Weekend reading: worst asset allocation, Home Buyer’s Plan, and more

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Hi everyone and welcome to weekend reading, where we share some of the best posts we read over the past week. We hope you enjoy them as much as we did. If you haven’t already, please consider following us on Twitter, Facebook, and Google+.

Personal Finance

Sun Life did a research that shows Canadian mortgage holders are once again more likely to pay down their mortgage than save for retirement. This isn’t surprising seeing as how debt elimination is usually the number one priority for Canadians, seeing as how our finance minister likes to point out our record level of household debt on a regular basis. The basic rule for deciding if you should pay down your mortgage or save for your retirement is this: if you can earn a higher after-tax return in your retirement account than in your mortgage rate, then you should save for retirement. If you can’t, then pay down your mortgage.

Spring Personal Finance does a podcast on the Home Buyer’s Plan, and discusses its controversy. Is it time that the government looked at indexing the HBP limit to inflation?

Investments

Servo Wealth uses the process of elimination to find the worst asset allocation. Interestingly, any all bond asset allocation, such as T-bills, intermediate bonds and long-term corporate bonds yielded low returns for the amount of risk involved in the investments. This illustrates the importance of having a proper asset allocation that involves some stocks, even for the risk averse.

Preet Banerjee from the Globe and Mail writes an interesting article about how many funds you should have in your portfolio. The more funds you have, the more likely it is that you’re buying the whole index. If you’re going to do that, then you may as well use an ETF to lower your fees.

Insurance

Here at AAFS Insurance, we looked at the life insurance application process and all the steps that are involved from the moment you begin filling out the application form to the day you receive your policy.

At LSM Insurance, another expert weighs in on various life insurance topics. This time, Jamie Golombek from CIBC Private Wealth Management discusses the insurance policy he owns and how he determined the coverage amount.

Hope you have a good weekend, enjoy the gold medal game on Sunday, and come back next week for a new post!