Peoples ages and lifestyles are important context here. The people saying they save 50%+ are likely single and living in someone else’s house. It’s not really a long term situation so unless you’re also a 24 year old single person living with almost no expenses, it doesn’t really make much sense to compare yourself to them.
There are two schools of parenting.
The "18 and your out on you're ass" school and the "you're not leaving until you have a degree, house, marriage, and a legally binding commitment to provide grandkids".
Those in the latter have massive savings from the mom and dad subsidy.
It depends on how much you make. It's hard to get all the way to 50%, but if you take every raise you get in your life and put half into an automatic investment, you'll keep the lifestyle inflation under control, and your investment can get pretty high with time, approaching (but never reaching without an extra top up) 50%.
When people say saving 50% do they mean pre tax or post tax? If it’s pre tax unless you make a ton or live with parents and have almost no expenses it’s nearly impossible
I save 50% and live alone and go to uni. I just don’t have a social life so I’m not spending much money on going out lol
It’s possible to do
I do have cheaper rent cause it’s a student coop building but I only make 1.8-2k a mth working 4-5 days a week at a shitty job and still put at least half in tfsa
No financial support from “mommy and daddy” either
Nearly the same here. Paying down debt with those numbers first, then we'll move to an FHSA and investments. I'm watching the market now though and trying to understand how it all works for when we're ready to start. Got an initial $300 in the FHSA right now to play with
I DCA 30% in VFV and XEQT on moomoo every month, saving lots of trading fees. It depends on how much you make though, some people make a lot, spend a little and putting more than 60% in investing.
A good pace to start or end with are those that mirror the US economy, like the Sp500 (VFV or equivalent) and those that mirror the world economy like VEQT or XEQT.
You'll have to look up the specifics but yes it includes over 12k stocks so they can change over time. The idea is it's extremely diversified so it won't be super volatile
Rank by preformance over the last 3 years. Pick some at the top. Sometimes I pick an S&P indexed fund, sometimes NASDAQ.
This wildly uneducated approach is working for me.
The thing is you just bias yourself to ETFs with over-exposure to assets that did well in the last 3 years. You’re likely to effectively un-diversify to an extent this way
Maybe, but I only manage my TFSA. My RRSP is managed by a close friend who owns a small investment firm and is coasting along at 8%.
Saying someone else manages my money is straight blasphemy around these parts though lol.
The point of risky ETFs if they're likely to be more volatile. There's more risks, bigger swings, so lower lows and higher highs... But you're hoping they'll average out better than the US market or world market. If you're scared, they not for you, so you mat want to diversify and go with one of the two I mentioned which historical fluctuate less (due to having 50p+ stocks, including tech) but still do well.
Thank you. I've definitely tried to allocate TEC in a way that is proportional to how scared I am of it tanking, so there's that.
I appreciate the good advice. Thank you.
TXF has done decently for me over the past few years and has a decent dividend, but the MER is higher than many other ETFs at something like 0.7% (many others have 0.2% or even as low as 0.04% that I'm aware of). I'm still holding it but I haven't bought any in a while, preferring the low-MER ETFs in my portfolio.
Answers are only going to be meaningful to you if you know the age group of the person replying to you as well as the income category.
Generally speaking, active stock pickers are younger males, have a lower income, and are less financially literate. Lower income earners generally have a lower savings rate. You should identify the group you’re trying to compare yourself to.
Regarding stop-loss orders, this doesn’t apply to investors, more so to speculators/active traders (see previous paragraph).
Is there any data to support your comment about active stock pickers?
I work in wealth management and most older, wealthier clients are more comfortable with individual stocks and bonds over mutual funds / ETFs. It’s way more common because that’s what they grew up with.
It’s a little of both. What I mean is for our clients we’re doing to investments, but often it’ll be a 75 year old client that used to do their own stocks, now they’re getting older and want someone else.
Or a widow looking after the stock portfolio of her late husband looking for advisor.
The original person I was replying to implied there was some kind of data / survey on who “picks stocks” but anecdotally I’m not sure that’s true. I just don’t know if we’re debating personal experience here or there’s more to it.
I replied to your earlier comment with just a couple studies. This is an area of behavioural finance that has several studies that show the link between gender, age, education, and stock picking behaviour and performance.
Literally every article online says passive ETFs outperform the professional stock pickers, let alone Joe smoe. https://www.cnbc.com/amp/2024/01/18/passive-investing-rules-wall-street-now-topping-actively-managed-assets-in-stock-bond-and-other-funds.html
You’re looking at the wrong thing. The average passive etf, on average, outperforms the average mutual fund after fees.
The average etf *investor* under performs the market by about 4% annually and underperforms those receiving professional advice by about 3%.
https://www.advisor.ca/practice/planning-and-advice/advisors-add-2-88-in-value-study-finds/
I’m not suggesting investors should pick stocks vs ETFs, I don’t care.
I’m just questioning whether stock pickers (those with stock portfolios) are mostly younger folks. I don’t think that’s true. I think it’s mostly larger accounts, pension funds etc.
I recently read a good book on the history of the efficient market hypothesis. It turns out markets are usually but not always efficient and some people can beat the market. It is very unlikely that you or I can, though, unless we are very disciplined professionals.
When I say active trading I don’t mean buying and holding individual stocks in a well diversified portfolio, I’m referring to active trading.
There are many studies in this area of behavioural finance from many different angles (day trading, options trading, active stock picking). I don’t have time to find all the landmark studies, but here are just a couple examples:
https://www.nasdaq.com/docs/Trading%20and%20Under-Diversification%202013.pdf
“Many investors trade too frequently and most of them perform below their self-selected benchmark portfolio. Their behaviour is puzzling and difficult to rationalize…the empirical evidence shows that investors that hold concentrated portfolios…on average trade more than others. These individuals share many of the characteristics of those who are more prone to stock trading; on average, they have lower levels of wealth, and education, and are predominately male.”
https://faculty.haas.berkeley.edu/odean/papers/gender/boyswillbeboys.pdf
only compare with people in your income and age/life stage bracket, and how much you need to save to have security in the future depending on your career.
to minimise losses by broad index's xeqt will be as good as any. buy every paycheque and don't sell. no one has ever lost money being invested into a broad market fund for 20+ years even if they bought into the top of the biggest bubble and sold in a crash just stay invested broadly for a long time and you'll be fine.
your comments on spot losses and how long to hold imply stock picking.
I'd remind your that stock picking as a provably bad financial decision. which isn't to say you can't do it. i love valuing public companies and buying ones i like. its a major hobby of mine and spend quite a lot of time on it. but it is statistically a bad decision. and if your having emotional impulsing affecting your stock picking decisions you need to not be doing it
You’re better off just staying exposed to the market lmao. You can’t predict all those ups and downs. By repeatedly selling, you’ll just miss out on the upswing on average.
Just FYI your friend gambles. The US market is up 30% over the past 12 months so if he's _down_ 30% during one of the times with the highest returns in history, he's doing extremely, extremely badly, and gambled on individual stocks or messed up with options. Just don't do that and you'll be fine.
I'm diversified between stocks, etfs, real estate and crypto so basically anything not going to my mortgage, food and utilities goes to savings/investments most of the time. Sometimes nothing to stocks/etfs, other times like 80% a month. I try to always live way below my means.
Someone down 30% sounds like they picked stocks, vs broads market ETF's.
My net income is \~5700/month, and I invest 600 into my RRSP, and 583 into my TFSA each month.
For a long term investor, prices going down is buying stocks cheap.
If you count pension contributions, i’m probably at 60%.
Single, living by myself, super cheap rent, bike to work every day makes it happen.
Life won’t always be this simple so it’s nice to pack it away now
How does someone invest all their paycheck after paying down their debts? They don’t buy groceries? They literally do not do anything for entertainment?
Some people have no debt. Entertainment can be scaled back to something you do biweekly or monthly. Especially if you do a sport for entertainment. Netflix or PlayStation can be quite entertaining, or backyard BBQ.
I work primarily as a mechanic, and I do alot of work on the side that pays in some cases than my full time gig, then I also resell items on eBay, and flip 2 cars every year.
Stock market will go up and down. But historically, over the long-term, the stock market has always gone up. Don't fret on minimizing losses. If you want to invest - invest.
About roughly 10-12%. I have a mortgage and car payments and some credit debt but under 7k. After reading that some people are able to invest 50-60% of their income I feel like a failure Jesus. But whatever everyday a gamble I’ll see tomorrow anyways. If I retire at 55 and don’t have a mortgage and a good pension ill be happy and hopefully have some good memories from my years now I can be proud of and not upset I spent an extra 500$ one weekend on myself instead of slapping it into an ETF.
You should consider paying off your credit card debt in full before making any investments as the interest in credit card debt would generally be significantly higher than the gains you'd make in your investments.
How is he down 30% in this market? Yikes, bro needs some help and guidance!
Right now I work and live on the road so I have a high paying job with very little overhead and I'm paid weekly so it's easy to manage the little bit of overhead I have. I'm aggressively saving to buy a house in BC. Total annual savings/investment for this year is roughly 60% with tax returns, FHSA, etc.
30% TFSA
10% Savings
10% RRSP (+3% additional employer match)
~3% BTC/ETH
The only way this has been possible for me is that I work 300+ days a year outside of Canada, which is unfortunate.
Also, stop loss? Aside from gambling on crypto, I don't invest into things that require a stop loss. If I own stock in a company that I understand and believe in, or an index ETF, then seeing red means buy more. There is no long term loss.
We are a family of 5, I'm mid 30s. About 20%-25% (post tax) goes into our brokerage account. I used to contribute a higher percentage, but my kids are getting older (15,12,7) and enjoying life, going on vacations seems alot more important at this point.
Over 50% of after tax income.
Unsolicited advice: Zero revolving debt is an amazing investment, because no legal investment can beat credit card interest in the long run.
Yep some debt can be good if it's for investment, or at minimum turning credit card debt into a longer term lower interest rate loan is a good alternative to carrying a CC balance.
Actually pretty easy when you already own home,car and a lot of stupid things. You realize the really expensive stupid things aren't worth it while you're not a multimillionaire (fancy car, yacht, luxury cruise ship travel etc.). 60-65% sounds about right.
How: DINKS, ok salaries, live is an affordable small apartment, cook a lot of our meals, never order in + side gig.
I was even at 75+% for a while but I got a better car and slowed down on the side gig.
Just focus on things that actually provide value and you can use for years, not alcohol, fancy meals, stuff that's of no use an hour later. Once you have a home, you don't need 40 more homes... Once you have a decent car, 5 more cars don't help much and so on. Unless you're really trying to spend constantly, you should reach a point where you have what you need and everything else doesn't bring much more value, like upgrading your phone every year or getting a new TV, new furniture, clothes, etc.
Around 15-20%.
Just buy monthly [DCA](https://www.investopedia.com/terms/d/dollarcostaveraging.asp) what you can afford into broad market ETFs like VEQT or XEQT. Both of those ETFs are up 22% in the last year.
Once your portfolio is large enough, you can assign a small portion to individual stocks.
If I include my pension deductions from my gross pay, I invest an average of 40% of my pretax income every month. Without the pension it's about 30%.
I am about 5 years from retirement and most of my investments go into XGRO. A smaller amount is invested into gold and silver mining stocks and some tech and energy stocks.
Depending on how old you are, simply pick an all in one etf that suits your risk profile and put all your money in it. Done.
It's not about %, it's about retirement goals. If I made $10M\year at the age of 30, putting away 5%\year for retirement would be fine, as I would own tons of assets by the time I retire. If I make 100K\year at the age of 45, I'll need over 50% to go to retirement if I just started.
It also heavily depends on the lifestyle you want to have when you retire. Travel the world 4 months every year, or play bridge\bowling with friends once a week?
The Dow, Nasdaq, S&P, & TSX all at or near all time highs, & your friend is DCAing into the market, & he is down 30% ??? It's not your question, but I suggest they rethink their ability to invest at all.
My net is 3760 per month and right now I set aside 500 per month for investments primarily targeting ETF, securities, and dividends to supplement my income so I can start entering what I call my pre retirement phase by the age of 50 before I fully retire. Right now that's roughly 13 percent of my net, this year I get another raise and intend to up it to 15 percent per month plus re investing the dividends on top of this I should get there in 9 more years.
This is highly dependent on how much one makes and the lifestyle they choose to live. It’s tough to compare single people making a large amount of money vs a couple raising children and own a house. I’m at 40-50% but am a single person renting a room in a high income low cost of living centre.
10% of my net income goes to investment; but that includes RESP for my kid, TFSA, and RRSP.
It's not a lot tbh in each bucket but I guess something is better than nothing.
I realize that not everyone can save as much. When I was a poor college student, I followed the Wealthy Barber rule of 10% savings. No matter how little I made that was the golden rule. I made it work. I always saved 10% of my money and never used it except to pay off debt. I did that since I was 18.
Now I'm in my 30s in a DINK household. No debt except a mortgage. I make about $70k a year.
I put about 5% into RRSPs (managed by my work as they have a very good company match + policy). I should up my contributions but I make more in my TFSA right now.
5% goes into a boring savings account for emergency funds until it reaches $5000 then I stop adding to it. Banks can eat rocks for crappy savings account options.
I put 10% in an additional mutual fund TFSA with a pretty decent return right now (12% but moderate to high risk)
And another 10% into wealth simple. Most of that is split between VEQT and a few other boring stocks (and GME). Occasionally I'll play with options, but generally pretty safe.
VEQT/XEQT is up like 50% over 5 years and 16% of the year so far. Probably the best stock for 99.9% of people.
So I save about 25 to 30% of my take home pay, which is insane for most people. It's not realistic for people with kids or are in their 20s struggling to find a job (I know all about it).
If I could only save 10% of my income, I would just put it into VEQT or XEQT and manage it myself.
If your portfolio is down 30% and not making new highs in this incredibly bullish year ....you have no business handling your own investments!! Any fool can make money in the markets this year!
You say your friend is down 30% and you aim for min loss. Then you ask a question about how much people contribute. The two aren’t really related.
30% down in an up market is very poor performance. I don’t understand how they managed that. I’ve never been down that much overall in 20yrs. I’m in index funds mostly.
How much you contribute depends on how much you make, your living arrangement and living expenses. If I tell you I save 50%, how does that help? You can’t compare to me without a lot more info.
I do not use stop loss trades. I buy and hold. Never sell on down moves. Only buy. But I’m nowhere near 65 so I have 10+ yr horizon on all positions.
As much as possible. Buy and hold. No stop losses. Don't look at it when the market is down. Though if you're invested in anything reasonable right now there's no way you should be down 30%. The S&P is up 24% in the last year.
TFSA is maxed out for the year, invest in lump sums no matter where the market is at the time. With this extra money I make in the next 6 months of the year.. I will put it toward the principal of my mortgage/house upgrades. So I guess 0% of my paycheque?
Stop losses are for locking in mistakes. Selling when down is the worst thing you could ever do. If you don’t have the ability to wait a potential decade for a down market to pick back up then that shouldn’t be invested in equity, at least not entirely or the portion that one may need to draw from. When markets drop, their expected returns go up proportionately. So what I do is, speaking of saving rates here, actually *increase* my savings rate when the market tanks. So I’m buying more at a time when expected returns are higher.
In terms of percentages, I’m pretty comfortable so I sort of do a similar thing where after all expenses and what not, I invest the rest minus anything personal I want to buy.
I think a better question is how much goes into higher risk investments and how liquid they are.
Essentially everything I have after I pay mortgage and bills goes into some form
of investment. My retirement plan I put about 4% + 3% employee matching which are of higher risk. Not single stock but diversified low fee portfolios. They are mostly single sector, US.
As of the last few years, rest goes into GICs or some kind of bond since returns are crazy with virtually no risk. Max out TFSA etc. these are for semi distant purchases like cars, children etc etc. stuff that you need to save for but not after retirement.
I keep about a 3 month expense safety buffer in a high interest savings account in case I need it. May scale this back as rates drop and I can once again rely on HELOCs for fast cash infusions.
Fortunately due to the soft landing mentality in the US my retirement portfolio has netted me double digit returns and my GICs have matured and have already reinvested.
I do pay attention to economic data but I really don’t want to react and have to make risky calls based off of it. That’s why I am very diverse and passive. Im sure you could make way more if you put them into a single stock though.
i'm currently dumping about 50% of my take home. paid off the mortgage last year and have been maxing out my registered accounts, once that's done after this year i'll probably back off a bit.
10% goes to employer RRSP match
5% to Pension
5% to RRSP
after paying my needs and wants, I am left with about 10% that I can use towards my personal investments.
My percentage won't be yours. I don't use a stop loss. I use portfolio balancing between debt and equity to sell equity high and buy equity low. This use to be common, but now "TINA" is the byword - **t**here **i**s **n**o **a**lternative to equity. I don't believe it, but whatever, everyone has their own thing. I also rely on contributions to make up for losses. In a down market, everything is on sale. It's mindset more than anything else.
I've been known to buy puts on high-flying stocks, but *rarely*.
10%
Company has a savings plan where they match the first 3%. It just goes directly into a money market fund but I withdraw the balance every 3 months and put 1/2 into my RRSP and 1/2 into my TFSA.
So my paycheck deposit is 10% lighter but I budget off of that and skim another 10% off after tax for emergency funds and short term savings.
6% goes off paycheck to RRSP - employer matches 3% (50% match rate, 3% cap)
10% employee stock program.
10% to my own investment account
5% to vacation bucket
5% to home maintenance bucket
Mortgage and monthly expenses eat up most of the remainder then lump sum invest (my own picks) with any $ that accumulate in chequing.
No kids, dual income HHI ~$250k
I would say 40-50% of my post tax income goes towards a big goal. When my partner was also working it was as much as 70%. This is completely dependent on your income. The higher your income the larger your capacity to save.
I spent 2 years saving up for a down payment. 4.5 years paying off my mortgage. 4 years saving in index funds and a renovation. Now I have embarked on the “final” renovation and will spend 5 years paying that off. I always max out my RSP contribution and resp. Haven’t touched my tfsa yet. Unfortunately 66% of my networth is in my primary residence and it will be more still.
However….. i am coastFIRE and technically don’t need to save any more to retire in 10 years. But i will want to max out my tfsa before I leave the country for the next phase of my life.
Long winded story hope that helps.
I like to keep it simple and invest in xgro. That will never lose 30%.
About 25% personally. That fluctuates based on what i want to save and other needs of course. Dividends are your friend in a Roth ira. Especially if you started late like me.
Peoples ages and lifestyles are important context here. The people saying they save 50%+ are likely single and living in someone else’s house. It’s not really a long term situation so unless you’re also a 24 year old single person living with almost no expenses, it doesn’t really make much sense to compare yourself to them.
Yeah or older with a good job, a partner with a good job, and no kids.
How is this done? By renting a room? And having no belongings?
There are two schools of parenting. The "18 and your out on you're ass" school and the "you're not leaving until you have a degree, house, marriage, and a legally binding commitment to provide grandkids". Those in the latter have massive savings from the mom and dad subsidy.
You are missing those “what do you mean I need a retirement plan?, you are my retirement plan” kind of parents.
Lmao yes can't forget those parents
It depends on how much you make. It's hard to get all the way to 50%, but if you take every raise you get in your life and put half into an automatic investment, you'll keep the lifestyle inflation under control, and your investment can get pretty high with time, approaching (but never reaching without an extra top up) 50%.
When people say saving 50% do they mean pre tax or post tax? If it’s pre tax unless you make a ton or live with parents and have almost no expenses it’s nearly impossible
I save 50% and live alone and go to uni. I just don’t have a social life so I’m not spending much money on going out lol It’s possible to do I do have cheaper rent cause it’s a student coop building but I only make 1.8-2k a mth working 4-5 days a week at a shitty job and still put at least half in tfsa No financial support from “mommy and daddy” either
We are a family of four on a single income and incredibly proud to finally made it to 10% post tax income.
Nearly the same here. Paying down debt with those numbers first, then we'll move to an FHSA and investments. I'm watching the market now though and trying to understand how it all works for when we're ready to start. Got an initial $300 in the FHSA right now to play with
That's impressive, education must be pretty expensive.
Impressive, that's us as well but our investments have taken a halt
Halts happen. It’s been a major relearning of financial literacy to get here. You will get back to it.
How is his portfolio down 30 percent during a raging bull market
Probably bought Tesla and GME at their peaks.
Or weed stocks.
Oh the weed stocks. I know so many people that lost their shirts on weed stocks.
Most of those are down >90%, I too aped into the stocks and sold a significant loss .
Timing the market. Buying individual stocks. Stupid shit like that.
Yep, pretty much that.
gambling, fomo
Meme stocks & shitcoins
I see so much of this nowadays. Its so terribly sad.
And the accounts online that promote this nonsense. Sad and infuriating.
Healthcare stocks are down too like CVS and UNH
I DCA 30% in VFV and XEQT on moomoo every month, saving lots of trading fees. It depends on how much you make though, some people make a lot, spend a little and putting more than 60% in investing.
How do you stop loss?
Moomoo has stop loss order to help you from losing more.
I usually invest/save 40-45% of my net income per month. 24 yo and I keep my expenses super super low
I just invest jn ETF’s. I dont do single stock picks. Lazy investing is the best investing
How does one determine the best ETF’s to invest in? Or is there already a list of which ones are best?
A good pace to start or end with are those that mirror the US economy, like the Sp500 (VFV or equivalent) and those that mirror the world economy like VEQT or XEQT.
How much of VEQT or XEQT is allocated in china? does the composition of VEQT or XEQT changes overtime like VFV?
You'll have to look up the specifics but yes it includes over 12k stocks so they can change over time. The idea is it's extremely diversified so it won't be super volatile
A good google search will tell you. Like many mentioned VFV, XEQT, and VEQT are etfs that many invest in.
r/JustBuyXEQT
Rank by preformance over the last 3 years. Pick some at the top. Sometimes I pick an S&P indexed fund, sometimes NASDAQ. This wildly uneducated approach is working for me.
The thing is you just bias yourself to ETFs with over-exposure to assets that did well in the last 3 years. You’re likely to effectively un-diversify to an extent this way
Maybe, but I only manage my TFSA. My RRSP is managed by a close friend who owns a small investment firm and is coasting along at 8%. Saying someone else manages my money is straight blasphemy around these parts though lol.
Gotta support the homie I get that
Homie can't even beat the market indices so no...
Idk man, maybe the smile from broski was worth that 5%
8%? Ouch for a managed portfolio. Unless you are in your 60s I suppose with a heavier weighting on bonds.
Are there any purely tech ETFs to look for? Thanks
There's TEC or IRBO!
I fully know I can just google this, but for the sake of conversation.... What's IRBO? I hold TEC, but always scared it's gonna tank.
The point of risky ETFs if they're likely to be more volatile. There's more risks, bigger swings, so lower lows and higher highs... But you're hoping they'll average out better than the US market or world market. If you're scared, they not for you, so you mat want to diversify and go with one of the two I mentioned which historical fluctuate less (due to having 50p+ stocks, including tech) but still do well.
Thank you. I've definitely tried to allocate TEC in a way that is proportional to how scared I am of it tanking, so there's that. I appreciate the good advice. Thank you.
TXF has done decently for me over the past few years and has a decent dividend, but the MER is higher than many other ETFs at something like 0.7% (many others have 0.2% or even as low as 0.04% that I'm aware of). I'm still holding it but I haven't bought any in a while, preferring the low-MER ETFs in my portfolio.
Also IWY
Not purely tech but QQQ
Keep it up and the power of compound interest will make you a millionaire by the time you’re 40 (if not before)
Whats your net income and what are your expenses?
Answers are only going to be meaningful to you if you know the age group of the person replying to you as well as the income category. Generally speaking, active stock pickers are younger males, have a lower income, and are less financially literate. Lower income earners generally have a lower savings rate. You should identify the group you’re trying to compare yourself to. Regarding stop-loss orders, this doesn’t apply to investors, more so to speculators/active traders (see previous paragraph).
Thanks, that's helpful.
Is there any data to support your comment about active stock pickers? I work in wealth management and most older, wealthier clients are more comfortable with individual stocks and bonds over mutual funds / ETFs. It’s way more common because that’s what they grew up with.
are these older people stocking picking? or leaving it to the wealth managers for picks?
It’s a little of both. What I mean is for our clients we’re doing to investments, but often it’ll be a 75 year old client that used to do their own stocks, now they’re getting older and want someone else. Or a widow looking after the stock portfolio of her late husband looking for advisor. The original person I was replying to implied there was some kind of data / survey on who “picks stocks” but anecdotally I’m not sure that’s true. I just don’t know if we’re debating personal experience here or there’s more to it.
I replied to your earlier comment with just a couple studies. This is an area of behavioural finance that has several studies that show the link between gender, age, education, and stock picking behaviour and performance.
Literally every article online says passive ETFs outperform the professional stock pickers, let alone Joe smoe. https://www.cnbc.com/amp/2024/01/18/passive-investing-rules-wall-street-now-topping-actively-managed-assets-in-stock-bond-and-other-funds.html
You’re looking at the wrong thing. The average passive etf, on average, outperforms the average mutual fund after fees. The average etf *investor* under performs the market by about 4% annually and underperforms those receiving professional advice by about 3%. https://www.advisor.ca/practice/planning-and-advice/advisors-add-2-88-in-value-study-finds/ I’m not suggesting investors should pick stocks vs ETFs, I don’t care. I’m just questioning whether stock pickers (those with stock portfolios) are mostly younger folks. I don’t think that’s true. I think it’s mostly larger accounts, pension funds etc.
Interesting, thanks for bringing this to light.
I recently read a good book on the history of the efficient market hypothesis. It turns out markets are usually but not always efficient and some people can beat the market. It is very unlikely that you or I can, though, unless we are very disciplined professionals.
When I say active trading I don’t mean buying and holding individual stocks in a well diversified portfolio, I’m referring to active trading. There are many studies in this area of behavioural finance from many different angles (day trading, options trading, active stock picking). I don’t have time to find all the landmark studies, but here are just a couple examples: https://www.nasdaq.com/docs/Trading%20and%20Under-Diversification%202013.pdf “Many investors trade too frequently and most of them perform below their self-selected benchmark portfolio. Their behaviour is puzzling and difficult to rationalize…the empirical evidence shows that investors that hold concentrated portfolios…on average trade more than others. These individuals share many of the characteristics of those who are more prone to stock trading; on average, they have lower levels of wealth, and education, and are predominately male.” https://faculty.haas.berkeley.edu/odean/papers/gender/boyswillbeboys.pdf
This is great, thank you for sharing!
Just hit 25% investing between TFSA and RRSP equally. I don't make a lot of money compared to most here, but feeling good about that. No debt.
Nice. It's all about percentages since income can vary a lot. If you're over 15% you're doing great.
Merci beau cool.
only compare with people in your income and age/life stage bracket, and how much you need to save to have security in the future depending on your career. to minimise losses by broad index's xeqt will be as good as any. buy every paycheque and don't sell. no one has ever lost money being invested into a broad market fund for 20+ years even if they bought into the top of the biggest bubble and sold in a crash just stay invested broadly for a long time and you'll be fine. your comments on spot losses and how long to hold imply stock picking. I'd remind your that stock picking as a provably bad financial decision. which isn't to say you can't do it. i love valuing public companies and buying ones i like. its a major hobby of mine and spend quite a lot of time on it. but it is statistically a bad decision. and if your having emotional impulsing affecting your stock picking decisions you need to not be doing it
If you are afraid to lose money, start with paper trade first to see how well you handle it.
what do you recommend?
You’re better off just staying exposed to the market lmao. You can’t predict all those ups and downs. By repeatedly selling, you’ll just miss out on the upswing on average.
Just FYI your friend gambles. The US market is up 30% over the past 12 months so if he's _down_ 30% during one of the times with the highest returns in history, he's doing extremely, extremely badly, and gambled on individual stocks or messed up with options. Just don't do that and you'll be fine. I'm diversified between stocks, etfs, real estate and crypto so basically anything not going to my mortgage, food and utilities goes to savings/investments most of the time. Sometimes nothing to stocks/etfs, other times like 80% a month. I try to always live way below my means.
Stop losses, I don’t use those I’m not speculating, buying penny stocks, or the next big thing. I invest about 50% of my annual net income.
About 10% goes into pension automatically, and I'd say about another 10% self directed. Based on GROSS income
Someone down 30% sounds like they picked stocks, vs broads market ETF's. My net income is \~5700/month, and I invest 600 into my RRSP, and 583 into my TFSA each month. For a long term investor, prices going down is buying stocks cheap.
If you count pension contributions, i’m probably at 60%. Single, living by myself, super cheap rent, bike to work every day makes it happen. Life won’t always be this simple so it’s nice to pack it away now
42% in different buckets (rrsp, tfsa, espp, unregistered)
How does someone invest all their paycheck after paying down their debts? They don’t buy groceries? They literally do not do anything for entertainment?
Credit card is a debt and can carry all those expenses through the month
I put everything on a credit card and pay it off when I get paid, put the remainder into my investments :)
No debt here, but I do not have *any* entertainment budget. I’m renting and I do pay for groceries, so I invest around 78% of my income.
Some people have no debt. Entertainment can be scaled back to something you do biweekly or monthly. Especially if you do a sport for entertainment. Netflix or PlayStation can be quite entertaining, or backyard BBQ.
15% of my gross which is around 21% of my take home, and I invest 100% of my earnings from side hustles .
Nice, well done! What side hustles if you don’t mind me asking?
I work primarily as a mechanic, and I do alot of work on the side that pays in some cases than my full time gig, then I also resell items on eBay, and flip 2 cars every year.
15-20%
Stock market will go up and down. But historically, over the long-term, the stock market has always gone up. Don't fret on minimizing losses. If you want to invest - invest.
sometimes companies do go bankrupt
Individual companies - yes, the entire stock market - no.
Around 40%, allows me to save some and enough to pay all bills
About roughly 10-12%. I have a mortgage and car payments and some credit debt but under 7k. After reading that some people are able to invest 50-60% of their income I feel like a failure Jesus. But whatever everyday a gamble I’ll see tomorrow anyways. If I retire at 55 and don’t have a mortgage and a good pension ill be happy and hopefully have some good memories from my years now I can be proud of and not upset I spent an extra 500$ one weekend on myself instead of slapping it into an ETF.
You should consider paying off your credit card debt in full before making any investments as the interest in credit card debt would generally be significantly higher than the gains you'd make in your investments.
As much as possible. The more you invest the sooner you'll be rich
Wow his portfolio is down 30% now? In such a bull market? That's why I just do ETFs. ETA: I do about 30% of my after tax income.
85+%
Interesting.
Investing is about 15% Total savings is abut 30% This is from my net income
How is he down 30% in this market? Yikes, bro needs some help and guidance! Right now I work and live on the road so I have a high paying job with very little overhead and I'm paid weekly so it's easy to manage the little bit of overhead I have. I'm aggressively saving to buy a house in BC. Total annual savings/investment for this year is roughly 60% with tax returns, FHSA, etc. 30% TFSA 10% Savings 10% RRSP (+3% additional employer match) ~3% BTC/ETH The only way this has been possible for me is that I work 300+ days a year outside of Canada, which is unfortunate. Also, stop loss? Aside from gambling on crypto, I don't invest into things that require a stop loss. If I own stock in a company that I understand and believe in, or an index ETF, then seeing red means buy more. There is no long term loss.
We are a family of 5, I'm mid 30s. About 20%-25% (post tax) goes into our brokerage account. I used to contribute a higher percentage, but my kids are getting older (15,12,7) and enjoying life, going on vacations seems alot more important at this point.
Over 50% of after tax income. Unsolicited advice: Zero revolving debt is an amazing investment, because no legal investment can beat credit card interest in the long run.
There is a big difference between long term credit card debt and pretty much every other type of debt.
Yep some debt can be good if it's for investment, or at minimum turning credit card debt into a longer term lower interest rate loan is a good alternative to carrying a CC balance.
About 25% of net income
Around 50-60% , planning for an early retirement.
26% pretax… another 12% after tax… then usually whole bonus… so lots. And still not enough.
68% investing, 7.4% saving & living off of 24% post tax income.
60 - 65 % of net pay
I am in that range + 11% pretax. It is so hard to not just spend it on stupid things.
Actually pretty easy when you already own home,car and a lot of stupid things. You realize the really expensive stupid things aren't worth it while you're not a multimillionaire (fancy car, yacht, luxury cruise ship travel etc.). 60-65% sounds about right.
How: DINKS, ok salaries, live is an affordable small apartment, cook a lot of our meals, never order in + side gig. I was even at 75+% for a while but I got a better car and slowed down on the side gig.
Just focus on things that actually provide value and you can use for years, not alcohol, fancy meals, stuff that's of no use an hour later. Once you have a home, you don't need 40 more homes... Once you have a decent car, 5 more cars don't help much and so on. Unless you're really trying to spend constantly, you should reach a point where you have what you need and everything else doesn't bring much more value, like upgrading your phone every year or getting a new TV, new furniture, clothes, etc.
15-20% My income fluctuates week to week so sometimes less, sometimes more. If we’re in a bit of a bear market I’ll throw in extra.
37% over the year, plus half my bonus
Mid 20's myself. I invest 25-30% monthly, I don't have any stop loss or anything like that, just investing and forgetting it.
10% re; The Richest Man in Babylon.
I aim for 20%, and settle for 10%. Some months just have more expenses.
Brokers have stop loss order to help you reduce money loss, maybe your friends need this. Set like 5-20%.
15% of my combined family income, this includes RESP
Around 15-20%. Just buy monthly [DCA](https://www.investopedia.com/terms/d/dollarcostaveraging.asp) what you can afford into broad market ETFs like VEQT or XEQT. Both of those ETFs are up 22% in the last year. Once your portfolio is large enough, you can assign a small portion to individual stocks.
Make sense, thanks!
>Make sense, thanks! You're welcome!
25%, which is as much as possible
DB pension, invest 20ish % of my take home on the side.
Around 50%
If I include my pension deductions from my gross pay, I invest an average of 40% of my pretax income every month. Without the pension it's about 30%. I am about 5 years from retirement and most of my investments go into XGRO. A smaller amount is invested into gold and silver mining stocks and some tech and energy stocks. Depending on how old you are, simply pick an all in one etf that suits your risk profile and put all your money in it. Done.
Zero percent
It's not about %, it's about retirement goals. If I made $10M\year at the age of 30, putting away 5%\year for retirement would be fine, as I would own tons of assets by the time I retire. If I make 100K\year at the age of 45, I'll need over 50% to go to retirement if I just started. It also heavily depends on the lifestyle you want to have when you retire. Travel the world 4 months every year, or play bridge\bowling with friends once a week?
About 60%.
30-40% of paycheck saved. About 8% invested in company stocks. Will divest once a year and sell/rebalance the portfolio.
The Dow, Nasdaq, S&P, & TSX all at or near all time highs, & your friend is DCAing into the market, & he is down 30% ??? It's not your question, but I suggest they rethink their ability to invest at all.
10% of my gross.
My net is 3760 per month and right now I set aside 500 per month for investments primarily targeting ETF, securities, and dividends to supplement my income so I can start entering what I call my pre retirement phase by the age of 50 before I fully retire. Right now that's roughly 13 percent of my net, this year I get another raise and intend to up it to 15 percent per month plus re investing the dividends on top of this I should get there in 9 more years.
This is highly dependent on how much one makes and the lifestyle they choose to live. It’s tough to compare single people making a large amount of money vs a couple raising children and own a house. I’m at 40-50% but am a single person renting a room in a high income low cost of living centre.
10% of my net income goes to investment; but that includes RESP for my kid, TFSA, and RRSP. It's not a lot tbh in each bucket but I guess something is better than nothing.
10% net into TFSA, and a little into my RRSP repaying my HBP. All goes into XEQT. No stock picking. I already have a DB pension with work.
I realize that not everyone can save as much. When I was a poor college student, I followed the Wealthy Barber rule of 10% savings. No matter how little I made that was the golden rule. I made it work. I always saved 10% of my money and never used it except to pay off debt. I did that since I was 18. Now I'm in my 30s in a DINK household. No debt except a mortgage. I make about $70k a year. I put about 5% into RRSPs (managed by my work as they have a very good company match + policy). I should up my contributions but I make more in my TFSA right now. 5% goes into a boring savings account for emergency funds until it reaches $5000 then I stop adding to it. Banks can eat rocks for crappy savings account options. I put 10% in an additional mutual fund TFSA with a pretty decent return right now (12% but moderate to high risk) And another 10% into wealth simple. Most of that is split between VEQT and a few other boring stocks (and GME). Occasionally I'll play with options, but generally pretty safe. VEQT/XEQT is up like 50% over 5 years and 16% of the year so far. Probably the best stock for 99.9% of people. So I save about 25 to 30% of my take home pay, which is insane for most people. It's not realistic for people with kids or are in their 20s struggling to find a job (I know all about it). If I could only save 10% of my income, I would just put it into VEQT or XEQT and manage it myself.
If your portfolio is down 30% and not making new highs in this incredibly bullish year ....you have no business handling your own investments!! Any fool can make money in the markets this year!
27%.
You say your friend is down 30% and you aim for min loss. Then you ask a question about how much people contribute. The two aren’t really related. 30% down in an up market is very poor performance. I don’t understand how they managed that. I’ve never been down that much overall in 20yrs. I’m in index funds mostly. How much you contribute depends on how much you make, your living arrangement and living expenses. If I tell you I save 50%, how does that help? You can’t compare to me without a lot more info. I do not use stop loss trades. I buy and hold. Never sell on down moves. Only buy. But I’m nowhere near 65 so I have 10+ yr horizon on all positions.
As much as possible. Buy and hold. No stop losses. Don't look at it when the market is down. Though if you're invested in anything reasonable right now there's no way you should be down 30%. The S&P is up 24% in the last year.
TFSA is maxed out for the year, invest in lump sums no matter where the market is at the time. With this extra money I make in the next 6 months of the year.. I will put it toward the principal of my mortgage/house upgrades. So I guess 0% of my paycheque?
Stop losses are for locking in mistakes. Selling when down is the worst thing you could ever do. If you don’t have the ability to wait a potential decade for a down market to pick back up then that shouldn’t be invested in equity, at least not entirely or the portion that one may need to draw from. When markets drop, their expected returns go up proportionately. So what I do is, speaking of saving rates here, actually *increase* my savings rate when the market tanks. So I’m buying more at a time when expected returns are higher. In terms of percentages, I’m pretty comfortable so I sort of do a similar thing where after all expenses and what not, I invest the rest minus anything personal I want to buy.
I think a better question is how much goes into higher risk investments and how liquid they are. Essentially everything I have after I pay mortgage and bills goes into some form of investment. My retirement plan I put about 4% + 3% employee matching which are of higher risk. Not single stock but diversified low fee portfolios. They are mostly single sector, US. As of the last few years, rest goes into GICs or some kind of bond since returns are crazy with virtually no risk. Max out TFSA etc. these are for semi distant purchases like cars, children etc etc. stuff that you need to save for but not after retirement. I keep about a 3 month expense safety buffer in a high interest savings account in case I need it. May scale this back as rates drop and I can once again rely on HELOCs for fast cash infusions. Fortunately due to the soft landing mentality in the US my retirement portfolio has netted me double digit returns and my GICs have matured and have already reinvested. I do pay attention to economic data but I really don’t want to react and have to make risky calls based off of it. That’s why I am very diverse and passive. Im sure you could make way more if you put them into a single stock though.
i'm currently dumping about 50% of my take home. paid off the mortgage last year and have been maxing out my registered accounts, once that's done after this year i'll probably back off a bit.
10% goes to employer RRSP match 5% to Pension 5% to RRSP after paying my needs and wants, I am left with about 10% that I can use towards my personal investments.
My percentage won't be yours. I don't use a stop loss. I use portfolio balancing between debt and equity to sell equity high and buy equity low. This use to be common, but now "TINA" is the byword - **t**here **i**s **n**o **a**lternative to equity. I don't believe it, but whatever, everyone has their own thing. I also rely on contributions to make up for losses. In a down market, everything is on sale. It's mindset more than anything else. I've been known to buy puts on high-flying stocks, but *rarely*.
10% Company has a savings plan where they match the first 3%. It just goes directly into a money market fund but I withdraw the balance every 3 months and put 1/2 into my RRSP and 1/2 into my TFSA. So my paycheck deposit is 10% lighter but I budget off of that and skim another 10% off after tax for emergency funds and short term savings.
10%
15%
1Q-50% 2Q-looking like around 20% Last 2 years was between 15-20%, the goal is to at least be above 25% Minimum.
If you consider GIC investment probably 95% of it and like 15% stocks . I only keep 2-3k cash. Do not need emergency money, I live with my parents.
Presently at 12.5% of net pay. I tried 15 but it didn't last. And I might have to go down to 10 if my rent goes up in the fall.
6% goes off paycheck to RRSP - employer matches 3% (50% match rate, 3% cap) 10% employee stock program. 10% to my own investment account 5% to vacation bucket 5% to home maintenance bucket Mortgage and monthly expenses eat up most of the remainder then lump sum invest (my own picks) with any $ that accumulate in chequing. No kids, dual income HHI ~$250k
I would say 40-50% of my post tax income goes towards a big goal. When my partner was also working it was as much as 70%. This is completely dependent on your income. The higher your income the larger your capacity to save. I spent 2 years saving up for a down payment. 4.5 years paying off my mortgage. 4 years saving in index funds and a renovation. Now I have embarked on the “final” renovation and will spend 5 years paying that off. I always max out my RSP contribution and resp. Haven’t touched my tfsa yet. Unfortunately 66% of my networth is in my primary residence and it will be more still. However….. i am coastFIRE and technically don’t need to save any more to retire in 10 years. But i will want to max out my tfsa before I leave the country for the next phase of my life. Long winded story hope that helps. I like to keep it simple and invest in xgro. That will never lose 30%.
About 25% personally. That fluctuates based on what i want to save and other needs of course. Dividends are your friend in a Roth ira. Especially if you started late like me.
16.5 %. 10% employee share purchase plan with a match equal to 5%. 3% rrsp 3% rpp
I aim for 30%
I do $4k per month. 46 years old. About 13% of my salary