In a Nutshell Just passed the half way point in the Nortel annuity vs. lump sum decision, it’s time to review my current thinking on my personal decision. Prior to receiving the option letter I was heavily inclined to take the commuted value (lump sum) if it was reasonably close to the actuarial fair value, […]

  In a nutshell   Non-fiduciary advice is an oxymoron. Statutory fiduciary advice is achievable by a principle, rather than rules, based approach. Advice is about process not product. Advisors placed in a context conducive to fiduciary behaviour must transition from a business to a professional model by: state-of-the-art best practices (e.g. IPS), institutional/employer oversight […]

In a nutshell The expanded CPP is a key element addressing Canada’s pension crisis. Proposed level of expanded CPP is acceptable, but the 49 year phase-in period makes addressing other problems of Canada’s retirement income system urgent. Needed changes include: higher savings rates, low-cost accumulation/decumulation vehicles, longevity insurance, fiduciary level of care/advice for all retirement […]

In a nutshell The primary application of rebalancing for most DIY investors should be risk management. Most other rebalancing reasons/approaches are essentially active calls on market direction with guaranteed costs without guaranteed benefits. Using appropriate (capitalization weighted) passive broad-market index fund(s), the risky part of the portfolio gets most/all rebalancing achieved automatically; the only required […]

In a nutshell The bad news is that we are living through a VUCA world (volatility/uncertainty/complexity/ambiguity)… the good news is that forecasting is difficult especially about the future. Changes/challenges and therefore threats/opportunities are everywhere: oil prices between $25-$150 and up, passive investment continues to grow with active investors thankfully working to eliminate pricing inefficiencies, China’s […]

 In a nutshell  Ezra argues that the vast majority of retirees will be better of purchasing a longevity annuity rather than an immediate annuity.  He opines that “the so-called annuity puzzle is not a puzzle…(but) if longevity insurance were widely available but still shunned, then that would indeed be a puzzle for social scientists to investigate.” […]

In a nutshell The annuity vs. lump-sum decision is explored as a function of lump sum offered. Qualitative and quantitative considerations are reviewed, as well a tool is provided to allow consideration of: the required break-even return rates and stock allocations under various conditions, the impact of age when 60% (survivor benefit) kicks in, and pensioners’ […]