Skip to main content

Peter Keung, 29

Occupation

Co-owner of a website development company.

Story continues below advertisement

Portfolio

High-interest savings accounts and mortgage.

The investor

Peter Keung helps run a company that offers Web consulting services. Among the websites he has launched is highinterestsavings.ca, a portal where persons interested in high-interest savings accounts can find rate comparisons, educational articles and a discussion forum.

How he invests

Mr. Keung holds emergency funds and short-term savings in a high-interest saving account at Achieva Financial. It pays the current top rate of 2 per cent (along with several other Manitoba credit unions). He is planning to transfer savings from ING Direct to Canadian Direct Financial, which has paid 3 per cent on its tax-free savings account for over two years.

As for deploying other savings, Mr. Keung is focused on paying down his mortgage as fast as possible. He has signed up for accelerated weekly payments, doubled payments, and a lump-sum prepayment of the principal every year.

Story continues below advertisement

Paying off the mortgage isn't as hard on the nerves as investing in stocks. "It's easier for me to sleep when I don't have to worry about how the stock market is doing," Mr. Keung explains. And his life is busy: "I like to spend my time thinking about things other than money."

Besides, he feels he is getting "more bang for the buck." Paying down the mortgage relieves the homeowner of 3 to 6 per cent in annual interest, which beats the current 1 to 3 per cent on savings accounts and GICs. One might earn more with stocks but the uncertainty and volatility are not worth it for an ultra-conservative investor like Mr. Keung.

Interest costs on a $250,000 mortgage with a 25-year amortization may total more than $200,000. Options for quicker payment can shave $50,000 (or more) off. Saving that much relieves a middle-income person of the necessity to earn approximately $75,000, before taxes. That's about a year less working at the office.

Best move

"Living within our means… ."

Worst move

Story continues below advertisement

"Selling Google stock when it had reached $300… ."

Advice

"Invest in what you are comfortable with and spend only what you can afford."

Special to The Globe and Mail.

Want to share our strategies?

E-mail mccolumn@yahoo.com

Report an error Licensing Options
Comments

The Globe invites you to share your views. Please stay on topic and be respectful to everyone. For more information on our commenting policies and how our community-based moderation works, please read our Community Guidelines and our Terms and Conditions.

We’ve made some technical updates to our commenting software. If you are experiencing any issues posting comments, simply log out and log back in.

Discussion loading… ✨