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So I've signed up with Questrade and put bought a portfolio for my TFSA. Since I haven't reached the TFSA limit, I'm going to be saving about $1k or so each month to keep putting into my investments, rather than doing the lump sum rebalancing every year. When I buy into my ETFs every month, should I 1) buy to rebalance my portfolio, ie., buying the ETFs I have that are underperforming and buying less of the ones that have been doing well so that my allocation stays the same throughout the year. It'll be more work every month to figure out the percentages. or 2) keep buying at my current 10/30/40/whatever allocation and just rebalance at the end of the year (thereby incurring selling fees, but buying less and just waiting things out overall) I'm leaning toward Option 1, I'm still buying low, and not selling in a panic when things crash, but I'm also riding stock highs and lows a lot more than just waiting for a once a year thing to take a look.
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Sep 15, 2015 00:40
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| # ¿ Apr 28, 2024 22:14 |
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So I'm im sort of a weird situation for financial prioritization. I'm finally on sound financial footing with loans paid off and several years into a defined benefit pension plan with the government. I've been diligently contributing money into ETFs in my TFSA through Questrade at a 100% equity allocation because I don't plan to touch that money until I retire and the db pension is my security since I can retire at 60 with 70% of my income. I changed jobs recently and feel comfortable that I can put about $15k a year starting January into my TFSA which is at about $40k now. I still have about $30k room in my TFSA and had planned to keep dumping that extra money in the market, but with stock markets at all time high I don't feel great about dumping all my newfound wealth into the market right now even if maxing my TFSA is a short-term goal. I know market timing is a fool's errand, but am I crazy for just putting that extra money into a savings account for a couple years and using it for a housing downpayment or just waiting for the market to die as literally everyone expects in the next couple years? It just seems crazy to me to throw money into stocks when we're at the tail end of a bull market. Note I don't plan to mess with my current portfolio since that's been accumulated over years and I'm fine with taking a big haircut on it. It's just these new contributions which would double my portfolio size in a couple years. I'm in my early 30s and in Toronto so saving up for housing is starting to become a thing with all the renovictions my friends are getting.
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Nov 5, 2019 21:28
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Thanks for the advice, everyone. And yeah I recognize the hypocrisy of the real estate bet but I only want a condo, I can afford it, and it'll take me several years of volatility in the market or real estate to save up a downpayment for something I plan to live in for a long time so the peace of mind is worthwhile. The way Toronto's going, I figure the real estate market will either keep being silly or tank with the recession so either way I'll want a downpayment in a few years for peace of mind if nothing else. Investing's irrational, I'm just trying to temper mine.
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Nov 5, 2019 23:16
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