April 2021 Financial Update

“Don’t tell me what you think, tell me what you have in your portfolio.”

― Nassim Nicholas Taleb, Skin in the Game: Hidden Asymmetries in Daily Life

My Investment Philosophy

  • Diversify – investments and taxes.
  • Do nothing – automate.
  • Develop margin of safety – allow assets to compound.

Networth% April 2021

Equities (80%VGRO, Brk.B)

37%

Fixed Income (20%VGRO, VAB, Cash)

25%

Personal Residence

24%

Extra Unit

7%

Commercial Unit

5%

Other

0.5%

Our Portfolio

I treat all accounts as one portfolio.

Portfolio Accounts% April 2021

Account

Ticker

Asset

Portfolio %

Corporate

BRK.B

Berkshire Hathaway

4.7

Corporate

VGRO

80/20 Asset Allocation ETF

62

RRSP1

VAB

Aggregate Bond

2.3

RRSP1

VGRO

80/20 Asset Allocation ETF

1.6

RRSP2

VAB

Aggregate Bond

3.8

TFSA1

VGRO

80/20 Asset Allocation ETF

1.4

TFSA2

VGRO

80/20 Asset Allocation ETF

1.4

Taxable

VGRO

80/20 Asset Allocation ETF

2.2

GIC

4.8

Cash

16

Portfolio Holdings% April 2021

VGRO

80/20 Asset Allocation ETF

69%

Cash + GIC

Fixed Income

21%

VAB

Aggregate Bond

6%

Brk.B

Berkshire Hathaway

4.7%

Asset Allocation

59.5%

Portfolio Gain (Loss) YTD

176,123

Portfolio Gain (Loss) 2020

370,596

Portfolio Gain (Loss) 2019

83,249

Mailbox Money – April 2021

“Life is really simple, but men insist on making it complicated.” Confucius (BC 551-BC 479) Chinese philosopher.

My investment philosophy is simple.

I have zero alpha.

I want “know nothing, do nothing” mailbox money.

Mailbox Money

VGRO

18,528

Interest

8,314

VAB

967

April 2021 Total

27,810

12 Month Trailing

120,799

2021 YTD

52,410

2020

125,388

2019

107,264

April 2021

I started blogging in 2018. I did it to make myself accountable. I also tend to think better when I write things out. My finances were a jumble mainly from neglect. I updated totals for years but never spent time reviewing what the totals were composed of. I admit that I owned many individual stocks bought during the dotcom crisis and simply never looked at them until 2017.

I didn’t even know how dividends were paid. I did not know that it was based on the number of shares that I owned. Duh!

The biggest reason I never looked was because we had so many companies. I do not do well with complexity.

I am not kidding when I say that I need things to be simple. My default for too much complexity is to ignore things.

But since I started the blog it has forced me to review all of it. And when I did, I started cutting things out ruthlessly.

It was great timing since this was around the time Vanguard started their asset allocation ETFs in Canada.

I think I bought it during the first week after the launch of VGRO.

Nowadays I hold 1 stock, 2 ETFs, cash and some real estate.

I do not bother with asset location. I do not try to lower fees by buying the individual ETF components. I do not tax loss sell. I do not engage in currency conversion with Norbert’s gambit.

I literally buy VGRO wherever I can and then hold it. I don’t even have to rebalance.

I have no idea what is the best way to invest. I am certain that my way is not the optimal way.

However I know that this is the simplest way. I know that if I can stay with this strategy, I can hope to attain market returns. That is good enough for me.

I want my investments to be automated and passive.

To mitigate equity volatility, I will hold more cash and spend less when needed.

I will not be adding alternative investments. It has taken me long enough to make things simple.

Plus I am starting to see that I just don’t care about money enough to bother trying anything else. That is the most honest answer.

The whole point of writing monthly updates is to keep myself on track. My biggest problem has been that I stop watching things after a while. This is why asset allocation ETFs like VGRO are wonderful. I can literally set it and forget it eventually.

I finally got our portfolio to 60/40 asset allocation. My bank terms were coming due so it was time to get it all invested. I am starting to not even want to manage the cash in my bank accounts.

I love my portfolio. It is simple and it feels great to just buy more VGRO. Once it’s bought, I do not need to deal with it except collect dividends quarterly.

That is my idea of “do nothing”.

Online shopping has become my default now. I love Costco Instacart. I have not gone shopping physically except for a couple of times to Costco with my hubby. I recently gave my membership to hubby since I don’t plan to shop in the warehouse anymore. My lifestyle is changing.

Life is becoming more routine. I love routines. I eat the same breakfast and lunch daily. It’s oatmeal for breakfast and I have an apple and nuts for lunch.

I have finally lost weight. I haven’t been able to lose weight for the past few decades. There must be a correlation between living a more aligned life and my losing weight. I am in my fifties and I am the same weight I was during high school. That sounds great but I was overweight for the past 28 years. Life is all about how you look at things.

The weight loss could be from the 15K steps I have been able to log daily. My iphone step counter has been keeping track. My life is certainly getting simpler.

There will be no more updates of my kids’ investment accounts. They both want to manage their own investments. I have managed my own stuff since I was 17 years old. They are both old enough now.

I plan on giving a modest sum to my kids early. Enough that if they leave it alone for 20-30 years, they could have a simple retirement on this alone. Why not? I would never hand them a fully formed portfolio. But I can hand them the original seed capital. It would be up to them to nurture it and grow it.

If they can’t handle the funds, then I am glad that we did not give more. It is training them to handle larger amounts of money.

Plus I hope they learn to keep things simple.

I spent decades reacting to my finances. I spent decades detesting tax season.

I thought how could anyone else in my family look after our finances like this. I can’t figure some of it out and I was the one who bought the asset.

That is why I don’t bother with alternative investments. I just want my finances simple enough so that my family can manage it and so that I actually want to look at it.

At this point there is no discernible way that I can make our finances better. But there are plenty of ways to mess things up.

The only thing left to do is to keep up to date with any big changes that could impact our finances. Just make sure that we’re on the right track so that we can continue to do nothing.

I look forward to that.

March 2021 Financial Update

“Don’t tell me what you think, tell me what you have in your portfolio.”

― Nassim Nicholas Taleb, Skin in the Game: Hidden Asymmetries in Daily Life

My Investment Philosophy

  • Diversify – investments and taxes.
  • Do nothing – automate.
  • Develop margin of safety – allow assets to compound.

Networth% – March 2021

Equities (80%VGRO, Brk.B)

36%

Fixed Income (20%VGRO, VAB, Cash)

27%

Personal Residence

25%

Extra Unit

7%

Commercial Unit

6%

Other

0.6%

Our Portfolio

I treat all accounts as one portfolio.

Portfolio Accounts% – March 2021

Account

Ticker

Asset

Portfolio %

Corporate

BRK.B

Berkshire Hathaway

4.5

Corporate

VGRO

80/20 Asset Allocation ETF

59

RRSP1

VAB

Aggregate Bond

2.3

RRSP1

VGRO

80/20 Asset Allocation ETF

1.6

RRSP2

VAB

Aggregate Bond

3.9

TFSA1

VGRO

80/20 Asset Allocation ETF

1.5

TFSA2

VGRO

80/20 Asset Allocation ETF

1.4

Taxable

VGRO

80/20 Asset Allocation ETF

2.2

GIC

5

Cash

19

Portfolio Holdings% – March 2021

VGRO

80/20 Asset Allocation ETF

66%

Cash + GIC

Fixed Income

24%

VAB

Aggregate Bond

6%

Brk.B

Berkshire Hathaway

4%

Asset Allocation

57.0%

Mailbox Money- March 2021

“Life is really simple, but men insist on making it complicated.” Confucius (BC 551-BC 479) Chinese philosopher.

My investment philosophy is simple.

I have zero alpha.

I want “know nothing, do nothing” mailbox money.

Mailbox Money

March 2021

Asset

Ticker

$$$

% Total

Aggregate Bond

VAB

748

79%

Interest

199

21%

March 2021 Total

947

Mailbox Money

$$$

2021 YTD

24,600

12 Month Trailing

105,585

2020

125,388

Kids’ Portfolios – March 2021

4% SWR / year

Son, VEQT + VGRO

9,653

Daughter, VEQT

1,089

VEQT = Vanguard All-Equity ETF Portfolio

March 2021

It takes more discipline to maintain simplicity. There is so much noise out there. There are many ways to invest. Thankfully I am disciplined by nature. I care about keeping things streamlined much more than I care about getting outsized returns.

I want a simple process that is timeless. And it is not about sticking ones’ head in the sand. I am well aware of the other investing options. But I also know what it is that I am seeking.

The hardest thing to do in life is to do nothing.

Interesting isn’t it? Everyone has been taught that one needs to be hardcore, busy and productive. Bah! Not true.

The best results I have ever had was when I did nothing. Or the bare minimum.

I quit Twitter this month. I realized that I am not really social enough for social media. Plus I thought it would encourage me to write daily. It didn’t. I think I can maintain monthly updates. Otherwise there isn’t much else to say.

I am mildly obsessed with making our financial life as simple as possible. I am convinced further complexity will not garner better results.

There is not much new in personal finance. Live below your means, save the extra and keep doing this over and over. I would say invest but admittedly we barely invested and we still reached financial independence.

The best parts of my life reside outside the financial system. Good health, good relationships, hobbies like reading and walking.

My son made a change in his taxable account recently. He switched from VEQT to VGRO. He did not want to deal with rebalancing so he chose to maintain his taxable account with VGRO. He could likely keep this holding his entire investing life. How cool is that?

It is tiring to read about people who question why others would leave their careers even after reaching FI.

Hey, if you love your job so much, stay then. Everyone has different issues so it is very hard to get solid advice. And stop casting around the internet looking for validation!

Reaching FI does not mean one has to change anything if they don’t want to. Plus careers can be fluid. It’s just work. You can always change things up. Folks get so caught up with the perfect decision. There likely isn’t one.

People are often seeking validation for whatever they do. I make my changes privately and tell no one.

I recently had a discussion with a financial advisor. He kept trying to state that one must never DIY a corporate portfolio. Why not? I just own VGRO. I didn’t bother telling him that. No wonder most folks don’t want to manage their own finances. So much fear mongering.

But it’s the usual recommendations. You need to buy more whole life insurance. But maybe we can just work less! I am tired of financial helpers who keep trying to increase complexity. We are not that wealthy and I am okay with paying some taxes.

So for now. I will leave everything as is.

Enjoy Your Career With Financial Independence?

Many in Medicine consider it beneath them to talk about money. I recall my best friend stating that her financial advisor had numerous credentials. I reminded her that no matter the credentials, her advisor could not guarantee her anything when it came to investing.

As doctors we actually believe more education makes a difference. For very specific skill sets ofcourse. I want a very well trained and experienced surgeon thank you very much.

Many of our colleagues are burnt out or becoming so. I think many of them need to realize that FI may help them mitigate this.

It doesn’t much matter how you achieve FI. Make more or save more. Probably should do both.

Many of us have control over spending less. Perhaps start here. Maybe dream about what you want your ideal career and lifestyle to look like.

Then work backwards.

Medicine is such a long road. Each path is chockerblock full of colleagues who operate on “shoulds”. And desperately cataloguing if they are doing better than you.

Many doctors are super annoying. I find most are so desperate to appear expert that they pretty much shut out all other paths.

Medicine teaches one to memorize and follow rules and guidelines. The very strategies that make you successful as a doctor are EXACTLY the traits that will block you from finding freedom and options.

Medicine is like much in life. There are the 20%, who no matter how much money they have, will practice Medicine until they are 80. They desperately need the identity of being a physician. They would be nothing without it.

But I don’t think most doctors are like that. Most folks like being a doctor, want to do it well but also want other things in their lives.

Well it’s these non 20%ers that can use FI. Having FI may allow you to have a more enjoyable career.

No one talks about this but there are not that many “shoulds” in medical practice in Canada. Many of us are independent practitioners. If we can not navigate our priorities and lives with such immense autonomy, no wonder our American colleagues are having a hard time.

It appears that many docs are opting for salaried positions. I am grateful that I was able to work intensely for my first decade. A salaried position would have limited my earning potential big time.

I have been FI since I was in my mid 30s. This allowed me to spend more time with my young children.

But the thought of quitting Medicine never crossed my mind. I see bloggers doing this and then telling the world about it. What the heck for?!!!

I still work part time in Medicine. It’s a nice way to give back. That’s the thing about Medicine, one never has to waste bandwidth worrying about meaning and purpose. And yeah blogging just doesn’t quite cut it for me.

My husband and I reached FI in our mid 30s. I wanted to stay home with the children and I initially wanted my husband to join me. Thankfully I understood human behaviour. I knew that this might not be the right path for my husband.

Instead he took the opposite path and chose to continue working. But work changed for him as well.

He is a surgeon. Since FI, he does not care if the OR cancels his cases at the last minute. He doesn’t care if anesthesia delays him once again. He doesn’t care if there are rumours about OR allocations. He just doesn’t care at all.

He works because he likes it. But will readily give up aspects he does not enjoy anymore.

That’s why FI may be helpful during your medical practice.

But then again my sister in law who is a materialistic physician often announces that owing large amounts of debt on her home makes her work more. I guess this inspires her? I don’t bother asking since I don’t care to travel down that rabbit hole.

So maybe FI will help some docs. Not all, since money can’t help with all the other psychological aspects which make life meaningful. FI helps with money stuff. The rest of the stuff is up to each of us to figure out.

And I don’t believe reaching FI and announcing it to the world that you quit Medicine makes it a more correct decision.

I have never told anyone that we have FI. Mainly because who the heck would care?

We used it to assist with our life choices. And my husband and I took opposite choices with our careers. Think about this. Reaching FI did not help my husband work less.

The more he gave up the stuff he did not like, the more he made. And it was hella more enjoyable.

So FI is about having choices. It might help with burnout. A bit? As I get to the end of this post I am less sure.

Okay it helped us. Maybe that’s all I can say about it. I don’t pretend to have any idea of someone else’s life dynamics.

Medicine does not answer all of life’s bigger questions. Neither does FI. That story and journey will be one only you can travel. And all our roads will be different.

Celebrate that and stop looking outwardly for answers that only can come from within yourself.

Best of luck on everyone’s journey.

Leave It Alone

Once I decided what I wanted, everything became easier. I don’t care if I so-call “win” but I sure want things to stop being such a bother.

Here are the myriad of things I leave alone.

  1. Financial forecasts. I am convinced that nobody knows anything that will make any difference to my finances.
  2. The News. Aside from finding out when to get my parents’ vaccine, all the rest is junk.
  3. Norberts gambit for currency conversion. Who cares? Once I sell Berkshire when we work part time, I want zero USD.
  4. Travel hacking. Um if we can’t afford it easily we can just stay home. Travelling is not a huge deal for me.
  5. The best credit card. I don’t care, see my point 4 above.
  6. Mortgage rates. I don’t have a mortgage so it does not impact me.
  7. HELOC, line of credit, margin accounts, etc. I have cash around to take care of most financial transactions. I have still done well with all my cash drag. Whatever.
  8. Real estate investing. Been there, done that. No thanks. Back in the day I used to recall wondering why anyone would sell their cash flow RE. Now I know. When you have enough money, some of us just want less hassles.
  9. Financial advisors. Why? They can’t guarantee anything. I can enjoy volatility all by myself. I think we need excellent software that can help with retirement withdrawals. And we need a version of CPP that folks can buy more tranches if needed.
  10. Pensions. Never have to think about this since we have none.
  11. Real estate prices. Omg I am glad I have my house. I could not imagine trying to buy one during this crazy market.
  12. Fancy furniture. I have purchased many high end expensive furnishings. I think IKEA is good enough nowadays. I think this way about almost everything luxury or status branded. It does not matter to me. Everything breaks no matter how “high quality” they profess to be.
  13. Budgets. Don’t do this either. I track with Mint. The only category we had increased spending was dining out. After COVID this has not been an issue.
  14. Asset location. I keep more bonds in our RRSP but that’s the extent of my asset location. I don’t really believe in any of it. The simplest is to keep the same asset allocation ETF in all the accounts. The folks who use VBAL(60/40) in all accounts make sense.
  15. Tax loss harvesting. I refuse to do this anymore. I am convinced that I lose in ways I can’t even calculate when I do this. Probably from bid-ask spreads. I tend to move large amounts so this would likely neutralize the benefits from tax loss harvesting.
  16. Figuring out the perfect safe withdrawal rate (SWR). After much spreadsheeting, some bloggers just recommend 3.25%. But this does not take into account those who have over saved. If you have oversaved, the so called SWR many obsess about is meaningless.

I have been on a deep cleansing route with respect to my finances. And if feels amazing. I am even looking forward to tax season.

You know your life has changed for the better when you can say that.

What About The House?

I am grateful I have my home. I wanted a place to build our lives around. Convenience was more valuable to us.

It was important to live close to a university so that my children could live at home during school. I had planned for this when my youngest was born.

Housing is such an emotional issue. I could never understand it when I have heard people (okay men) stating that they went with a stock portfolio instead of their home. I would rather have both.

I wonder what their wives think about this. I would not be pleased if my husband made me make that choice.

That’s what I see sometimes on personal finance blogs. It’s so extreme. I could care less if my volatile portfolio will “win” for me in like 40 years. I would rather have a good enough home AND a portfolio.

I know family members who listened to bloggers telling them that homes are wasteful. I know people who were convinced that the housing market would come down.

In Canada, if you were waiting for that, you missed out. Missing out on the past housing boom feels worse than missing out on the stock market.

The stock market gains are invisible. Missing out on the housing market would be out there for all to see.

So life is not all about spreadsheets. Sure you have more money if you have maximum in the market, maybe. But it could also be halved. Since you pinned all your hopes and dreams on it, the decline would likely sting even more.

I am clear about what money means for me. I know what game I am playing. I want money to help those I care about and for convenience. Everyone has to define what they want money for. Then the path becomes clear.

There is no “right” way when it comes to money. Do not let anyone fool you otherwise. I am tired of people carrying on as if they are experts. Give me a break.

No wonder my women friends’ eyes start glazing over when finances comes up. Most of us just don’t care about the details.

I respect the work of bloggers about retirement withdrawal rates. But the big ticket message is simply to draw a lower percentage. Omg. Well duh!

If you take out less, you will be less likely to deplete your savings. I think ANYONE can figure that one out.

There are zero failsafe plans folks. Stop searching for them.

That’s why I have come full circle to the aspects that I control. I prefer to be less busy thus index ETFs work. Who cares if they are not perfect or the best. I don’t need it to be.

I don’t care if I win. But I will be supremely annoyed if I try really hard, make life unpleasant for me and my loved ones and still do meh.

That. Would. Really. Make. Me. Mad.

Thus unless the financial plan is simple, easy and enjoyable – I want no part of it.

Life has been glorious since I started using this simple filter.

Get a house if you really want one and can afford one. Don’t let the internet tell you otherwise.

Create your website with WordPress.com
Get started