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Carrick on money

The last thing people need is more financial advice Add to ...

This is one of the smarter things I’ve read on personal finance lately. It’s a short blurb on a website called Lifehacker that argues people don’t need any more financial advice. What they need is to take a step – virtually, any step – to improve their finances.

This message is particularly relevant right now because November is Financial Literacy Month. The underlying philosophy of this and similar events is that if we keep talking about financial literacy, people will absorb key messages likes cutting debt and saving more. Count economist Frances Woolley among those who think this strategy is ineffective.

I’m all for keeping the conversation about financial literacy going. But we need more than just talk to get people to take that first step toward improving their finances. One practical solution is so-called nudge theory, where people are encouraged or guided to make smart financial moves they might not otherwise consider. A financial industry consultant pointed out an app called Dobot to me recently as an example of how nudge theory can work. Dobot is aimed at millennials and helps them set and meet specific savings goals.

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Retirement rebranded – it’s now the encore adulthood
Another term for this idealized version of retirement is the “third age.” The idea is that you spend a chunk of your post-employment years redefining yourself. The complication: More and more seniors will be working through their encore adulthood.

Where to live in retirement: How about a cruise ship?
No joke. If cruising is your thing, you might just be able to afford this.

Consider the money coach
That’s the friendly term used by some fee-only financial planners, who charge hourly or by flat rate for advice and don’t sell products. Here’s an introduction to money coaches that concludes with an important piece of advice: Make sure your coach is accredited. Look for the Certified Financial Planner (CFP) or Registered Financial Planner (RFP) designation.

Will millennials ever get married?
A U.S. study says today’s young adults are getting married later, and there’s reason to believe that some may never marry.

What does monthly rent of $6,300 get you in Toronto?
It gets you this three-bedroom furnished semi in an urban neighborhood. For what it’s worth, you could buy a $900,000 house with 5 per cent down and have mortgage payments just below $4,000 per month. Add property taxes, upkeep/maintenance and insurance and you’re still well below $6,300.

The U.S. housing bubble was an amateur production
Maclean’s digs into numbers showing how expensive housing is in Canada and finds we’re in risky territory. Read this if you think all’s well in the housing market.

Today’s featured financial tool
The people behind the Chartered Financial Analyst (CFA) designation have assembled resources for investors on topics like top investing mistakes, financial planning for newlyweds and having difficult conversations with your financial adviser. By the way, the CFA is top-tier, as investing accreditations go.

Ask Rob
The question:
“What are your thoughts regarding multiple financial advisers?”

My reply: “I can’t see the benefit of playing advisers off against each other. You could end up with conflicting advice, or ineffectual and even harmful advice that results from an adviser not knowing what other financial input you’re receiving and acting on. When someone asks about having two advisers, it tells me he or she hasn’t found the right person yet. Keep looking.”

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length.

Featured Video
How well is the financial industry serving the LGBT community?

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