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Middle Class Millionaire

Middle Class Millionaire
I rant about the market, stocks, retirement, saving money and anything and everything related to money, investing and retiring early. I will also share my financial progress and document my journey from middle class to an early retirement.

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Inflation
2008-08-21 15:30:00
Well for anyone (except apparently economists) it really shouldn?t come as a surprise that inflation in Canada is on the rise. The inflation rate in Canada is now sitting at approximately 3.4% versus 3.1% during the same period last year. Although 3.4% is quite manageable for most households it is the largest increase we?ve seen in the last five years. Here are the main culprits behind the rise:-gasoline up 28.6%-natural gas up 25%-food (avg) up 4.3%-bakery products up 13.2%-mortgage costs up 8.3%Note: Although our inflation is rising we are still a full 2 points lower than our U.S neighbours.
More About: Inflation

Great West Life ? GWO
2008-07-31 20:01:00
Well I?m happy to report that I?ve received another raise courtesy of one of my perennial dividend paying favourites, Great West Life (GWO). They announced yesterday that the quarterly dividend would be increased by 5%. They now payout $0.3075/share quarterly, which gives them a current yield of about 4.1%. It?s not a huge raise but in this environment I?ll take it.

U.S Housing - Just Walk Away...
2008-07-29 16:34:00
Well if you?re in the market for a house in Las Vegas or Miami they all just went on sale for 28% off. I?m not suggesting that they?re good value, just cheaper than they were. Compared with the previous year house prices in both Las Vegas and Miami dropped a whopping 28% last month. These markets sagged a full 12% lower than the national average, which saw declines of approximately 16%. With declines like these it is no wonder that the delinquency rate is rising. In many markets it?s now cheaper and faster to simply default on your mortgage and walk away from the house than it would be to pay off an inflated mortgage. In the amount of time it would take to pay off the value that you?ve lost on your home you could have saved enough money for another house and rebuilt your credit. For example, if you purchased a house last year in Las Vegas or Miami for $350,000 you would now be down a whopping $98,000 in equity. At that point the only financially responsible thing to do would be t...
More About: Housing , Walk

CDN REIT Sector Index Fund ? XRE
2008-07-22 20:56:00
ABOUT XRE?The iShares? CDN REIT Sector Index Fund seeks to provide long-term capital growth by replicating, to the extent possible, the performance of the S&P®/TSX® Capped REIT Index through investments in the constituent issuers of such index, net of expenses. The Index is comprised of securities of Canadian real estate investment trusts ("REITs") listed on the TSX, selected by S&P using its industrial classifications and guidelines for evaluating issuer capitalization, liquidity and fundamentals.?HOLDINGSRIOCAN REAL ESTATE INVST TR (REI.UN) - 25.33% H&R REAL ESTATE INVSTMNT-UTS (HR.UN) - 14.77% CAN REAL ESTATE INVEST TRUST (REF.UN) - 10.36% BOARDWALK REAL ESTATE INVEST (BEI.UN) - 9.32% CALLOWAY REAL ESTATE INVESTMENT (CWT.UN) - 7.49% CAN APARTMENT PROP REAL ESTATE (CAR.UN) - 6.98% PRIMARIS RETAIL REAL ESTATE (PMZ.UN) - 6.10% CHARTWELL SENIORS HOUSING (CSH.UN) - 4.90% COMINAR REAL ESTATE INV-TR (CUF.UN) - 4.42% INNVEST REAL ESTATE INVESTME (INN.UN) - 4.01% DUNDEE REAL ESTATE INVEST...

Turbulent Markets
2008-07-21 19:49:00
Anyone with even the slightest interest in the markets is now fully aware of the recent turbulence in the both the Canadian and American markets. Both the housing and financial markets have been in a virtual free fall for most of 2008. The analysts and newscasts have also switched from optimistic to doom and gloom. Consumer confidence is falling and the general feeling about the markets and housing is now very negative. On top of all that it looks like inflation along with interest rates may start to rise. All in all it?s not really a pretty picture. Given the dismal outlook on the economy what?s an investor to do? That's a great question that I certainly don?t have the answer to so...I?ll defer to my response to an investor who?s been here before.WARREN BUFFET?We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.??Our favourite holding period is forever.??Only buy something that you'd be perfectly happy to hold if the market shut do...
More About: Markets , Buffet

What Exactly is Personal Disposable Income?
2008-07-18 19:21:00
This is just a follow up to yesterday?s post and will hopefully clarify the definition of Personal Disposable Income that was used yesterday. According to Statistics Canada personal disposable income is :?the amount left over after payment of personal direct taxes, including income taxes, contributions to social insurance plans (such as the Canada Pension Plan contributions and Employment Insurance premiums) and other fees. It is a measure of the funds available for personal expenditure on goods and services and personal saving for investments as well as personal transfers to other sectors of the economy.?So basically personal disposable income = income ? taxes

Canadian Household Debt On the Rise
2008-07-17 16:02:00
The level of household debt has been steadily increasing for the last 20 years in Canada so it should be no surprise that it continued to rise again this quarter. The average Canadian household now has an average of 19.6 cents of debt for every dollar of networth and household debt is averaging about 123.8% of personal disposable income. This is a frightening figure at this stage of the financial cycle as it is much more likely that interest rates will be rising than decreasing. An increase in interest rates will of course make managing this debt much more difficult for many Canadian households. How does your household debt compare to your personal disposable income?
More About: Household , Debt , Rise

How satisfied are you?
2008-07-11 18:41:00
If you are thinking about enlisting the services of a full service broker you may want to check out the results of the following survey by J.D. Power and Associates. Their survey measured how satisfied Canadian investors are with full-service investment firms. Based on a 1,000-point scale here are the results:Edward Jones: 758Berkshire Investment: 752Wellington West Capital: 747Dundee Wealth: 731Raymond James: 729RBC Dominion: 728National Bank Financial: 727Credential Securities: 726Desjardin Securities: 724Canaccord Capital: 723Industry average: 720Laurentian Bank: 717CIBC Wood Gundy: 713Assante: 709Scotia McLeod: 699TD Waterhouse: 694BMO Nesbitt Burns: 689

High Interest Saving Accounts - Guest Post
2008-07-10 14:01:00
GUEST POST FROM http://nocommunism.blogspot.com/Middle Class Millionaire has foolishly agreed to let me do a guest post. I apologize in advance for the mass exodus away from his blog.... to mine! Ha ha!Sucker.Oh, right. I was supposed to make a serious point about something.Okay, most of us have a very similar problem. We don't have enough money. Even when we get a little extra, we're either using it to pay down debt, or we're plowing it back into our investments.If you were, say, this guy or this guy, you'd definitely want to place to park your excess cash. But where? Don't worry son, I can help!Let's start with the big banks, just so we can get them out of the way early. They all suck. The best one offered is RBC, which offers a high interest savings account at 2.75%. The catch is that all you get on that account is online banking.As for the other big banks? You either need ridiculously high minimum balances, or the rate sucks. Most are 2.25%, and quite a few have a minimum ...
More About: Post , Interest , High , Guest , Saving

Want to Retire Rich? Stay Married
2008-07-08 20:14:00
I think everyone out there knows at least a few people who have had to for one reason or another part ways with their spouse. Other than the emotional costs of divorce there is a huge financial burden as well. Let?s just do a little exercise, take all of your networth (including pension) and divide it in half. Before you divide your networth in half don?t forget to subtract the thousands of dollars usually required to legally file for divorce and all of the associated real estate fees that go along with selling the cottage, house etc...Next you?ll want to take all of your shared living expenses, mortgage, heat, hydro, gas, cable, internet, house taxes etc... and double them (because you?ll each need your own place now). Get the point? Divorce is expensive...so if money is tight it just might be worth working a little bit less (not more) and spend that time with your spouse instead....(especially if you live in Quebec) PROVINCIAL DIVORCE RATES Newfoundland and Labrador - 17.1%Prince ...
More About: Rich , Retire , Stay , Married

BCE Deal is Done!
2008-07-04 19:45:00
Well the BCE deal is finally going to be done and is expected to close before the 11th of December! I purchased BCE in December 2007 and although I didn?t expect the volatility, or the favourable ruling for the bondholders it is nice to see that my rational for buying was correct. To see my original thesis behind purchasing BCE please click here.Whether BCE is actually worth $42.75 is a whole other story though....
More About: Deal

Requesting Guest Posters
2008-07-02 20:18:00
As you can probably tell by the reduction in posts this is turning out to be a very busy summer for me at Middle Class Millionaire. So...I am asking you (readers and/or other blog owners) if you would be interested in submitting a post or two over the next couple of months. I am open to receiving posts on anything related to finances, investing, retirement planning, market conditions etc... I will post it on my blog but will of course give you all the credit for your writing. If you are interested please send me an email at middleclassmillionaire.blogspot.com or just leave me a comment with your email address and I?ll get back to you.Thanks.
More About: Posters , Guest

Are you Worried about a Breakup?
2008-06-26 04:00:00
Since posting about my recent purchase of GE I?ve been emailed a number of times asking if I?m concerned about the increasing pressure being exerted on GE to breakup. Well the answer is no, absolutely not! Personally, I think that the real value of a world class conglomerate like GE would be unlocked if it was broken up into their separate operating divisions. It?s very rare that large conglomerates trade at a value equal to the sum of their parts and I think that GE is no exception. As a shareholder of a conglomerate you really have nothing to lose from a breakup. Instead of owning many shares of one world class company you?d own less shares of many world class companies. The only difference being is that you can sell the divisions you don?t like and in all likely hood the value of the separate companies would be greater than that of the conglomerate. So to make a short answer long----breakups are an investors best friend.
More About: Worried

BCE ? A Sigh of Relief
2008-06-24 00:22:00
You could almost hear a communal sign of relief today as the Supreme Court of Canada dismissed bondholder objections to the proposed $35-billion deal to privatize BCE. Despite this ruling there is obviously still a lot of doubt on the street as the 30 million shares traded today resulted in only a 5.7% increase in the share price. Personally, I will continue to hold my shares and am speculating that this ruling will solidify the deal in the $41 to $42.75 range. Here is what some of the professional are predicting:-Troy Crandall at MacDougall, MacDougall & MacTier ? $42.75 (80% likelihood)-Joseph MacKay at Desjardins Securities Inc. ? $39.25-David Lambert at Canaccord Adams ? $42.75
More About: Relief , Sigh

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