Tag Archives: Investing

Baking, Sourdough and Martha Stewart – Is There Room Today for Investing in Stocks and Bonds?

Cara used to call me “Martha Stewart”.  I supposed it was partly her age and being embarrassed at having a mom-dad at home.  I had single parented for a decade by this time and I didn’t want the girls to be somehow disadvantaged because their primary care provider was a guy.

In the days before the richness of online recipes and apps, my “go-to” was a tattered copy of “The Joy of Cooking” and I’ll admit that reading the basic skills part at the beginning of the book coupled with my proclivity to measuring in “about” rather than precise amounts, and sometimes skipping steps, led to as many failures as successes.

In time I started to watch Martha Stewart on TV and slowly built the skills and confidence to master the basics.  And it helped me affirm that my tastes, while decidedly masculine, were appropriate.

My quip back to her was “fine, you can’t have any of the chocolate chip cookies I’m making”, or something like that.  I always felt insecure raising the two girls alone and worried that I would somehow fail them.  I was pro-feminist before I knew what that meant and supported them in whatever choices they made.  If that meant walking to the school to pick one up with her bass baritone sax because the truck was broken down yet again and I didn’t have the slack to get it fixed or making homemade cookies because it was cheaper than store bought, so be it.  The important thing was to make sure that they didn’t miss out or do without.

I read and posted an article recently about a growing trend in making the perfect sourdough bread.  I was intrigued by this group of male tech-employed millennials, their search for perfection and the precision with which they undertook baking that perfect loaf.  I’ll admit that some basic skills coupled with my recent experience with a food delivery service leaves me in the artisanal space and the world of food excellence, but I doubt I have the temperament to pursue the perfect loaf.

One of our CSI members is working through the process of launching a beer bread business, baking sourdough bread from the leavings of the beer making business.  Looking beyond conceptually the impact of both a green and circular economy and how he is creating value from something that was destined for pig feed or the big organic digesters the city runs for bio-waste, I was struck by how the opportunities for making and selling artisanal bread are limited by scalability issues.  The excellence of the product lies in part in the lack of preservatives, so its shelf life is limited, the margins of the product are such that there is no room for sales returns and finally the product is a one-off so there is no suite of artisanal products that can be wholesaled.

If anyone can figure out how to ramp this business up it is Dihan.  He is doing enough to have perfected his recipe and approach, has examined his options and is exploring what avenues are available to him.  I strongly suspect that his final choices are going to rest in both technology and the disruption that technology is causing in the area of fulfillment.

Consider for a minute what the process is for you in bread fulfillment.  You could go to Costco and buy Costco sized bread products.  You can buy the same product at your local grocer, but (bread scandals aside) at a higher price.  Or you could nip into your local convenience store and pay a higher price still.  From bakery to retail, you are largely unaware of the steps and effort to make, ship, stock and manage that inventory so that wherever you buy it, it is easy and convenient.  Well maybe not Costco – but who shows up to Costco just to buy bread?

What you’re buying isn’t something full of wholesome goodness, but a product designed to remain fresh for a lengthy time.  I can buy a loaf of pedestrian whole wheat or some douchie version, but I guarantee you that the last slice two weeks from now is going to be as fresh as the first slice that I took out.  No mouldy nor desiccated offering as it sat out on my counter; truly a marvel of food engineering.

Over the course of two decades I have heard the cries of foul from my peers complaining about discount brokers. Like the male millennial purveyors of the ultimate sourdough experience, there are those that find enjoyment in constructing and managing their own portfolios.  Others with less discipline but more experience are like the home-made pierogi crowd who through years of making them know just the right mix and texture to make the perfect dough (hint, save and use the potato water). They don’t need us to be order takers.  In fact, the DIY group can do it far more cheaply and effectively than I can.

Our chosen profession is in the advice-giving channel; our value proposition is in the experience.  I am toying what it means to be “artisanal” using stocks and bonds as the base ingredients, but I share the same struggle as the beer-bread entrepreneur.  I’m just not sure how I fulfill the client experience in a world of tighter margins and packaged goods.  In fact, I may be convinced that back-to-the-basics is better but don’t know how to communicate that.

So yes Cara, maybe I haven’t lost my Martha Stewart tendencies.  I just haven’t figured out how to make it work for me.

David Chellew and Linda Odnokon have been life partners and in business together for almost 19 years. During that time, they have mellowed into their respective roles and enjoy working with individual investment clients. Dave is a Portfolio Manager and Linda is an Investment Advisor with iAS and work out of the co-work space, Centre for Social Innovation at Queen and Spadina downtown Toronto.

Industrial Alliance Securities Inc. (IAS) is a member of the Canadian Investor Protection Fund (CIPF) and the Investment Industry Regulatory Organization of Canada (IIROC). iA Securities is a trademark and business name under which Industrial Alliance Securities Inc. operates.

This information has been prepared by David Chellew, Portfolio Manager for Industrial Alliance Securities Inc. (IAS) and does not necessarily reflect the opinion of IAS. The opinions expressed are based on an analysis and interpretation dating from the type of publication and are subject to change. Furthermore, they do not constitute an offer or solicitation to buy or sell any the securities mentioned. For more information about IAS, please consult the official website at www.iasecurities.ca. David Chellew can open accounts only in the provinces where he is registered.

 

The Journey from Angry Recycler to Socially Responsible Investing

Raising four teenagers in a blended family can be challenging.  In fact, if memory serves me correctly, if you lose your sense of humor teens can be impossible to be around.

In our kitchen in our waterfront home (well, more like a rambling near-shack) we had a pantry cupboard that I had removed the shelves from.  It wasn’t much different than all cupboards in the kitchen, for years missing the hardware.

I wanted to paint all of the old 1960’s plywood fronted and varnished wood a nice clean flat white.  I got so far as to bust the shine and prime part of one shelf on one cupboard before I had to abandon my best of intentions to deal with other things.  9 years later when we sold the house it still had that one shelf half-painted, but along the way the cupboard and drawer hardware had reappeared.

Don’t get me wrong, it’s not that I don’t finish what I start, or that I’m not a good handyman.  It’s just that having a two-story eight-bedroom, two-thirds of an acre home required more work than I could reasonably handle, even with a lot of willing help.

In fact, Linda called it the money pit.  That’s not quite fair; it had good bones and a decent layout.  It had never been finished well by the original owner and while linoleum floors and cheap carpeting might have been embarrassing, our four teens and their assemblage of friends didn’t care.  In fact, by dint of location and who the teens were, I’m sure there are few people from Sudbury between the ages of 30 and 35 who haven’t partied at the house.

Getting Back to that Pantry 

Unlike the garbage which sat next to the fridge, the pantry had a big plastic garbage can lined with recycling bags.  Big recycling bags.  Into it went all the empty cans, bottles and cardboard that a bunch of teens could generate.

I watched on many occasions one of the four opening the door just wide enough to pitch an empty onto the pile.  Opening the door fully meant confronting the fact that there would be a flood of recyclables rushing out.  I kid you not, I watched all of them sneak around, being environmentally conscious, but avoiding Linda.  Mama O didn’t brook attitude; if she saw it she would deal with it, which meant whomever was closest would be stooping over, picking up the rush that Linda caused and hauling the bags outside.

As a man, I appreciated teen avoidance behavior.  As an adult, if I opened the door and found disaster within, I was going to have to deal with it, which inevitably included fitting all the debris into two bags in a pantry with a one bag limit.  I worked on a more elegant version of avoidance; I just wouldn’t recycle.

I wouldn’t recycle, that is, until my oldest daughter Cara called me out.  Rather than sheepishly admit that I was doing the dad-version of sneaking a pitch, I went on some self-righteous rant.  Digging out my recyclables from the garbage, I yanked the door open in anger, dropped an f-bomb, and waited for the flow of cans, bottles and cardboard to come to an end.  Too embarrassed to do much more than pick it all up and haul it out, I never fully reconciled our kids’ environmental stewardship with their unwillingness to do much more than a sneaky pitch.

Our household never came to understand why, in early 2003, the great recycling drama would come to an end.  Rather than deal with the inevitably tension-filled back and forth, I would check the pantry a couple of times a week when I woke up early, and if it was nearing overflowing, quietly stuff the bags before carrying my morning coffee and the recycling out.

Today Rob and James proudly point out that they only generate one little garbage bag a week because of their recycling and composting efforts.  I quite frankly want to use the verbal equivalent of throttling them:  you know, something sarcastic about what an effort that may take.

Environmental Concern Should Inform our Investing

Environmental consciousness comes easily to me.  When I was ten, growing up on the South Shore, I would troop down to the STOP (Society to Overcome Pollution) depot with the week’s haul of newsprint and spend a couple of hours volunteering.  This was driven more by a 1960’s “hippy” philosophy than it was the economics of filling up landfills.

Now that I work out of the CSI co-work space, I am even more acutely aware of the effort necessary to be responsible stewards of the environment.  I carry around orange and banana peels to make sure they get into the compost pail.  I separate out my garbage and am aware of what ends up in my pail that I am trying hard not to empty more than once a month.  And that community influence extends to home.

For a while now Linda and I have been trying to divert most of our wet waste at the condo to the compost chute.  We’ve also questioned whether using non-compostable bags makes sense or if we’re just making things worse.  We now have a 1-gallon wet waste pail lined with small compostable liners – my bio-bomb in the making (so called because wet waste makes a satisfying splat when falling down an 11-story chute).

Because of where we are, Linda and I are starting to pay closer attention to socially responsible investing.  More than avoiding “bad” companies we’re starting to look at them through the B Corporation lens.

In an ideal world, I would have a plethora of B Corp certified publicly traded companies to chose from (as far as well can tell there is only one in Canada, Dirtt Environmental Solutions).  But sometimes leadership means taking a little extra time and focusing on quietly carrying out the recycling.

David Chellew and Linda Odnokon have been life partners and in business together for almost 19 years. During that time, they have mellowed into their respective roles and enjoy working with individual investment clients. Dave is a Portfolio Manager and Linda is an Investment Advisor with iAS and work out of the co-work space CSI (Centre for Social Innovation) in downtown Toronto.

 

Industrial Alliance Securities Inc. (IAS) is a member of the Canadian Investor Protection Fund (CIPF) and the Investment Industry Regulatory Organization of Canada (IIROC). iA Securities is a trademark and business name under which Industrial Alliance Securities Inc. operates.

 

This information has been prepared by David Chellew, Portfolio Manager for Industrial Alliance Securities Inc. (IAS) and does not necessarily reflect the opinion of IAS. The opinions expressed are based on an analysis and interpretation dating from the type of publication and are subject to change. Furthermore, they do not constitute an offer or solicitation to buy or sell any the securities mentioned. For more information about IAS, please consult the official website at www.iasecurities.ca. David Chellew can open accounts only in the provinces where he is registered.

Passive versus Active Investing: There are no Shortcuts

I had a friend who absolutely hated weeding his mother’s flower beds and herb garden.

Even as a teen I knew they were something amazing, literally dominating an acre, and his mother’s pride.  I don’t suppose I’m equipped even now to understand where gardening for pleasure becomes gardening to impress, but clearly Danny’s mom was gardening to impress.

Fed up, Danny decided one day to take a short cut and nipped out to Canadian Tire to buy some herbicide.  Three days later nothing was left but flower bed after flower bed of dead and dying plant material.  I didn’t see Danny for the rest of the summer.

Investing is much like that:  there are no shortcuts.

You can, like me, buy cut flowers which pleases Linda and is convenient to me.  Living in a condo doesn’t leave space in my life for growing things and frankly I don’t place much value on the process, only the result.  It’s a lot like the planters on King Street West that miraculously have gone from winter foliage to spring flowers overnight.

The other end of the spectrum are the gardeners in our condo complex.  Our flower gardens are beautiful, and a small group of volunteers spend countless hours of their retired time keeping them that way, developing through the spring with early blossoms to late fall ablaze.  I didn’t exactly endear myself to one of them last year when she was complaining about not getting any help to which I quipped maybe we just needed to pave them over.  I know myself and as much as I love the results I’m not prepared to spend the time getting them there.

The decision about whether to be a passive or active investor is a lot like that.

There are no short cuts to riches.

“Overnight” success in investing requires a lot of trial and error, and time committed to experimentation and failure, until you find a groove which works for you.  People like me can help with the process, providing advice, guidance and mentorship but ultimately you must take responsibility and work at it.

At the other end of the spectrum is the “buyer of cut flowers”.

Passive investing is a lot less labor intensive and if all you want is the benefit of the bloom, you need to school yourself in terms of expectations.  On occasion you might benefit from the blaze of color, but generally what you’re going to get is a well ordered manicured investment landscape.

I’ve toyed a lot with the concept of control when it comes to defining investment.  But I keep coming back to the same thing.

It’s about time commitment.

My profession is one of my passions, but I get that not everyone shares my interests.  The demarcation is your willingness to experiment, to take the time and effort to learn what you need to make an informed decision.

And if you think you found the magical answer to instant riches, remember Danny and his herbicide.

David Chellew and Linda Odnokon have been life partners and in business together for almost 19 years. During that time, they have mellowed into their respective roles and enjoy working with individual investment clients. Dave is a Portfolio Manager and Linda is an Investment Advisor with iAS and work out of the co-work space Brightlane on King West in downtown Toronto.

 Industrial Alliance Securities Inc. (iAS) is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada. iA Securities is a trademark and business name under which Industrial Alliance Securities Inc. operates.

This information has been prepared by David Chellew, Portfolio Manager for Industrial Alliance Securities Inc. (iAS) and does not necessarily reflect the opinion of iAS. The opinions expressed are based on an analysis and interpretation dating from the type of publication and are subject to change. Furthermore, they do not constitute an offer or solicitation to buy or sell any the securities mentioned. For more information about iAS, please consult the official website at www.iasecurities.ca. David Chellew can open accounts only in the provinces where he is registered.

Yoga: love the idea, but not sure it’s for me.

Yoga:   love the idea, but not sure it’s for me.

Tonight, is the night.  I’ve decided to break the seal and attend my first yoga class.

I don’t have to tell you that every bit of my acquired masculine identity is screaming “no, no, no.”  As much as I want to suck it up and get on with it, the gulf between the first step and where I am now has been as wide as the Grand Canyon.  Failing sprouting wings and being able to soar across, that divide has been far too wide.

So, what’s changed my attitude?  Well, I’ve decided that since I’ve survived putting flax seed in everything (what I jokingly call Chia Pet to Linda; there’s a story in that) I can risk alfalfa sprouts and Thai pants.

On the road to where I want to be

I’m fitter than I was but I still sport a rather robust girth.  The image I have of myself does not match the reflection in the mirror and quite frankly I am ashamed.  On the other hand, if I can wear compression wear doing aerobics in the gym, I can suck it up and roll around with all the grace of a python than has swallowed a pig.  That, like the pig, shall pass.

I’m ready to swallow my shame and get on with it.

Go big or go home

I go for the gusto.

Everything that I do, if I cater to both my competitive nature and need to succeed, I do to the extreme.  I find it hard to break down an entirely new activity into manageable, progressively more challenging parts.  Instead I go overboard.

When it comes to fitness, I’ve been there, done that.  I have paid exorbitant sums in the past for a personal trainer, struggling with the limitations he placed on me rather than letting me beat the machines, or hit yet again another personal best.  And the same PT was determined to follow his own agenda and despite my concerns and objections I found myself in a situation where I got hurt.

I’m going to work overtime to take a measured approach.

Attitude

I grew up straddling more than one socioeconomic class and the great generational divide between Hippy and Disco.  Yoga practitioners were the alfalfa-sprout-eating long-hairs that I was too young to be but wished I was.

Too, generationally as a late-boomer, I’m not as open to alternative lifestyles, as much as it is acceptable to those younger than me.  I struggle with my sons’ embracing not only chest thumping, grunting weight training and exercise but their determination to live a healthier lifestyle through diet and, yes, yoga.

James, the youngest, taught me something about personal care.  It isn’t that he is flamboyant, but that he is willing to embrace metrosexual.  He taught me it was okay to feel comfortable wearing flip flops.

Rob, the oldest, is more direct in his approach, and unapologetically pursues a healthier alternative way of life.  He taught me that it was okay to be in your face about what works for him.  For Rob, more than any else, I owe him to give yoga a shot.

And I owe it to myself to be open.

Need

I am starting to push up against limits both in physiotherapy and in aerobics.  I need an answer to the surprising tightness and soreness of muscles increasingly liberated.  I want to continue to step up my efforts because frankly I enjoy my twice-daily 40-minute workouts.  And I’m ready to begin challenging myself with cable and free weights.

To do that though, I must start to address a decades-long aversion to disciplined stretching coupled with a pathology of over and under-developed muscle groupings after 39 years coping with a leg injury.

I find it interesting that that one thing, need, overcomes the weight of inertia, closing that chasm and making the step across manageable.  Not easy mind you.  But manageable.

Investing

Managing your finances is little different than any other endeavor in life.  It is only when need overcomes the baggage you carry that you can actively deal with it.  And the older you are, the tighter your attitudes.

I’m not suggesting that Linda or I have the answers you need to be more successful as an investor; that comes from within.  But we’re both good at being a coach to help you sort out what barriers have stood in your way to past financial success.  And we both can help you break things down into manageable bites.

To find out more, give me (437 266 1125) or Linda a call (437 266 1126).

David Chellew and Linda Odnokon have been life partners and in business together for almost 19 years.  During that time, they have mellowed into their respective roles and enjoy working with individual investment clients. Dave is a Portfolio Manager and Linda is an Investment Advisor with iAS and work out of the co-work space Brightlane on King West in downtown Toronto.

Industrial Alliance Securities Inc. (IAS) is a member of the Canadian Investor Protection Fund (CIPF) and the Investment Industry Regulatory Organization of Canada (IIROC). iA Securities is a trademark and business name under which Industrial Alliance Securities Inc. operates.

This information has been prepared by David Chellew, Portfolio Manager for Industrial Alliance Securities Inc. (IAS) and does not necessarily reflect the opinion of IAS. The opinions expressed are based on an analysis and interpretation dating from the type of publication and are subject to change. Furthermore, they do not constitute an offer or solicitation to buy or sell any the securities mentioned. For more information about IAS, please consult the official website at www.iasecurities.ca. David Chellew can open accounts only in the provinces where he is registered.

Shame and gut-wrenching fear: 20 years without the dentist.

Sitting in my dental hygienist’s chair gripping the arm rests to the point that I was ready to rip the leatherette and stuffing away from the steel frame, I had to keep willing myself to be calm and breathe.  Laying supine with my mouth gaping open while some dude was poking, and scraping, isn’t the scene where I can wax poetic or opine on some weighty issue.  I was focused on how many teeth he had left to do so I had some sense of when I could leave all that stress behind for another three months.

Don’t get me wrong, my hygienist is both gentle and patient.  Like my dentist, he is non-judgmental and encouraging.  But the journey to the hygienist chair was 20 years long.

I was at one point a custodial single parent.  That meant I had to make many decisions that parents must make, but some of them were weightier.  Cara and Shannon always came first and since money was almost always tight I neglected many things in my life, including my dental care.

As time went on the condition of my mouth got worse and worse.  It got to the point that I stopped smiling, I was so self-conscious.  But it took a decade for Linda, patient life-partner extraordinaire, to cajole me into walking into the dentist.

I was deeply ashamed and in absolute terror.  Childhood experiences coupled with a military dentist left me with a phobia that to this day I’m not sure I can adequately define.

Intellectually, abstractly, I was amazed at the warmth and kindness shown to me by both my dental clinic and equally my dental surgeon.  Without being pejorative, they were direct and honest without accusation.  After the initial assessment I agreed upon an eight-week course of freezing, drilling, sculpting and cleaning.

And I discovered the absolute delight of nitrous oxide.  A stressful time of my life professionally two years ago the gas itself was a great escape.  Every Friday afternoon at 4 I got to leave the world behind and float into the weekend.

How they approached me addressed the shame.  I wasn’t made to feel less-than, inadequate or somehow a failure.  And I could conquer my fear of dentists, or at least chain that beast, with a little help of some gas and a routine that I met without fail for that eight-week period.  And today I can smile, or at least learn to, with confidence.

Linda and I don’t have access to laughing gas although we can use a little humor to help put you at ease.  Our starting point is right now and what may come.  It’s our job to help you identify clearly what it is that you want to accomplish and help create a map for your journey to get there.

November is Financial Literacy Month in Canada.  Why don’t you give me (437 266 1125) or Linda (426 266 1126) a call and help you begin the process of making more informed choices.

David Chellew and Linda Odnokon have been life partners and in business together for almost 19 years.  During that time, they have mellowed into their respective roles and enjoy working with individual investment clients.  Dave is a Portfolio Manager and Linda is an Investment Advisor with iAS and work out of the co-work space Brightlane on King West in downtown Toronto.

Industrial Alliance Securities Inc. (IAS) is a member of the Canadian Investor Protection Fund (CIPF) and the Investment Industry Regulatory Organization of Canada (IIROC). iA Securities is a trademark and business name under which Industrial Alliance Securities Inc. operates.

This information has been prepared by David Chellew, Portfolio Manager for Industrial Alliance Securities Inc. (IAS) and does not necessarily reflect the opinion of IAS. The opinions expressed are based on an analysis and interpretation dating from the type of publication and are subject to change. Furthermore, they do not constitute an offer or solicitation to buy or sell any the securities mentioned. For more information about IAS, please consult the official website at www.iasecurities.ca. David Chellew can open accounts only in the provinces where he is registered.

On Blowing Up Eggs and Campfires:  Finding a Way Out of Complacency

I can remember Shannon (my youngest daughter) when she was 9 or 10, asking me why I didn’t just make her omelet by putting a raw egg in the microwave.  I was grousing about having to clean out the mug I had just made her egg in and I answered her that I suspected that the egg would blow up.

She was no sooner out the door to go to school than I grabbed a raw egg and put it in the microwave.  There is a YouTube video that doesn’t do exploding eggs justice.  Delighted, I put another in and “boom”.  And another.  And another.  I kept at it until I had exploded a dozen eggs with childish delight.

I couldn’t clean the microwave and rather than going to work that morning I had to troop out and buy a replacement.  There are times that it just makes sense to give into the mischievous 8-year-old in yourself.

This past summer Linda and I had the opportunity to go visit a friend at her cottage in North Bay.  She was a little addled by her recent termination from a major financial institution but plans ultimately fell through.  Linda suggested we go camping instead and on a leap of faith we rented an SUV and dropped $2000 on the gear to make it happen.

We camped five times this past year, and from bone chilling cold in late August (we have toque stories) to mid-30 weather in late September, our central activity was the campfire.

Linda is a trooper and we discovered we camp exceedingly well together.  By the last trip we could set up our site in the dark with an economy of motion and absolutely no frayed tempers or impatience (well almost no frayed tempers).

And we mastered the art of the campfire.

From early boy scout skill, we evolved into two true 8-year-old experts in fire.  A dollar store pillar candle anchoring the first flame, we’d build either a log cabin or teepee (log cabin in our considered opinion is better) out of dry kindling from Canadian Tire around it.  In turn we’d place a circle of firewood with a piece at the top upon which Linda would stack pyramid-fashion 50 votive candles stripped of their tin.  Lastly, a liberal dosing of BBQ starter or lamp oil and we were ready.

In all we built ten or twelve this way, and once the satisfaction of seeing a blaze, we would settle into the night quiet around the fire.  We did have some detours like Jiffy Pop that sort of act like eggs in a microwave, marshmallows that set the Bailey’s on fire when quenched and hilarious racoon stories about how they would hold themselves just outside the circle of light thrown by the fire to try to raid our food.  The “who us” look on their faces when I turned a flashlight on them was hilarious.

A willingness to start down a new path almost always calls upon us to set aside our preconceptions and inertia.  It is often easier to risk losing out on future opportunities and stay in our complacency than it is to take that first step.

Linda and I firmly believe that the process of taking control of your financial future means taking that first step out of your comfort zone.  We can help you find a comfortable way to do that.

We are committed to helping people be better informed and better investors.  And there is every chance that you don’t need to change a thing.

November is Financial Literacy Month in Canada.  Why don’t you give me (437 266 1125) or Linda (437 266 1126) a call and arrange to sit down with us.

Who knows, maybe we’ll find some smiles along the way.

David Chellew and Linda Odnokon have been life partners and in business together for almost 19 years.  During that time, they have mellowed into their respective roles and enjoy working with individual investment clients.  Dave is a Portfolio Manager and Linda is an Investment Advisor with iAS and work out of the co-work space Brightlane on King West in downtown Toronto.

Industrial Alliance Securities Inc. (IAS) is a member of the Canadian Investor Protection Fund (CIPF) and the Investment Industry Regulatory Organization of Canada (IIROC). iA Securities is a trademark and business name under which Industrial Alliance Securities Inc. operates.

This information has been prepared by David Chellew, Portfolio Manager for Industrial Alliance Securities Inc. (IAS) and does not necessarily reflect the opinion of IAS. The opinions expressed are based on an analysis and interpretation dating from the type of publication and are subject to change. Furthermore, they do not constitute an offer or solicitation to buy or sell any the securities mentioned. For more information about IAS, please consult the official website at www.iasecurities.ca. David Chellew can open accounts only in the provinces where he is registered.

Three Habits You Need to Successfully Save for Retirement: Beware of “Money for Nothing and Chicks for Free*”

 

I’ve always been a gifted academic, fortunate that I see complexity as a puzzle that can be quickly solved.  And long ago I learned to stop suffering from paralysis of analysis to make recommendations and follow through on them.  But having an academic bent or good ‘gut’ instincts for the market means nothing when you’re saving for retirement.

Since I first got into the brokerage business I’ve always struggled with our collective need to “beat” the market, although there is merit in managing risk and opportunity.  In my opinion, building a strategy based on a lottery ticket mentality turns the stock market into an elaborate casino.  I personally don’t like spending time in casinos and I don’t want to work in one.

Don’t get me wrong; I have clients who have made enormous amounts of money speculating.  And they have in the main retained most of it.  They deal with me because I am a source of information and analysis, a set of second eyeballs for their deals, an arbiter of technical trends and a latent conscience.

In my opinion, this doesn’t represent most investors.  As much as we all like to sally forth from the walls of our complacency, taking a risk with a little bit of money, close contact with the time demands, angst and uncertainty of investing in a single speculative stock quickly defeats us.

Frankly, if you think about the last “big thing” in Canadian markets, many investors would have been better off spending a smaller portion of their money on bud and smoking it.  At least they would have been chill.

In my many years in the industry I see three highly effective investment habits over and over that lead to a healthy retirement:

1.    Save Systematically

Either you’re committed or not.

I have seen people with below average incomes saving disproportionally larger shares of their income and amassing huge sums of money.  And I have seen others with large incomes facing the horror and panic of having five years to save enough money to last them for 40.

Saving systematically is a habituation.  If you have the discipline to commit to and keep to a saving program then it is merely a matter of defining what that amount will be for the year and reviewing it to increase it on an annual basis.

If you need a little external discipline, then borrow it to invest, provided you pay it off during the year.

I have seen both approaches work very well over the last 25 years.

2.   Have a Sound, Consistent and Easy Strategy to Follow

There are far too many get-rich-quick schemes out there and they inevitably line the pockets of the purveyors and producers of this garbage.

Some years ago, a friend and colleague reminded me that the market was driven by fear, greed and envy.  Yet successful savers that I have known and come to respect fall for none of these.  That doesn’t mean they don’t suffer from anxiety from time to time, or that they are not tempted to jump on board the “latest thing”.  It means regardless of the temptation or fear, they don’t depart from their strategy.

A sound strategy is one that is replicable, timeless and concise.  We will be talking about building a retirement portfolio using rate reset preferred shares, or new issues, real estate investment trusts (REITs), strip bonds or only bank and insurance stocks in later posts.  They can all form part of a sound strategy singularly or in combination.

Regardless of your short-term risk profile, a strategy like this is built around doing the same thing over and over.  They are not “Dire Straits” opportunities.  You know the ones:

“That ain’t workin’ that’s the way you do it
Money for nothin’ and chicks for free”[1]

3.    Be Clear on Your Goal

Goals can be clear, concise and easy to monitor.  Too many moving parts and the chances that you will keep to a routine that will allow you to meet the goal is lost.

Many years ago, I started working out at a gym.  I had one of the PTs put together an exercise routine for me that focused on upper and lower body on alternate days.  I spent the first month or so trying to learn the “slow, slow, quick, quick” of the dance of the machines.  I became about proficient as I was with waltz classes.  Don’t ask me to dance.

I only became successful when I hired a full time PT that I was committed to 3 days a week.  The goal was to make the work out; I allowed him to guide me through the routine, vary it for maximum effectiveness and he held me accountable for both cardio that I did on my own and my off-day routines.  The point?  I had a goal:  to make every workout I had scheduled and in doing so keeping the PT off my back.

 

Getting Started

The time to start is now.  If you’re like most people, you’re carrying a lot of garbage.

It’s time we sat down and explored your attitudes toward saving and set a measurable and achievable goal to help you start down the road to financial fitness.

I’m not going to promise you that it’s easy.  I can promise you that after meeting you will feel lighter because we’ve helped you take out the trash.  I can also promise that we can set a goal that is both timely and achievable.

Partner Linda Odnokon (437-266-1126) and I (437-266-1125) are both available to explore your financial anxiety.  Give us a call.


[1] Easy, easy money for nothin’, chicks for free) (I want my, I want my MTV)
(Money for nothin’ chicks for free)

Written by Mark Knopfler, Gordon Sumner • Copyright © Universal Music Publishing Group

[11] Ibid

 

David Chellew and Linda Odnokon have been life partners and in business together for almost 19 years.  During that time, they have mellowed into their respective roles and enjoy working with individual investment clients.  Dave is a Portfolio Manager and Linda is an Investment Advisor with iAS and work out of the co-work space Brightlane on King West in downtown Toronto.

Industrial Alliance Securities Inc. (IAS) is a member of the Canadian Investor Protection Fund (CIPF) and the Investment Industry Regulatory Organization of Canada (IIROC). iA Securities is a trademark and business name under which Industrial Alliance Securities Inc. operates.

This information has been prepared by David Chellew, Portfolio Manager for Industrial Alliance Securities Inc. (IAS) and does not necessarily reflect the opinion of IAS. The opinions expressed are based on an analysis and interpretation dating from the type of publication and are subject to change. Furthermore, they do not constitute an offer or solicitation to buy or sell any the securities mentioned. For more information about IAS, please consult the official website at www.iasecurities.ca. David Chellew can open accounts only in the provinces where he is registered.