Retirement dilemma

Question: I am in a dilemma. I have used many different brokers since I have lived in different parts of Canada and overseas over the years. Many have been totally useless and some have been far too inexperienced. The result is that my wife and I have ended up with poor returns and bad advice in the past.

We took early retirement in 1998 and since building a permanent home by the lake north of Muskoka, I transferred our investment accounts to a discount broker and have paid close attention to financial news and advice in the newspapers, on the Internet and through publications such as your Internet Wealth Builder.

I am happy with my asset mix and think that I have a good quality portfolio but my dilemma is that I am spending far too much time tracking what is going on and I feel too stressed and concerned regarding major changes affecting individual stocks which I hold. I am coming to the conclusion that I don’t get enough time to do other things I want to do because I am thinking too much of market swings and whether I should move out of this or move into that. Perhaps it would be better for my peace of mind to change direction.

Inside and outside of RRSP/RRIF accountsmy wife and I have enough money invested to last us past 90 years of age based on our current budget escalated by a 3% annual inflation, providing that our investments show a minimum combined annual return of 7.5%. As I still want to have some involvement in our financial affairs I am facing three options:

1. Move the bulk of our investments to mutual funds and only keep tab on the choice and appropriate blend of funds over the years to come and leave the balance in blue chip stocks only. This would be easier and less stressful that being concerned with performance of individual securities. The downside is that I have to be prepared to pay approximately 2% annual MER on the bulk of our investments.

2. Seek the financial advice of a professional who would make recommendations and who would act as a sounding board to investment opportunities that I come across. The downside is that sometimes trades are seemingly recommended for purposes of generating commission income. The alternative is a flat 1% annual fee on the total investment value but that would be in addition to MERs on any mutual funds held and I am not sure it is worth the cost.

3. Continue with my discount broker and act on advice provided by publications such as yours backed up with my own research before executing orders, while maintaining a more conservative approach.

Any comments you may have would be appreciated. – D.G.


You have a dilemma. You’re doing quite well with your investments, but you don’t want to devote as much time to the process.

The logical answer is to simplify your financial life. This is not a time to be fretting about the cost – a couple of percentage points is worth it if it buys you peace of mind and more time to do the things you enjoy.

Therefore, I would suggest the following approach:

1. Move primarily to a mutual funds portfolio, using core funds only. Avoid sector funds, which have to be treated like stocks and require constant monitoring. Use a conservative asset mix so you won’t have to worry about stock market gyrations.

2. Find yourself a good financial advisor in whom you have confidence who will build your portfolio, keep watch over it, and contact you if a change is indicated.

3. Stay informed about current developments in the market so that you’ll be in a position to ask intelligent questions and to bring a critical assessment to the advice you are offered. – G.P.