Our 2021 Portfolio

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What a year 2021 has been. A new US president. An attempted coup in Washington. The development of a miraculously effective vaccine in record time and the start of the largest global inoculation campaign in history, only to be derailed by a new super infectious variant just as the end of the pandemic looked to be in sight.

To say it was all a bit head-spinning would be a massive understatement. Let’s take a look at how all this news has affected our investments.

Rising Economies Lift All Portfolios

Even though all we can think about right now when it comes to 2021 is the resurgence of the pandemic, we have to remember from the stock market’s perspective that the vast majority of 2021 was focused on two events: Mass inoculation of the world’s developed economies and those economies re-opening as a result.

U.S. unemployment levels peaked during the height of the pandemic at 15% in March 2020 before beginning it’s slow inexorable march back down, hitting just under 4% at the end of 2021. A similar trend occurred up here in Canada.

And while world events like the January 6 insurrection and the arrival of Omicron definitely provided plenty of anxiety along the way, the fact of the matter is that the world economy was so sucky at the end of 2020 that it was hard for stock markets to go down any further.

So instead, they went up!

In 2021, the US Market led the global economic recovery, increasing a stunning 28%!

The Canadian TSX did similarly well, popping up for a total 25% gain for the year.

The MSCI EAFE (Europe, Australia, Far East) Index was the big laggard on the equity markets this year, increasing by “only” 11%.

So basically, everyone who invested in equities this year made money. No matter what index people chose, it went up, with the USA-centric investors doing the best.

Bonds, on the other hand, were another story. In an advancing stock market, it’s actually expected for bonds to go down as bonds tend to move in the opposite direction of stocks, and this year was no different.

One rather interesting side story to all this is the Canadian Dividend Index that we track through the ETF PDC. This ETF is the last of our “Yield Shield” assets, and concentrates their holdings on banks, insurance companies, utilities, and other high-quality companies that pay above-average dividends. These companies were also the ones that were affected the most when our banking regulators forbade dividend increases in 2020, so when those regulations were removed, big dividend increases were announced by all our major banks, and this was reflected by PDC’s over-performance this year, clocking in a stunning 30% gain for the year, beating even the US Market!

Put it all together in a 75% equities/25% bonds allocation and we got a really solid 15% overall performance on Portfolio A!

Portfolio B went up even higher, clocking in at 45% for 2021, but as always it’s not a particularly useful number since a) Portfolio B is invested more aggressively than Portfolio A and b) we added money over the year so part of that gain is new cash.

Put it all together and that means our overall net worth went from $1,549,000 at the end of 2020 to $1,841,000 in 2021, for a net gain of 19%!

And while I’d love to point to a decision that I consciously made in 2021 that resulted in these eye-popping gains, the truth is that everyone who followed the Investment Workshop and was fully invested at the beginning of 2021 would have had a similar result. The only material difference between our personal investment portfolio and the Investment Workshop is that we’re now at 75/25 while the workshop is 60/40 (our initial allocation when we first retired), but even 60/40 portfolios did well this year, clocking in at a respectable 12%.

The Yield Shield Works!

Long time followers know that in the FIRE space, we’re probably one of the most cautious early retirees out there. While many other FIRE bloggers were comfortable with a sky-high equity allocation of 90% or more and relying on continuously increasing stock markets to fund their retirement, we stubbornly stayed on a more conservative footing and kept our equity allocation at 60% for many years. We’ve also used the Yield Shield strategy coupled with a Cash Cushion to protect against having to sell anything during a down market. And now, as we enter our seventh (!) year of retirement, MAN are we glad we did that.

Since 2015, we’ve endured the Saudi oil crisis of 2015, two polarizing US elections, a government shutdown in 2018, and oh yeah, a global pandemic in 2020 that’s still ongoing. All these events injected massive volatility into financial markets, and if we were simply high-equity cowboys we would have had to sell at a loss at some point to fund our continued retirement. But because of all the systems we put into place, not only did we not have to sell at a loss, we were still able to participate in the inevitable recovery as our portfolio marched higher and higher.

That being said, the Yield Shield was never meant to be our “forever” portfolio. We were pure indexers when we were working, and our plan is to return to being pure indexers at some point in the future.

Turns out, that point may be now.

Because after I finished my year-end analysis of our 2021 portfolio, I came to a rather interesting realization: That the overall yield on our portfolio, even without any Yield Shield ETFs, was enough to support our spending going forward.

Here’s our asset allocations for both portfolios, along with each asset’s 12 month trailing yield.

Canadian Index (TSX)16.0%2.70%
Canadian Dividend Index9.0%3.63%
US Total Market Index25.0%1.17%
MSCI EAFE Index25.0%3.20%

If we were to plug in our current portfolio value into these percentages, we realize that, when added, together, the yield we’d get from just holding them is greater than our entire 2022 projected budget!

AssetWeightYieldProjected Income
Canadian Index (TSX)16.0%2.70%$7,953.12
Canadian Dividend Index9.0%3.63%$6,014.55
US Total Market Index25.0%1.17%$5,384.93
MSCI EAFE Index25.0%3.20%$14,728.00

Now, what would happen if we were to eliminate the dividend index and combine it with the TSX?

AssetWeightYieldProjected Income
Canadian Index (TSX)25.0%2.70%$12,426.75
Canadian Dividend Index0.0%3.63%$0.00
US Total Market Index25.0%1.17%$5,384.93
MSCI EAFE Index25.0%3.20%$14,728.00

We’re still good!

In fact, what would happen if we were to increase our equity allocation from 75% to, say, 90%?

AssetWeightYieldProjected Income
Canadian Index (TSX)30.0%2.70%$14,912.10
Canadian Dividend Index0.0%3.63%$0.00
US Total Market Index30.0%1.17%$6,461.91
MSCI EAFE Index30.0%3.20%$17,673.60

We’re STILL good!

So despite our naturally conservative nature, the math is now telling us that we should make the following changes to our portfolio in 2022…

Return to Pure Indexing

While our Yield Shield strategy has worked out brilliantly, we’ve been gradually divesting ourselves of these alternative assets for a few years now as the need for the additional complexity has receded, and now it looks like it’s time for our Dividend Stock Index to ride off into the sunset for its well-deserved retirement.

We probably won’t do this right away because I still think there are more outsized dividend increases that are going to be announced over the next few months, which will benefit the Dividend Index in both yield increases and capital gains, but once that’s over and the market has fully digested the news, I think it’s going to be time to merge our final Yield Shield asset into the general index.

Once this happens, we will have fully returned back into our old portfolio strategy of being pure indexers, and I for one couldn’t be happier. Not only will this reduce our overall portfolio fees (PDC has an MER of about 0.56% compared to the pure index MER of just 0.06%), it reduces our portfolio’s complexity. After this is done, our Portfolio A will consists only of 4 ETFs: A bond index, the Canadian equity index, the US equity index, and the MSCI EAFE index. Just as we always intended.

I expect this move will happen sometime in the first half of 2022, and we will be sure to announce when that happens right here on this blog.

Eliminate our Cash Cushion

Another thing that we’ve been doing to protect against market downturns is keeping a cash cushion separate from our portfolio and our current year living expenses. If you recall from our book when we wrote about our “Buckets & Backups” strategy, we determined how big this cash cushion should be based on the difference between our portfolio’s annual yield and our upcoming year’s spending expectations.

We generally like to keep enough in our Cash Cushion account to cover 3 years of down markets, so the formula for this amount is the following.

Cash Cushion = (Upcoming Year Budget – Yield) x 3

When we first left, our annual budget was $40,000. And when we left, all our Yield Shield assets were going at full strength, bringing our yield up to 3.5%, or $35,000 on our initial $1,000,000 portfolio. That meant that we kept ($40,000 – $35,000) x 3 = $15,000 in our Cash Cushion.

But now that our investments have grown so significantly, our yield (even without Yield Shield assets) is sufficient to cover our living expenses completely (which have, due to FIRECracker’s meticulous tracking, remained at $40,000). That means that according to the same formula, our Cash Cushion requirement is now $0.

We no longer need a Cash Cushion, which is great since it’s one less thing I need to keep track of going forward.

Increase our Equity Allocation

And finally, the math is now telling us it’s time to cowboy it up. After all, if our living expenses are covered by yield, then we really don’t care much about market volatility anymore. Even if dividends take a 10% hair cut like they did during the 2008/2009 financial crisis, we’d still be fine. And as FIRECracker likes to point out, if things got as bad as they did then, our expenses would drop as well, which they absolutely did during the pandemic.

So…I think it means we should increase our equity allocation to 90%!

It feels weird typing that out, since I’ve spent most of our retirement looking at those 90%+ equity cowboys and going “That’s way too risky.” But you can’t really argue with the math, can you? If market volatility no longer affects our ability to pay our bills, then it no longer makes sense to use bonds to reduce it.

That being said, I think I’m going to stick with a max equity ceiling of 90%. After all, if we go 100% equity, then it eliminates any rebalancing opportunities when stock markets take a dive.


2021 has been an absolute roller coaster, but as it turns out everyone who followed our Investment Workshop has seen their portfolios go up by at least double digits. We’ve achieved a lot together on this weird little blog of ours, but if there’s one thing I’m definitely proud of, it’s that we helped make our readers a lot of money, and this year has been one of the hottest ones. I don’t know what’s going to happen 2022, but to everyone reading this and followed our advice, give yourselves a pat on the back for doing the right thing.

Pop yourself a bottle of champagne, people. You’ve certainly earned it.

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65 thoughts on “Our 2021 Portfolio”

  1. Great write up. And it shows once again that with greater wealth one can “self insure” more. In this case, you no longer need the cash cushion both because of the dividend yield and because even with a major sell-off you have significant assets. I followed a similar trajectory. I DO hold I bonds yielding north of 7 percent currently as an “if all else fails break this glass” emergency fund, but I doubt I will ever need to tap them. What I like is that with the I bonds at least I’m keeping up with inflation partially rather than losing ground in a bank account.

    You said the yield shield “worked out brilliantly” but I’m guessing had you just been doing classic indexing the whole way post retirement you would have a higher net worth now. Do you agree? I think needing the psychological reassurance of “income” rather than capital gains holds people back. Welcome your thoughts.

    1. Maybe, but the Yield Shield is meant to prevent the possibility of selling at a loss, which is how a retirement can fail, so think of it like the Yield Shield boosted my 95% success rate (as per the 4% rule) to 100% without needing a bigger starting portfolio.

  2. Nice post! Quick question. What program do you use to track/graph the ‘net change’, ‘rate of return’, and ‘investment growth’? Thanks!

  3. Congratulations! Your portfolios seem to do really well indeed. Really awesome that the cushions are no longer needed. But I think the concept remains a crucial and good idea. The markets could have behaved very differently when you just retired and then it would surely have mattered.

    With what the markets are doing now (and today…) it will be an interesting time. Especially when the rate hikes are real and not just on the horizon. For me, it will be the first time I’ll have to learn not to sell even though things may be going down for a while. I have no idea how the market will react to the actual rate hikes.

    I’m very curious to see what bonds will do as well. Because according to people like Dalio they haven’t been behaving as they should have. Will they now?… Interesting times!

    1. Oh, they’re interesting times all right.

      While interest rate increases do typically make the stock market drop, there’s still so many supply chain issues holding the economy back that as those pressures alleviate, I’m still expecting stock markets to advance.

      Or rather, the upward pressure still seems greater than the downward pressure of rising rates. I guess we’ll see…

  4. Good for you!
    I am still just 4 years from starting retirement, but I am also laying plans to glide back to higher equities again over the next few years as my sequence of returns risk period closes, and with the help of these outstanding last 2 years, my portfolio generates a nice safety margin — away from the razor’s edge.

  5. Can you help me understand why you have such hesitation to sell equities in a down market to fund your retirement? I’m one of those 80-90% equity “cowboys” you refer to. The S&P has produced around 15.5% average return over the past 7 years for me. Has your 60/40 done better then that over 7 years? Excuse me if I am misunderstanding you but a few paragraphs you wrote seem to claim your 60/40 yield strategy produced better overall returns then my “cowboy” equities portfolio which I developed and believe in backed by Collins and Boggleheads. Appreciate your content and thank you!

    1. I agree with you. I think it was just their way of staying safe though. You have the advantage of looking backwards at your actual returns and saying wtf? But looking forward it is not as clear when the market may dip red. Having the cash on hand and not having to sell is comforting.

    2. If your portfolio yield covers all of your living expenses, there is no need to sell any of your equities. In a down market, if the price of your shares happen to be bellow your average cost base, why crystallize your loss if you don’t have to? Selling your shares in down markets, combined with an adverse sequence of return (e.g. 3 consecutive negative return years) could really hurt the value of your portfolio. The thing to do would be to buy more shares at the low price if you can and wait for the market to rise again.

    3. If your retirement fails, it’s because you were forced to sell too many assets during a temporary downturn. Because indexes always eventually rebound, if you sell at a loss, you won’t have enough units to participate in the recovery.

      So if you don’t want your retirement to fail, don’t sell at a loss! That’s what the Yield Shield does, it prevents you from being forced to do exactly that.

  6. That’s exciting that you’re considering moving your allocation back up! Congratulations on the success of your portfolio! 🎉

    We are nearing retirement and looking at possibly making the opposite move as we are mostly in equities. It will definitely flip the psychology and mechanics we’ve been using to get here, so it will be interesting!

    1. Thanks so much!
      And yes, that’s the strategy I would recommend as well. Go heavy equities as you’re accumulating, flip it to more conservative (60/40 + YS) in the early years of retirement, then pivot back to equities as sequence of return risk fades into the rearview mirror.

      Congrats! You’re going to love retirement 🙂

  7. But what happened to your Preferred Shares? You only mentioned the high dividend etf PDC. With regards to your BOND holdings are you still in VAB or have you moved them all to Short Term Bonds?

    1. Great question. The bonds in my main portfolio are short-term bonds, though to be honest if you stayed with an aggregate bond fund it didn’t really change your overall portfolio performance all that much.

      In my Portfolio B, I replaced my bond portion completely with preferred shares. This is because a) Portfolio B is stored completely in a taxable account so preferreds are more tax efficient and b) Portfolio B is more aggressive than A since it’s money I invested after retirement.

      Hope that helps!

  8. Congratulations to you guys, I hope 2022 will be a better year for you two and the pandemic is resolved. I think I’m not doing your book correct since I invested singularly in XGRO using Wealthsimple ($500 every 2 weeks) but it only shows a growth of about 5%. Can someone in the chat help me with my calculations?

    1. XGRO still made 15% in 2021, so it might be because of how Wealthsimple reports your portfolio returns. I’d ask their support people why the reporting is so off if I were you.

  9. Interesting you changed from 60/40 to 75/25, and now to 90/10. I think this was a good decision and this seems to be a general trend in the market. Lots of institutional investors seems to be doing this move. I think it make sense. With higher level of government debt, yields so low and potential higher inflation in the future, bonds are potentially the worst investment today.

    I think people (including institutional investors could even go 90/5/5, where bonds are splited half-and-half with gold. 90% equities / 5% cash or short-term bonds / 5% gold. 5% cash for liquidity (emergency need) and 5% gold for long term protection and the safety it procures as liquidity.


    Personally, I’m in the “high-equity cowboy” crowd. I pushed that a little bit too far though. I was 130/-30 equity/bonds before the pandemic, meaning I was borrowing to invest (aka short bonds). This worked well, but this was a hell-of-a-ride, particularly in 2020. Not sure I want to do it again. One advantage of using this method however is that the risk (leverage) go down as the stock market goes higher. So today, I’m already less risky with a 118/-18 porfolio.

    I like the 90/10 portfolio. I might consider it for the future. My return for 2021 was +25.8% for equity portofolio only. My total return including the leverage was around +36.5%. So, that may be not worth it considering the higher risk involved. And since I’ve seen that even the MonkeyBoo did better with a +41% return, I can certainly find a way to do better without the leverage…


    I think the reason why there is not a big difference with or without your Yield Shield is because the two ETF you use are very similar. Probably all Canadian Dividend Index are inside the TSX. And probably 60% to 80% of the holdings inside the TSX are inside the Canadian Dividend Index.

    I also agree with you that they are presently undervalued. Lots of dividend stocks have not participated in the stock market rally. But lots of them are very good and stable companies. That may rebalance eventually.


    We often don’t think about that, but lowering expenses and limiting/eliminating borrowing may be the simplest way to reduce risk. The fact that your portfolio yield cover all your expenses and that you don’t have to worry about market volatility is a great demonstration of how this strategy plays out.

    Congrats for the excellent year 2021. Wish you the best going forward !

    1. Yikes, you were 30% leveraged in 2020? Well, glad it worked out for you but that year was stressful enough without having to worry about margin calls on top of it.

      1. No worry about margin calls. These are all fixed-term loans. No margin call possible.

        Still stressful though. Leverage can improve positive returns, but it goes both ways.

  10. Bryce – One question regarding increasing your equity position:

    Since we’ve had such a strong performance of equities over the past two years & you’ve maintained the 75/25 allocation, if you shifted to 90/10 in a strong market, you’d effectively being selling cheap bonds and buying expensive securities.

    Don’t you think it would make more sense to Dollar Cost Average, or more appropriated stated, throttle your transition to the holding percentage over the course of months (rather than an immediate rebalance).

    This way, you’d continue to leverage the power of Modern Portfolio Theory you wrote about in your book (same reason why you won’t go more than 90% securities, i presume)

    1. Rebalancing back to your previous target allocation is the correct thing to do if your risk tolerance didn’t change. Ours did because our dividends are now enough to cover our living expenses, so we can afford to increase our risk tolerance. I think this is as high as we’re going to go though, so going forward yes we will be rebalancing things that went up and buying things that went down.

  11. Since most of us here hold index funds, I am curious about what your prediction is on the dividend yield of a fund such as VTI for 2022.

    Below is the dividend payout per year per share for VTI:

    2021 $2.9300
    2020 $2.7670
    2019 $2.9050
    2018 $2.6000
    2017 $2.3430
    2016 $2.2150
    2015 $2.0670

    1. MSCI EAFE Index does not include emerging markets so looks like they did. I wish they would not just skim over these sorts of things like removing preferred shares and emerging market and not provide any of their thoughts behind those moves.

    2. I did, but it was such a small part of my portfolio (and didn’t really have much of an affect on my overall performance one way or another) that it didn’t really matter.

  12. Thanks for sharing how your strategy is working out! Very inspiring 🙂

    Personally, I’m still in the accumulation phase and have about 2 more years to go. I’m using a portfolio that is slightly leveraged with 40/45/7.5/7.5 (stocks, bonds, gold, utilities). Nice risk properties and the leverage elevates the returns to usable levels (14% this year).

    Regarding the cash cushion, I’m rather risk averse so I would calculate the need for the cash cushion with the portfolio yield after a hefty drawdown.

  13. Yes, increase your stocks and be a stock picker. ETF combine the good and bad in their indexes and will always have low dividends and limited movement.

    My total portfolio amount is similar to yours but my dividends are about $90,000 a year.

    Inflation will not be transitory but will be super high from now on. Your cost of living will only go up and will not go down.
    My only bonds are US Savings EE and I bond. Now US I bonds rates are determined by US inflation rate and are paying 7% for the next 6 months!!!!

    I’m proud to say I have mainly an old school portfolio with banks, oil, energy, tels, consumer, health care all having mostly high dividends 1-7% and for 2022 their all going up.

  14. Hi guys, first of all, thank you so so so much for sharing this information with us, and you are right not only for helping us to make some good money (oh boy!) but maybe the most important by helping us do it with confidence and far less stress.

    Believe it or not, the knowledge you have shared has saved or restored several years of life that I had been losing with so much stress and uncertainty. But thanks to how you have managed to transmit the message has eliminated or drastically reduced those stress levels and is priceless. Your success makes me very happy.

    My two sons, 16,14 years old, have already read the book. And the 8-year-old is already lined up.

    God bless you with true wisdom, as usual; this was Brilliant; you are a natural WRITER and in the best subject!!!

    1. Wow, thank you so much! It’s always great to hear when our blog manages to make our readers money AND lowers their stress levels. You are kicking ass at life, keep it up 🙂

  15. The thing I like the most on this blog and about you guys is that you don’t shove that crazy 90% or 100% equity down the throat of your audience like many bloggers out there do. 60/40 is a great portfolio for 95% of us out here
    Congrats on that and keep up the great work

  16. I really like that compared to other fire bloggers you guys were always so conservative.

    Keeping a decent percentage in bonds, having a cash cushion.

    I am a bit surprised that you will increase your stock holdings so high to 90%.

    I doubt anything will go wrong, but was nice to compare a conservative portfolio with the other more aggressive growth portfolios over the last few years!

    Any other year, anyone would love a 15% return from a 60/40 portfolio. It’s dwarfed by returns in 100% stock portfolios.

    Our Australian index is up about the same as Canadian and US pretty crazy returns.

    1. I still recommend 60/40 for those that are new investors and especially if you are about to retire.

      To be honest, I was surprised when the math suggested that I no longer need to be as cautious, and it took some time getting used to the idea of such an aggressive allocation after so many years of being more conservative, but your risk tolerance does change over time as your life circumstances change, and that’s what happened here.

      Glad you enjoyed our blog all these years! Here’s to many more!

  17. “That being said, I think I’m going to stick with a max equity ceiling of 90%. After all, if we go 100% equity, then it eliminates any re balancing opportunities when stock markets take a dive.”

    Awesome! Did you do any re balancing in March/April 2020 when you had a higher fixed income percentage?

    Congratulations and thanks for the update. I love how you make adjustments on logic and math and not emotion.

    1. “Did you do any re balancing in March/April 2020 when you had a higher fixed income percentage?”

      Oh yeah. LOTS of buying opportunities during that period. Plus, we were all stuck inside with nothing else to do.

      1. I would love to see a blog post on your rebalancing activities from last year and how you’ve rebalanced going into 2022. I’ve been following you guys for several years and I enjoy figuring out your mindset so I can incorporate into my own investing habits! 🙂

  18. I think you should slow down a bit. A couple points to consider:
    1. Dividends are not guaranteed, even with index funds. For example, VCN dividends were lower in 2020 than in 2019. I think it’s a good move however to merge your Canadian dividend ETF in the broad index one.
    2. Switching to 90/10 and eliminating your cash cushion greatly increases your risk and reduces your capacity to whether a prolonged downturn. I don’t think that’s a good idea for anybody in retirement.

    If I were you I’d stick to 75/25 for the time being, at least until we’re out of the pandemic. Progressively reduce the cash cushion, but keep 1 year in cash, if nothing else than for the sleep-at-night factor.

    I happen to be on the brink of early retirement (less than 1 year) and my lifetime asset allocation also happens to be 75/25, plus a 2-3 years cash buffer that I will reduce as time goes on. I would already have left my job if it wasn’t for the pandemic, but I continue grinding while I have the luxury of working from home.

    1. Correct, dividends are not guaranteed, but they’re a lot more resilient than you think. During the 2008/2009 crisis, dividends on an index portfolio only went down about 10%, and during the pandemic, dividends only went down about 5% before coming back up.

      Note that dividends for individual stocks can absolutely get creamed, but the diversification in an index fund prevents sector-specific issues from affecting the overall market’s yields too badly.

  19. Don’t you need a lot of men with guns to over throw a government. Where did you see the insurrection? Thailand or was it Afghanistan? There was no insurrection at the Capital on the 6th, there were no weapons and there is no way their breaking an entering with FBI inciters was going to change anything. You and the rest of the democrats just need to keep Trump from running again. The real problem is all the useful idiots that are helping our elected dumbocrats spends our country into hyper-inflation giving everyone of their 1%r buddies free money and driving up the cost for the rest of us. All the while these communists are taking over every institution and destroying our rights. Wake up! Canada is even worse.

      1. Parlor was taken offline by the hard left commies. Stay in Canada and learn about what freedom of speech used to be.

  20. HXT, HXS, and HBB Canadian ETFs follow/mirror their corresponding indexes for stocks and bonds … but since they are just mirroring the indexes … stock(dividend) and bond returns are incorporated into their pricing … so bond returns and dividends are not actually taxed until you sell ETF shares … rounded out with VDU and VEE makes an interesting combo … worth a look?

    1. I used to own funds that did similar things as Horizon that used swap contracts that convert interest/dividends into capital gains, but then-finance minister Jim Flaherty changed a rule outlawing that particular strategy and the fund plummeted as everyone rushes for the exit.

      After that experience, I stay away from funds that rely on tax loopholes. It’s just too vulnerable to regulatory changes.

  21. The downside to changing your asset allocation based off of recent performance and changing of perceived necessity is that if stocks crash 40%, your portfolio is back down to 1.2 mil or so. And then you need the yield shield again supposedly. And by then, you will have to rebalance BACK to 75/25 or 60/40 which actually would be selling equities when they’re low. Much in the same way, rebalancing to more equities now after a successful run up is buying equities when they’re high.

  22. Great job to the both of you. I’m glad things are going well and happy to see that buying and holding index funds works.

    I’m 46 and the wife is 43. We’re at 80/20. The 20% bonds is 5 years of expenses. Our portfolio at the end of the year was $1,125,000. Currently it’s at $1,072,000 because of the recent January decline. I’m looking forward to a re balancing opportunity if this continues.

    We hold VTI VXUS in taxable and VT BNDW in our IRA’s.

    I have a feeling 2022 will be a very volatile year.

  23. When every government is printing more money than ever before this investing doesn’t seem to work. The 60/40 style was actually negative when you take into account ~15% debasement of fiat. So the 12% gains didn’t even stave off inflation. Your $100 became $112 but your purchasing power is now $95. Seems like the aggressive profolio is the better option in these times of crazy printing. No bonds seems like the answer. Why not 100% s&p? Or better yet just pick the top 20 of the s&p?

  24. Great recap. 2021 was certainly a good year for investors. Like you we are conservative early retirees. Our living expenses have always been covered by our yield, but due to our conservative nature we have always maintained a cash cushion (18 – 24 months of expenses in our case). I understand that it is not feasible for everyone to build up so much additional cash before taking the plunge into retirement, but I’m surprised that you’re considering eliminating your cash cushion. As your assets in retirement continue to grow it’s a great opportunity to build up your cash cushion further to mitigate against future unforeseen risks.

    I know that from a strictly financial standpoint this is inefficient, but it is an opportunity to add an additional safety net. Who knows what the next crash or upheaval will bring. But it could be unlike anything we’ve seen in the last 100 years (just like this pandemic), so I know that I always sleep better knowing that we have a year or two of living expenses set aside in cash.

  25. Can you please let us know what etfs each of your portfolios are in?
    I’m trying to find it but can’t (and also just read your book)

    Also, can you clarify which of the etfs are in which of your accounts (tfsa vs rrsp vs non registered)

  26. @Wanderer – You’re average dividend yield currently is 2.6%. That only makes you $45k because you have $1.6+M in the bank.

    What are those with $1M in the bank suppose to be doing right now? Using our cash cushion until dividend yield increases?

    Also, if you could please include a list of the actual ETF’s / stocks that you invest in, that would be super helpful. Thanks!

  27. Hello,
    love your blog. Can you please tell us the exact tickers and and their percentage for the Canadian audience. When I look at the investment workshop it still shows 60/40. I would like to see exactly which ETF you have and what percentage of those you hold. So we can follow the same path.
    Also, for some of us who wants to rebalance from 60/40 -> 90/10. Should we do it in one go or should we do over few months/weeks ?

  28. You use $ next to your net worth amount. Just to clarify, is your net worth stated in U.S. dollars or Canadian dollars?

    I know you’re Canadian, but you also have Canadian/American readers.

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