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Monday, May 1, 2017

In the Globe and Mail

Posted by Tim Stobbs on May 3, 2016

Well there is a nice little article over at the Globe and Mail on me today and they managed to get a few items wrong.  Sigh.   Feel free to ask any questions you like here on the article and I will do my best to address them.

For now I offer the following points:

  1. Nope, I don’t have $600,000 saved.  They got that particular fact wrong.  Currently it is closer to ~$420,000 in investments plus a paid off house.
  2. No gold plated pension. In one of the comments on the article someone assumed I have a defined benefit pension plan.  No I don’t.  That ~$420,000 above includes my defined contribution plan amount.  I have a okay pension plan, but not a defined benefit one.
  3. How little do you spend? It varies like most other people but our average spending is around $28,000 to $32,000 a year.  Keep in mind I have no mortgage payment so feel feel to add yours in to get a clue on how I compare to you.

Hope that helps,

Tim

Comments

13 Responses to “In the Globe and Mail”
  1. Liquid says:

    Nice job getting featured on TGAM. :) Too bad they didn’t even get basic facts right lol. How many more years for your kids to move out you think? I think that will decrease your household spending by quite a bit.

  2. Tim Stobbs says:

    @Liquid – Ah the joys of doing interviews. I accept it happens, after all that was a 1.5 hour conversation distilled down to less than 1000 words. I expect the kids will likely be out anywhere from when they turn 18 to 22 (depending on what and where they continue their education). They are currently 11 and 8, so I expect someone at home for at least the next 10 years. I agree that will give us a bit more excess cash when the leave.

  3. Sandra Charlton says:

    Very well written and in depth article and I love the advice you give at the end. I’m wondering how you’re accounting for inflation in your calculations for how much you plan to have for retirement? Too bad these articles aren’t longer – I would love to have read more.

  4. Tim Stobbs says:

    @Sandra -It’s hard to have the articles much longer as then they start to cover multiple pages which is a bit too long for the format. I suppose that is why we have books and magazines for the longer more in depth material. As to your question, I have assumed 1.5% inflation adjustments to my estimates, which is a bit on the low side but based on what I found out from studies looking at retiree spending in retirement the full CPI index tends to over inflate the actual by about 0.5%. And I have some additional buffers in the event I’m wrong, I am willing to consider a part time ‘fun’ job after I leave full time work and my wife wants to keep her business going after I quit, she wants to slowly shut it down as she really enjoys what she is doing now. After all it a job where she works from home, picks her clients and only does part time care…what’s not to like?

  5. Jay says:

    http://forum.mrmoneymustache.com/mustachianism-around-the-web/globe-and-mail-'retire-at-45-or-even-40-it-can-be-done'/msg1074333/#new

    From the MMM forum, not a lot of comments. I read some of the Globe comments, lots of people looking for excuses where it won’t work. Some of the comments were nice, how do the comments compare to a few years ago?

  6. Sandra Charlton says:

    Thanks for the response Tim. Yes if someone loves their job, they may not want to leave it. And your wife gets to have her kids around too and help others. The inflation estimate seems good – may a bit conservative? Anyway, enjoyed reading about you.

  7. Freedom35 says:

    I stumbled across the Globe and Mail article. I thought it was nicely written up and positive for “mainstream” coverage. Looking forward to poking around and seeing what else you have to say.

  8. Gene says:

    Congrats on the being featured in TGAM. Everyone has to build a life that works for them. Based on your calculations I should be retired by now. But my wife and I love living in France and spending money on great life experiences like travelling to different cities and giving our kids opportunities to experience new cultures. Luckily I have a job that I like… but more importantly, our portfolio can more or less sustain us should we wish to retire on dividends and income.

    I think you can probably turn your lifestyle into an income generating plan via financial coaching, paid writing and speaking engagements.

    I also wonder about your plan to retire based on RRSPs. All income drawn from a RRSP is considered income and taxed as income. Dividends from a non-registered portfolio are taxed differently and you can live with a much lower tax rate. Have you considered not investing in RRSPs so that you can eventually lower your taxes once you retire?

    Keep up the great site!

  9. Rick says:

    Hi Tim, interesting read. Can you elaborate more on “No gold plated pension. In one of the comments on the article someone assumed I have a defined benefit pension plan.  No I don’t.  That ~$420,000 above includes my defined contribution plan amount.  I have a okay pension plan, but not a defined benefit one.”?

    What type is it, how much ect. I have a small CF pension, from when I retired in 2004 after 20 years.

    Thanks.

  10. Tim Stobbs says:

    @Jay – I honestly don’t read the comments most of the time because they are usually so very negative, so I did have a look at the Globe’s version and I was oddly surprised to see a number of positive ones in there. Perhaps the world is getting a bit more used to people who choose this kind of life. Anyway, much more positive than in years past to answer your question.

  11. Tim Stobbs says:

    @Gene – Oh I totally agree everyone needs a plan that works for them. Everyone’s life is different so does their plans. I never planned on turning myself into an expert while doing this. I just happen to like talking about money. I plan on doing likely one more money book as a follow up to Free at 45, but after that I don’t particularly have any plans to do speaking engagements. Actually in my case the amount in the RRSPs won’t be much of an issue for tax since our income target is so low we can take out most of it with no tax at all by staying close to the basic income tax deduction for both my wife and I. Meanwhile the non-taxable investments and TFSA accounts will cover the rest. I plan to do a post in the future explaining this in a bit more detail.

  12. Tim Stobbs says:

    @Rick – I have a defined contribution plan at work. I put in 5% and they match 6%, but the good feature if the fees are very low (like almost ETF low), which is an okay amount but not the best plan I have every been part of. The best plan I ever saw was a defined contribution where the private company paid all of my contributions for me. I can’t recall the exact % they put in, but I only worked there a few years and had a health balance at the end of it.

  13. Congratulations Tim! I’ll check out the article & feature it :)

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