Reduce stress by automating your finances

We’re living in a tense period on the “investment” side, it’s on nerves, my nerves included. I won’t pretend to enjoy looking at my investment data.

Despite seeing my wallet being backed up, I’m relieved not to have to deal with it! If I’m really holding the reins these days, every morning I’ll wonder about the need to step in. And after succumbing to the temptation to maneuver, I still wondered if it was appropriate.

In investing, it is best to keep a certain distance with your portfolio.

If you’re not using a trustworthy manager, I see only one solution: put yourself on autopilot!

Don’t ask yourself more questions

Readers of this column are familiar with my favorite bias of passive low-cost management, the most accessible investment approach for the average investor who doesn’t have access to the best services of a manager. Fees are low and no large sums of investment are required. It requires little time and no knowledge of the markets, or very little.

Just buy exchange-traded funds (ETFs). Since they are repeating the market, no analysis is required. So we can have it with our eyes closed, which is a prerequisite for the “automatic” approach.

Buy at regular intervals

The central element of this philosophy is based on an investment calendar that should never deviate from it, regardless of market conditions. It can be every two weeks, every month, every three months we acquire new fund units while keeping the tempo for a predetermined amount.

We must not think or trust our intuition, and we must not listen to our feelings! We imitate the regularity and indifference of the clock.

Bear markets display the virtues of this method. Regular buying of index fund stocks outperforms others during the decline. It is the investments made today that will prove in the long run to be the most profitable. They will compensate for purchases made at full price (last year) and reduce the average cost of their investment.

automatically as possible

Ideally, all of this should happen on its own to reduce the “human factor”. It is not always easy with ETFs, it all depends on the trading platform used and the type of portfolio chosen.

If he fabricates his own portfolio from a few index funds, the investor can automate part of the process (from his bank account to his investment account), but often has to step in to complete his transactions. The less funding, the simpler the task. This is why ETFs dedicated to asset allocation fit so well with this investment approach, with the individual fund acting as a portfolio.

Again on the side of mutual funds regular investments can be programmed more easily. But the management fee for these products is much higher. For me, these costs are a barrier, unless you provide access to a good advisor. This is rarely the case when one owns few assets. It is best to look for an ETF trading platform that offers the highest level of automation. And some gloved work if needed. solidly.

Automate your financial life

A friend of mine (hello Andrei!) has gotten really good at automating his finances. When his salary is deposited into his account, there is no trace of it the next day. The funds were distributed to different purposes and functions without any interference from his part. Here are the operations to be planned:

  • savings: You can schedule payments to the TFSA or RRSP.
  • Invoices : It’s easy to set up automatic payments for all service providers.
  • Calculation of taxes and home maintenance: By programming transfers to a dedicated account, we avoid fainting when large bills fall upon us.
  • Project account: Trips, renewals, a year off…



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