What hobbies or activities are you planning to take on in retirement?
Golf? Bridge? Iron-man events? Each sounds good for mind or body. Now for another activity that seems beneficial – managing your own investments.
A reader got in touch recently to ask about this. She and her partner are newly retired and interested in taking a more hands-on approach to their investments, which are currently looked after by an adviser. The adviser charges 1 per cent, which can add up to a significant amount for people who have built substantial retirement savings.
My suggestion: Don’t do it. Set up a small investing account on the side with an online broker to scratch that itch to manage your own investments. Leave your retirement account with the adviser, providing he or she is delivering good service and investment returns.
The argument for leaving retirement savings with a good adviser is partly about the aging process. Last year, I had an e-mail from an 80-year-old doctor who was a lifetime DIY investor. He said he was starting to worry about his ability to manage his investments going forward. Fearing he’d make an investing mistake with his portfolio, he was open to turning his portfolio over to an adviser.
Ideally, taking on management of your own investments when you retire goes well for 10 or 20 years. Then, what? Finding an adviser at any age can be an exhausting process of seeking recommendations from friends and family, having initial conversations and then interviewing prospective candidates.
The reader who asked about self-directed investing was interested in learning more about investing, which is an excellent way to spend time in retirement. The adviser-client relationship works best when there’s a common understanding about the markets, risk, diversification and so on.
But there’s a big difference between learning about investing and managing a portfolio of investments that is relied upon for retirement income, covering big expenses and possibly leaving a legacy for family. Everyone, pros and amateurs alike, make mistakes when investing. The difference is in the mistakes themselves – are they small and fixable, or disastrous in causing long-term damage?
An ideal way to learn about investing in retirement is to open a self-directed tax-free savings account at an online broker. Start fresh with the current year rather than transferring your existing TFSA money, and see how it goes.
TORONTO – Canada’s main stock index was up more than 100 points in late-morning trading, helped by strength in base metal and utility stocks, while U.S. stock markets were mixed.
The S&P/TSX composite index was up 103.40 points at 24,542.48.
In New York, the Dow Jones industrial average was up 192.31 points at 42,932.73. The S&P 500 index was up 7.14 points at 5,822.40, while the Nasdaq composite was down 9.03 points at 18,306.56.
The Canadian dollar traded for 72.61 cents US compared with 72.44 cents US on Tuesday.
The November crude oil contract was down 71 cents at US$69.87 per barrel and the November natural gas contract was down eight cents at US$2.42 per mmBTU.
The December gold contract was up US$7.20 at US$2,686.10 an ounce and the December copper contract was up a penny at US$4.35 a pound.
This report by The Canadian Press was first published Oct. 16, 2024.
TORONTO – Canada’s main stock index was up more than 200 points in late-morning trading, while U.S. stock markets were also headed higher.
The S&P/TSX composite index was up 205.86 points at 24,508.12.
In New York, the Dow Jones industrial average was up 336.62 points at 42,790.74. The S&P 500 index was up 34.19 points at 5,814.24, while the Nasdaq composite was up 60.27 points at 18.342.32.
The Canadian dollar traded for 72.61 cents US compared with 72.71 cents US on Thursday.
The November crude oil contract was down 15 cents at US$75.70 per barrel and the November natural gas contract was down two cents at US$2.65 per mmBTU.
The December gold contract was down US$29.60 at US$2,668.90 an ounce and the December copper contract was up four cents at US$4.47 a pound.
This report by The Canadian Press was first published Oct. 11, 2024.
TORONTO – Canada’s main stock index was little changed in late-morning trading as the financial sector fell, but energy and base metal stocks moved higher.
The S&P/TSX composite index was up 0.05 of a point at 24,224.95.
In New York, the Dow Jones industrial average was down 94.31 points at 42,417.69. The S&P 500 index was down 10.91 points at 5,781.13, while the Nasdaq composite was down 29.59 points at 18,262.03.
The Canadian dollar traded for 72.71 cents US compared with 73.05 cents US on Wednesday.
The November crude oil contract was up US$1.69 at US$74.93 per barrel and the November natural gas contract was up a penny at US$2.67 per mmBTU.
The December gold contract was up US$14.70 at US$2,640.70 an ounce and the December copper contract was up two cents at US$4.42 a pound.
This report by The Canadian Press was first published Oct. 10, 2024.
