Investorial

I haven’t gone off the deep end yet. Investorial is not a Blog about my own portfolio. I also don’t share the propensity to divulge my investment practices as other bloggers do. But I did enjoy reading The Dividend Guy and Investing Intelligently provide updates about their portfolio decisions.

The decision to not involve myself with posting portfolio updates is because the spirit of Investorial is to talk and discuss about media influences in the investment and financial arena. In my mind, it’s a conflict of interest to talk about my own investment practices.

However, I felt it was relatable to share with you that I have recently disposed of any seggregated funds in my portfolio. I used to have a small position in a seg fund that I bought at the beginning of my investing career. You can read my views about seg fund in this archived post.

This is neither an endorsement for or against seggregated funds, but a post about the fact that one shouldn’t jump into investments for the wrong reasons. I jumped into the situation while I was only starting to learn about investments, I was listening to friends and “advisors”. I was also less knowledgable and catch-phrases like “guarantee” were pleasing to a consumer like myself who only hears what they want to hear.

Arming myself with knowledge, I’m able to look back at my decisions and critique them. I chose to redeploy the invested capital and I’ve learnt to judge with a critical eye before leaping into action.

If you are a DIY Canadian tax preparer, The Frugal Canadian did a short but informative comparative review of some available options for you. I myself have always used QuickTaxWeb because of its comprehensive coverage of tax situations, but I’m looking forward to test-driving the other options that were unknown to me such as TaxFreeway and TaxWiz.

I spotted an interesting article via LifeHacker about the acquisitive mindset of the popular majority. I don’t see anything new and unobvious that were stated in the article, but nevertheless a good read for you to reflect on your own priorities in life.

My opinionated self has previously sounded off on how I think the relationship of Money and Happiness can be summarized.

Times Online: “Unhappy? That’s Rich …” by Carol Midgley

I recently saw in a company’s (un-named to protect anonymity) newsletter, this announcement about their group plan insurance. Take a look at this censored excerpt:

Each year our insurer reviews the cost of our LTD coverage and makes adjustments to the premium based on the claims incurred during the year. Our incidence of disability claims has increased this past year, and as a result of the insurer’s review the premium for your coverage will increase by 10% beginning with the first pay in January.

For example, if you earn $xx,xxxx annually, your payroll deduction for LTD coverage will increase by approximately $x.xx per month, or $xx.xx per year.

It is important to understand that even with this increase [company name] employees are still enjoying significant discounts on premiums. You receive a premium discount under the group plan that is not available with individual disability insurance contracts.

It seems like it is still a great deal right? Well, before you decide for yourself, let’s examine how group insurance works!

Underwriting
First of all, Insurance companies are in business to make money! Underwriting is a process that is critical to (more…)

Forbes.com ran an article today on 7 Financial Planning Diseases, capitalizing on the New Years Resolutions atmosphere to capture reader attention. Personal Finance For Dummies author, Eric Tyson, explains that many people twist the fundamentals of personal money management and get themselves into trouble. Here’s a summary and my self-analysis. (Read the article for more details)

1. Excessive Spending
2. Workaholism
3. Herd Following & Information Junkies
4. Extreme Save-ism
5. Procrastination
6. Mismatched Style (between couples)
7. Adolescent-Onset Budgeting Woes

My self-analysis
This list is geared more towards adults with a family and kids. As a single guy, #6 and #7 do not apply to me, but will be something I have to be mindful in the future. Striking a balance between #1 and #4 is a struggle for most people. I believe I am doing well in that area. I don’t spend money often. But when something is worth spending, I won’t sacrifice quality for thriftiness. I still don’t understand how #2 works or fits in this list. #5 is an admitted failing of mine. Often I’d have many ideas to blog on Investorial, but my procrastination renders these ideas usely in the think-tank. Some times, I forget to pay bills with that attitude too!

I’m leaving #3, “Herd Following & Information Junkies”, for last because this is certainly one of the reasons why Investorial began as a hobby. I do not necessary think being an information junkie is a sin. Both herd followers and contrarians have a habit of gathering a lot of information. The difference is how they process that information! Herd followers get excited about the news that they want to hear, and are more apt to jump on the bandwagon without performing further analysis. Their preconceived conclusions and quick-to-judge attitude leaves them as vulnerable ripe pickings for contrarians and skeptics who often dig and uncover for facts that are more-than-meets-the-eye.

Are you a herd follower or a contrarian? Sound off please!

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I highly regard Sir John Templeton’s history as a value investor. Even at the age of 93, he’s still very actively investing and when he speaks, the invesment world listens! Here’s a list of 5 Steps to Financial Success from Sir John. Take calculated risks. Save, don’t spend. Shop for value investments. Take advantage of international free markets. Minimize your taxes.

The only one that doesn’t move me much is the idea of taking advantage of international free markets. It is a good idea, but one that consumes much more resources and attention than I can afford at the moment. I guess, if you got the will, you’ll find a way!

View the entire article, with detailed explanations, here [via TheStreet.com]

More often than not, stocks, mutual funds and investments are ’sold’ to the general public. Investments is not like the furniture business where customers look for what they want. All the public has to do is say ‘I’m interested’, and there’ll be hordes of information waiting to sell you and tell you what you need.

Take a look at this article about managing risk through diversification. It is a sound article except for the sales tactics and overtones that fail to leave the article. I’m not saying that the author is trying to sell you something, rather I see that he is regurgitating the same sales talk from financial institutions and advisors alike. Let’s examine this closer!

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The age old question, does money buy happiness? One of my friends seem to think so, and I can’t say I disagree but I’ll approach it with a different angle!

I was messing around with my Friendster one night (thanks to Jen!) and was actually having fun doing it. I’ve been a bad card-carrying member of Friendster since September 2003 but have not actually linked anybody as my friend. But I was really waiting for everyone to join in to make my search easier (that’s my story and I’m sticking to it).

I came across an old acquaintance from my University days. James is a big fella who is in my opinion, extremely smart. If you’ve ever heard him speak or talk to him, you can tell that he has a unique perspective apart from other people. Jame’s blog, Random Thoughts, has a post about his thoughts on money and happiness. It is an interesting read, and “Big Jim’s” personality certainly shines through too!

My perspective, I don’t think “Money makes happiness”. There are many people with money that are not happy. Instead, I submit that “Lack of money makes you sad”. No matter what your dream of a lifestyle is, if you do not have the funds to make it a reality, you will not be happy. Do you agree?

Big Jim’s Random Thoughts: 7 Degrees of Happiness

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