Sitcom InvestingWritten by Kemberly Wardlaw
A fickle stock market encourages good-humored mockery. Recently, as I watched premiere of a sitcom, an obvious omission breached television etiquette. Silence followed every exaggerated comedic set-up. There was no laugh track. Where were premeditated giggles from show's "audience?" At last, viewer determines funny moment. It then occurred to me, writers of this new show adopted an aspect used by investment news programs. I will be first to admit, in addition to miscellaneous printed and electronic financial information, television provides an abundance of supplemental financial news. However, shows often leave me asking, "What's missing?" In addition, shows may very well leave viewers with ultimate responsibility, which segment is entertainment and which is practical advice. Perhaps you may recognize one of canned statements below that investment show gurus continuously utter. Although each may be applicable (and in may cases vital to successful financial planning), notice missing "laugh tracks." How many times have you heard "Invest For Long Term?" The analyst may be leaving out "because I hope you forget my last appearance and short term disaster I have caused for viewers who actually acted on my recommendation." Each investor's long-term outlook is somewhat different for other's and you should always review guests' recommendations with caution. What is his or her reasoning for such revelation? "Buy and Hold." The missing part: "because I have no idea of an exit strategy to recommend." True enough, more successful investors are those who invest according to a well-planned strategy and stick to it. They generally hold onto their winners. There are, however, times that will dictate an exit strategy.
| | CAN I AFFORD TO RETIRE?Written by Peter F. Baigent CFP, CLU, CHFC, RFP
First Published Fall 1990 Almost every day I get asked, "Can I afford to retire?" Although we have very sophisticated computer programmes to answer these questions, we must first ask client "How much do you need coming in every month, in today's dollars when you retire"? This gets everyone squirming at thought of having to do some budgeting, to determine answer to that question. I guess budgeting conjures up thoughts of early years, when pennies had to be pinched and planning was a necessity. I do not feel budgeting is necessary at retirement, but an analysis of your cash requirements will be necessary in order to determine when you can retire. This is rather a hypothetical cash flow estimate.To further complicate problem, most people think in after tax terms as they are used to a take home pay cheque. At retirement, you usually have to remit your own income tax payments directly, whereas previously they were deducted at source. There will be a lot less deductions at retirement. You no longer have to pay Canada Pension or Unemployment Insurance, Union dues or most group insurance costs. But, you need to base your calculations on gross income. How much you will need at retirement depends totally on your lifestyle. A good financial planner will tell you if your figure is realistic, but standard of living is yours to decide. Henry David Thoreau, famous American philosopher in his book "On Walden Pond", speculated that one could subsist by living in a pine box in a forest near pond. Although example is extreme, it makes point about lifestyle. It will be different for each person. What is suitable for me may be
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