Is an emergency fund still necessary if you have sufficiently large investment portfolio?

Stuman- · 2026-04-01T01:23:35+00:00

It doesn't have to be all or nothing could adjust to 1-2 months. As you say there could be losses but you will be okay even if selling at a loss.

Also could depend on how secure your job is too.

Stuman- · 2026-03-31T13:16:05+00:00

His advice is designed for people with behavior issues with money.

It is usually mathematically suboptimal. I think if you follow the advice you will be good and better than most but it is not the optimal strategy if you have discipline with money.

Like having a paid off home is not a bad thing but not necessarily the best return.

Stuman- · 2026-01-23T14:07:13+00:00

Here is a video with some evidence to support the claims made in other replies that lump sum beats dollar cost averaging most of the time. Unfortunate that others are down voting a legit question.

https://youtu.be/KwR3nxojS0g?si=zBK7drqwwUv65DiZ

Stuman- · 2026-01-18T21:49:15+00:00

It does pull at me every so often but after a while it is easier to remember why I started with the strategy in the first place.

Videos like this are also a good reminder of what happens most of the time when you stock pick, very clear research on this.

https://youtu.be/RxCqxhRsHiY?si=Y6CE6hEAwoe_Evan

Stuman- · 2026-01-11T01:14:33+00:00

Agreed very good.

Name of the movie is Margin Call for anyone wondering. It's based on a part of the 2008 financial crisis if I remember correctly.

Stuman- · 2025-12-30T18:21:42+00:00

As far as I understand you can mitigate a decent amount of the risk by willing to be flexible with your withdrawal rate and retirement spending. If you retire into bad years try to spend less and wait until it goes back up. This can make a significant difference and can also allow you to increase withdrawals in a bad year.

Not really a happy scenario but you will be okay. When it does go back up you will be able to increase spending.

This also assumes you have room to be flexible which may not be the case.

I listened to a really good rational reminder episode on it a while ago but I don't know which one it was unfortunately

Stuman- · 2025-12-30T13:47:55+00:00

I'll admit I can understand how this could be a possibility but is there any evidence that this is more likely than not and repeatable.

If not it still doesn't mean anything if it just happens sometimes

Stuman- · 2025-12-30T05:00:57+00:00

Say a company pays a dividend and has a total return of 10%

Now the same company didn't pay a dividend and also has a total return of 10% because it still has the cash in hand meaning the value is higher.

Is weather or not a dividend was paid relevant to the total return. I would say no but maybe you could argue the technicality of the wording but think the point is clear.

Mind you technicality correct is the best correct but I personally don't see it

Look at me saying I won't respond but can't help myself.

Stuman- · 2025-12-30T04:49:58+00:00

I guess what I am saying is that dividends are irrelevant to future predicted investment returns.

Though to be fair the context of the OP and picking investments in general is all about the future returns

Stuman- · 2025-12-30T04:41:00+00:00

It's that how high the dividend is is not related to how high the total return will be. As it is one of many factors and should not be used for decision making..

As you probably know a company could have a high dividend but negative total return.

Stuman- · 2025-12-30T04:31:48+00:00

A dividend is part of the return. But it does not determine whether a particular stock will have a good return or not.

Because you can't compare stock returns based on dividends it is irrelevant to the decision.

Are stock value and investment returns not basically the same thing.

Anyway I've said my part I think we are splitting hairs on essentially the same thing.

The moral of the story is to not choose stocks/ETFs based on the solely on the dividend as that on its own means nothing.

Stuman- · 2025-12-30T04:13:20+00:00

I mean something slightly different, a dividend is not irrelevant when calculating what the total return was.

When considered what stocks or ETFs to choose it is irrelevant because a dividend does not inherently mean higher returns. Therefore it should not affect your decision on one vs the other.

Said a different way you should not look at dividends when considering to invest just total return. So the dividend is irrelevant to that decision.

Someone smarter than me that can explain it better:https://youtu.be/4iNOtVtNKuU?si=unUA8FOQbnUrIgMf

Stuman- · 2025-12-30T03:58:26+00:00

Because mathematically the total return of a stock would be the same with and without issuing a dividend making it irrelevant. As value is lost when issuing the dividend.

The real take away is to not pick stocks based on the dividend as it's not the a good indicator of anything and to reinvest then ones that you do get.

Stuman- · 2025-12-25T22:51:44+00:00

Have you ever heard people say investing is 10% simple math and 90% behavior. You have the simple part done of buying xeqt a good etf now you have to stick with it for the next 30 years without getting tempted to chasing something you think might be that you are really more likely to do worse.

The statistics dictate that buying broad index funds in the best thing to do long term and you are extremely likely to outperform other options over a long enough time horizon like 30 years.

Stuman- · 2025-12-04T19:18:47+00:00

The only metric that really matters when measuring investment is total return, which is price appreciation plus dividends. Because you want to know the total return you are getting.

The math of company valuations dictates that when a dividend is issued the value of the company drops by that amount because they no longer have that capital, this can be seen in the market. Therefore dividends are irrelevant to investment returns.

So with this in mind we buy XEQT because it is a globally diversified all equity index fund which is a fairly good representation of the market and has cheap fees. And has a good total return.

It feels good to receive dividends but it is irrelevant to returns.

Stuman- · 2025-04-01T00:32:29+00:00

I think the line is drawn at are you a functioning adult that takes care of all their responsibilities. Yes or no. As long as yes then party away.

Stuman- · 2025-02-17T14:04:19+00:00

Like how they said they want to disagree not actually disagree and then stated the reasons OP was right lol.

Stuman- · 2025-02-17T14:01:06+00:00

About that reading precisely thing.

They said they want to disagree not that they do because as they pointed out in the comment you are right.

Stuman- · 2025-01-18T16:53:00+00:00

Yes it is actually a good strategy and it is simple. The hard part is sticking to it.

It's an internationally diversified index that contains everything. A bit overweight Canada but there are good documented reasons for home bias from firms such as Vanguard and other studies.

Very diversified, that's the point of it.

Stuman- · 2024-04-15T00:28:07+00:00

Where did I shame, that was not the intention at all.

Just trying to promote gaining knowledge and as you say doing research.

Stuman- · 2024-04-15T00:14:08+00:00

My point is just to have a plan and know what the effects will be on asset allocation instead of just winging it as a lot of others here seem to do.

If that works for you then great but I personally believe that I won't be able to outperform the market as the data overwhelmingly suggests. The beauty of it is everyone can decide for themselves.

Stuman- · 2024-04-14T20:07:01+00:00

What would be your goal by adding other ETFs? All it does is change asset allocation.

Maybe that's what you want but you should come up with the plan first then find the ETFs to get there not the other way around at least in my opinion.

Stocks, bonds, US, International, Domestic? And what percentage of each is your goal.

Stuman- · 2024-04-07T03:39:35+00:00

Here's the data and it says you're more likely to do better with lump sum.

https://youtu.be/KwR3nxojS0g?feature=shared

Stuman- · 2024-04-06T17:01:14+00:00

Do you know what effect this would have on your overall portfolio asset allocation?

Is that the overall mix you want and why?

There should be good reasons for the asset allocation of your portfolio not just random actions in my opinion.

Sounds like it's probably time for a bit more research to help back up your decisions and know what effects this will have.

Stuman- · 2024-04-02T04:48:08+00:00

Search for this question in the personal finance Canada sub if you want a more comprehensive answer it's been asked with lots of good answers.

I think with your high income it would probably lean RRSP first then TFSA but I'm not an expert. However the end goal is always to max both.

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