Jun 152017

We’re Living Longer

I don’t know how the term “aging gracefully” can be a compliment. To me it just sounds like a nicer way of saying you’re slowly looking worse. 😛 When the government pension (CPP) was first introduced in the 1960s, the average life expectancy was about 71 years old. The idea was that most workers would retire at around 65 years old, and receive 5 to 10 years of CPP benefits in retirement. And that was the case for awhile. 🙂 But today, the average life expectancy in Canada is over 80 years old which puts more pressure on the CPP investment board to perform well. It’s not unreasonable to assume that my generation of workers (millennials) could have a life expectancy on average of 90 years or older.

According to a Telegraph article, we could witness in our lifetime a world where most babies will have a life expectancy of 100 years or longer! 😀 It’s nice that people are living longer than previous generations. But it’s also kind of sad to think about getting old. Can you imagine having sex when you’re 90? It’ll probably be like trying to shoot pool with a rope. 😕

Young adults are also starting careers later today than in the 60s. So with relatively less money going into the sovereign wealth fund, and more people withdrawing, many economists are worried about the future sustainability of government benefits on the local, provincial, and national level – not just in this country, but all around the world.

If generation Y folks are likely to live to 90 years old, then planning to retire at 65 may not be financially feasible unless a large amount of wealth is saved up first. For those who are planning to retire early like myself, it is even more difficult. Assuming I reach financial freedom by 35, I will have 55 years of living in retirement if I choose to. That sounds great. But the reality is I will most likely be working on and off, or on a part-time capacity throughout my 40s and 50s because there are only so many non-productive activities I can do before I get bored and start working on something economically productive again. 🙂

So instead of planning to live until 80 years old, most healthy people my age should be aiming for 90 as the starting point. And with that it means accumulating more personal savings for retirement. But also keeping in mind that there is no set retirement age anymore, so plan to be flexible with work schedules to accommodate a balanced lifestyle.


Random Useless Fact:

Mar 242016

Gradual Change

According to the U.S. government, the country only grew 1% in Q4 of 2015. But that’s still better than Canada. Our GDP up here only increased 0.8%.  It doesn’t feel like the economy in either country is going to pick up any time soon. Personally I don’t mind slowing down or even contraction. Slow economic times is a natural part of the market cycle because it helps with the price discovery mechanism and prevents bubbles from becoming too big. But of course politicians want to encourage more growth all the time which means investors have to be smarter and more cautious about where to deploy capital.

One concern that affects everyone in the world is an aging global population. Japan is leading the charge on this one. Many Japanese couples grow fruit trees and live to a ripe old age. According to the World Bank, Japan has the oldest demographic with 26% of its population being age 65 or older. We all know what happened in Japan for the last 20 years. It’s GDP is basically unchanged from 1995 to 2015. Same goes for Japan’s stock market. Any money thrown into the Nikkei 225 index 20 years ago would have produced virtually no gains as of now. The couch potato method of index investing doesn’t always work for everyone.

The percentage of Canadians who are 65 or older is about 17% today. In the U.S. it’s about 15% of the population. We are still a long way off from Japan’s 26%, but it’s worth noting that 17% of Japan’s population was 65 years or older in the late 1990s.


I would continue to invest in large, profitable companies. But high quality stocks have been bid up so much that there isn’t much room for them to go higher in the short term based on fundamentals. This is why I look at alternative places to invest as well.

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Jul 282015

Insolvencies by Age and Province

A lot of money is tainted. It taint yours, and it taint mine. 😀 That’s why it’s important to make the most of the money we do have and spend it responsibly. But sometimes if we don’t have enough money to buy what we want, we’ll need to use debt.

There’s nothing inherently wrong about borrowing money, but we have to be careful to not overextend ourselves. When we are no longer able to service our debt payments we are considered to be insolvent. The insolvency rate for Canadian consumers is only 4.2% and has been steadily declining since 2010. Here’s an interesting chart via the Government of Canada showing the distribution of insolvency by age groups.

15-07-consumer-debt-by-age-Insolvencies by Age and Location

According to the graph adults between 25 to 29 years old such as myself only represent 7.1% of all insolvency cases. This is lower than most other age groups. On the other hand, Canadians between the ages of 40 and 44 are most likely to become insolvent.

Younger adults are generally still building up their financial stories. It’s easier for younger workers to change careers. And they’re also more likely to live with their parents. Meanwhile, middle-aged folks have fewer financial options. It appears after we turn 40 we’re likely busy raising families. Salary increases are not as generous as earlier in our careers. And some of us will need to start taking care of our aging parents. This sounds like the worst time to be worrying about debt problems, yet the evidence shows this is exactly when we’re most likely to struggle staying solvent.

How can we prepare for this mid-life financial risk?

Allow me to present a brief case about debt and age groups. 😀


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Mar 172012

There are many advantages to investing while we’re young. There isn’t a specific best starting age though because our circumstances vary. I started at 21 because that’s when I got my first real job and started making money. It’s only been a few years but I can already see lots of benefits of investing in my twenties rather than putting it off.

  • Time –  Compound interest is very powerful. “Time is money” after all (゜∀゜)
  • Tech Know-how – Technology can make investing more convenient. The younger generation tends to adopt new technologies faster.
  • More Risk – There is a lot of future earning potential to cover any short term losses when we’re younger. I have the physical ability and patience to withstand a depression so I can afford to put more money into the stock market and ride out any volatility.  
  • More options – We tend to take on more responsibilities as we mature and grow. Today I can invest in myself by studying abroad, travel to find other opportunities, and use my time and money however I want, even start a small business if I want to. But in the future I have to be more responsible with my time and money, especially once I have a family.
  • Energy– Pulling all-nighters researching stocks, working over-time, taking on multiple jobs, reacting quickly to market sentiment, and recovering faster from fatigue. These things become harder to do as we age.
  • Exposure to Global Events – By being involved in making investment decisions we can better understand our surrounding economy. Corporations have a major influence on the world we live in, so understanding companies means understanding society, so we can make better decisions than other young people who are not so informed. Exposure to corporate finance may lead us to discover what jobs are currently in demand, for example.
  • Planning for Life’s Situations – Planning today makes life easier tomorrow. We can invest in a life insurance policy to guarantee us fixed income once we’re retired. The younger we are the cheaper the premium. We can also invest in our children’s future through RESPs (similar to 529 plans.) But the later we wait to invest the more opportunities we will miss along the way.
  • Learn from Mistakes – We can afford to make bigger mistakes because we have the time to recover from them ( ・ω・) Some mistakes to avoid are: postpone investing, expect unrealistic returns, and keep all eggs on one basket. It’s never too late to start investing. For those who made the mistake of waiting to invest, remember that the game is not over yet. “The best time to plant a tree is 20 years ago. The second best time is today.


Random Useless Fact: The elephant is the only mammal that can’t jump.

Aug 242011

How my perception about materialism/income have drastically changed in the last decade or so.

Year – 2002
Occupation – high school
Outlook on life – apathetic

Adult life sounds difficult. There seems to be so much responsibility. What’s the point of making money other than to survive? Money isn’t everything. As long as I have enough to live on then that’s all that matters. The average Canadian makes $40k/yr. Sounds like a lot already. I will be very satisfied if I can make $40,000/yr some day.

Year – 2005
Occupation – college
Outlook on life – concerned
Looks like post secondary education is a necessity these days to even find a decent job. I’m not actually ahead of most people. I should work harder or else I’ll get left behind when all my friends start working in their respective careers. With the way inflation is going I should be able to make $60,000/yr some day if I apply myself in school and try to find a good job afterwards.

Year – 2008
Occupation – junior associate
Outlook on life – inspired
Starting my first real job, great! My entry level compensation is only $35K but looks like there is plenty of room for career advancement. All my co-workers are making much more than me and they have nicer homes, newer cars, and give off sophisticated auras. Some of the senior graphic designer are making $70K a year, wow.  If I include the income from my part-time job, I should be able to eventually make $80,000/yr of total income one day.

Year – 2011
Occupation – intermediate associate
Outlook on life – optimistic
Got a promotion this year. Also starting to make a small bit of investment income. I’m buying all the comics, toys, and food I couldn’t afford before when I was broke. Money is awesome. I’m starting to want more and more of it. I’m only making mid 5 figures now, but I think some day I can make $100,000/yr and eventually reach financial independence. This new blog I started last year will help me reach my goals.

I guess a lot can change in 9 years.