Portfolio Live - Investment Portfolio Rebalancing Spreadsheet

Portfolio Live v1p3

The objective of this spreadsheet is to allow you to re-balance your investment portfolio while reducing purchasing costs and maximize tax efficiency. It does not spread the funds (or stocks) across all accounts, but tries to keep all of each fund in just 1 or 2 accounts. 

Updated to version 1.3 on October 15th, 2015 to fix a minor bug. Updated to version 1.2 on August 28th, 2015 to add new functionality to allow you to balance the portfolio based on Asset Classes instead of just by each Asset (Fund or Stock). In the spreadsheet there are two separate sheets, one to do the calculation by Asset and the other by Asset Class. 

Version 1.1 added new functionality to allow you to force funds not to be sold from any of the accounts. This feature can be used to allow you to balance the portfolio as best as possible while not selling funds with unrealized capital gains in the Taxable account. 

Here's a link to the spreadsheet on Google Sheets. After you open this please make a copy to your own Google Drive.  

Here's a link to an Excel version. Note that in this version you need to enter stock, ETF and mutual fund prices by hand, or use this Google Sheet - Portfolio Prices - to pull prices from Google Finance and then paste them into the Excel spreadsheet. 

Financial Studies 1 - RRSP Withdrawal Strategies?

What is the question?

I have three questions I want to answer with this blog post. 

1. Should you begin withdrawing RRSP when you retire, or wait until some later time such as at 71 when you are forced to begin withdrawals?
2. What is the amount of withdrawal from RRSP, relative to withdrawals from other investment accounts, that will maximize value?
3. Will you maximize value by setting income from RRSP to make your taxable income the top of a specific tax bracket?

Financial Basics Update #1

I have made the following changes, updates and improvements to the Financial Basics series.

August 5, 2015

Financial Basics 2 - Income Tax

I removed the comment that the tax rate in Alberta is a flat 10%, since this will be changing in 2016.



Financial Basics 3 - How Different Savings Accounts Work

I added the following bullet to the description of an RRSP account

• Contributions do not have to be deducted from taxes in the current year and can be carried over and deducted in subsequent years.

I modified the following under TFSA for the change in TFSA limits in 2015.

• Contribution limit for 2009 to 2012 was $5000, for 2013 to 2014 it was $5500 and is now $10,000 from 2015 onward.  The contribution limit used to be indexed to CPI (consumer price index, or inflation) and rounded to the nearest $500, but with the increase in the limit in 2015, the indexing now no longer applies. 

Financial Basics 4 - Self-directed Accounts

I added the following paragraph to clarify why you would need a US $ account.

If you will be trading in securities in US dollars, or need a US $ account and credit card for purchases in the US, the following features are required. They come free with an Investorline account.

• US dollar conversion and US dollar cash account within Taxable account.
• Ability to pay your US$ credit card from the US dollar account.

Retirement Planning and Forecasting

Retirement Planning and Forecast Spreadsheet (for Canada)

Note that this version of the spreadsheet is now out of date. Go to my post on the new version here.

Updated to version 1.12 on May 7th, 2015 for update to TFSA limit and RRIF minimum withdrawal percentages. Download new version here.  See bottom of post for a list of enhancements and fixes. 

This spreadsheet allows you to make an accurate financial plan for your retirement, starting at any time in your life.  Unlike many retirement tools, this spreadsheet shows a cash flow forecasts vs time and identifies which account money is saved into (during employment) and which account or source the retirement income is withdrawn from.  It handles the different account types (RRSP, LIRA, TFSA and non-tax free account), the limits imposed on them and does income tax calculations for any of the provinces.  

The picture below shows the main page of the spreadsheet which contains all the inputs you need (in yellow) and provides a cash flow forecast and how the savings accounts increase and decline.  

I hope you find the tool useful and I am always willing to hear of suggestions to improve it. 

Financial Basics 11 - Optimum Frequency to Reinvest Cash Dividends and Interest

This post is about the frequency at which you should re-invest the cash dividend (or interest) payment you receive from your ETF funds.

Normally you will received dividends or interest from mutual funds or ETFs either monthly or quarterly. Many stocks return dividends quarterly.

Financial Basics 6 - Saving and Investing Strategy

This post is about our saving and investing strategy. We all share a common goal of retiring comfortably.  What I want to do here is summarize a set of guidelines that will help us maximize the success of our savings. 

In my Financial Basics post #5 I referred to Jim Collins Stock Series set of blog posts and asked you to read the first three of those. You should also read this one that's not part of the stock series - How I failed my daughter and a simple path to wealth. If you haven't read them yet, go and read them and then come back here. 

Financial Basics 5 - Types of Investments

This post contains brief information on the different types of investments available.  In a later post I will discuss which one of these types I recommend (Index tracking ETFs).

Toronto Stock Exchange 

From the "Types of Investment Accounts" post you will recall the 3 level hierarchy (for saving and investing accounts)

• Bank or Investment company
• Type of account (TFSA, RRSP, RESP, Taxable)
• Type of investment

Financial Basics 4 - Self-directed Accounts

This post is about what type of account you should have to contain all your different types of savings accounts. From the title you should expect that I am going to suggest a self-directed account and you are right. For clarity, I will refer to this as your Trading Account, so that I don't confuse it with the savings accounts (TFSA etc.). This trading account will be with one of the big banks or an online brokerage.  

The Bank

(A famous night club, now restaurant, in Calgary.  My wife used to go there in the 80s)

Recommendation

I use BMO Investorline. I have made a list of functionality below that you should look for in a trading account, and mine has all of these. Trades are $9.95 and you can find trading accounts with cheaper trades, but I only need to make about 20 trades per year.  

Financial Basics 3 - How Different Savings Accounts Work

This post is about the different types of savings accounts you can use in Canada.  

Article was edited March 2017, to update TFSA and RRSP limit amounts.

There are 3 levels of hierarchy to savings accounts and investments.  The three levels are:

• Bank or Investment company
• Type of account (TFSA, RRSP, RESP, Taxable)
• Type of investment

Financial Basics 2 - Income Tax

This post is about understanding income taxes enough to know how they impact saving, investment and retirement income.  Income tax is a very complex subject and this post will NOT be a complete summary of all the income tax laws and rules (in Canada).  This post will attempt to summarize just what you need to know for saving and investing, provide links to additional references (if you wish to read more) and also links to tools to help understand the quantitative impact of income taxes. 

If you are not familiar with the origins and purpose of income tax you should read the Wikipedia entry on the subject Wikipedia: Income Tax. Pay attention to the sections "Defining Income" and "Deductions Allowed" as these are important concepts when considering saving and investing as not all types of income are taxed in the same manner, some contributions to savings (ie RRSP) are deductions and some investment income (ie dividends) are allowed tax credits against taxes. 

Financial Basics 1 - Stuff I wished I knew when I was 22

I've had this blog up for a couple of years now.  All I have posted so far are some spreadsheets that I wish to share with others.  Two are related to my profession and two related to retirement planning. Spreadsheets eh?  Yes, I am an Engineer.

I'm thinking that it is time to broaden my horizons and actually write posts about subjects other than spreadsheets?  Will anyone care?  Maybe not, but I'll let the readers decide that. 

This post is about summarizing in a simple way the basic information one needs in order to save and invest for retirement or financial independence.  I now wish that I would have both received and heeded this advice when I was starting out in the working world, mainly because I would have worried less about investing and would not have made some mistakes that cost me a bit of money along the way.  Not losses per se, but more like gains that were missed.