Personal finance coach Michael Kim and I chat about common mistakes that new investors make, and how to avoid them. We also chat about Mike’s investing journey, as well as his relationship with money and why he started his coaching business. 

Key Takeaways

  • Passive vs Active Investing: passive is buying and holding with the goal of matching the market. Active is characteristically more trading activity (i.e. buying and selling frequently) with the aim of beating the market\
  • Mike uses a passive investing strategy because there is the least amount of room for error and he believes it is the best use of his time TIME
  • The four mistakes new investors make are:
  1. Not investing for a purpose. You should invest to achieve your financial goals. Answering that question will help you decide what to invest in
  2. Not having a strategy. Do you know what you are going to do if a recession occurs/lose your job/get closer to your financial goals? Definitely have a plan in place so that you know what to do in every single one of these scenarios.
  3. Investing without a foundation – it’s important to understand the basics of investing, and understand what you are investing in, such as different asset classes, what a TFSA is, what an RRSP is, etc.  
  4. Thinking investing will solve all your problems because you need a lot of money to generate a significant return. There are other areas to focus your time on to potentially make more money (i.e. start a side hustle), then you will have a larger nest egg to invest and be able to generate larger returns on investment

Tips/Tricks:
Investing is not hard, it’s as simple as going to a website on Amazon and clicking buy
To start investing, you don’t start with investing.
First look at your financial goals, your current financial situation, and your budget and emergency fund
Once you’ve done the groundwork, you’ll know what to invest in

Mike’s Links

http://lifeplanting.com/

Instagram

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EQ Bank – all accounts get 1.25% interest, TFSAs get 2.3% interest!

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On the seventh episode of MI$$ FINDEPENDENT, Gloria wraps up Season 1. She is joined by her friend Vickie, they discuss emergency funds, avoiding bank fees, and short to mid-term investing for those financial goals. We will be talking about what an emergency fund is, how to set one up, different types of bank accounts, how to find the right bank account for you, as well as investing for short to medium term and some safe places to put your money.

Homework
Task 1: Set up and optimize your emergency fund
Task 2: Get rid of those pesky monthly bank account fees Task 3: Consider opening a high-interest savings account to save for your short term financial goals

Links/Sources
Canadian Financial Capability Survey 2019
Gov’t of Canada bank account tool
High interest savings accounts
Personal income spending flow chart
Canadian Banking Basics from the Canadian Bankers Association
CDIC – How deposit insurance works

Sign up for no-fee banking with Tangerine or EQ using my referral code!
Tangerine Bank – new accounts get 2.5% interest (first 5 months), use my Orange key: 40411403S1
EQ Bank – all accounts get 1.5% interest:

Thanks so much for tuning in! Catch you on season 2.

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On the sixth episode of MI$$ FINDEPENDENT, Gloria is joined by her friend Lucy, they discuss all these fun acronyms – tax-free savings accounts (TFSAs), registered retirement savings plans (RRSPs) and non-registered accounts – what they are, what their benefits are, what to invest in them, contribution limits and when to use each. One thing I wanted to mention that we didn’t talk about is employer-matched retirement savings. If your employer will match your RRSP contribution, definitely sign up – it’s free money!!

Homework
Task 1: Determine whether you’re in the financial position to invest right now
Task 2: Open up that TFSA if you haven’t already! Determine whether now is a good time for you to open an RRSP based on your current tax bracket and earning potential
Task 3: Check your TFSA and RRSP contribution limits and contribute what you can!

Links/Sources
2016 Canadian Census data on registered accounts
2019 RBC Study on Canadian TFSAs vs RRSPs

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