Jan 112015

When the Toronto stock exchange dropped  8% in the first 2 weeks of December I thought 2014 was going to end on a down month. But fortunately confidence came back to the market and investors pushed stocks back up. In the end it was a pretty flat month with minor gains in some sectors. :) Had the TSX stayed down at 8% below November’s close, my net worth would be down $13K right now instead of actually being up by $3,300 for the month. Phew. 8-)

*Side Income:

  • Part-Time Work = $700
  • Dividends = $500
*Discretionary Spending:
  • Fun = $200
  • Debt Interest = $1500

*Net Worth: (MoM)14-11-fiscal-update-net-worth

  • Assets: = $837,400 total (+1,700)
  • Cash = $2,800 (+800)
  • Stocks CDN =$87,900 (+500)
  • Stocks US = $53,300 (-500)
  • RRSP = $51,400 (+900)
  • MICs = $15,000 (same)
  • Home = $254,000 (same)
  • Farms = $373,000 (same)
  • Debts: = $517,800 total (-1,600)
  • Mortgage = $195,700 (-300)
  • Farm Loans = $203,500 (-400)
  • Margin Loan CDN = $26,900 (-300)
  • Margin Loan US = $25,100 (+700)
  • TD Line of Credit = $30,000  (-400)
  • CIBC Line of Credit = $10,400 (-400)
  • HELOC = $18,200 (same)
  • RRSP Loans = $8,000 (-500)

*Total Net Worth = $319,600 (+1.0%)
All numbers above are in $CDN. Conversion rate used: 1.00 USD = 1.18 CAD

Overall it’s been a terrific year. I’m almost worth $320K now. Yay! Here’s a comparison to last year.

Dec 2014 Dec 2013
Assets $837,400 $742,500
Debts $517,800 $533,600
Net Worth $319,600 $208,900


So that’s a six figure annual increase. Not too shabby. It’s actually the best year for me so far. :D Most of this wealth surge in 2014 was due to the continuing increase of asset prices. About 5 years ago I went on a mission to build up my financial assets. By the beginning of 2014 I had accumulated about $750K of gross assets. Most of that amount is financed by long term bank loans.

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Nov 302014


I’ve had a decent month resulting in a wealth gain of $5,800. Mostly thanks to my investment gains. I received $200 of interest payment this month from my Sherritt high yield bond, with an 8% coupon, which I blogged about how to buy earlier this year.

The price for a barrel of oil has fallen in the last 3 months from $94/barrel to just $66/barrel. This capitulation is no doubt caused by an oversupply of oil on the global market and a slowdown of demand in Europe and Asia. It looks like oil exporting countries are facing a crude predicament. ;) Last week the Organization of the Petroleum Exporting Countries (OPEC) held a meeting to discuss its operation plans. OPEC is an oil cartel, represented by 12 countries in the middle east, Africa, and South America. Together this organization produces about 1/3rd of the oil supply in the world. Due to its large influence OPEC can single handedly change the price of oil in the world by increasing or decreasing its member’s oil output. During its recent meeting the cartel has decided to maintain its production levels at 30 million barrels a day. OPEC is trying to price North American oil producers out of the market.  

The decision was largely unexpected by investors. Keeping oil production high means more oil supply on the market so this news has caused a large drain on Canadian and U.S. oil stocks. I hear drilling for oil tends to be a boring job. :D But if these low energy prices continue then we could see less hiring in the oil sands and Bakken area, which will stifle economic growth. :(  I’m not in any rush to buy more into energy companies just yet. I think low oil price will be the norm until middle of 2015 at least. Instead I am looking at other sectors of the economy for growth opportunities. Financials and telecommunication stocks on average are both up 8% over the last month alone. That’s almost 100% annualized return. The consumer cyclical industry is doing well too, up 13% in November alone. These are companies like retail, drugs, food, beverage, etc. such as Dollarama and Tim Hortons. :)

*Side Income:

  • Part-Time Work = $500
  • Dividends = $400
  • Interest = $200
*Discretionary Spending:
  • Eating Out = $100
  • Others = $100

*Net Worth: (MoM)14-11-fiscal-update-net-worth

  • Assets: = $835,700 total (+3,700)
  • Cash = $2,000 (-600)
  • Stocks CDN =$87,400 (+2000)
  • Stocks US = $53,800 (+1200)
  • RRSP = $50,500 (+1100)
  • MICs = $15,000 (same)
  • Home = $254,000 (same)
  • Farms = $373,000 (same)
  • Debts: = $519,400 total (-2,100)
  • Mortgage = $196,000 (-300)
  • Farm Loans = $203,900 (-400)
  • Margin Loan CDN = $27,200 (+200)
  • Margin Loan US = $24,400 (+500)
  • TD Line of Credit = $30,400  (-300)
  • CIBC Line of Credit = $10,800 (-600)
  • HELOC = $18,200 (-200)
  • RRSP Loans = $8,500 (-1,000)

*Total Net Worth = $316,300 (+1.9%)
All numbers above are in $CDN. Conversion rate used: 1.00 USD = 1.14 CAD

My retirement fund was able to withstand the beating of oil stocks over these last few months because I maintain a diversified portfolio. I just want a large nest egg when I reach financial freedom. If one type of stock underperforms I’m sure another type will make up for it. Oils well that ends well. :)

Random Useless Fact:
The Swiss are like Dwarves because they live in the mountains, collect gold, make intricate machinery, and aren’t concerned by the wars of men.

Nov 032014

Last month was quite the roller coaster ride. But maybe all this market volatility is a good thing. The rich keep getting richer because the assets they own, like stocks and real estate, continue to grow in value. But this is a worrying signal because high levels of inequality have usually lead to recessions in the past.


For someone to make a lot of money it generally requires other people to work for it. For example, the CEO of a large company can’t earn a large salary if not for the hundreds of employees working under him. :) And a real estate investor can’t make a living off his rental income if his tenants decide to move out or otherwise stop paying him. So in order for the wealthy to maintain their high standards of living they have to be supported by the larger base of the lower and middle class workers. But if the poor keeps getting poorer then eventually they’ll just give up supporting the wealthy. This is already starting to happen around the world as people are dropping out of the workforce. :( In the U.S. the labor participation rate is only 62.8%, the lowest since 1978. But it’s also important to remember that employment circumstances are very localized. For example the unemployment rates in Oregon and Idaho are 7.1% and 4.5% respectively, which is quite a big difference, even though the two states are right beside each other. ;)

The recession in 2008 somewhat served as an equalizer of economic status where the people who owned the most financial assets lost more than anyone else, and the world became a little more equal. But the net worth gap between the rich and the poor has been growing again since 2010. So maybe a small stock market correction every now and then like we’ve seen in October is probably more favorable than having another large recession. It’s in society’s best interest to not let wealth inequality get out of control. The rich depend on the production of the working class to thrive, so if the working class becomes less productive then eventually everyone will be in trouble. :?

At one point in mid October my stock portfolio was down by more than 4%. Luckily however the market decided to recover most of that loss. My existing investments are still down for the month but I saved some money from my income and paid down some extra debt to make up the difference. In other words both my assets and debts were down, but my debts lost more value so I still increased my wealth overall, albeit just barely. :D

*Side Income:

  • Part-Time Work = $800
  • Dividends = $500
*Discretionary Spending:
  • Eating Out = $100
  • Others = $100

*Net Worth: (MoM)chart_14sept net worth graph market volatility inequality

  • Assets: = $832,000 total (-4,000)
  • Cash = $2600 (-800)
  • Stocks CDN =$85,400 (-3300)
  • Stocks US = $52,600 (-300)
  • RRSP = $49,400 (+400)
  • MICs = $15,000 (same)
  • Home = $254,000 (same)
  • Farms = $373,000 (same)
  • Debts: = $521,500 total (-4,200)
  • Mortgage = $196,300 (-600)
  • Farm Loans = $204,300 (-500)
  • Margin Loan CDN = $27,000 (-500)
  • Margin Loan US = $23,900 (-1000)
  • TD Line of Credit = $30,700  (-300)
  • CIBC Line of Credit = $11,400 (-200)
  • HELOC = $18,400 (-100)
  • RRSP Loans = $9,500 (-1,000)

*Total Net Worth = $310,500 (+0.10%)
All numbers above are in $CDN. Conversion rate used: 1.00 USD = 1.13 CAD

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Oct 012014

The American economy is starting to pick up. U.S. stocks have held steady in September. However the Canadian stock market dropped 4.3%, the price of oil fell $3 per barrel, and the value of the Loonie sank to just 89.4 cents U.S.

Thankfully my finances held up okay in September. I did lose about $5,600 of value in my stock portfolio though. :| It’s hard to make money when the entire stock market index takes a big hit. However I still managed to end the month with a net worth increase of +$1,400. This is largely due to my rental income which came at the end of the month. I deposited this payment of $5,177 into my bank account, same as this time last year. Unfortunately I’m still cash flow negative on my farmland investment by about $4K a year, but I’m hoping that the land will appreciate in value over time to compensate for any short term losses.


Phew, if it wasn’t for this payment I’m afraid my net worth would have dropped by several thousand dollars. :? But instead I eked out a small gain! I receive 2 rent payments annually from the farms; once in the spring and once in the fall.

What a coinkydink. ;) Just as I experience a month of stock market decline my farmland investment pulls through for me. :D I decided to use the extra rental money to pay down some of my debt. I know my debt level might be a bit on the high side and many people have given me pretty strong signals to use less leverage. But for now I think I’m doing alright with over 6 consecutive years of double digit annual returns.

I’ve had a lot of time to experiment and reflect on my financial choices since buying a condo in 2009 and living by myself.  I’ve discovered what matters most is to be flexible and have a solid understanding of one’s unique financial situation. Understanding removes uncertainty and creates confidence, which will lead to a sense of control. I’m comfortable with my debt because I’m confident I have control over it. However it’s important to have a contingency plan as well, which I thoroughly stress test.

*Side Income:

  • Part-Time Work = $500
  • Dividends = $400
  • Farm Rent = $5,200
*Discretionary Spending:
  • Eating Out = $100
  • Others = $200

*Net Worth: (MoM)chart_14sept net worth graph economy slow down

  • Assets: = $836,000 total (-3,900)
  • Cash = $3400 (+1200)
  • Stocks CDN =$88,700 (-5300)
  • Stocks US = $52,900 (-300)
  • RRSP = $49,000 (+500)
  • MICs = $15,000 (same)
  • Home = $254,000 (same)
  • Farms = $373,000 (same)
  • Debts: = $525,700 total (-5,300)
  • Mortgage = $196,900 (-400)
  • Farm Loans = $204,800 (-400)
  • Margin Loan CDN = $27,500 (-2200)
  • Margin Loan US = $24,900 (+700)
  • TD Line of Credit = $31,000  (-1000)
  • CIBC Line of Credit = $11,600 (-400)
  • HELOC = $18,500 (-100)
  • RRSP Loans = $10,500 (-1,500)

*Total Net Worth = $310,300 (+0.45%)
All numbers above are in $CDN. Conversion rate used: 1.00 USD = 1.12 CAD

I hold mostly dividend growth stocks in my margin accounts. They’re large-cap, blue chip companies such as Chevron, Starbucks, or Disney, with large economic moats and have a history of increasing earnings and dividends over time. Apparently the severe weather in the prairies this year has not deterred farm buyers :) Alberta received a lot of snow. Saskatchewan and Manitoba experienced pretty bad flooding. Yet according to a Re/Max report land prices are still going up.

Land in short supply left “well-financed” Alberta farmers ready to make a deal on short notice, Re/Max said, noting tiled land, for example, sold for as much as $10,000 per acre in southern Alberta, up 20% over the previous year.

In Saskatchewan, prices increased from between $1,500 and $2,000 an acre in 2013 to between $1,800 and $2,200 in 2014. Manitoba saw its price range go from between $1,350 and $1,600 to $1,500 and $2,000.

My Saskatchewan farms are currently worth about $1,200 an acre on average. If we assume that report is accurate then even a conservative $100/acre increase would give me a solid $31,000 capital appreciation for this year alone. :D That alone would be more than enough to cover the entire cost of servicing my total debts, for which I pay about $18,000 of interest per year.

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Sep 012014

It’s the first day month of Autumn :) It’s hard to believe another month has gone by already. The U.S. economy grew at a brisk 4.2% in the second quarter of 2014, and Canada’s increased to 3.1%, which is the fastest pace since 2011. Consumers are spending more, exports are up, and stock markets are reaching all times highs! But for many people it still feels like a struggle to get out of a recession because their real wages have stagnated since 2008 yet the real cost of food, shelter, and other goods are higher. Grinding away at a job, saving some money, and relying on the government have always placed people at a disadvantage.

Those who want to actually get ahead economically have to make the right decisions with their money. Thankfully this is not hard to do. All investors who use a simple indexing strategy have seen the fruits of this recovering economy. Strong GDP growth usually means more discretionary spending, more profits for businesses, and more expensive houses. It’s hard to lose money in the markets when stocks, real estate, and bonds have all gone up over the last few years.

*Side Income:

  • Part-Time Work = $1,200
  • Dividends = $400
*Discretionary Spending:
  • Eating Out = $100
  • Others = $200

*Net Worth: (MoM)chart_14july

  • Assets: = $839,900 total (+1,600)
  • Cash = $2200 (+200)
  • Stocks CDN =$94,000 (+1400)
  • Stocks US = $53,200 (+500)
  • RRSP = $48,500 (-500)
  • MICs = $15,000 (same)
  • Home = $254,000 (same)
  • Farms = $373,000 (same)
  • Debts: = $531,000 total (-3,700)
  • Mortgage = $197,300 (-400)
  • Farm Loans = $205,200 (-400)
  • Margin Loan CDN = $29,700 (-700)
  • Margin Loan US = $24,200 (+300)
  • TD Line of Credit = $32,000  (-200)
  • CIBC Line of Credit = $12,000 (-700)
  • HELOC = $18,600 (-100)
  • RRSP Loans = $12,000 (-1,500)

*Total Net Worth = $308,900 (+1.75%)
All numbers above are in $CDN. Conversion rate used: 1.00 USD = 1.09 CAD

That’s about $5K increase from the previous month. Not bad :) I had 3 pay periods at my part time job which is rare but always nice. The Canadian stock market set a new record high, partially due to Tim Hortons shares shooting up 27% in August :D I have about $2K of cash in my RRSP account. I might invest in some media companies in September.

Besides the regular side income sources I’ve listed above I also made $186 from selling stock options in August :) At the beginning of this year I didn’t really understand what options were. But I learned about them, experimented with them, explained how writing options work, and now I plan to trade options on a regular basis and make $1000 to $1500 from option premiums every year. This would certainly help increase my net worth over time ;)  Writing options can be less risky than trading stocks, but it’s guaranteed to make a premium every single time. So far my options have never been exercised before.


Earning extra income is literally as simple as learning a new skill, trying it out, and becoming comfortable enough with it to turn it into a habit. The hard part is building up the confidence to trust your own judgement. And there’s only one way to do that; by doing ;)

Random Useless Fact:
Dwarf hamsters are prone to diabetes so avoid feeding them sweet treats and fruit.