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It’s much easier to maintain a portfolio of a few ETFs than it is a couple of dozen individual stocks.Getty Images/iStockphoto

Robb Engen of the Boomer & Echo blog did something brave – and smart – a few years ago. He sold his $100,000 portfolio of 24 dividend stocks and replaced them with a portfolio of two exchange-traded funds.

Mr. Engen is now reporting back on the results, which are quite good. Be sure to give his report a read if you're a member of the dividend investing cult.

People are such true believers in dividend stocks that Mr. Engen says he actually lost readers when he made the switch to ETFs. Loyalty to dividends is understandable, given the strong returns that dividend stocks have delivered in the years following the last market crash.

But ETF investing offers some big advantages. It's much easier to maintain a portfolio of a few ETFs than it is a couple of dozen individual stocks. And when you use ETFs that track major indexes, you have a very good chance of outperforming the results you get from picking your own stocks. Index investing also compares well to professionally managed mutual funds. Finally, it's worth noting that ETFs tracking the big benchmark stock indexes pay dividends themselves (the ETFs pass along the dividends paid by the stocks they hold).

Mr. Engen says his ETF portfolio is more diversified than his dividend stocks, easier to manage and performing well. "I've taken back hours and hours of time," he writes. "I no longer stress over one stock, one industry, or one country's performance. And, my investment returns haven't suffered – they've flourished."

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Rob's personal finance reading list…

What to do about your Shoppers and PC Optimum points
The Shoppers Drug Mart Optimum and PC Optimum rewards points programs merge on Feb. 1. Here's what you need to know about how your existing points will be valued in the future.

Tips for saving money at the supermarket
A well-stocked list of ways to save money on your grocery shopping. One smart idea is to buy frozen veggies – they can be cheap and nutritious.

Still at work in their 80s… and loving it
The New York Times looks at a group of seniors who are happily working well into their 80s and even 90s. They do it because they love their work, and sometimes because they need the money.

What it means when your credit score drops
A lot of people are monitoring the credit scores on a frequent basis these days, which means they may well notice a drop in their score from time to time. Here are seven reasons why a score might fall. I'm on record as saying that people are getting overly fixated on checking their credit score.

Today's featured financial tool
Rising oil prices are pushing the cost of gasoline higher. The GasBuddy website is how you fight back. Find the cheapest gas in your part of your city.

Ask Rob
The question:
"I've begun tracking my household and personal spending the old fashioned way – in a little book where I write everything down and tally it up. It then occurred to me that there must be an app for this and sure enough – there are many! Could you recommend a budgeting app for someone with no accounting skills and limited computer savvy?"

The answer: "A financial planner I know really likes YNAB (stands for You Need a Budget), which has a small monthly fee. Others like, which is free. For a good rundown on how the two compare, check out this thread on Reddit's Personal Finance Canada page. It's also worth noting that some banks are now offering apps and tools for budgeting. TD, for example, offers the MySpend app, while RBC offers a myFinance Tracker for online banking clients."

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
Still wondering what the heck Bitcoin is all about? Check out this hilarious video from Late Night With Seth Myers.

In case you missed these Globe and Mail personal finance stories
– The popularity of ETFs in Canada is growing at an amazing speed
– Not having a credit card means you have no credit history
– The bears are starting to sniff around the bond market (for Globe Unlimited subscribers)

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