Where are you in your investing life cycle?

Asset allocation, risk, diversification and rebalancing. Pros/cons of hiring a financial advisor. Seeking advice on your portfolio?

Where are you in your investing life cycle?

Early accumulation phase
17
15%
Middle accumulation phase
23
20%
late accumulation phase
34
30%
Withdrawal phase
39
35%
 
Total votes: 113

Rooster
Contributor
Contributor
Posts: 174
Joined: 16 Jan 2012 13:03

Re: Where are you in your investing life cycle?

Post by Rooster »

Middle accumulation as well.

Mid 30s. Paid off mortgage (house was until recently biggest asset, now slightly less than half). Really kicked up my time devoted to learning in the past 18 months or so as I moved away from all e-series with haphazard asset allocation to etfs as financial assets started accumulating more significantly.
Benchwarmer
Contributor
Contributor
Posts: 616
Joined: 04 Dec 2010 20:39

Always in accumulation mode

Post by Benchwarmer »

According to RRIFmetic, my networth (net after-tax estate in today's dollars) keeps increasing for as long as I live. In theory I am always in accumulation mode. When I graphed it in Excel, the slope is greater in my working years than in retirement.

I think most of that is because my spending is modest. I hate traveling, don't enjoy golfing, there is really not much I can spend money on. To keep things simple, I assumed that expenses in retirement will be identical to when working.

However there is one big curve that someone can throw at the plan. I am single. I would like to re-run RRIFmetic for a couple, assuming that my spouse has no income of any type. What multipler should I use (I assume that expenses doesn't double for a couple).
User avatar
AltaRed
Veteran Contributor
Veteran Contributor
Posts: 33399
Joined: 05 Mar 2005 20:04
Location: Ogopogo Land

Re: Where are you in your investing life cycle?

Post by AltaRed »

There are huge variables that would be different for everyone. On the plus side, there would be income splitting when withdrawing pensions saving tax dollars. In the case of living expenses, those could easily double for 2 people if having a spouse causes you to travel, play golf, boating, etc. Food costs will depend on how much you and your new spouse entertain a lot. In short, the only likely things that may only be 100-150% of what you incur now would be property taxes/insurance, and utility bills.

As an example, since my SO and I have just combined our households, we really do not expect much, if any, savings from making the combination. What we save in some things, we will spend more in other ways.
Imagefiniki, the Canadian financial wiki The go-to place to bolster your financial freedom
User avatar
kcowan
Veteran Contributor
Veteran Contributor
Posts: 16033
Joined: 18 Apr 2006 20:33
Location: Pacific latitude 20/49

Re: Where are you in your investing life cycle?

Post by kcowan »

We save on accommodations when travelling or living. Not much else. I suppose I am happier sitting at home than heading to the pub for company. So there is some savings there hypothetically.
For the fun of it...Keith
User avatar
freedom_2008
Contributor
Contributor
Posts: 841
Joined: 16 Nov 2010 17:46
Location: Victoria

Re: Where are you in your investing life cycle?

Post by freedom_2008 »

By your definition, withdrawal phase = "living off of their investments", but it doesn't mean one has to spend all the income from the investments. So one can be in the withdrawal phase while his/her/theirs wealth is still increasing at the same time.

So I would think people who are really "retired" (stopped working for salary income) are all, by definition, in withdrawal phase, regardless your money still grows or not, right?

We are definitely in withdrawal phase, retired and living off investments (not on pensions). Our investments still grow some, but the rate is much slower comparing to working time.
“Life is 10% what happens to you and 90% how you react.” — Charles R. Swindoll
User avatar
Insomniac
Veteran Contributor
Veteran Contributor
Posts: 2802
Joined: 29 Oct 2011 19:01
Location: Vancouver Island

Re: Where are you in your investing life cycle?

Post by Insomniac »

freedom_2008 wrote: So I would think people who are really "retired" (stopped working for salary income) are all, by definition, in withdrawal phase, regardless your money still grows or not, right?
I agree with that.
User avatar
StuBee
Veteran Contributor
Veteran Contributor
Posts: 2944
Joined: 21 Sep 2010 11:08
Location: SW Quebec

Re: Where are you in your investing life cycle?

Post by StuBee »

freedom_2008 wrote:By your definition, withdrawal phase = "living off of their investments", but it doesn't mean one has to spend all the income from the investments. So one can be in the withdrawal phase while his/her/theirs wealth is still increasing at the same time.

So I would think people who are really "retired" (stopped working for salary income) are all, by definition, in withdrawal phase, regardless your money still grows or not, right?
I agree 100%. IMHO, around 5 of the votes (perhaps moe) in the late accumulation phase should really be in the withdrawal phase. This means that close to half of the respondents are (by my definition) are in withdrawal phase. The overwhelming majority of these are probably what most people would consider to be "retired". Exceptions are certainly possible.
"The term is over: the holidays have begun. The dream is ended: this is the morning."-C.S.Lewis, The Last Battle
User avatar
kcowan
Veteran Contributor
Veteran Contributor
Posts: 16033
Joined: 18 Apr 2006 20:33
Location: Pacific latitude 20/49

Re: Where are you in your investing life cycle?

Post by kcowan »

I think it is a matter of degree. If you investment portfolio is primarily growing, then you are accumulating even if you are retired.
For the fun of it...Keith
User avatar
SkaSka
Contributor
Contributor
Posts: 727
Joined: 29 Nov 2012 01:21
Location: Raincouver

Re: Where are you in your investing life cycle?

Post by SkaSka »

Early accumulation, not accumulating at the moment though.

Paying off student loans before starting any real accumulation.

Wife has a fair chunk accumulated, because she was smarter than me and didn't take on any student loan debt :)
Come on Eileen
Contributor
Contributor
Posts: 143
Joined: 05 Nov 2006 18:38
Location: Western Canada

Re: Where are you in your investing life cycle?

Post by Come on Eileen »

kcowan wrote:I think it is a matter of degree. If you investment portfolio is primarily growing, then you are accumulating even if you are retired.
As always, the definition is important. I have always presumed that the accumulation phase meant you were adding to the portfolio. In other words, passive investment gains do not equate to accumulation in my mind. Therefore I voted withdrawal.
User avatar
AltaRed
Veteran Contributor
Veteran Contributor
Posts: 33399
Joined: 05 Mar 2005 20:04
Location: Ogopogo Land

Re: Where are you in your investing life cycle?

Post by AltaRed »

Come on Eileen wrote: As always, the definition is important. I have always presumed that the accumulation phase meant you were adding to the portfolio. In other words, passive investment gains do not equate to accumulation in my mind. Therefore I voted withdrawal.
:thumbsup: I agree with the addition of 'adding to the portfolio from external sources'. What a difference May 2013 versus March 2009 makes.
Imagefiniki, the Canadian financial wiki The go-to place to bolster your financial freedom
Benchwarmer
Contributor
Contributor
Posts: 616
Joined: 04 Dec 2010 20:39

Re: Where are you in your investing life cycle?

Post by Benchwarmer »

AltaRed wrote:I agree with the addition of 'adding to the portfolio from external sources'. What a difference May 2013 versus March 2009 makes.
So if someone in retirement spends less than his pension income, he then fits the definition, and is therefore in the accumulation phase?
User avatar
AltaRed
Veteran Contributor
Veteran Contributor
Posts: 33399
Joined: 05 Mar 2005 20:04
Location: Ogopogo Land

Re: Where are you in your investing life cycle?

Post by AltaRed »

I reckon so. I think the real point is whether one is physically adding funds to their investment portfolio or not, however it is done. That is the definition of accumulation to me.
Imagefiniki, the Canadian financial wiki The go-to place to bolster your financial freedom
Rooster
Contributor
Contributor
Posts: 174
Joined: 16 Jan 2012 13:03

Re: Where are you in your investing life cycle?

Post by Rooster »

Personally, I'd be inclined to qualify anybody withdrawing from assets to live on as in the withdrawl phase. This regadless of whether that person is still net accumulating. That person would be accumulating more if not withdrawing. To me, they are in the withdrawing phase. Withdrawing does not mean depletion.
SQRT
Veteran Contributor
Veteran Contributor
Posts: 5441
Joined: 01 Nov 2012 11:33
Location: Ontario/Arizona

Re: Where are you in your investing life cycle?

Post by SQRT »

Looks like we are getting a little hung up on definitional issues. Any conclusions re the survey? Maybe that we are pretty mature ( at least from an investment perspective) group?
User avatar
StuBee
Veteran Contributor
Veteran Contributor
Posts: 2944
Joined: 21 Sep 2010 11:08
Location: SW Quebec

Re: Where are you in your investing life cycle?

Post by StuBee »

With 71 respondents the sample size is quite adequate. In spite of the "definitional issues", I think that some conclusions can be drawn.
#1 Respondents are a mature group with an overwhelming majority in late accumulation or withdrawal.
#2 Close to half of all respondents are in the withdrawal phase (especially if those who appear to be retired but have responded accumulating are transferred to the withdrawal phase).
"The term is over: the holidays have begun. The dream is ended: this is the morning."-C.S.Lewis, The Last Battle
SQRT
Veteran Contributor
Veteran Contributor
Posts: 5441
Joined: 01 Nov 2012 11:33
Location: Ontario/Arizona

Re: Where are you in your investing life cycle?

Post by SQRT »

StuBee wrote:With 71 respondents the sample size is quite adequate. In spite of the "definitional issues", I think that some conclusions can be drawn.
#1 Respondents are a mature group with an overwhelming majority in late accumulation or withdrawal.
#2 Close to half of all respondents are in the withdrawal phase (especially if those who appear to be retired but have responded accumulating are transferred to the withdrawal phase).
yes, agree
User avatar
EmperorCoder
Contributor
Contributor
Posts: 199
Joined: 27 Jan 2007 15:21
Contact:

Re: Where are you in your investing life cycle?

Post by EmperorCoder »

As a proud DIYer, my savings have recently crossed the million-dollar mark.

I think my achievement is remarkable in a couple of ways :
  • I'm only 35 years old
  • The money was accumulated solely through saving and investing (no inheritances)
  • I am employed and work regular hours (no business income)
  • A divorce has cut my net worth in half four years ago
I would attribute my success so far to a couple of factors :
  • A desire to learn about financial stuff and taking care of my money
  • Watch my spending closely in the early years
  • Be good at what I do so I could earn more than the average Joe doing the same job
  • Some luck (let's be honest)
ig17
Veteran Contributor
Veteran Contributor
Posts: 3418
Joined: 21 Feb 2005 20:54

Re: Where are you in your investing life cycle?

Post by ig17 »

EC, congratulations! 1M @ 35 is very impressive, especially after divorce.

I'm curious how you invest. Can you describe your investment style?
User avatar
EmperorCoder
Contributor
Contributor
Posts: 199
Joined: 27 Jan 2007 15:21
Contact:

Re: Where are you in your investing life cycle?

Post by EmperorCoder »

ig17 wrote:Can you describe your investment style?
Only stocks, with a bit of leverage when valuations are appealing (never more than 10% leverage)

I own 5 to 8 stocks at a time, I do lots of research. I am mostly a value investor. I buy when it's cheap and sell when it's fairly valued. So buy and hold is not for me.
User avatar
adrian2
Veteran Contributor
Veteran Contributor
Posts: 13333
Joined: 19 Feb 2005 08:42
Location: Greater Toronto Area

Re: Where are you in your investing life cycle?

Post by adrian2 »

ig17 wrote:EC, congratulations!
+1!
Imagefiniki, the Canadian financial wiki
“It doesn't matter how beautiful your theory is, it doesn't matter how smart you are. If it doesn't agree with experiment, it's wrong.” [Richard P. Feynman, Nobel prize winner]
User avatar
StuBee
Veteran Contributor
Veteran Contributor
Posts: 2944
Joined: 21 Sep 2010 11:08
Location: SW Quebec

Re: Where are you in your investing life cycle?

Post by StuBee »

EmperorCoder wrote:As a proud DIYer, my savings have recently crossed the million-dollar mark.

I think my achievement is remarkable in a couple of ways :
  • I'm only 35 years old
  • The money was accumulated solely through saving and investing (no inheritances)
  • I am employed and work regular hours (no business income)
  • A divorce has cut my net worth in half four years ago
I too am really impressed (and also envious :oops: ) We (household) crossed that line a few years ago but I was 15 years older than you now are and (probably) with a bigger net employment income. I presume that you are not including personal real estate in your number. Would you mind telling me what sort of IRR (internal rate of return) it took to get you there??
"The term is over: the holidays have begun. The dream is ended: this is the morning."-C.S.Lewis, The Last Battle
User avatar
kcowan
Veteran Contributor
Veteran Contributor
Posts: 16033
Joined: 18 Apr 2006 20:33
Location: Pacific latitude 20/49

Re: Where are you in your investing life cycle?

Post by kcowan »

adrian2 wrote:
ig17 wrote:EC, congratulations!
+1!
+2
This is extraordinary!
For the fun of it...Keith
User avatar
EmperorCoder
Contributor
Contributor
Posts: 199
Joined: 27 Jan 2007 15:21
Contact:

Re: Where are you in your investing life cycle?

Post by EmperorCoder »

StuBee wrote:I presume that you are not including personal real estate in your number. Would you mind telling me what sort of IRR (internal rate of return) it took to get you there??
I don't own any real estate, but I plan to eventually when valuations come back to earth.

I track my net worth since 2007. I've enjoyed an IRR of 24% despite a divorce that had pretty much the effect of halving it in 2010.

I also track my investment returns since 2006, which have yielded 21.4% annualized.
THEMAINEVENT
Contributor
Contributor
Posts: 154
Joined: 31 Aug 2010 10:10

Re: Where are you in your investing life cycle?

Post by THEMAINEVENT »

Mid accumulation. 43, household net worth around $2m. Would like to be semi retired in 10 years and run my business 15-20 hours a week (get away to my nice man cave at my office building I own to get away from my then menopausal wife). :D

Plan on selling commercial building in 15 years when its paid for and taking the proceeds as income over first 10 years of retirement.
Post Reply