Quote:
Originally Posted by Izzle
Diversification is the closest thing one can get to a "free lunch."
Diversify across:
- asset classes
- industries
- geography
|
There is no free lunch. Diversification has a cost as well.
Quote:
Originally Posted by Aarongavey
I find guessing at what you will spend in retirement quite difficult right now because most of our spending is on our kids. They will be out of the house in a decade though. We currently save about 13% of our gross income, not including CPP. But I would estimate that 35% of our gross income or more goes into the kids (both are in competitive sports). Don’t expect that expense to go down in the next decade but it makes it difficult to figure out what our retirement expenses would be. Kids have maxed out RESP’s and only two years left to save on one to keep getting the government money and 5 years left to save on the other.
While helpful, I find calculators like the one shared above don’t take into account differing expense levels for when you are raising children. If I cut out the kids or even reduce their cost to me when they are adults to 10% of my current gross the amount my wife and I need to live off of is substantially less.
|
The financial plan has to be revisited and reviewed as things change. Even your own vision of retirement and associated spending can change significantly, so while projecting years out and it not being perfect is a drawback, things get clarified as you get closer.