Hey Tina what day of the week is it
- It's Saturday oh my goodness Norm we've not done a movie - Uh oh let's go!
Gee doesn't Saturdays come around quickly - It does - Do we have anything to talk about today Tina
- Oh I'm sure we'll find something to talk about Norm - So how about
how we invested the money from the house what do you think - Sounds great so we are
Norman and Tina and we talk about all things retirement - If you haven't yet subscribed to us
please hit that subscribe button we would really appreciate it
what are we going to talk about today Tina - Well we sold our house and we've rented an apartment
and what did we do with the money? that is what lots of people are asking us on our comments - Well
we dug a hole in the back garden and buried it no we didn't do that that's a good question Tina
the very first thing that we did - The first thing was that we paid off all our outstanding
debts - Yes we did - Yeah by that we mean any credit cards any line of credits you name it anything you
might know pay it off - So we walked away from the house it was already mortgage-free and any loans
that we had for things like new windows, new garage doors, new roofs we paid all that off so totally
debt-free and the advantage of doing that is it's a high rate of return on your capital as well some
of the lines of credit were more percentage wise than what we would get in an investment account
so the other thing that we did immediately was max out the tax-free savings account (TFSA), we opened
one each and we had already been saving into them so we just ensured that we had the maximum amount
of contributions that were allowed to make in the tax-free savings account and that way it hides
the money from the tax man so that was one of our strategies of retiring poor was to shelter
the money in the TFSA - Then another thing we did was we roughly put about 50 percent of our money
into high interest savings accounts now by these we mean the sort of online accounts very similar
to EQ bank, Credit Unions they were all paying at the time they still are now a higher interest rate
than the high street banks so we do have those - At the time five years ago they were paying a
heck of a lot more is three and a half percent yeah we're down to about one and a half percent
and maybe you're asking why are we doing that and not maxing out equity investments well
we've used that money to invest in dividend stocks on pullbacks and we've already had two
pretty good pullbacks since we sold the house and it's really helped we also opened non-registered
trading accounts so we have these stock trading accounts at the bank it's a discount brokerage
we're using Bank of Montreal discount brokerage and we have contributed to those and we buy
dividend stocks and in particular the aristocrat dividend stocks and those
if you're not familiar with aristocrat stocks just Google it you'll find all the information out
about it but there's stocks that have consistently paid dividends with an unbroken record
so what else - So we have some of our favorite stocks that we have bought and some of those are
Fortis, Bell Canada, Bank of Montreal, CIBC, Telus and Enbridge those are just a few of the
ones that we have that we like - And they're all aristocrat dividend stocks - And they're all paying
really good dividends aren't they Norm - And from the time that we've bought them they range from
five percent return to seven and a half percent return dividends paid quarterly
Forties is an interesting stock based out in Newfoundland they've consistently increased
their dividend each year as well so why fifty percent why hold fifty percent in cash well
as we said before we are using it to buy stocks on pull backs because we felt the stock market
has been overvalued for some considerable time we also wanted safety of our money it's taken a long
time to to get that money so we don't want to lose it - No that's true - It also we were having a
major life change as well we sold the house we rented an apartment and we didn't know whether
this would be for us so if we kept the cash that would be enough for a deposit on a house
a small house or a condo - It was going to give us options wasn't it - It was and so basically
we've got the cash there we also wanted to travel we've had four good years of traveling
and that financed some of those travels as well which you can't do from just having stocks
so having cash made us feel safe and it's given us some buying opportunities in the
stock market as well - We also we do hold all our U.S. dividend stocks in our RRSP
- The Registered Retirement Savings Plan in Canada - So doing that we avoid any withholding tax don't
we so it works good for us - It's the best way for us to hold USA dividend stocks and then we
don't have the U.S. government withholding a small portion of tax on the dividend payments
so yeah hold U.S. dividend stocks in a retirement savings plan
from the cash deposits we make annual payments into the TFSA as well so that ensures that we can
continue to max out, so what we're doing is from that cash is we're converting it into a tax-free,
hidden from the tax man which helps us continue to "retire poor" inverted commas so it's been
handy to have that cash to be able to make those deposits into the TFSA which is a tax-free savings
account - And one thing we have found is that in the five years since we took early retirement
we actually still have all the capital but we've during that time we've had four years of travel
and also having the cash on hand has allowed us to buy a car and an RV trailer hasn't it Norm
- It has and it it hasn't depleted any of our capital so how is it possible Tina that we've
had four years of travel and that was something in the region of 12 to 15 cruises - Yeah lots of trips
- Yeah and and when we get comments in our YouTube comments section, people saying
you should come to Iceland or Madeira or somewhere, well we've been to all those places
in the last five years so how is it possible that we were able to still do all that
and still have all our capital left - Because we're a big believer in passive income as well
as dividend stocks and now we are also getting our CPP and all the other government state pensions
- The CPP is the employee, employer contributed Canadian Pension Plan which is the same as Social
Security in the U.S. and we have taken that at 60 years of age - We have - And so now we're getting,
well I'm getting the government's state pension - You are I have another year to go for that don't
- I'm the Old Fogey so with good management we've been able to - Hold on to it - Yeah the
passive income has been interesting and we're actually going to make the next video about that
to give an idea because a lot of people have been asking us what should I do in retirement or
how can I earn money in retirement to offset maybe the lack of savings that we have
so we've certainly been able to do that so this was just a quick what we've done
with the money from selling our house - Yeah to coming into the apartment and because so many
viewers have asked us what did we do with the money and how could we help
them make the decision and so that's why we thought we would tell our story - Exactly so
happy Saturday yeah thanks for watching - And hope everybody is staying safe and keeping well out
there - And thanks for your continued support and we'll see you on the next video bye, bye