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.