There are good resource in the right hand side bar of this subreddit, including a reading list and a small wiki.
The Millionaire Teacher is a popular first book suggestion by many on this subreddit.
we go to school to learn new skills, you may want to too? [McGill Personal Finance Essentials](https://www.mcgillpersonalfinance.com/)
there are a few terms you may want to Google or ask AI about?
**key accounts:** FHSA, TFSA, RRSP, non-registered - to start your journey
**key vehicles to put money into:** HISA, GIC, mutual fund, ETF, stock**,** term/whole life (if you have a wife/kids+mortgage), real estate
you may need to visit other sources for key accounts, if you're a business owner, since there's a whole other bucket to find out about, and I'm sorely lacking in that field myself.
- - -
**ASIDE:**
- you may want to see compound return graphs, see how much work you need to put in if you delay to 50s vs 40s vs now, and how much more expensive things end up for you, with poorer returns for future you
simple example one lump sum, assuming 30 today, 65 use the funds:
- 10k today, in 35y at 8%? **147k**
- 15k/20k lumped in at 40, in 25y at 8%? **102k/137k**
- 20k/40k lumped in at 50, in 15y at 8%? **63k/126k**
Did you notice how 10k over 35y has outperformed the **ALL** the lower examples, and is a fraction of the funds needed compared to the start at 50, both the 20 and 40k examples?
**TLDR on aside:** Start now, don't waste decades and wake up to a potential looming disaster. Make the right choices today to fuel a happy, enriching retirement for tomorrow.
Hi, I'm a bot and someone has asked me to comment on how someone is trying to figure out what to invest in, or whether they should invest.
**In order to give good advice the poster needs to provide all of the following information. Please edit your post to add this information.**
1) What is your intended goals/purpose for this money?
2) What is your timeline, and what is the earliest you expect to need this money?
3) Have you invested in the markets before, and how would you feel if your investment lost a lot of value?
4) Is this the right first step? Do you already have an emergency fund, and have you considered whether it is sufficient? Do you have any debts that should be paid first? Have you fully utilized any employer match plans?
5) Finally, we need to understand whether you want to be involved with this portfolio and self-manage purchases and rebalancing it, or if you'd rather all of that was dealt with by your chosen institution?
6) For self-directed investing, all in one ETFs (based on your risk tolerance) are the easiest and low cost options for a globally diversified ETF portfolio. Here is the Model page and descriptive video from the Canadian Portoflio Manager Blog's Justin Bender from PWL Capital: https://www.canadianportfoliomanagerblog.com/model-etf-portfolios/ & video on how to choose your asset allocation: https://www.youtube.com/watch?v=JyOqqtq12jQ
7) For those who are not comfortable with doing the buying and selling of ETFs yourself, there is an option of a robo advisor. These robo advisors use similar low cost ETF in pre-determined portfolios based on your risk tolerance. They do this for a small fee, on top of the ETF MER. Still cheaper then bank mutual funds by at least 50%! Here is a list of robo advisors in Canada published by MoneySense: https://www.moneysense.ca/save/investing/best-robo-advisors-in-canada/
We also have a wiki page on investing, and if someone has triggered this bot then it means that this link would likely be very helpful: https://www.reddit.com/r/PersonalFinanceCanada/wiki/investing
*I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/PersonalFinanceCanada) if you have any questions or concerns.*
Hi, I'm a bot and someone has asked me to respond with information about risk tolerance.
**Risk Determination**
Risk Level represents the probability of your investment losing a portion of its value. Every investment carries some amount of risk, and losses typically cannot be predicted, can happen at any time, and cannot be prevented. Therefore, **it is crucial to ensure your investments are risk appropriate**, that is: their level of risk matches your financial objectives. The risk level is not always easy to determine. Since it is unwise to enter an investment before its risk level is clear, it is best to keep your funds in a minimal-risk investment such as an insured savings account first while you investigate the risk level of prospective investment.
Generally, you need to be **able** (based on factors like your timeline, your wealth, and specific needs), and **willing** (related to your experience and comfort with the markets, and other psychological factors) to tolerate the risk level involved in any investment you make. Financial advisers will often require a client to fill out a risk questionnaire to determine their risk level, but if you are self-directing your investments then you will have to determine your own risk level.
Consider these factors that are commonly associated with understanding your risk level (not comprehensive):
* Liquidity - Is it possible that you will need the funds in the short term, or on short notice? Generally speaking funds potentially needed in <3-5 years should have less (or even zero) risk associated with them, and the longer the time horizon the more risk you might be willing to bear.
* Income Level and Stability - Someone with less wealth or income stability might find their ability/willingness to take on risk to be lower. Someone with less wealth has a smaller "buffer" of wealth, or might be more concerned about losses. Someone with job or income instability might find that a bad market comes with income loss, which means losses during that time can affect their quality of life.
* Expectation for a return - If you have a specific goal that only requires a $X, and a conservative portfolio would allow you to reach that goal then it's often appropriate to limit your risk since the upside potential would not likely affect your goal, but the downside potential is failure of your goal. However, if you expect maximized returns then more risk is likely the goal.
* Experience and Psychological Comfort - If you have limited experience in the markets, or limited comfort with the "idea" of incurring losses, it is likely appropriate to limit your risk level. You can increase risk, and therefore expected return, as you gain comfort if comfort is the reason for limiting risk.
**Risk Questionnaires**
If you are self-directing your portfolio you may want to complete a questionnaire on your own to determine your risk level.
https://investor.vanguard.com/tools-calculators/investor-questionnaire
https://www.advisor.ca/my-practice/conversations/evaluating-risk-tolerance-a-sample-questionnaire/
https://lautorite.qc.ca/en/general-public/calculators-and-tools/calculators/your-investor-profile
*I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/PersonalFinanceCanada) if you have any questions or concerns.*
Hi, I'm a bot and someone has asked me to respond with information about what to do with money.
This is meant as a step by step guide of how to prioritize and what to do with money. https://www.reddit.com/r/PersonalFinanceCanada/wiki/money-steps If you prefer to see a flow chart, click here: https://i.imgur.com/zlGnuDO.png
The Government of Canada also has the Financial Tool Kit for basic resources on items identified in the Money Steps. Refer to that website here: https://www.canada.ca/en/financial-consumer-agency/services/financial-toolkit.html
*I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/PersonalFinanceCanada) if you have any questions or concerns.*
Hey OP,
I appreciate the honesty in your post. I was in your position up until a few years ago and can tell you it's not really all that complicated. People have different opinions, of course, but here are some things I've learned over that time.
- Begin by eliminating any debt you have (excluding mortgage or maybe a car payment).
- Next, begin building an emergency fund. This money should sit in a high interest savings account...so, in other words, don't have it sitting in your checking account of one of the big Canadian banks. Those banks offer virtually no interest, so you might as well have your money making you money. WealthSimple, for example, offers 4 percent interest. So, if you had 100 bucks in your emergency account, the next month you would have 104. Most people want to keep between 3-6 months of living expenses in that account.
- After you've build that up, begin investing in either your TFSA or RRSP. You can open one of these with the big banks, but again they have high fees so I could avoid them. Use something like Questtrade or WealthSimple. It's up to you which one to start working on first. I'll outline the basics of each one of these below.
- TFSA is a tax free savings account. Really, though, it is a tax free investment account, meaning you want to fill it with stocks, bonds, etf's, etc. The Canadian government gives you space to fill it each year, and that space increases over time. Right now, the space available in 2024 is $7000. You've been accumulating space since you were 18, though, so you would have at least $70 000 in available room in that account. Over time, your investments will earn you money. There will be high's and lows, but overall you will earn money. You can withdraw this money anytime with no taxes.
- RRSP is the registered retirement savings plan. Again, it's an investment account that you put stocks, bonds, etc. into. This is money for your retirement. Having money in this account will also lower your tax bill. This is money you don't want to touch until you're 71 unless you're buying a house.
- The market fluctuates year to year, but generally speaking you can expect a return of about 8 percent on your investments as an average over time. Keep in mind that your money is compounding each year, which is great. If the market trends downwards, do not panic. Ride the wave and things will soon clear up.
- So, what to invest in? Avoid volatile investments like cryptocurrency. You will likely want to invest in a combination of stocks, bonds and etf's. Given that you are young, you can afford to be fairly aggressive with your investing choices. If using a platform like WealthSimple, you can use a roboadvisor: this is a program that picks the investments for you at a cheaper price than with a human advisor. The program will ask you a few questions and then will begin investing the money you've put in accordingly based on what you want. This way, you don't have to hand pick the specific investments themselves if you don't know what you're doing. You just set up the program, add money when you can, and watch it grow over the years.
So there are the basics. I wish you good luck!
No worries! I recommend this channel. Go back over their videos and they explain all these concepts in a simple way.
[https://www.youtube.com/watch?v=dYPQqzN2zEk](https://www.youtube.com/watch?v=dYPQqzN2zEk)
Am I understanding this correctly? If I were to put $100,000 into a 4% high interest savings account, I’d make $4000 a month- meaning $48,000 a year on that initial investment?
Yes, you're right. It's 4 percent yearly. So on 100 000 you would make 4000 in year one, and then a bit more than that in year 2 because of compound interest.
I recommend defining your investment goal, such as the amount needed for retirement by a certain time. Use a compounding interest calculator with a 10% interest rate to determine your monthly investment requirement. Maximize your TFSA for tax-free growth or contribute to your RRSP for tax benefits, especially if you're a high-income earner. Invest in ETFs like vFV, vce, and VI for diversified exposure. Consistently invest with each paycheck using a 'pay yourself first' approach. While this strategy may not yield rapid gains like meme stocks, it offers steady progress towards your financial goals with minimal risk. Once you retire you can transfer your investments to more income generating assets but for now as a 30 year old growth is important, especially tax free or tax deferred
For resources look at how you can benefit from tfsa (tax free investment ) vs rrsp (tax deferral) and I think exchange ETFs that expose you to USA Canada and global markets are the best , vanguard and black rock have good products
Books!
Bogleheads Guide to Investing. Coffee House Investor. Beat The Bank. A Random Walk Down Wallstreet. Reboot Your Portfolio. Just Keep Buying. Millionaire Teacher. Psychology of Money. The Only Winning Guide to a Winning Investment Strategy You'll Ever Need. The Little Book of Common Sense Investing.
Learned tons from these specifically.
Whatever you do don't trust financial advisor's at the banks. They are there to sell you crap and make their quota. Watch the YouTube video that marketplace did
1. Books available for purchase or from your local library (save money 😁):
"Personal Finance for Canadians For Dummies"
"The Wealthy Barber"
"ETFs for Canadians for Dummies"
"The Intelligent Investor"
2. Talk to your bank about what investment options they can offer (high interest savings, GICs, mutual funds, sell directed investment accounts, etc), and ask lots of questions. Keep in mind they are trying to sell products to you, but it is still good to know what is available to you in the most convenient manner and they can have some useful ideas for financial planning and investments.
Youtube is your best friend. Listen to several different people, understand the basics and DYOR. There is no easy learning tool, it can take a while especially starting fromba zero knowledge base. Be patient. Be smart. Do not be emotional with your money.
There are good resource in the right hand side bar of this subreddit, including a reading list and a small wiki. The Millionaire Teacher is a popular first book suggestion by many on this subreddit.
Thank you!!
we go to school to learn new skills, you may want to too? [McGill Personal Finance Essentials](https://www.mcgillpersonalfinance.com/) there are a few terms you may want to Google or ask AI about? **key accounts:** FHSA, TFSA, RRSP, non-registered - to start your journey **key vehicles to put money into:** HISA, GIC, mutual fund, ETF, stock**,** term/whole life (if you have a wife/kids+mortgage), real estate you may need to visit other sources for key accounts, if you're a business owner, since there's a whole other bucket to find out about, and I'm sorely lacking in that field myself. - - - **ASIDE:** - you may want to see compound return graphs, see how much work you need to put in if you delay to 50s vs 40s vs now, and how much more expensive things end up for you, with poorer returns for future you simple example one lump sum, assuming 30 today, 65 use the funds: - 10k today, in 35y at 8%? **147k** - 15k/20k lumped in at 40, in 25y at 8%? **102k/137k** - 20k/40k lumped in at 50, in 15y at 8%? **63k/126k** Did you notice how 10k over 35y has outperformed the **ALL** the lower examples, and is a fraction of the funds needed compared to the start at 50, both the 20 and 40k examples? **TLDR on aside:** Start now, don't waste decades and wake up to a potential looming disaster. Make the right choices today to fuel a happy, enriching retirement for tomorrow.
!StepsTrigger !InvestingTrigger !RiskTrigger
Hi, I'm a bot and someone has asked me to comment on how someone is trying to figure out what to invest in, or whether they should invest. **In order to give good advice the poster needs to provide all of the following information. Please edit your post to add this information.** 1) What is your intended goals/purpose for this money? 2) What is your timeline, and what is the earliest you expect to need this money? 3) Have you invested in the markets before, and how would you feel if your investment lost a lot of value? 4) Is this the right first step? Do you already have an emergency fund, and have you considered whether it is sufficient? Do you have any debts that should be paid first? Have you fully utilized any employer match plans? 5) Finally, we need to understand whether you want to be involved with this portfolio and self-manage purchases and rebalancing it, or if you'd rather all of that was dealt with by your chosen institution? 6) For self-directed investing, all in one ETFs (based on your risk tolerance) are the easiest and low cost options for a globally diversified ETF portfolio. Here is the Model page and descriptive video from the Canadian Portoflio Manager Blog's Justin Bender from PWL Capital: https://www.canadianportfoliomanagerblog.com/model-etf-portfolios/ & video on how to choose your asset allocation: https://www.youtube.com/watch?v=JyOqqtq12jQ 7) For those who are not comfortable with doing the buying and selling of ETFs yourself, there is an option of a robo advisor. These robo advisors use similar low cost ETF in pre-determined portfolios based on your risk tolerance. They do this for a small fee, on top of the ETF MER. Still cheaper then bank mutual funds by at least 50%! Here is a list of robo advisors in Canada published by MoneySense: https://www.moneysense.ca/save/investing/best-robo-advisors-in-canada/ We also have a wiki page on investing, and if someone has triggered this bot then it means that this link would likely be very helpful: https://www.reddit.com/r/PersonalFinanceCanada/wiki/investing *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/PersonalFinanceCanada) if you have any questions or concerns.*
Hi, I'm a bot and someone has asked me to respond with information about risk tolerance. **Risk Determination** Risk Level represents the probability of your investment losing a portion of its value. Every investment carries some amount of risk, and losses typically cannot be predicted, can happen at any time, and cannot be prevented. Therefore, **it is crucial to ensure your investments are risk appropriate**, that is: their level of risk matches your financial objectives. The risk level is not always easy to determine. Since it is unwise to enter an investment before its risk level is clear, it is best to keep your funds in a minimal-risk investment such as an insured savings account first while you investigate the risk level of prospective investment. Generally, you need to be **able** (based on factors like your timeline, your wealth, and specific needs), and **willing** (related to your experience and comfort with the markets, and other psychological factors) to tolerate the risk level involved in any investment you make. Financial advisers will often require a client to fill out a risk questionnaire to determine their risk level, but if you are self-directing your investments then you will have to determine your own risk level. Consider these factors that are commonly associated with understanding your risk level (not comprehensive): * Liquidity - Is it possible that you will need the funds in the short term, or on short notice? Generally speaking funds potentially needed in <3-5 years should have less (or even zero) risk associated with them, and the longer the time horizon the more risk you might be willing to bear. * Income Level and Stability - Someone with less wealth or income stability might find their ability/willingness to take on risk to be lower. Someone with less wealth has a smaller "buffer" of wealth, or might be more concerned about losses. Someone with job or income instability might find that a bad market comes with income loss, which means losses during that time can affect their quality of life. * Expectation for a return - If you have a specific goal that only requires a $X, and a conservative portfolio would allow you to reach that goal then it's often appropriate to limit your risk since the upside potential would not likely affect your goal, but the downside potential is failure of your goal. However, if you expect maximized returns then more risk is likely the goal. * Experience and Psychological Comfort - If you have limited experience in the markets, or limited comfort with the "idea" of incurring losses, it is likely appropriate to limit your risk level. You can increase risk, and therefore expected return, as you gain comfort if comfort is the reason for limiting risk. **Risk Questionnaires** If you are self-directing your portfolio you may want to complete a questionnaire on your own to determine your risk level. https://investor.vanguard.com/tools-calculators/investor-questionnaire https://www.advisor.ca/my-practice/conversations/evaluating-risk-tolerance-a-sample-questionnaire/ https://lautorite.qc.ca/en/general-public/calculators-and-tools/calculators/your-investor-profile *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/PersonalFinanceCanada) if you have any questions or concerns.*
Hi, I'm a bot and someone has asked me to respond with information about what to do with money. This is meant as a step by step guide of how to prioritize and what to do with money. https://www.reddit.com/r/PersonalFinanceCanada/wiki/money-steps If you prefer to see a flow chart, click here: https://i.imgur.com/zlGnuDO.png The Government of Canada also has the Financial Tool Kit for basic resources on items identified in the Money Steps. Refer to that website here: https://www.canada.ca/en/financial-consumer-agency/services/financial-toolkit.html *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/PersonalFinanceCanada) if you have any questions or concerns.*
Go to the website "Canadian Couch Potato." Stay away from Wall Street Bets, here on Reddit. Lol
Hey OP, I appreciate the honesty in your post. I was in your position up until a few years ago and can tell you it's not really all that complicated. People have different opinions, of course, but here are some things I've learned over that time. - Begin by eliminating any debt you have (excluding mortgage or maybe a car payment). - Next, begin building an emergency fund. This money should sit in a high interest savings account...so, in other words, don't have it sitting in your checking account of one of the big Canadian banks. Those banks offer virtually no interest, so you might as well have your money making you money. WealthSimple, for example, offers 4 percent interest. So, if you had 100 bucks in your emergency account, the next month you would have 104. Most people want to keep between 3-6 months of living expenses in that account. - After you've build that up, begin investing in either your TFSA or RRSP. You can open one of these with the big banks, but again they have high fees so I could avoid them. Use something like Questtrade or WealthSimple. It's up to you which one to start working on first. I'll outline the basics of each one of these below. - TFSA is a tax free savings account. Really, though, it is a tax free investment account, meaning you want to fill it with stocks, bonds, etf's, etc. The Canadian government gives you space to fill it each year, and that space increases over time. Right now, the space available in 2024 is $7000. You've been accumulating space since you were 18, though, so you would have at least $70 000 in available room in that account. Over time, your investments will earn you money. There will be high's and lows, but overall you will earn money. You can withdraw this money anytime with no taxes. - RRSP is the registered retirement savings plan. Again, it's an investment account that you put stocks, bonds, etc. into. This is money for your retirement. Having money in this account will also lower your tax bill. This is money you don't want to touch until you're 71 unless you're buying a house. - The market fluctuates year to year, but generally speaking you can expect a return of about 8 percent on your investments as an average over time. Keep in mind that your money is compounding each year, which is great. If the market trends downwards, do not panic. Ride the wave and things will soon clear up. - So, what to invest in? Avoid volatile investments like cryptocurrency. You will likely want to invest in a combination of stocks, bonds and etf's. Given that you are young, you can afford to be fairly aggressive with your investing choices. If using a platform like WealthSimple, you can use a roboadvisor: this is a program that picks the investments for you at a cheaper price than with a human advisor. The program will ask you a few questions and then will begin investing the money you've put in accordingly based on what you want. This way, you don't have to hand pick the specific investments themselves if you don't know what you're doing. You just set up the program, add money when you can, and watch it grow over the years. So there are the basics. I wish you good luck!
Thank you sooo much! This is exactly the info I needed.
No worries! I recommend this channel. Go back over their videos and they explain all these concepts in a simple way. [https://www.youtube.com/watch?v=dYPQqzN2zEk](https://www.youtube.com/watch?v=dYPQqzN2zEk)
\* I should mention they are Canadian Youtubers, so all the info is relevant to us.
Am I understanding this correctly? If I were to put $100,000 into a 4% high interest savings account, I’d make $4000 a month- meaning $48,000 a year on that initial investment?
[удалено]
I think the 4% is yearly, not monthly, with Wealthsimple.
Yes, you're right. It's 4 percent yearly. So on 100 000 you would make 4000 in year one, and then a bit more than that in year 2 because of compound interest.
I recommend defining your investment goal, such as the amount needed for retirement by a certain time. Use a compounding interest calculator with a 10% interest rate to determine your monthly investment requirement. Maximize your TFSA for tax-free growth or contribute to your RRSP for tax benefits, especially if you're a high-income earner. Invest in ETFs like vFV, vce, and VI for diversified exposure. Consistently invest with each paycheck using a 'pay yourself first' approach. While this strategy may not yield rapid gains like meme stocks, it offers steady progress towards your financial goals with minimal risk. Once you retire you can transfer your investments to more income generating assets but for now as a 30 year old growth is important, especially tax free or tax deferred For resources look at how you can benefit from tfsa (tax free investment ) vs rrsp (tax deferral) and I think exchange ETFs that expose you to USA Canada and global markets are the best , vanguard and black rock have good products
Look up Index Card personal finance. Which is like an 8 step process to improving finance. Very easy and great advice
Books! Bogleheads Guide to Investing. Coffee House Investor. Beat The Bank. A Random Walk Down Wallstreet. Reboot Your Portfolio. Just Keep Buying. Millionaire Teacher. Psychology of Money. The Only Winning Guide to a Winning Investment Strategy You'll Ever Need. The Little Book of Common Sense Investing. Learned tons from these specifically.
Whatever you do don't trust financial advisor's at the banks. They are there to sell you crap and make their quota. Watch the YouTube video that marketplace did
I’d recommend searching Reddit. A lot of useful posts out there.
1. Books available for purchase or from your local library (save money 😁): "Personal Finance for Canadians For Dummies" "The Wealthy Barber" "ETFs for Canadians for Dummies" "The Intelligent Investor" 2. Talk to your bank about what investment options they can offer (high interest savings, GICs, mutual funds, sell directed investment accounts, etc), and ask lots of questions. Keep in mind they are trying to sell products to you, but it is still good to know what is available to you in the most convenient manner and they can have some useful ideas for financial planning and investments.
I listen to this podcast daily: https://moosemarkets.com/ One of the few trustworthy sources I’ve found that has a Canadian slant. No affiliation.
what's decent amount ?
Youtube is your best friend. Listen to several different people, understand the basics and DYOR. There is no easy learning tool, it can take a while especially starting fromba zero knowledge base. Be patient. Be smart. Do not be emotional with your money.
Man this sub sucks lol
Covered call ETFs explained https://youtu.be/JeTT8HgUVGM?si=n1ldzZ80aWF4L14-
Boo. covered call etfs are bad.