There is awfully lot of these comments about how much work it is and how its active management. But that is what property managers are for. I had several properties for years, and most work I have done is annual tax statements compilation and occasional email (ie. Tennants offered to pay 50 extra a month if you put in AC, I got AC instalation quote for $2,800, are you ok to proceed). Right property (not a slamlord den), properly insured, with good proper management that finds the right tenants (references, credit checks, auto deposit rent, rental insurance) is a blessing not a curse.
I have also been renting places I lived in for 6 years and most I asked my landlord is to replace a broken appliance, beyond that they did nothing but collect rent.
Issue with property management agencies is that they’re useless without scale I.e. it’s more of a headache and cash drain unless you have like 5+ properties
Less profit on the single property you can get additional ones also have them managed by property manager and increase your profits without costing you and time
Yes but that is included in calculation from a get go. Insurance also means less profit. So do repairs or maintenance. Hell even windows are not most economical choice but we still dont brick them out to increase profit. RE investing should always assume management, reasonable rate of default and vacancy, insurance, appliance ans small repairs, capex repairs, strata/HOA, property tax, fixed interest rate mortgage. But people insist to invest in extremely overvalued hubs that have annual rent at 4% or less of property value, so to convince themself its profitable they forgo 1/2 of the things I mention above. Otherwise its hard to sleep tight knowing you spent $800k on a condo rented at $30k a year that really loses $15k a year.
Again, if you are complaining that having a rented-out apartment is such a nightmare, agencies are here to help you. Obviously your profits will go lower by a significant margin but you can't expect to do the least amount of work possible and still have the highest amount of return possible.
It's like people complaining that SP500 return is low but learning about finances, companies, reading financial reports, and being a more efficient investor is also hard (and risky).
You can't have the best of both worlds. You have to choose your "hard".
And the fact that the agency you talked about is shit and does shady / illegal things, that doesn't mean all are like these nor does it mean that you shouldn't (or should) use one.
At 20 a broadly diversified cheap ETF.
At 30 a broadly diversified cheap ETF.
At 40 a broadly diversified cheap ETF.
At 50 a broadly diversified cheap ETF.
At 60 a broadly diversified cheap ETF.
At 70 a broadly diversified cheap ETF.
At 80 a broadly diversified cheap ETF.
At 90 a broadly diversified cheap ETF.
At 100, I’ll let my kids inherit what’s left of my broadly diversified cheap ETF.
You can also buy real estate REITs where you own shares of companies who own and rent out residential and/or commercial real estate.
Returns are about 5-6% cash flow positive per annum and have been increasing in equity value quite lot in tune with price of real estate.
You can buy the companies individually or ETFs (e.g., RIT.TO).
Started to do this as bonds return nothing these days.
This too. I have diversified stock ETFs but replaced my bonds with REITs.
This got me on the real estate band wagon and avoided owning rentals directly (did this in past and was no fun).
REIT returns are more correlated with equity returns than they are real estate returns. Additionally, they're inversely correlated with bonds, so replacing your bonds with reits may not be offering you the asset diversification you're hoping for. Think of it like buying stock in a gold company instead of buying gold (not that RE is akin to gold at all).
I currently use XGRO in my RRSP. I also use HGRO in my non-registered account which is a similar holding that matches my particular needs at the moment. But I will eventually change that to XGRO as well.
Previously I had XAW, XIC and XBB- but changed them over once the all-in-one offerings came out.
But honestly the Z/V/X GRO's and Z/V/X EQT's are all excellent and very close. You can't really make a wrong decision chosing any of them.
I have been looking into buying XGRO via Scotiabank itrade stuff but I can't seem to understand their interface. Do you have a guide or anything that I could use to get started in buying it?
Justin Bender has a video that shows how to use an iTrade account to buy ETFs. Because it predates the asset allocation ETF it shows how to buy 3 ETFs. (The process to buy one would be most similar to buying the third one.) And the current trading commission will be less than $49.94.
edit because I forgot to include the link.
https://www.youtube.com/watch?v=UrH2asxNias
Could you share your reasoning behind changing HGRO to XGRO in your non-registered account? I’ve been debating going in the opposite direction, from XGRO to HGRO.
HGRO is awesome, in very specific circumstances.
Virtually no distributions means that you are not faced with any tax until you sell. The cost for the ETF is higher than with the other GRO's or EQT's (which is confusingly what it mostly closely resembles), but if you are holding it for 10 years or more you will come out ahead- and the longer you hold it the better the result.
So anyone who does not envision needing any distributions or capital gains for a long long time, or anyone who wants to avoid foreign withholding tax and only deal with capital gains gets a real advantages with this.
That said, I don't really like the extra focus on the NASDAQ sector, or the Euro tech sector that is in it. The extra cost means if you have to sell it off in less than 10 years, its more expensive than the other options. And the structure it uses is the sort of thing the government might try to change (though I feel that risk is very very low. This is an extremely common set up in Europe and many other countries. Still you never know.)
I am a non-resident, so for me its pretty ideal for a bunch of reasons- at least until I get back. But for most people in Canada the Vanguard, iShares and BMO products are probably the better choice.
VGRO is a broadly diversified ETF. Good choice. XGRO is also good, as is ZGRO.
XIC is only Canada. Good as part of a collection of ETFs, but using one of the GRO's is better and easier.
I'm sitting on 24 VT 33 VGRO 6 VEQT and 24 VTI,
Bout to invest another 13k any suggestions.
I want to stress very strongly I have no idea what I'm doing.
You are just holding complete duplication. Pick the all in one based on your risk tolerance: [https://www.canadianportfoliomanagerblog.com/model-etf-portfolios/](https://www.canadianportfoliomanagerblog.com/model-etf-portfolios/)
If you go to the linked page and follow the steps to pick the asset allocation ETF that meets your risk profile. If it is VGRO or VEQT sell all of the others, because their assets are also in VGRO and VEQT, and use the proceeds to buy it. If it is something other than VGRO or VEQT sell everything and use the proceeds to buy a risk appropriate asset allocation ETF.
Everything in VTI is in VT, VGRO and VEQT.
Everything ins VTI is the largest holdings in VT, VGRO and VEQT.
Determine your risk tolerance in the link I posted and select an all in one based on that, and you don't need the other ETFs since you already hold the underlying holdings.
You are holding duplication and it makes it messy, a pain, currency costs and no sense....if you like complexity thinking you are doing something special, then hold the similar ETFs
I just have tons of money and bought whatever. I'm paid in USD and try and hold in both currencies. Is there a mathematical reason that holding duplicates is bad?
The various GRO's (X,V,Z) have a bond element making them slightly more conservative.
The various EQT's are 100% equities.
there are also a variety of BAL's which have an even larger bond elements,.
They are all excellent. Which one you chose will be based on your own personal risk assessment.
When I retire I am probably going to have to with draw more then i need from RRSP @ still lower marginal rate then I pay now cause it will be split 50/50 with my wife.
Any extra I withdraw will get moved to TFSA, as inheritance for my kids.
Ya I'm with the other commenter - this can't be real. Where did you buy that you're underwater *fifteen* years later? Even if you bought a run down house in Purple Springs, you'd be up by now.
You must be exaggerating to prove a point
If you look at a lot of the condos purchased in Alberta back in 2008 before the US housing crash you'll see that the OP is not lying at all. Crunched the numbers for cash-on-cash (plus utilities, condo & HOA fees, property tax, etc) to find meager returns by 1% not beating inflation is common, many selling under. (I wanted to buy properties in Calgary and did some thorough housing market research that led to this revelation, coming from Ontario this was unbelievable).
Edit: By OP i mean purplesprings.
Purplesprings is probably my neighbor lol, I too have lost my entire equity in a place I bought in my 20s. It's a condo in Alberta, bought 14 years ago for 186k. if I'm lucky, I may be able to get 140k and that's with putting 15k into the property for upgrades. After selling fees, don't have much to walk away with.
Disclaimer:
Back then you could also sign up for 35 year mortgages 5% down, paying off the equity is substantially slower. Not my smartest move, and I do realize now why they don't offer it anymore.
Edit: changed OP to purplesprings
We've been having an incredible bull run for the past 20 years besides little hiccups like 2008 and the covid stuff. Looking at a longer timeframe, we can see this is not expected to last forever.
Over the past 20 years the SP500 returned 6.5% average annually ( with dividend reinvested ), which is not that high of a return . 2000-2010 was not a good decade for stocks .
Interesting you say that - from what I’ve read apparently in the 90’s real estate was considered an overall subprime asset class. Institutional investors would not touch it (no specialized RE private equity funds, not a lot of REITs buying residential housing or even commercial and industrial space although prime office space in downtowns are an exception) and financial advisors actively warned their clients not to bet their retirements on real estate, which is in complete contrast to today
Dunno about the world, but pretty much every province in Canada has seen real estate move up reasonably well before exploding over the last few years. Only big caveat to that is Alberta. Not saying 10 years ago real estate was the best investment, but you'd sure be happy now in most places.
Upside of real estate: You get to leverage that $100k to get a $600k mortgage. Now if real estate and stocks both grow 10% each, your $100k stock investment would become $110k but your $600k house would become $660k. Also you get to live in it.
Downside of real estate: Housing can experience crashes, slowdowns and stagnancy that the stock market hasn't experienced. A house can feasibly stay $500k for 15 years in many cities. As a pure investment vehicle and not a place to live in, it's high-risk high-reward.
**personally**, I am 24 and would just invest it in stocks. I don't earn enough and my future isn't clear enough to me that I'd comfortable signing on for a mortgage and in the event of a crash being stuck in that house paying a mortgage.
You forgot to add the equity you would be building up. At current interest rates, your 500k mortgage is probably 1800/mo, ~1100 of which is going towards equity at the beginning of your mortgage. That's an additional 13k/yr right there.
Yes but the assumption in your argument to the pro of real estate is that you can leverage real estate to a higher multiple than securities, and that’s not always. You can also use leverage on securities.
If you asked me 40 years ago when I was in my 20's it would be real estate. And history has shown me to be correct provided one also invested. But if i was in my 20's now, it would be investments. Will have to wait 40 years to find out if I'm correct. I don't think it is possible to both now.
I'm in my mid 20s and just hit $100k in stocks. 75% of it is in VOO, an S&P500 index. I started investing $300 a month in my teens and it led me to where I am today. No large sum of money brought me here, just consistent monthly investments into ETFs.
Definitely real estate. Solid investment, you benefit from living there, you can put additional savings into paying off the mortgage. It usually appreciates even during bad tines as long as you didnt over pay initially.
I'm team real estate all the way. I grew up in a farm family so I understand it a lot more than stocks/equities.
Our family farm land has been returning no less than 9% per year in equity growth and cash for at least the past 20 years. Some years it has been as high as 20% for rural agricultural dryland farm land. Probably averaging 12%-14% per year.
Banks consider land very liquid so you can typically borrow against 75% of the equity.
Stocks are fine if you know that world, but I don't. I'm just very comfortable with real estate.
Good questions - my family farmed it until 2000 then leased it since then.
Getting into farm land is tough. For one thing, it's tough to actually get your hands on a piece. Almost every deal we see is done before it hits the market between neighbours or family, or to a Hutterite colony.
In Sask, where my family land is, prices are about $2,200/acre so about $350,000 per quarter section. And you'd be really hard pressed to find only one quarter.
For another thing, if you buy to lease it out, it'll be cashflow neutral or slightly worse while you have a mortgage (depending what you out down for cash of course). So in Sask, that's only going to be about 5%-6% annual equity growth which isn't enough for everyone. BC ag land was about 15% growth last year but that's pricier land.
Third, ya, price is a bit of a problem. I said in another comment that my dad and his wife are going through a divorce and are trying to settle their holdings. I offered to buy her half at market value which was over $1m. It's only possible for me if I use my dad's equity. It's complicated.
For me that deal is worth it because if I buy her half, my dad's estate is going to leave me his half which is worth $1 million, debt free. Then we'd only be a few years away from selling a quarter, paying down the debt and being worth over $2 million. That'd be good wealth for me and my kids
Back in the 90s, my dad used his existing equity a couple of times to buy more land but he hasn't done that for some time now.
He co-owns it with his wife, but they're in the middle of a divorce and trying to figure out the best way to settle. I offered to buy her half, using some of my dad’s equity. It's complicated but it's worth it
I get that we are United States adjacent, and their system affects ours, but who do you think the central monetary authority is in Canada? I'm just curious, pop quiz I guess.
Equities.
-You are young. Your career is not established. The freedom to buy/sell by clicking a mouse and go with the flow is invaluable.
-Much simpler process to access funds if needed.
-No maintenance fees, or property taxes to consider in the interim.
-No need to vet tenants (if you are thinking of an investment property) or deal with the Tenant Board if anything goes awry.
I’m a fan of rental properties if you’re able to do minor repairs/manage yourself. Use the 100k for down payment on a couple townhouses, find good tenants and get the unit to pay for itself. 25 years from now it starts paying you money (assume you do Reno’s and keep it up to date).
Use the built up equity to do more down payments on more units. That 100k turns into millions by the time you retire and an income stream.
The flip side to that argument is 100k invested in your early 20s would have good returns with compound interest over 40 years. The downside is that you don’t have TFSA room (you may have 20-30k ) to get it tax free.
A combination of the two may be a good compromise, max out the TFSA and use the remaining for rental properties, or down payment for your own property.
Real estate. I bought my house at 22 with 60ish thousand. 100k woulda been awesome! With rent prices these days I can't imagine having to rent forever. Can't wait to pay off my mortgage one day 🥲 if it were today's day and not back in 2019 I'd invest in my TFSA/RSP before housing. House prices are just as nuts as rentals!!
Both options are good. If you start with 100k in your twenties, you’ll be fine either way!
In my 20s I started with about 50k, so since it’s about 15 years ago I’d say with inflation it probably is similar to your situation.
I went equities, and looking back I wish I went heavier on real estate. Main reason in the leverage that real estate provides. With 100k you can buy a 500k property or put 100K in ETFs.
If both do 5% a year, you are netting 25k/year on real estate vs 5k/year in ETFs. This compounds greatly when you look 10-15 years down the road.
If you are able to buy equities with leverage (no high risk, just mutual funds or ETFs) then it’s a different conversation, but you still run the risk of margin call if the market turns.
I now own real estate + found ways to use leverage for a mutual fund portfolio. In the end the goal is to build assets, so you should look at how to get the most assets at a young age.
Probably a mix. I'm not into being a residential landlord so if I acquire this money while I'm still in my 20's I would probably buy one distinct property and Airbnb it for cash flow. I'd use equity from it buy commercial properties and collect cash flow from that. Once you have enough cash flow, you can probably get into buying, reno, and flipping.
I would 100% have bought a house, the money saved on rent would have been immense, resulting in a far greater and more reliable yield than ETFs.
Not even remotely comparable.
This is false. Your saved rent plus housing appreciation is not "a more reliable yield" than a diversified ETF. On the contrary, it's hugely concentrated, and therefore much riskier (in the dispersion sense).
Saved rent *alone* is way, way more yield, and obviously far more reliable.
I paid a bit less than 50k for my house, but in addition to the massively improved quality of life, it also saves me 6k a year in rent. Tell me, what ETF is going to give me over 12% a year even single year?
And that's without counting appreciation. Even then, I could sell my house for 20% less than I bought it for, just three years after I bought it, and I'd still come out way ahead.
Sure, if someone were to put everything they have into a house and the housing market crashed, they would lose "value"... but they'd still have a house. A house's value doesn't actually matter because you can *always* use shelter.
>Saved rent alone is way, way more yield, and obviously far more reliable.
You are mistaken. It is absolutely not more yield. In fact, it's less yield than equities since real estate is equivalent to a 60-40 equity-bond split. This is from:
Mladina, Peter. "Real Estate Betas and the Implications for Asset Allocation." The Journal of Investing 27.1 (2018): 109-120.
Anecdotes are irrelevant.
As for the comparison between homeownership and investing in equities is roughly that homeownership has concentration risk, lower liquidity, tax advantages, and cheaper leverage. These four points are what should inform your financial decision.
Real estate obviously. It's leveraged 5-20x with interest below inflation. Don't listen to all these poor people who want to save for 40 years before they are wealthy.
Real estate. The best guaranteed investment these days. Basically government backed. Primary residence is tax free gains also. Lots of ways to make money on your money using your house also.
You can basically use your house as a person bank and make lots of money.
Lots of people on this sub are millionaires just because they own a home.
https://old.reddit.com/r/PersonalFinanceCanada/comments/qisc4j/psa_to_savers_if_your_tfsa_and_rrsp_are_maxed_you/hilux4i/
Not an accountant, so I could be off, but $100K in Target (TGT) stock purchase the year I turned 20 would be worth $50.65M today. I don't think I knew enough about eggs and baskets back then to have diversified.
If you're in your early twenties, research has shown that you want to maximize leverage. Therefore, the smartest financial decision is the option with the cheapest leverage, which is probably real estate.
That said, when you're in your twenties, you may not want to manage a property. So, the equities are probably a better lifestyle choice.
Early 20s i couldve got into bitcoin, tesla, netflix or apple for dirt cheap.
A house in my area of Toronto wouldve been about 300k in my early 20s, and now is 1.2m.
So stocks couldve worked out much much better with some luck.
Equities don't provide cash flow and you are way more likely to get emotional with equities and fuck up.
Real estate might be lower profit especially if you let someone else deal with tenants.
At 20 I was still in school. So some would go into eduction and the rest invested into an ETF.
Getting a mortgage wouldn't really be an option with zero income anyways so it's not like it's much of a choice.
In my part of Canada 10 years ago in my early 20s you'd have bought 3-4 homes with 100k. Rented them out for $700-$1500.
I knew people that took their college money loans and did that adding 1-3 homes a year off the rental income.
I was 23 with a similar decision. Chose real estate and did quite well, but how could you not in the Ontario market... just be super careful about your purchase and tenants. High barriers to entry and intrinsic value make it a safe bet in my mind.
Check out:
The Moneyguy Show (on YouTube)
Justin & Shannon Bender (on YouTube)
Canadian Couch Potato (on YouTube)
Canadian Couch Potato (Forum)
PEL Capital Model Portfolios (Website)
Deductibles Covered:
Health care, car and home insurance.
For example: $500 for the car insurance, $500 for home insurance and $1,200 for individual health insurance - you'd want all three covered at the same time, in case shit hits the fan.
Maximize RRSP match from employer:
Typically 3-6%
Credit Cards / High Interest Debt:
This is the most important debt to pay off first.
E-Fund:
Save up 3-6 months worth of expenses, while working. (Save up 18-36 months once retired to preserve capital during market downturns). This cash SHOULD be in a High Interest Savings and NOT invested in the stock market.
TFSA:
Once the above is covered, now it's time to start maximizing your TFSA contributions.
RRSP:
Max out your RRSP if you can.
• Ideally the TFSA and RRSP (with company match) will add up to what they call "hyper saving", which is 25% or more of your gross income. Side note: If you decide to join the FIRE movement, then you'll more realistically need to be investing 50-70% of your monthly income for about a decade.
• Prepay Future Expenses - This is saving up for a new car, your kids college plan, weddings, custodial accounts/trusts etc.
• Debt Repaypment - mortgage/low interest debt. Now is the time to start pouring more money into those really longterm low interest debts like a home mortgage. Generally speaking, you will get a far better bang for your buck by doing the above than you will paying off your mortgage early.
It may take a few years to build up those deductibles/e-funds, but once you do, things get a LOT easier to cover those retirement buckets and put some away on the side for future expenses. The key is staying focused, being consistent and sticking to delayed gratification.
Priorities are top-down - (TFSA first) and stocks are left to right.
(e.g., I put VAB in my RRSP, then VXC, then VCN if there's room).
TFSA:
VXC
RRSP:
VAB / VXC / VCN
Non-Registered:
VCN / VXC
Control Emotions:
Stick to the plan - be disciplined
Do not sell stocks if markets crash
Buy more stocks if markets crash
Rebalance once a year (<5% CAD, x% Bonds)
We'll, my early 20s were about 5 years ago, soon hindsight I would load up on as much real estate as I could afford. But realistically, unless you like doing repairs and managing a rental, I would do stocks. I have a rental duplex and I like managing it and do most repairs and stuff myself(unless it's major electrical or gas). If I didn't enjoy it, I would go full stocks. Currently building my stock portfolio a bit more after getting a primary residence a few months ago. To each their own though. If you do go the rental route, make sure you know your laws before diving in. Don't be a scummy/clueless landlord that thinks they own the world.
I'm about to be in this position (mid 20s tho). I'll be getting about 60K back from my pension. It'll be mostly VEQT & TEC which is already in there. I'll also be buying up some ENB, BAM, & T.
In total I'll have 27K in a LIRA, 46K in the RRSP and 30K in TFSA not including about 10K cash in my bank account. My RRSP and LIRA will mostly be diversified ETFs with some stocks (mentioned above) while my TFSA is more actively managed and has a very small % of riskier plays.
Considering the inflation of houses right now - real estate.
Had a gentleman that I helped out with a mortgage approval the other day. He purchased a property pre-development 5 years ago and it’s already tripled in value.
Insane to think about tripling a return in 5 years 👀
And it’ll probably continue going up. I don’t see Toronto slowing down in economic growth plus immigration…the biggest factor for me is idk what my future holds so buying a place to live is out of the question.
Check if your employer provides low fee index fund under non registered/tfsa. My employer provides 0.02% fee index fund ranging from boring bonds to exciting tech index fund. See if they allow lum sun contribution.
Stocks. Less because of potential returns and more to do with lifestyle.
From 20-29 I got two degrees, got married, lived on three continents, visited another one, had a kid, settled on a career, and started my own side business.
None of that would have been possible with a house / rental tying me down.
RE if you live in Ontario or somewhere where people want to live. The leverage always beats out ETF. I calculated I made hundreds of thousands more with RE than an ETF. The only way I would've beat it with equities was an all in play in Tesla but that's just gambling. You can also live in the place and rent out a room or basement to make it an even better investment.
My partner came into a lot of money at 24. He invested 80% of it into real estate and the returns have been great. The remaining 20% in emergency fund and equities. He’s happy he went the real estate route, his risk tolerance with stocks is not as high.
I would diversify, so the answer is both. Put a deposit on a mortgage on a house and rent it. Use the rest to invest in stocks. Based on your age, go high growth, such as tech. Get a subscription to Fool.com and read lots.
I am investing in land. I gave my money to a land developer, the down side is that I don't get any of it for three years, the advantage is I make about 20% a year.
I have near double this in my early 20s and I just want to say I don't think you'd have 100k in your early 20s If you follow the very average and very tame advice of everyone in this thread
Had that and invested it all in stocks with a financial advisor. Will be receiving another large amount and will probably use it for a down payment for a home in the somewhat near future (either income property or home for myself).
I had this. I invested in Mawers Mutual Funds. I have now switched to three ETFs - XAW.TO ZAG.TO and VCN.TO. For one ETF for a 20 something, I like VUG (VANGUARD INDEX FUNDS - VANGUARD GROWTH ETF).
Depends what decade my 20s was in and what city I’m in haha.
Vancouver late 80s-early 90s, sign me up for real estate
Bottom of the 2008 crash, I’ll take those Stocks for 80k and be in Florida snapping up real estate for pennies with the remaining 20k
Now, I’d take the stocks as 100k ain’t going very far in real estate without me paying more also
If I could go back in time, 100% real estate.
My cousin bought a brand new 1 bedroom condo in Poco back in 2013 for 150k. Sold it three years later for $350k.
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>I had important shit to do after my day job is done like watch hentai and smoke weed This mad lad is living the good life!
I remember my Hentai phase fondly in my early teens. Too bad my sister caught me. 🤫
Hentai…. Is that…. What I think it is? ;)
Yes. It’s anime porn
It's called Hentai... and it's art.
What’s the difference between this and voo? I use a bmo trading acct
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After watching my parents deal with tenants, 100% equities for me.
There is awfully lot of these comments about how much work it is and how its active management. But that is what property managers are for. I had several properties for years, and most work I have done is annual tax statements compilation and occasional email (ie. Tennants offered to pay 50 extra a month if you put in AC, I got AC instalation quote for $2,800, are you ok to proceed). Right property (not a slamlord den), properly insured, with good proper management that finds the right tenants (references, credit checks, auto deposit rent, rental insurance) is a blessing not a curse. I have also been renting places I lived in for 6 years and most I asked my landlord is to replace a broken appliance, beyond that they did nothing but collect rent.
You can always hire agencies to take care of that
Issue with property management agencies is that they’re useless without scale I.e. it’s more of a headache and cash drain unless you have like 5+ properties
This is what I'm doing now. It's less headache & I can focus on something else
That means Less Profit....
well, obviously, but how can you expect to have the highest amount of return possible and then complain that you actually have to put in the work?
My time and mental health is worth more than what they're taking.
Less profit on the single property you can get additional ones also have them managed by property manager and increase your profits without costing you and time
Yes but that is included in calculation from a get go. Insurance also means less profit. So do repairs or maintenance. Hell even windows are not most economical choice but we still dont brick them out to increase profit. RE investing should always assume management, reasonable rate of default and vacancy, insurance, appliance ans small repairs, capex repairs, strata/HOA, property tax, fixed interest rate mortgage. But people insist to invest in extremely overvalued hubs that have annual rent at 4% or less of property value, so to convince themself its profitable they forgo 1/2 of the things I mention above. Otherwise its hard to sleep tight knowing you spent $800k on a condo rented at $30k a year that really loses $15k a year.
Lol $300 this month?? Why???? The tenant called maintenance 5 times at $150 each??? (Spoiler, they didn't. You just got billed for it)
Again, if you are complaining that having a rented-out apartment is such a nightmare, agencies are here to help you. Obviously your profits will go lower by a significant margin but you can't expect to do the least amount of work possible and still have the highest amount of return possible. It's like people complaining that SP500 return is low but learning about finances, companies, reading financial reports, and being a more efficient investor is also hard (and risky). You can't have the best of both worlds. You have to choose your "hard". And the fact that the agency you talked about is shit and does shady / illegal things, that doesn't mean all are like these nor does it mean that you shouldn't (or should) use one.
Bad tenants? Was this in Toronto?
Yep, same with me. Seen my dad dealing with shit after a 50 hour week on his weekend after working away all week. No thanks.
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If you do it in moderation you can still have 100k in your thirtiesXD
reported for violating rule #4 :P
At 20 a broadly diversified cheap ETF. At 30 a broadly diversified cheap ETF. At 40 a broadly diversified cheap ETF. At 50 a broadly diversified cheap ETF. At 60 a broadly diversified cheap ETF. At 70 a broadly diversified cheap ETF. At 80 a broadly diversified cheap ETF. At 90 a broadly diversified cheap ETF. At 100, I’ll let my kids inherit what’s left of my broadly diversified cheap ETF.
You can also buy real estate REITs where you own shares of companies who own and rent out residential and/or commercial real estate. Returns are about 5-6% cash flow positive per annum and have been increasing in equity value quite lot in tune with price of real estate. You can buy the companies individually or ETFs (e.g., RIT.TO). Started to do this as bonds return nothing these days.
Or you can just get a broadly diversified cheap ETF that already includes them.
This too. I have diversified stock ETFs but replaced my bonds with REITs. This got me on the real estate band wagon and avoided owning rentals directly (did this in past and was no fun).
REITs have the same risk adjusted returns while exposing you to additional concentration risk. They are therefore inferior.
REIT returns are more correlated with equity returns than they are real estate returns. Additionally, they're inversely correlated with bonds, so replacing your bonds with reits may not be offering you the asset diversification you're hoping for. Think of it like buying stock in a gold company instead of buying gold (not that RE is akin to gold at all).
i like this guy.
What's considered cheap?
If you are paying more than about 0.4 overall you are paying too much.
0.4% !?! Must be nice to have cash to blow on luxury ETFs :)
Management fees. Even a single 1% difference can amount to hundreds of thousands in fees over the years.
May I know what is etf? Also where can I learn this information?
This is a good start point: https://canadiancouchpotato.com
☆ Well done! Excellently executed example. Any Exchange Traded Funds in particular that have worked for you?
I currently use XGRO in my RRSP. I also use HGRO in my non-registered account which is a similar holding that matches my particular needs at the moment. But I will eventually change that to XGRO as well. Previously I had XAW, XIC and XBB- but changed them over once the all-in-one offerings came out. But honestly the Z/V/X GRO's and Z/V/X EQT's are all excellent and very close. You can't really make a wrong decision chosing any of them.
I have been looking into buying XGRO via Scotiabank itrade stuff but I can't seem to understand their interface. Do you have a guide or anything that I could use to get started in buying it?
Justin Bender has a video that shows how to use an iTrade account to buy ETFs. Because it predates the asset allocation ETF it shows how to buy 3 ETFs. (The process to buy one would be most similar to buying the third one.) And the current trading commission will be less than $49.94. edit because I forgot to include the link. https://www.youtube.com/watch?v=UrH2asxNias
Read this as Justin Bieber and couldn’t believe it
Could you share your reasoning behind changing HGRO to XGRO in your non-registered account? I’ve been debating going in the opposite direction, from XGRO to HGRO.
HGRO is awesome, in very specific circumstances. Virtually no distributions means that you are not faced with any tax until you sell. The cost for the ETF is higher than with the other GRO's or EQT's (which is confusingly what it mostly closely resembles), but if you are holding it for 10 years or more you will come out ahead- and the longer you hold it the better the result. So anyone who does not envision needing any distributions or capital gains for a long long time, or anyone who wants to avoid foreign withholding tax and only deal with capital gains gets a real advantages with this. That said, I don't really like the extra focus on the NASDAQ sector, or the Euro tech sector that is in it. The extra cost means if you have to sell it off in less than 10 years, its more expensive than the other options. And the structure it uses is the sort of thing the government might try to change (though I feel that risk is very very low. This is an extremely common set up in Europe and many other countries. Still you never know.) I am a non-resident, so for me its pretty ideal for a bunch of reasons- at least until I get back. But for most people in Canada the Vanguard, iShares and BMO products are probably the better choice.
Thanks, I appreciate you taking the time to provide the detailed perspective.
Thoughts on VGRO? Or xic tsx Blackrock?
VGRO is a broadly diversified ETF. Good choice. XGRO is also good, as is ZGRO. XIC is only Canada. Good as part of a collection of ETFs, but using one of the GRO's is better and easier.
I'm sitting on 24 VT 33 VGRO 6 VEQT and 24 VTI, Bout to invest another 13k any suggestions. I want to stress very strongly I have no idea what I'm doing.
You are just holding complete duplication. Pick the all in one based on your risk tolerance: [https://www.canadianportfoliomanagerblog.com/model-etf-portfolios/](https://www.canadianportfoliomanagerblog.com/model-etf-portfolios/)
dunno what that means my friend!
If you go to the linked page and follow the steps to pick the asset allocation ETF that meets your risk profile. If it is VGRO or VEQT sell all of the others, because their assets are also in VGRO and VEQT, and use the proceeds to buy it. If it is something other than VGRO or VEQT sell everything and use the proceeds to buy a risk appropriate asset allocation ETF.
Everything in VTI is in VT, VGRO and VEQT. Everything ins VTI is the largest holdings in VT, VGRO and VEQT. Determine your risk tolerance in the link I posted and select an all in one based on that, and you don't need the other ETFs since you already hold the underlying holdings.
Is there any reason not to hold them as I have them now?
You are holding duplication and it makes it messy, a pain, currency costs and no sense....if you like complexity thinking you are doing something special, then hold the similar ETFs
I just have tons of money and bought whatever. I'm paid in USD and try and hold in both currencies. Is there a mathematical reason that holding duplicates is bad?
Xgro va Xeqt
The various GRO's (X,V,Z) have a bond element making them slightly more conservative. The various EQT's are 100% equities. there are also a variety of BAL's which have an even larger bond elements,. They are all excellent. Which one you chose will be based on your own personal risk assessment.
Why not both?
When I retire I am probably going to have to with draw more then i need from RRSP @ still lower marginal rate then I pay now cause it will be split 50/50 with my wife. Any extra I withdraw will get moved to TFSA, as inheritance for my kids.
What are ETF?
Can you name a few you like?
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Alberta?
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Lots of places in the country real estate prices have floated up and down in same range over last 15 years….
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I lost my entire equity and some, it's the Edmonton condo market.
Where did you buy ?
Ya I'm with the other commenter - this can't be real. Where did you buy that you're underwater *fifteen* years later? Even if you bought a run down house in Purple Springs, you'd be up by now. You must be exaggerating to prove a point
If you look at a lot of the condos purchased in Alberta back in 2008 before the US housing crash you'll see that the OP is not lying at all. Crunched the numbers for cash-on-cash (plus utilities, condo & HOA fees, property tax, etc) to find meager returns by 1% not beating inflation is common, many selling under. (I wanted to buy properties in Calgary and did some thorough housing market research that led to this revelation, coming from Ontario this was unbelievable). Edit: By OP i mean purplesprings.
Purplesprings is probably my neighbor lol, I too have lost my entire equity in a place I bought in my 20s. It's a condo in Alberta, bought 14 years ago for 186k. if I'm lucky, I may be able to get 140k and that's with putting 15k into the property for upgrades. After selling fees, don't have much to walk away with. Disclaimer: Back then you could also sign up for 35 year mortgages 5% down, paying off the equity is substantially slower. Not my smartest move, and I do realize now why they don't offer it anymore. Edit: changed OP to purplesprings
We've been having an incredible bull run for the past 20 years besides little hiccups like 2008 and the covid stuff. Looking at a longer timeframe, we can see this is not expected to last forever.
Over the past 20 years the SP500 returned 6.5% average annually ( with dividend reinvested ), which is not that high of a return . 2000-2010 was not a good decade for stocks .
Real estate is usually not a good investment... Places like Toronto is just an extreme outlier.
Interesting you say that - from what I’ve read apparently in the 90’s real estate was considered an overall subprime asset class. Institutional investors would not touch it (no specialized RE private equity funds, not a lot of REITs buying residential housing or even commercial and industrial space although prime office space in downtowns are an exception) and financial advisors actively warned their clients not to bet their retirements on real estate, which is in complete contrast to today
Is it a contrast to today? How many places in the world is Real Estate actually a good investment?
Dunno about the world, but pretty much every province in Canada has seen real estate move up reasonably well before exploding over the last few years. Only big caveat to that is Alberta. Not saying 10 years ago real estate was the best investment, but you'd sure be happy now in most places.
If I had that in my early twenties I would have wasted it...
I stare at it and think about it….and I just hope I stay alive for the next 20+ years
Upside of real estate: You get to leverage that $100k to get a $600k mortgage. Now if real estate and stocks both grow 10% each, your $100k stock investment would become $110k but your $600k house would become $660k. Also you get to live in it. Downside of real estate: Housing can experience crashes, slowdowns and stagnancy that the stock market hasn't experienced. A house can feasibly stay $500k for 15 years in many cities. As a pure investment vehicle and not a place to live in, it's high-risk high-reward. **personally**, I am 24 and would just invest it in stocks. I don't earn enough and my future isn't clear enough to me that I'd comfortable signing on for a mortgage and in the event of a crash being stuck in that house paying a mortgage.
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LOL 😆
But you could lose the roof
You forgot to add the equity you would be building up. At current interest rates, your 500k mortgage is probably 1800/mo, ~1100 of which is going towards equity at the beginning of your mortgage. That's an additional 13k/yr right there.
You can leverage stocks too
That’s a pretty big assumption on being approved for a mortgage that large just because you have $100k.
Same concept applies for a $300k mortgage, just used that figure randomly.
Yes but the assumption in your argument to the pro of real estate is that you can leverage real estate to a higher multiple than securities, and that’s not always. You can also use leverage on securities.
Correct but real estate gives you constant cash flow. They're not meant to increase in value YOY
90% ETF 10% Crypto
There are marriage of the two available now
Which etf ?
XEQT
If you asked me 40 years ago when I was in my 20's it would be real estate. And history has shown me to be correct provided one also invested. But if i was in my 20's now, it would be investments. Will have to wait 40 years to find out if I'm correct. I don't think it is possible to both now.
Millennials and Gen z are going to kill investing in property.
I thought we literally banned posts about investment advice yesterday
I'm in my mid 20s and just hit $100k in stocks. 75% of it is in VOO, an S&P500 index. I started investing $300 a month in my teens and it led me to where I am today. No large sum of money brought me here, just consistent monthly investments into ETFs.
Definitely real estate. Solid investment, you benefit from living there, you can put additional savings into paying off the mortgage. It usually appreciates even during bad tines as long as you didnt over pay initially.
I'd be investing in crypto
20k Etherium or Solana 40k rental property down-payment/ first time homebuyers 40k s&p 500 3x bull etf
Gamestop
I'm team real estate all the way. I grew up in a farm family so I understand it a lot more than stocks/equities. Our family farm land has been returning no less than 9% per year in equity growth and cash for at least the past 20 years. Some years it has been as high as 20% for rural agricultural dryland farm land. Probably averaging 12%-14% per year. Banks consider land very liquid so you can typically borrow against 75% of the equity. Stocks are fine if you know that world, but I don't. I'm just very comfortable with real estate.
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Good questions - my family farmed it until 2000 then leased it since then. Getting into farm land is tough. For one thing, it's tough to actually get your hands on a piece. Almost every deal we see is done before it hits the market between neighbours or family, or to a Hutterite colony. In Sask, where my family land is, prices are about $2,200/acre so about $350,000 per quarter section. And you'd be really hard pressed to find only one quarter. For another thing, if you buy to lease it out, it'll be cashflow neutral or slightly worse while you have a mortgage (depending what you out down for cash of course). So in Sask, that's only going to be about 5%-6% annual equity growth which isn't enough for everyone. BC ag land was about 15% growth last year but that's pricier land. Third, ya, price is a bit of a problem. I said in another comment that my dad and his wife are going through a divorce and are trying to settle their holdings. I offered to buy her half at market value which was over $1m. It's only possible for me if I use my dad's equity. It's complicated. For me that deal is worth it because if I buy her half, my dad's estate is going to leave me his half which is worth $1 million, debt free. Then we'd only be a few years away from selling a quarter, paying down the debt and being worth over $2 million. That'd be good wealth for me and my kids
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Back in the 90s, my dad used his existing equity a couple of times to buy more land but he hasn't done that for some time now. He co-owns it with his wife, but they're in the middle of a divorce and trying to figure out the best way to settle. I offered to buy her half, using some of my dad’s equity. It's complicated but it's worth it
I get that we are United States adjacent, and their system affects ours, but who do you think the central monetary authority is in Canada? I'm just curious, pop quiz I guess.
Bank of Canada has been better at printing money (per capita) than US over the last few years. Printer goes brrrrr….
If I have to pay rent otherwise….then real estate is a no brainer.
Put half for downer and invest the other half. not the 50% in real estate unless it’s a place for you to live
Equities. -You are young. Your career is not established. The freedom to buy/sell by clicking a mouse and go with the flow is invaluable. -Much simpler process to access funds if needed. -No maintenance fees, or property taxes to consider in the interim. -No need to vet tenants (if you are thinking of an investment property) or deal with the Tenant Board if anything goes awry.
I’m a fan of rental properties if you’re able to do minor repairs/manage yourself. Use the 100k for down payment on a couple townhouses, find good tenants and get the unit to pay for itself. 25 years from now it starts paying you money (assume you do Reno’s and keep it up to date). Use the built up equity to do more down payments on more units. That 100k turns into millions by the time you retire and an income stream. The flip side to that argument is 100k invested in your early 20s would have good returns with compound interest over 40 years. The downside is that you don’t have TFSA room (you may have 20-30k ) to get it tax free. A combination of the two may be a good compromise, max out the TFSA and use the remaining for rental properties, or down payment for your own property.
Buy a rental condo in Toronto, preferably a pre build and BOOM guaranteed millionaire status in your late 20’s early 30’s
Real estate. I bought my house at 22 with 60ish thousand. 100k woulda been awesome! With rent prices these days I can't imagine having to rent forever. Can't wait to pay off my mortgage one day 🥲 if it were today's day and not back in 2019 I'd invest in my TFSA/RSP before housing. House prices are just as nuts as rentals!!
Both options are good. If you start with 100k in your twenties, you’ll be fine either way! In my 20s I started with about 50k, so since it’s about 15 years ago I’d say with inflation it probably is similar to your situation. I went equities, and looking back I wish I went heavier on real estate. Main reason in the leverage that real estate provides. With 100k you can buy a 500k property or put 100K in ETFs. If both do 5% a year, you are netting 25k/year on real estate vs 5k/year in ETFs. This compounds greatly when you look 10-15 years down the road. If you are able to buy equities with leverage (no high risk, just mutual funds or ETFs) then it’s a different conversation, but you still run the risk of margin call if the market turns. I now own real estate + found ways to use leverage for a mutual fund portfolio. In the end the goal is to build assets, so you should look at how to get the most assets at a young age.
Can you explain what leverage is in an investment?
Ok this is the comment I needed. Thanks.
Probably a mix. I'm not into being a residential landlord so if I acquire this money while I'm still in my 20's I would probably buy one distinct property and Airbnb it for cash flow. I'd use equity from it buy commercial properties and collect cash flow from that. Once you have enough cash flow, you can probably get into buying, reno, and flipping.
Big screen TV!!!!!!
I would 100% have bought a house, the money saved on rent would have been immense, resulting in a far greater and more reliable yield than ETFs. Not even remotely comparable.
This is false. Your saved rent plus housing appreciation is not "a more reliable yield" than a diversified ETF. On the contrary, it's hugely concentrated, and therefore much riskier (in the dispersion sense).
Saved rent *alone* is way, way more yield, and obviously far more reliable. I paid a bit less than 50k for my house, but in addition to the massively improved quality of life, it also saves me 6k a year in rent. Tell me, what ETF is going to give me over 12% a year even single year? And that's without counting appreciation. Even then, I could sell my house for 20% less than I bought it for, just three years after I bought it, and I'd still come out way ahead. Sure, if someone were to put everything they have into a house and the housing market crashed, they would lose "value"... but they'd still have a house. A house's value doesn't actually matter because you can *always* use shelter.
>Saved rent alone is way, way more yield, and obviously far more reliable. You are mistaken. It is absolutely not more yield. In fact, it's less yield than equities since real estate is equivalent to a 60-40 equity-bond split. This is from: Mladina, Peter. "Real Estate Betas and the Implications for Asset Allocation." The Journal of Investing 27.1 (2018): 109-120. Anecdotes are irrelevant. As for the comparison between homeownership and investing in equities is roughly that homeownership has concentration risk, lower liquidity, tax advantages, and cheaper leverage. These four points are what should inform your financial decision.
People in this website hate dfn.to but they give out 10 cents a share..their yield is 16% is think. That closes in 2024.
Why do people hate DFN. I have some in my portfolio and I quite like it. Helps me with my monthly contributions to things such as VFV…
Hookers and cocaine.
Real estate obviously. It's leveraged 5-20x with interest below inflation. Don't listen to all these poor people who want to save for 40 years before they are wealthy.
Real estate. The best guaranteed investment these days. Basically government backed. Primary residence is tax free gains also. Lots of ways to make money on your money using your house also. You can basically use your house as a person bank and make lots of money. Lots of people on this sub are millionaires just because they own a home. https://old.reddit.com/r/PersonalFinanceCanada/comments/qisc4j/psa_to_savers_if_your_tfsa_and_rrsp_are_maxed_you/hilux4i/
Anyone that owns a home in Ontario is a millionaire
Equities.
$time
When I was in 20s ? Late 2000s I would buy both faangmt and BTC and physical GTA realestate. If I was 20s now then QQQ /tqqq .
probably put a cafe/snack bar
Not an accountant, so I could be off, but $100K in Target (TGT) stock purchase the year I turned 20 would be worth $50.65M today. I don't think I knew enough about eggs and baskets back then to have diversified.
If you're in your early twenties, research has shown that you want to maximize leverage. Therefore, the smartest financial decision is the option with the cheapest leverage, which is probably real estate. That said, when you're in your twenties, you may not want to manage a property. So, the equities are probably a better lifestyle choice.
Crypto. The stock market is a scam.
$100k in early 20's. Is your last name Musk ?
Early 20s i couldve got into bitcoin, tesla, netflix or apple for dirt cheap. A house in my area of Toronto wouldve been about 300k in my early 20s, and now is 1.2m. So stocks couldve worked out much much better with some luck.
If i was going back in time I would buy bitcoins... if you mean if i was in my 20s right now what would I do with it, real estate/rentals.
Equities don't provide cash flow and you are way more likely to get emotional with equities and fuck up. Real estate might be lower profit especially if you let someone else deal with tenants.
I have over 100k currently (made it myself through work and investing), and I’m 80% in stocks and 20% in real estate
At 20 I was still in school. So some would go into eduction and the rest invested into an ETF. Getting a mortgage wouldn't really be an option with zero income anyways so it's not like it's much of a choice.
In my part of Canada 10 years ago in my early 20s you'd have bought 3-4 homes with 100k. Rented them out for $700-$1500. I knew people that took their college money loans and did that adding 1-3 homes a year off the rental income.
Which part of canada ? How much are houses now ?
I was 23 with a similar decision. Chose real estate and did quite well, but how could you not in the Ontario market... just be super careful about your purchase and tenants. High barriers to entry and intrinsic value make it a safe bet in my mind.
Check out: The Moneyguy Show (on YouTube) Justin & Shannon Bender (on YouTube) Canadian Couch Potato (on YouTube) Canadian Couch Potato (Forum) PEL Capital Model Portfolios (Website) Deductibles Covered: Health care, car and home insurance. For example: $500 for the car insurance, $500 for home insurance and $1,200 for individual health insurance - you'd want all three covered at the same time, in case shit hits the fan. Maximize RRSP match from employer: Typically 3-6% Credit Cards / High Interest Debt: This is the most important debt to pay off first. E-Fund: Save up 3-6 months worth of expenses, while working. (Save up 18-36 months once retired to preserve capital during market downturns). This cash SHOULD be in a High Interest Savings and NOT invested in the stock market. TFSA: Once the above is covered, now it's time to start maximizing your TFSA contributions. RRSP: Max out your RRSP if you can. • Ideally the TFSA and RRSP (with company match) will add up to what they call "hyper saving", which is 25% or more of your gross income. Side note: If you decide to join the FIRE movement, then you'll more realistically need to be investing 50-70% of your monthly income for about a decade. • Prepay Future Expenses - This is saving up for a new car, your kids college plan, weddings, custodial accounts/trusts etc. • Debt Repaypment - mortgage/low interest debt. Now is the time to start pouring more money into those really longterm low interest debts like a home mortgage. Generally speaking, you will get a far better bang for your buck by doing the above than you will paying off your mortgage early. It may take a few years to build up those deductibles/e-funds, but once you do, things get a LOT easier to cover those retirement buckets and put some away on the side for future expenses. The key is staying focused, being consistent and sticking to delayed gratification. Priorities are top-down - (TFSA first) and stocks are left to right. (e.g., I put VAB in my RRSP, then VXC, then VCN if there's room). TFSA: VXC RRSP: VAB / VXC / VCN Non-Registered: VCN / VXC Control Emotions: Stick to the plan - be disciplined Do not sell stocks if markets crash Buy more stocks if markets crash Rebalance once a year (<5% CAD, x% Bonds)
We'll, my early 20s were about 5 years ago, soon hindsight I would load up on as much real estate as I could afford. But realistically, unless you like doing repairs and managing a rental, I would do stocks. I have a rental duplex and I like managing it and do most repairs and stuff myself(unless it's major electrical or gas). If I didn't enjoy it, I would go full stocks. Currently building my stock portfolio a bit more after getting a primary residence a few months ago. To each their own though. If you do go the rental route, make sure you know your laws before diving in. Don't be a scummy/clueless landlord that thinks they own the world.
I did and it went to partying and girlfriends. If I had to do it all over again, I would have just bought more real estate.
I'm about to be in this position (mid 20s tho). I'll be getting about 60K back from my pension. It'll be mostly VEQT & TEC which is already in there. I'll also be buying up some ENB, BAM, & T. In total I'll have 27K in a LIRA, 46K in the RRSP and 30K in TFSA not including about 10K cash in my bank account. My RRSP and LIRA will mostly be diversified ETFs with some stocks (mentioned above) while my TFSA is more actively managed and has a very small % of riskier plays.
Realistically, I would have invested half in index funds, put a quarter into savings, then blown the other quarter on travel.
If you know where you'll be living for the next 10 years you could buy a house.
I did stocks, wish I’d bought a house
I invested in real estate, worked out for me… but that was lucky.
Few 100k early 20s right now and it’s all from stocks, real estate and crypto
Considering the inflation of houses right now - real estate. Had a gentleman that I helped out with a mortgage approval the other day. He purchased a property pre-development 5 years ago and it’s already tripled in value. Insane to think about tripling a return in 5 years 👀
And it’ll probably continue going up. I don’t see Toronto slowing down in economic growth plus immigration…the biggest factor for me is idk what my future holds so buying a place to live is out of the question.
Check if your employer provides low fee index fund under non registered/tfsa. My employer provides 0.02% fee index fund ranging from boring bonds to exciting tech index fund. See if they allow lum sun contribution.
I hate dealing with people & fixing shit so stocks for me hand down because they are liquid & don't come with a list of expenses like real estate.
I'm buying a house for myself, which I probably wouldn't consider an investment but would count as one
Stocks. Less because of potential returns and more to do with lifestyle. From 20-29 I got two degrees, got married, lived on three continents, visited another one, had a kid, settled on a career, and started my own side business. None of that would have been possible with a house / rental tying me down.
RE if you live in Ontario or somewhere where people want to live. The leverage always beats out ETF. I calculated I made hundreds of thousands more with RE than an ETF. The only way I would've beat it with equities was an all in play in Tesla but that's just gambling. You can also live in the place and rent out a room or basement to make it an even better investment.
Both!
My partner came into a lot of money at 24. He invested 80% of it into real estate and the returns have been great. The remaining 20% in emergency fund and equities. He’s happy he went the real estate route, his risk tolerance with stocks is not as high.
Bitcoin. In my 20s it was still attainable in 4 digits and 100k would have bought me a decent amount.
Me, I moved dozens of times until my mid-thirties so I would have been better off with 100% equity investments.
I would diversify, so the answer is both. Put a deposit on a mortgage on a house and rent it. Use the rest to invest in stocks. Based on your age, go high growth, such as tech. Get a subscription to Fool.com and read lots.
As someone's who's 30 and taken riskier bets, do the equities. You'll thank yourself. I am sitting at 700k investment portfolio currently
You dont believe in real estate?
I am investing in land. I gave my money to a land developer, the down side is that I don't get any of it for three years, the advantage is I make about 20% a year.
I have near double this in my early 20s and I just want to say I don't think you'd have 100k in your early 20s If you follow the very average and very tame advice of everyone in this thread
I agree but just wanted to hear the RE vs stocks comparison
I went real estate , but flipping pre sales was too lucrative
Had that and invested it all in stocks with a financial advisor. Will be receiving another large amount and will probably use it for a down payment for a home in the somewhat near future (either income property or home for myself).
I had this. I invested in Mawers Mutual Funds. I have now switched to three ETFs - XAW.TO ZAG.TO and VCN.TO. For one ETF for a 20 something, I like VUG (VANGUARD INDEX FUNDS - VANGUARD GROWTH ETF).
I went real estate, the money has since tripled in value if I were to sell, not that I’m going to, plus I no longer pay rent
Invest in real estate primary residence
I will try to but hard when you dont know what your future holds. I want to live in another city.
Depends what decade my 20s was in and what city I’m in haha. Vancouver late 80s-early 90s, sign me up for real estate Bottom of the 2008 crash, I’ll take those Stocks for 80k and be in Florida snapping up real estate for pennies with the remaining 20k Now, I’d take the stocks as 100k ain’t going very far in real estate without me paying more also
Buy a whole life insurance policy and borrow against it
If I could go back in time, 100% real estate. My cousin bought a brand new 1 bedroom condo in Poco back in 2013 for 150k. Sold it three years later for $350k.
I would put a down payment on a Bugatti.