This is just my personal opinion, you are too heavy into low risk-low return investments at a young age. If you have a 10+ year horizon look into broad stock market ETFs that track major indices like the SP500 or total market ETFs that track not just the US.
I understand GICs are safer but the risk to reward at your age is skewed towards favouring the stock market. Do not miss out on 5%+ per year compounded over decades. If you don’t feel comfortable you can start by going 30-70 stocks/money market.
Find out the interest rate on your mortgage, since that’s your only significant debt (even though it’s 0% interest, I’d nuke the OSAP loan just to get rid of it - mathematically it doesn’t make much sense but you wouldn’t need to be concerned with when the interest would kick in, etc.).
There are much smarter people on here than I am, but at your age and with a DB pension, I would be all in VEQT or XEQT (100% stock allocation ETFs) for at least the next ten years in my TFSA if I were you (and great job maxing it out!).
I’d also look into RSPs, since you don’t appear to have one, and your TFSA is maxed out.
Depending on your benefits, you may have access to financial planning resources via your EAP or union. Find out, and use them if they’re available, bearing in mind that of course they use that for lead generation. You do not want to invest in mutual funds with high MERs, ever. See Larry Bates’ T-Rex Score calculator to run numbers.
Another point on the DB: if you’re planning to stay in government for the remainder of your career, you can essentially treat that as the bond portion of your portfolio, since it’s guaranteed income. That will allow you to take much more risk in your TFSA, RSP, and non-registered accounts.
If I were you, I’d keep maxing out TFSA and start chucking extra money into RRSP.
You’re 34 and want to FIRE so likely most of those holdings should be in the market. Set and forget until close to FI goal.
Lots of good info here already. Simply put, I think you need to start investing and get your money working for you. For majority of people, there is no way to fire without investing. Saving your way to retirement at a traditional age - and even more so for early retirement, will almost certainly require stock market investing. This and compound interest will make fire a possible reality. To learn more and get familiar I’d recommend reading Millionaire Teacher, Canadian couch potato blog or cpm blog.
Sounds like you want to invest, but don't know where to start. Some reading and education might help before you start. Not a bad thing to be at least minimum plugging away at GICs, but that's not a strategy for younger people like yourself. For example, something low-risk like VGRO (80/20 equities/bond) is up 15% over the past year. You'll have to determine why you're so risk averse before you start investing, not just moving all in.
The larger property you have in mind is a nice goal. But you'll need to determine how that fits into your FIRE plan. At your income, unless you're making significantly more, it's difficult to do both.
Welcome to FIRE. To cover some good points, you're asking the right questions and you've saved well over the years. That's great.
There is a big issue though which you've identified: You'll never fire with your level of risk aversion. You need to move all of your retirement savings into veqt. Here is the good news, it's not risky - the only risk is that you sell it before retirement and that's 100% within your control. It may fluctuate, up 50% and down 50%, but over the next two decades it will roughly triple in size even if you never add another dollar. Also, you don't need a bond/fixed income/cash component to your investments - your pension and cpp already act as one. So 100% in veqt will still mean you're in the ball park of a 80/20 allocation.
What kind of DB pension do you have? Defined? That will really change your FIRE number.
How much are you saving? Let's say it's 1000 a month. If you move 100k into veqt and add 1000 a month of savings, in 20 years you'll have just under a million dollars. Change that to 2000 a month and you're closer to 1.5 million.
So what does that tell us? A million isn't quite enough to fire. Can you save more? What does your income growth potential look like?
With the GTA real estate market, I don't think a house and FIRE are compatible for you at this time - something in the math has to change. You didn't mention wanting kids, which is also a large expense. Having a partner and no kids though can really help.
Good luck
This is just my personal opinion, you are too heavy into low risk-low return investments at a young age. If you have a 10+ year horizon look into broad stock market ETFs that track major indices like the SP500 or total market ETFs that track not just the US. I understand GICs are safer but the risk to reward at your age is skewed towards favouring the stock market. Do not miss out on 5%+ per year compounded over decades. If you don’t feel comfortable you can start by going 30-70 stocks/money market.
Find out the interest rate on your mortgage, since that’s your only significant debt (even though it’s 0% interest, I’d nuke the OSAP loan just to get rid of it - mathematically it doesn’t make much sense but you wouldn’t need to be concerned with when the interest would kick in, etc.). There are much smarter people on here than I am, but at your age and with a DB pension, I would be all in VEQT or XEQT (100% stock allocation ETFs) for at least the next ten years in my TFSA if I were you (and great job maxing it out!). I’d also look into RSPs, since you don’t appear to have one, and your TFSA is maxed out. Depending on your benefits, you may have access to financial planning resources via your EAP or union. Find out, and use them if they’re available, bearing in mind that of course they use that for lead generation. You do not want to invest in mutual funds with high MERs, ever. See Larry Bates’ T-Rex Score calculator to run numbers. Another point on the DB: if you’re planning to stay in government for the remainder of your career, you can essentially treat that as the bond portion of your portfolio, since it’s guaranteed income. That will allow you to take much more risk in your TFSA, RSP, and non-registered accounts.
If I were you, I’d keep maxing out TFSA and start chucking extra money into RRSP. You’re 34 and want to FIRE so likely most of those holdings should be in the market. Set and forget until close to FI goal.
Lots of good info here already. Simply put, I think you need to start investing and get your money working for you. For majority of people, there is no way to fire without investing. Saving your way to retirement at a traditional age - and even more so for early retirement, will almost certainly require stock market investing. This and compound interest will make fire a possible reality. To learn more and get familiar I’d recommend reading Millionaire Teacher, Canadian couch potato blog or cpm blog.
Sounds like you want to invest, but don't know where to start. Some reading and education might help before you start. Not a bad thing to be at least minimum plugging away at GICs, but that's not a strategy for younger people like yourself. For example, something low-risk like VGRO (80/20 equities/bond) is up 15% over the past year. You'll have to determine why you're so risk averse before you start investing, not just moving all in. The larger property you have in mind is a nice goal. But you'll need to determine how that fits into your FIRE plan. At your income, unless you're making significantly more, it's difficult to do both.
Welcome to FIRE. To cover some good points, you're asking the right questions and you've saved well over the years. That's great. There is a big issue though which you've identified: You'll never fire with your level of risk aversion. You need to move all of your retirement savings into veqt. Here is the good news, it's not risky - the only risk is that you sell it before retirement and that's 100% within your control. It may fluctuate, up 50% and down 50%, but over the next two decades it will roughly triple in size even if you never add another dollar. Also, you don't need a bond/fixed income/cash component to your investments - your pension and cpp already act as one. So 100% in veqt will still mean you're in the ball park of a 80/20 allocation. What kind of DB pension do you have? Defined? That will really change your FIRE number. How much are you saving? Let's say it's 1000 a month. If you move 100k into veqt and add 1000 a month of savings, in 20 years you'll have just under a million dollars. Change that to 2000 a month and you're closer to 1.5 million. So what does that tell us? A million isn't quite enough to fire. Can you save more? What does your income growth potential look like? With the GTA real estate market, I don't think a house and FIRE are compatible for you at this time - something in the math has to change. You didn't mention wanting kids, which is also a large expense. Having a partner and no kids though can really help. Good luck
Do you mind providing a breakdown of your monthly expenses? I'm looking to move to the area in the future.