Personal Financial Planning: Behaviour and Its Implication for Wealth Accumulation

A Different Spin on A Beaten to Death Topic

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Jake · Apr 17, 2026 5:53 pm

I’ve been away for a week, preoccupied by other things. The last week has seen a lot of activity on the geopolitical front, with the tensions in the Middle East having eased for now. The Dow has taken a run up almost to the 50,000 level again. Amazing how volatile it actually is and how fast the stock prices can move.

The last few months have been another lesson in how panic will destroy value. It seemed pretty bleak about a month ago as the war started, and there were fears about the ultimate strength of the Iranian regime. I’m not a politician, but it’s not clear to me that this will be another break until there is a change in the presidency and things slide the other way. What do I know?

What does all this mean for my investment strategy? As a septegenarian it’s clear. Look to remove the volatility in my portfolio and nail down some cash flows. This translates into more fixed income and more conservative stocks. A slow process, but there really is no other choice.

I did some homework and determined that an optimal annual return for me is 4%. Some investment advisors proposed that in order to achieve that goal, I should go 75% fixed income and 25% equities. I assumed an 10% annual return on my equities and 4% on the fixed income. That would give me a weighted average return of around 5.5%. They were asking for a management fee of 1%. The net to me is 4.5%. Not much margin for error, particularly in years that see a downmarket. If I simply do 100% fixed income with no fee, I have a locked-in return of 4%. I’m not sure where the investment managers are adding any value. Beats me.

Remember that the equity portion still has risk. And I’m already assuming a 10% rate of return on equities every year. This needs more work. The truth to be told is that I can live with a pretty meagre rate of return and still maintain my lifestyle. But do I need to pay so much for a little incremental return with risk?

#investing#investment philosophy#investment strategy#investments#portfolio strategy
Jake · Apr 10, 2026 7:03 pm

The markets closed on a bit of a sour note today. It seems that the Middle East situation continues to display volatility. I had a bit of government chasing around to do (driver’s license), and it took hours with some missteps. I find the level of compliance now astounding.

More government interference:

“In Ontario, licensing to build new homes is mandatory and regulated by the Home Construction Regulatory Authority (HCRA). It is illegal to build or sell a new home without a valid HCRA licence.

1. Licensing Requirements & Process (HCRA)To obtain a license, you must prove you have the technical and business competence to build homes. Competency Requirements: You or a “Designated Person” in your company must complete seven HCRA-approved education courses.Application & Vetting: You must apply through the HCRA Builder Portal, which involves an audit of your business ethics and financial health.Background Checks: Criminal record checks for directors are required.Tarion Registration: After getting a license, you must register with Tarion Warranty Corporation for the Qualification for Enrolment (QFE) to enroll every new home you build.

2. Licensing Costs (2026)The initial investment to become a licensed builder is significant, with costs split between training, application fees, and security deposits. Mandatory Education: Approx. $4,500 ($600–$670 per course).HCRA License Fee:$3,525 for a new standalone license (no prior history).$880 for a new license tied to an existing “umbrella” group.Renewal Fee: $715 (annual).Tarion Initial Security Deposit: Often a Letter of Credit starting at $10,000+.Professional Fees (CPA/Legal): $500–$2,000 for financial statements.Total Estimated Initial Cost: ~$19,525+.

3. Costs to Build Housing in Ontario (2026). Beyond licensing, the cost to build a house in Ontario is generally between $300 to $600+ per square foot, depending on design, materials, and location. Hard Costs (Labour/Materials): The average cost for a custom home is roughly $340–$575 per sq. ft. in 2026, excluding land.Soft Costs (Permits/Admin): Permits and regulatory fees can add $10,000 to $30,000 or more per project.Location Impact: High-demand areas like Toronto or Ottawa can exceed $400–$500 per sq. ft., whereas rural areas may be cheaper.”

How did we manage to get along without this for all of these decades? It’s just another tax, another barrier to home construction that will reduce housing availability and increase the cost.

Invest in Canada, where you have a business-friendly environment!

#invest Canada#investing#investment philosophy#investment strategy
Jake · Apr 10, 2026 7:43 am

I have been using AI frequently in trying to determine an investment strategy. Quite often, I get results that are contradictory and sometimes completely wrong. If you even start to dig a little, you find that much of the information that is generated is at best unreliable. Look carefully as to where the information is coming from. You’ll see the sources footnoted in much of the AI narrative.

What I have noticed is that even for financial-related matters, AI is drawing the information from Reddit and Wikipedia. Now I don’t know about you, but these are highly unreliable sources of financial information drawn from people who are just writing with little or no knowledge of accounting, tax or financial management. In my opinion, the whole thing is getting seriously dumbed down.

“Costco (COST) stock is generally considered a high-quality, long-term hold, but its premium valuation (P/E over 50) makes it expensive to buy at current, near-record high levels. While analysts have a moderate buy consensus with a $1,185 target, new investors may want to wait for a price pullback.

Key Considerations for Costco Stock:


Strong Performance: Costco has high membership renewal rates and a durable, consumer-defensive model.


High Valuation: Trading at a P/E ratio over 50, it is expensive relative to the S&P 500 and peers such as Walmart.

Growth Outlook: While dependable, growth is moderate rather than explosive, leading some to recommend holding rather than aggressive buying.

Analyst Outlook: Analysts generally consider it a “Moderate Buy”, with a recent BofA target of $1,185.Existing shareholders often hold for the long term, while new investors are advised to seek better entry points.

Further Exploration: Analyze the 5-year return comparison to see how Costco has historically outperformed the S&P 500. Review the latest Q1 earnings analysis to understand current operational performance and key risks. Examine a bearish valuation argument focusing on the stock’s high P/E ratio compared to its growth.”

This information is being drawn not from analysis by major US investment firms or analysts, but from the Motley Fool. This is the primary source of the information. So I am being fed the Motley Fool by using this hyped up search engine to transcribe the information.

I don’t know how to deal with this. What’s happened is that I have gone from rigorous analysis to relying on a search engine to scan through unreliable, unprofessional investment newsletter platforms. A truly scary thought. But markets are now dominated by emotion and trading tactics over the medium term rather than real fundamentals.

#investing#investing philosophy#investment philosophy#investment strategy#investments
Jake · Apr 9, 2026 8:59 pm

Stock markets were stable to up today, trying to digest the news from the Middle East. It’s my opinion that we are facing many years of instability in the Middle East and elsewhere. The United States has failed to play to win again, even with Trump at the helm.

I don’t care about the politics, but the current reality on the ground shakes my fundamental belief in the US economy. What we see in the news is a lot of “micro” reporting, very little in the way of looking at the long game and how this is going to play out over the years to come.

I cannot imagine what the Taiwanese are thinking right now, how all this will play out for them vis-à-vis the Chinese. I don’t think it looks good. If one were to incorporate this kind of thinking into their investments, how would one adjust one’s portfolio to this “new reality”?

To find a defensive strategy here for someone in my position (74 years old and looking at not so many years to go), there aren’t a lot of good options. Stocks, perhaps. And then I add in my uncertainty around the US Estate Tax if I’m outside of Canada, and my investment options become even more restricted. There is always the option of simply putting my cash into short-term vehicles like treasury bills and treasury bonds. The Investment professionals seem to feel that it is folly.

Not that they offer any viable alternatives. What I do believe is that investors probably don’t rigorously try to determine what their financial needs will be in the future. If you save for retirement, should you not get to a point where you have a target rate of return? Do I need 10% compunded every year to live? This requires some thorough analysis and an honest look at how you can live given what you have got. It’s a simple spreadsheet that most can do with little effort. Analyzing what comes in versus what goes out. Building in a rate of return and your taxes, and voila! Be honest with yourself while looking at what you have versus what you need. Make your lifestyle fit your cash flow.

As I get older, I find I need less, want less and can easily spend less. I don’t have the energy or desire to travel. I don’t spend much as I don’t go out much. I’m too exhausted.

Get real. Have a reasonable plan and move forward.

close up shot of a yellow alarm clock on a purple surface
Photo by Photo By: Kaboompics.com on Pexels.com
#behavioural finance#investing#investing philosophy#investment philosophy#investment strategy#investments#portfolio strategy
Jake · Apr 8, 2026 7:34 am

Stock markets look to open very strongly today after the announcement of a ceasefire between the United States, Israel and Iran. It looks like it will be quite a positive day for the markets. In my opinion, nothing has been resolved with Iran, and it’s difficult to know where markets will go.

In terms of long-term strategy, my question is: what has all this accomplished, and is it just a break in the action? I don’t know. But I have several objectives to achieve that have been imposed on me as a result of my attempt to emigrate from Canada. None of which I have dealt with because of the stickiness of taking long-term decisions with what I believe to be incomplete information.

I continue to resist creating an investment policy statement to guide me through this. And I am suffering severe indecisiveness.

#behavioural finance#investing#investing philosophy#investment philosophy#investment strategy#investments#portfolio strategy
Jake · Apr 7, 2026 8:53 am

Markets opened yesterday with a pretty much wait-and-see attitude to the goings on in the Middle East. For the time being, the markets seem to have shrugged off the increase in oil prices. The IMF has issued a warning about inflation and slowing global economic growth. I never see anyone back-check these guys to see if any of their forecasts ever pan out. I won’t bother doing so as it’s a waste of time.

I continue to struggle with implementing a plan for my portfolio to allow me to emigrate from Canada. I hit one roadblock after another. I ran into an issue with U.S. estate taxes. Yes, US estate taxes. It seems that whatever you do, there is some US rule or regulation that can affect you, no matter where you live. I fail to understand how this is possible, but most countries have given in to the extra-territorial application of US law. Something countries used to resist in the past, but here we are.

“Canadians with US situs assets (real estate, US stocks) exceeding USD$60,000 and a worldwide estate over USD$15M (2026) may face U.S. estate taxes. Scotia Wealth Management notes that while treaty exemptions offer relief, Filing Form 706-NA is required if U.S. assets exceed $60K. Proper planning is vital due to graduated rates up to 40%.”

My understanding is that to claim the exemption under the US-Canada Tax Treaty, you need to file the form. I don’t give tax advice, but I will check out what the implications are for me. Yet another thing to wreck your retirement planning that no one tells you about. Especially for those Canadians who would like to emigrate. It never stops. As long as I have an RRSP or RRIF, I will be unsure about everything and anything, it seems. With a never-ending host of issues/problems to address.

#investing#investing philosophy#investment strategy#leaving Canada#portfolio strategy
Jake · Apr 2, 2026 4:25 pm

Stock markets today were all over the place. I have been refraining from selling to raise cash to restructure my portfolio. It’s a little hard to time it perfectly. I should probably sell into the strong days, but I didn’t pull the trigger today. And a three-day weekend is a long time with what’s going on in the Middle East. Again, lack of strategy. I want to restructure, but I don’t have a plan. It’s always the same story: think, plan, do.

#behavioural finance#investing#investing philosophy#investment philosophy#investment strategy#portfolio strategy
Jake · Apr 2, 2026 9:35 am

The stock markets continue to reflect uncertainty over the Middle East. What I have noticed is the considerable decline in the share prices of many of the Magnificent 7. The market seems to have rotated out of the tech sector in a rather significant way. Share prices are down 20-25% from the most recent highs.

What I have noticed in my own behaviour is a lack of conviction in the strategy that I have tried to implement. My portfolio continues to display considerable volatility. I get excited and hang on when the market moves up, and become concerned when it moves down. I want to reduce my exposure to stocks, but do nothing to implement the strategy. It’s the same old story, a deer locked in the headlights, and I can’t move.

Fortunately, a couple of months ago, I lightened up on a lot of the stocks that have taken quite a nosedive. But I still have several stocks that are not consistent with my developing desire to mitigate the risk in my portfolio.

The takeaway from all this is simple. I have failed over the years to develop an investment strategy, so I am like a cork tossed in the waves. Because of my personal issues, I fail to do what I need to do. It’s always the same story: you cannot succeed if you are not prepared to act. Anxiety and a lack of self-confidence lead to dysfunctional decision-making.

In addition, not adjusting your investment strategy to your stage of life will cause anxiety, distress and a failure to make critical decisions.

#behavioural finance#investing#investment philosophy#investment strategy#investments#portfolio strategy
Jake · Mar 26, 2026 5:39 pm

The last couple of days have been a bit of up and down, and sideways. Tech stocks have gotten hit. Names such as Meta and Google have seen erosion in their stock prices. I noticed a rather steep decline in the Taiwan Semiconductor share price. Not surprising, so. I am going to do a post on Investment Advisors and their various responsibility to their clients, or the lack thereof.

#investing#investing philosophy#investment strategy#portfolio strategy
Jake · Mar 24, 2026 5:21 pm

For those of you looking to retire outside of Canada, there is an important issue/matter that you need to be aware of. I may have mentioned it in an earlier post, but it needs to be mentioned again.

Canadian financial institutions generally look to profitability when it comes to decisions about lines of business. The same applies to providing investment products to non-residents, whether they originate from Canada or not. If you are a Canadian resident and citizen, and you decide to emigrate, you will find the environment pretty hostile to your contemplated move. In 2021, TD Bank advised many, if not most, of their TD Direct Investing clients that their accounts would be closed. Clients were given 30 days, or their holdings would be liquidated. This becomes particularly problematic if you have a RRIF or a LIF. This would result in a pretty substantial tax hit in some circumstances. Before moving, you must investigate what will happen. After you leave, your options will be limited, if you have any options. There are a lot of rules and regulations for the opening of securities trading accounts for non-residents. And many, if not most, Canadian financial institutions don’t care about offloading a whole bunch of accounts once they decide to do so.

There are no easy answers here. You ned to plan for the worst and hope for the best. This is not an issue created by the Canada Revenue Agency. It’s internal bank compliance that drives this, and the cost of managing these accounts.

BE CAREFUL!

#investment accounts Canada#leaving Canada
Jake · Mar 24, 2026 8:57 am

Yesterday’s stock market bounce may very well be a “dead cat” bounce. In other words, just a pause in the action. The market today looks a little bit soft, but it was nice to see some return to a level of optimism. Perhaps this was misplaced, but that’s the way the market operates.

The point I would like to raise is how this affected my behaviour. What I mean is this. I went from pessimism (woe is me, why didn’t I buy the index and some safer ETFs) to why can’t I buy more stocks or gold. It’s the same old story, trying to time the market.

This kind of behaviour is a type of mental “whiplash”. It shows a lack of conviction in my principles, which are poorly defined. Again, this leads back to a well-developed Investment Policy Statement. Always back to first principles. And getting away from that in whatever I do is dangerous.

The Investment Policy Statement is the basic document that will allow me to keep my focus and avoid bouncing all over the place. Today, I will spend the day developing, refining, and concluding it.

#behavioural finance#investing#investing philosophy#investment philosophy#investment strategy#investments#portfolio strategy
Jake · Mar 23, 2026 7:56 am

Monday morning, waiting for markets to open. Today I decided that I won’t be looking at the goings on. It’s not productive and not useful, as I won’t sell into the pending chaotic days ahead. That doesn’t mean I won’t fret. However, I have noticed that although the markets are down from the highs, individual stocks have fared much worse. It just reinforces my next steps to reduce the volatility of my portfolio. I look at some of my old posts, and I didn’t take my own advice. Sorry state of affairs.

#behavioural finance#investing#investment philosophy#investment strategy#investments#portfolio strategy
Jake · Mar 22, 2026 8:22 am

The Canadian stock market has had a pretty good two years after being “dead money.” It was a very poor investment for a couple of decades. But, in my opinion, this has been driven by the financial sector, a paper shuffle. And then there is the real estate sector. Another paper shuffle. But you need to dig a little deeper.

As of early 2026, the financial sector, dominated by Canada’s “Big Six” banks, accounts for approximately 33%-33.2% of the S&P/TSX Composite Index’s market capitalization.

Bank Domination: The “Big Five” (RBC, TD, BMO, Scotiabank, CIBC), along with National Bank, command 86.3% of the Canadian banking sector’s market share, making them the primary drivers of this percentage.

Key Data Points for 2026:

Top Constituents: Royal Bank of Canada (RBC) and Toronto-Dominion Bank (TD) consistently rank as the top two largest companies by market cap on the entire TSX.

While the financial sector is the largest, it is closely followed by energy and materials, with banks serving as the primary anchor for the Canadian market’s high concentration in financials

Services, including the massive real estate sector, constitute over 70% of Canada’s GDP. Real estate, rental, and leasing specifically represents a major portion, often cited at around 13% to 14% of the national GDP, acting as the largest single industrial contributor to the Canadian economy.

Key Details Regarding the Services and Real Estate Sector:

Total Services Sector: The broader services sector, which includes professional services, healthcare, finance, and real estate, accounts for roughly 70% of GDP.

Real Estate Focus: The “real estate, rental, and leasing” industry is the largest contributor to Canada’s GDP, accounting for 13.2%.

Provincial Dependence: Some provinces are highly reliant on real estate, with British Columbia experiencing up to 1 in 5 GDP dollars (19.6%) generated by the sector.

Broad Definition: The real estate sector’s high percentage includes the “imputed” rent of owner-occupied homes, not just commissions and leasing fees.

Underground Activity: Real estate and related financial services are also key players in the underground economy, representing 15.3% of that activity.

This is indicative of the fact that Canada has no real economy. If you add in a few tech companies and a couple of pipelines, there’s not much out there for a long-term investor. And then there is the real estate sector, which adds no real wealth; it’s just playing with yourself to create fake value.

This would also explain the growing income inequality and the loss of productivity (failure to invest in anything except paper assets). Over the last decade (roughly 2015–2025), Canada has experienced a significant, structural slowdown in business investment in capital assets, leading to a widening productivity gap with the U.S. While non-residential capital stock grew by only 10.9% in real terms over the decade, investment per worker has stagnated or declined, particularly in machinery, equipment, and non-residential structures. 

In my opinion, this is the explanation for the rather anemic performance of the Canadian stock market in decades gone by. It likely does not bode well for the future. What will happen to Canada? I don’t know, but I wish I had acted on this a long-time ago. Poor retirement planning on my part, and not enough due diligence.

Will an investment advisor help here? I’m not sure. There are no easy answers. But can you really rely on someone who has a superficial knowledge of these matters to guide you long-term? To have an understanding of what’s going on in the long-term? I think not. You need to do a lot of due diligence to find someone to be your investment advisor.

#Canadian stock market#investing#investing Canada#investing philosophy#investment strategy#investments
Jake · Mar 20, 2026 7:45 pm

I am currently residing in Canada. I have lived here, except for a few short breaks, for over 65 years. I must say that as the years go by, I become increasingly disillusioned with Canada. I’m not sure what the attraction is for immigrants (other than they can’t get into the United States). Nosebleed prices for everything, incredibly high taxes with a government that is never satisfied with its “take”. It’s never enough.

During the last few years, there have been a lot of winners in the stock market, AI, and metals. The manufacturing sector is nonexistent. Governments have stifled the growth of the natural resource sector. Canadians are pretty much asleep, living off I don’t know what.

One of the main drivers of the Canadian economy is the real estate sector. Now that’s in crisis, and there is not much else out there. Maybe some tech will save the country, but ride a subway in Toronto at 2 PM in the afternoon and you will see the Canadian work ethic.

Today, Canadian stock markets took a huge dive. You would think that a resource-rich country like Canada would benefit from the turmoil in the Middle East. No. A more massive drop than New York.

Canadian stock market returns look good over the last five years. It’s because of the last couple of years. For decades, Canada was dead money. I believe that inevitably it will revert to that.

There are some good utility stocks, pipelines and maybe some tech. The rest is a real stinker. Look before you leap, and if you’re outside Canada, remember the currency risk that you are taking on board. Canada has not been a great place to put your money.

#investing#investing in Canada#investing philosophy#investment philosophy#investment strategy#investments#portfolio strategy
Jake · Mar 20, 2026 3:11 pm

In managing your personal finances and planning for retirement, another aspect that needs to be addressed is bookkeeping. Yes. Mundane, ordinary bookkeeping. It’s hard to keep track of what’s going on with your money unless you do some basic bookkeeping. You don’t have to be a CPA or have a college degree. There are some basics that you can do and stay ahead of the game.

First of all, you have your bank statement to keep track of your spending. You can buy a “canned” program, but you can also use Excel. Many banks, I believe, allow you to download your information that appears on your bank statement as an Excel file. There, the work can begin, but it’s pretty simple. Look at your cash inflows and cash outflows during the month. Then you’ll have your net cash position. The cash you take out, if you do, can simply be recorded as a miscellaneous expense.

This will be the first step to see what’s coming in and what’s going out. The difference is a critical number that I will discuss in my next post.

#investing#investments
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