Investorial

Day 3 of the series Rich At Any Age - A LifeCycle Guide To Personal Finance puts you at a fork in your financial path. You’ve dug yourself out of the crammed life of your 30s. But how would you react to the next decade of your life? It’s no wonder that mid-life crisis usually begins at the beginning of your 40s! Remember to supplement this article by reading the related MoneySense.ca articles!

Prime Time
Your 40s are the years when you finally begin to see the fruits of your hard work. But not everyone reacts in the same way. On the one hand, you may find yourself becoming more cautious as retirement draws closer. On the other hand, you may feel that after two decades of working hard to advance in your job, you deserve a year away from the office. Maybe you’re (more…)

Welcome to day two in a series rehashing MoneySense’s Rich At Any Age - A LifeCycle Guide To Personal Finance. We discussed starting out in your 20s. We will be observing the financial journey that people in their 30s undergo. As before, we will supplement it with related articles from MoneySense.ca

The Crammed Years
The balance sheet for your 30s looks pretty lopsided: heavy on the debt, stress and responsibility; light on the free time. If you’re like many people in their 30s, you’re juggling mortgage payments, a young family and a demanding job. Your financial plan needs to address some important questions. (more…)

Over the next few days, I will rehash a series that was featured a while ago from MoneySense.ca. The series was called Rich At Any Age - A LifeCycle Guide To Personal Finance. It was basically a synopsis of what most people could expect at a given stage of their life, with links to related MoneySense.ca articles.

I explained on Canadian Capitalist that MoneySense merged and reappeared as a sub-section of Canadian Business Online. As a result, that particular feature had links to articles that were no longer functional. I thought I might as well do a favour to MoneySense and direct readers to the stories that I found manually for each section. American readers may not understand the minor differences in the Canadian system but I’m sure you can follow along quite nicely!

Starting Out
Your 20s are all about new opportunities. Maybe you’ve been working for a couple of years and you’re starting to think about investing for the first time. Or perhaps you’ve just finished school and are looking for your first job that doesn’t involve flipping burgers or planting trees. Either way, this is the ideal time to be laying the groundwork for your financial future. “If you do your 20s right, you’re set for life,” says Paul W. Lermitte, a certified financial planner in Vancouver. (more…)

My friend Michael was chatting with me on MSN today asking if I knew about WealthWeb.ca. It was a site that he found useful to him because Canadians really have very few financial article portals available for their research. Tongue-in-cheek, I reminded him the reason for Investorial’s existence, but I quickly checked out the site.

WealthWeb is a collection of personal finance articles for Canadians. WealthWeb is maintained by James Yih, who has a vision to turn it into Canada’s resource centre to build, protect and manage wealth. James Yih is an author of two financial books, and is currently an account representative and Investment Marketing Consultant for Manulife Securities. I knew of James’s writings from his days as a weekly columnist on FundLibrary.com. In fact, I had connected with James via email about an article he wrote last year in (more…)

After featuring an “investment novel” about suspect venture fund blackholes that I found on Canadian Business Online, I went back to the site a few more times and found some pleasant changes. I used to be a subscriber of the magazine until I got fed up with its many pages of advertising editorials. Advertising editorials were pages of information designed to look like articles but were at least ethical enough to state that it’s actually an advertisement discreetly.

I realized that Canadian Business Online wore its new look just recently. I browsed through its roster list of columnists, pondering if I could ever write at the level of these professional journalists. (Hey, a blogger can dream right?).

I noticed something instantly. Out of the dizzying credentials of CFAs, accounting principals, and financial journalists, a very plain-looking staff writer Calvin Leung stood out. Yes, he’s Asian, but what caught my attention was his by-line compared to the other accomplished financial journalists.

Prior to joining the magazine, in 2005, [Calvin] worked in sales at Proctor & Gamble, in marketing at Unilever and in advertising as a freelance copywriter.

I’m not trying to take away anything from Calvin. In fact, with my contrarian thinking, I was actually excited to read (more…)

Blogs have tremendously revolutionize the way news and information are distributed. No longer do you need to be a traditionally trained journalist to get your words heard. Bloggers and blogs are obtaining scoops, exclusives just like their old media counterpart. Services are popping up like NowPublic.com that have fueled the citizen journalism movement.

However, from a financial perspective, the Web 2.0 has brought in some interesting applications that may point to a brave new world in the future. Prosper.com wants to become the online marketplace for people-to-people lending. Borrowers can shop for attractive from fellow lenders. These lenders are ordinary people like you and me, who can set their own rate. Members can also borrow and lend as a group! It seems like Prosper has put in place a lot of security features to prevent abuse of the system. However, the service network currently does not extend beyond the United States. It’d be interesting to see when someone from Canada will be borrowing from a lender in China!

Along the same lines is Fundable.org, which seeks to allow groups of people to pool money to make purchases and raise funds. Unique to its system is its ability to set fund raising goals and letting people pledge their contribution. Only when the goal is met will the pledges be binding.

Prosper.com and Fundable.org are 2 examples of the future in citizen banking, or citizen financing. No longer are consumers on the lowest end of the money game. Now, anyone can become a bank on both ends. Borrowers can scour for low interest loans to finance their investment activities, making the profit and paying little for the cost to use the money. Investors can charge high interest returns to people who are not looking to deal with banks. There are numerous applications possible in this realm. Will citizen CDs and term-deposits be far away?

I believe citizen banking is a offshoot of the micro-lending movement. It remains to be seen if this revolution will take off.

P.S. I wonder if the Pentagrams in both logos are trying to reference the conspiracy theories of a world bank or chosen to display connection between people. Just an observation, don’t read too much into it!

It’s only a matter of time when somebody exposes Principal-Protected Notes for the shady investment vehicle that it is. I’m glad that Duncan Hood was able to write a nice piece examining why Principal-Protected Notes (PPNs) are not a good idea.

In the end, I wouldn’t avoid PPNs just because they’re largely unregulated or because their “Information Statements” are so poorly written that even Glorianne Stromberg, a securities lawyer and former commissioner at the Ontario Securities Commission, admits she can’t understand them. I would avoid them because you can find better places for your money.

I first encountered PPNs approximately 2 years ago when CIBC partnered up with Mackenzie to introudce the FulPay series of PPNs. I’m not a historian of PPNs and don’t know exactly when these notes started, but their popularity are certainly a recent phenomenon. The financial industry’s marketing machine has again scored victory over the scarred pschye of the Canadian investor; successfuly reaching out towards their yearn for a “guarantee”. I say it’s a guarantee for you to overlook other investments vehicles that make more sense!

Remember this! When the industry introduces a new investment product, they are first thinking “how do we make money from this?” before they actually consider “how does this benefit the investor?“. And you can trust that they’ll always find a rationale, an angle to support this “benefit”.

By subjecting 70% of your PPN investment into a zero-coupon bond, you’re letting the bank borrow your money for their own investments on the cheap! We should always remember who has mastered the money game!

MoneySense.ca: “Protection racket: principal-protected notes” by Duncan Hood

The RSP season has come and gone. I had previously promised to blog about RSP advertisements and compiled a bit of information to that respect. I had prepared some materials about ING Direct, Altamira, Scotia Financial, the ROI fund and more.

However, I had a change of heart.

As more and more media came out to try and “help” consumers deal with the RSP season. I kept questioning why there was need for a “season”? Investing shouldn’t be about a certain 60 day period of the year! One of my friends even remarked that she thought “RSPs can only be bought during RSP season! I knew I had a lot of work to do here.

I decided that I did not want to be an influencing factor during this season. Self-publishing on the internet may be my hobby, but it also carries a responsibility. Whether I want to or not, the words that appear here may influence peoples’ decision. No disclaimer in the world can do away with my own guilt if I feel that I should not be blogging about RSP during the madness.

Now that this “season” is over, I do intend to blog about the material I’ve prepared. I also wish to discuss more about this seasonal mentality that we carry with us.