podcast

Episode 58: The Ins and Outs of Real Estate: Mortgage Rate, Rentals, REITs and Variable Annuities

On today’s episode, Benjamin and Cameron are talking real estate, specifically mortgage rates and REITs. For the first time since the early 90s, fixed mortgage rates are lower than variable ones, which have always been the popular choice. However, due to the fact that Canada’s yield curve is inverted, short term rates higher than their long-term counterparts. This is not usually the case, which makes it a great time to consider a fixed term mortgage, bearing in mind that it requires some lifestyle considerations. Benjamin and Cameron also provide some insights into the rental property market changes since 2015, with some astonishing figures. They then discuss REITs, which many think should be considered their own asset class. While it is often recommended to have REITs in your portfolio, research is starting to show that you are taking a great deal of risk you are not being compensated for. This means you may be better off investing in other options such as high exposure bonds which bear much less risk. For all this and much more, join us today!

Key Points From This Episode: 

  • Why fixed-rate mortgages are now lower than variable-rate ones. [0:03:58.0]

  • Interest rates went up, but the shape of the yield curve changed as well. [0:06:25.0]

  • Property prices have almost doubled relative to rent since 2015. [0:07:12.0]

  • What a rental wage is. [0:12:48.0]

  • What a REIT is and the benefits of investing one in your portfolio is. [0:17:05.0]

  • Why the risk of a REIT may not be justifiable. [0:21:01.0]

  • Variable annuity investors routinely outperform mutual fund investors [0:26:23.0]

  • And much more!

Episode 36: ETF Model Portfolios: For Performance and Comparison Purposes

Welcome to Episode 36 of the Rational Reminder Podcast. Today we are going to roll out our new ETF model portfolios. This includes only two new ETF’s compared to a couch potato type portfolio that many of you might be familiar with. Nothing too revolutionary, but it certainly makes a meaningful difference. In this episode we also talk about asset location and review a couple of great podcasts that we’ve been listening to that provide interesting tidbits for investors, and some great information about the evolution of the industry, and about working with the clients. So, for an incredible conversation, be sure to join us!

 

White Paper: Factor Investing with ETFs

Key Points From This Episode:

  • Slicing up your portfolio for tax efficiency purposes. [0:01:57.6]

  • Controlling for pretax or after tax asset allocation. [0:05:0]

  • Optimal asset locations - highest yielding assets in tax free accounts. [0:06:05.0]

  • Having the same asset mix across all your portfolios & forgetting asset location. [0:09:51.1]

  • Intricate versus complex adaptive. [0:12:22.0]

  • The benefits of working with an adviser. [0:15:32.7]

  • Holding yourself accountable if you’re going at it alone. [0:17:09.0]

  • How it is much harder to find missed prices in the marketplace even for an expert. [0:19:40.0]

  • A history of the financial advice business and how it’s evolved into what it is today. [0:21:29.0]

  • Index investing and where people get their information from. [0:23:33.0]

  • ETF model portfolios that truly offer exposure to the factors. [0:26:11.0]

  • Why people should be thinking about small cap in value. [0:31:38.0]

  • And much more!

Episode 34: The Safe Savings Rate: Shifting the Focus Away from Wealth Accumulation

Welcome to Episode 34 of the Rational Reminder Podcast. Today we are discussing how our new ETF model portfolios will be employed to better accommodate our non-client listeners to whom Dimensional Fund Advisors are not as relevant. We talk about how BlackRock and Vanguard are dominating the market, why the US is leading in passive investment and why traditional financial planning needs to be re-evaluated. In addressing our main topic—safe savings rates—we explore the need for moving away from a focus exclusively on wealth accumulation to an approach more concerned with a safe savings strategy. We ask the all-important question, “How much will I need a month when I stop working?” and provide helpful guidelines on how focusing on the process rather than on the number that can help you to achieve your financial goals. Join us today to find out how you can adopt a safe savings approach! 

Key Points From This Episode:

  • How we will accommodate non-client listeners using ETF model portfolios. [0:03:34.0]

  • The issue of accessibility with Dimensional Fund Advisors. [0:04:51.0]

  • How the world is exploding with asset allocation ETFs. [0:05:26.0]

  • The dominance of BlackRock and Vanguard in the market. [0:09:33.0]

  • How the US is leading in passive management. [0:10:06.0]

  • What the Vanguard-effect does [0:10:27.0]

  • Investing in factor funds versus portfolios of factor funds. [0:11:17.0]

  • The benefit of having a one-decision portfolio that has a variety of different factors. [0:13:28.0]

  • Factor returns versus smart beta returns. [0:15:33.0]

  • Why low beta looks good on the factor side, but bad on the implementation side. [0:16:19.0]

  • More about the 4% rule. [0:17:35.0]

  • The four steps of traditional financial planning. [0:18:06.0]

  • Pfau’s suggestion for a better alternative to traditional financial planning [0:20:27.0]

  • What your savings rate should be [0:24:00.0].

  • The benefit of having a safe savings approach rather than focusing on wealth accumulation. [0:25:09.0]

  • The challenge of knowing how much you need when you stop working. [0:25:49.0]

  • Why you need to focus on the habit rather than on the target. [0:27:10.0]

  • And much more!

Episode 28: Staying Ahead of the Curve: The History of Dimensional Fund Advisors

Today on the podcast we are very excited to welcome Brad Steiman who is the Canadian Head of Financial Advisor Services for Dimensional! This is an episode we literally cannot wait to share with our listeners as it is jam packed with really useful information, history, and inside scoops on Dimensional and what has helped them get to where they are today. As huge fans and associates of DFA this is the type of conversation we have been hoping to have for quite some time and hope you are as excited as we are. In our discussion, we cover Brad’s early career and how he became involved and employed by Dimensional. From there, Brad gives us some great insight into the important early events that shaped his and the companies trajectories as well as laying out the vital characters in DFA’s story. We also get into some of the ideas and the ethos that underpins the work done at the company, particularly around research, findings and implementation. For all of this and host of other interesting subjects be sure to join us for this episode!

 

Key Points From This Episode:

 

  • Brad’s initial attraction to working at Dimensional. [0:01:45.5]

  • The college years and the following epiphanies. [0:02:37.9]

  • Why Brad did not look at his early paychecks at Dimensional. [0:06:29.3]

  • How David Booth preempted the evidence-based approach. [0:08:53.1]

  • Dimensional’s continual approach to new research and data mining. [0:14:55.5]

  • The criteria Dimensional apply when assessing findings. [0:17:26.9]

  • Brad and Dimensional’s philosophy when it comes to stock momentum. [0:20:41.1]

  • The implementation strategy at Dimensional. [0:25:51.1]

  • ETFs versus mutual funds and Dimensional’s decision in this battle. [0:28:05.1]

  • Dimensional’s unique approach to working with the advisor community. [0:30:51.5]

  • Three of Brad’s favorite stories from his time at the company. [0:32:49.6]

  • Brad’s science based approach to happiness! [0:37:34.1]

  • And much more!

Episode 26: Embracing Uncertainty: Planning Ahead and Taking On the Risk with Big Bang Theory Writer, David Goetsch

Welcome to this holiday edition of the Rational Reminder Podcast. Today on the show we have a special treat for you. A little while back, Cameron made an incredible connection with our guest, David Goetsch. David is a writer and the Co-Executive Producer of the Big Bang Theory. David himself subscribes to our investment philosophy and he is passionate enough about it that he speaks about it at conferences every now and then. He is truly a fascinating guy and the impact that this investment philosophy had on him is unreal. Inside this episode David shares with us how he used to a be a self-described worrier who worried about every little thing in his life. But once he had his eyes opened up to this philosophy, it changed him forever. He now embraces uncertainty, he embraces risk, he is not worried about his portfolio at all, and it has given him a great amount of peace in his life. For an incredible conversation with an absolutely changed man, stay tuned to hear it all!

Key Points From This Episode:

  • How David’s financial advisor changed his entire life. [0:02:46.3]

  • What it means to become a transformed investor. [0:08:32.1]

  • The greatest impact that David’s philosophy had on his life. [0:10:19.7]

  • David’s relationship with his financial advisor; meetings, and guidance. [0:14:03.6]

  • How to think about the fees you pay your financial advisor. [0:16:11.1]

  • David’s miscalculation of risk in his life; moving to Hollywood. [0:22:36.0]

  • The journey of David’s career as writer in Hollywood. [0:27:17.3]

  • Schedule and writing process of the Big Bang Theory. [0:34:23.1]

  • How David defines success and happiness in his own life. [0:37:43.0]

  • The story of when David got check 1 of 104 from Big Bang Theory. [0:39:51.8]

  • And much more!