know what a GOOD choice would be?

Can't ask too much here; ETF's no GIC or savings account investment!
RetirEd

RetirEd

April 10, 2023
4:44 am
Bill
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RetirEd, my post was a response to MonkeyClub who did refer to wife & kids.

And to clarify, I agree with the long term blue chip idea only if you're positive re North America's continued economic prosperity & success in the coming decades.

April 10, 2023
11:46 am
MonkeyClub
Central Alberta
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Bill said
I agree with your first paragraph, that certainly has worked in the past few decades. Plus once you've paid the few bucks of commission on purchase of blue chips there are no further yearly fees or costs to reduce your return. Note that grossed-up dividend income later can make you hit seniors' benefit reduction thresholds (e.g. OAS clawback) earlier than regular income.

And educating your wife and progeny is key if the concern is who is going to manage my finances when I no longer can? Hopefully one of your progeny will be able to do that for you.  

Yeah, the 38% dividend gross-up potentially putting one into OAS clawback territory (net income over ~$81k for 2022) is a drawback. There are trade-offs with any strategy one employs.

April 10, 2023
5:23 pm
christinad
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Are ALDAS available now?

April 10, 2023
7:08 pm
Bill
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