The Simple 7 ETF Portfolio for Canadian Retirees.

It’s a question that I am asked with regularity. Readers will email or comment on articles “all of this ETF stuff is great, but how do I set this up for retirement?” Robb Engen of Boomer and Echo will, uh well, ‘echo’ that sentiment.

And it’s true, if you google creating a retirement portfolio with ETFs you get digital crickets. There’s not much out there in the blogosphere or on the sites of the major financial institutions. Articles that have headlines that suggest they are about to give some ideas on building an ETF portfolio for retirement usually stop short or discuss creating wealth for retirement.

So hey, I’ll give it a go. I’ve put in way too many thousands of hours studying asset allocation and retirement and retirement funding models. My sister who is a wonderfully dedicated primary school teacher ‘observes’ that I am a ‘hyperfixator’ or at least that I suffer from hyperfixation. Got kids? You might see some of that hyperfixation when they fire up that Xbox. Hey, as a Microsoft MSFT shareholder it’s my duty to disclose and provide you the link to the Xbox site. Hyper fixate away, kids.

Is this investment advice? Well not really. 

Of course, nothing on this site is concrete advice. Use the information and ideas to form and shape your own opinion. If you’re a self-directed investor you should know what you’re doing. You should understand your personal tax situation. You should understand currency conversion charges and withholding taxes. You should know what goes where with respect to RRSP vs TFSA vs non registered amounts and accounts. You should know the most optimal order on how to harvest your assets with respect to account types. You should know when to take CPP and OAS. You should know how much you can comfortably spend each year. You should understand estate planning, hold the proper insurance and know how to set up your beneficiaries.

Yes, I just listed a whole bunch of stuff in areas where you have partial or no understanding. I know, thanks for nothing eh. I never said this self-directing thing is easy. So what do you do?

Seek retirement and investment advice. 

You can still possibly self-direct your investments in the end if you have the knowledge and you understand your risk tolerance level. But I’d suggest that you contact an experienced fee-for-service financial planner who has expertise in the retirement arena. With a fee-for-service advisor you will pay as you go. You can pay by the hour, or perhaps pay a flat fee for the evaluation and plan. You might then set off on your own to build the portfolio with all the right pieces in the right place.

I’d also suggest that you read my review of Retirement Income For Life: Spending More Without Saving More. That’s a wonderful staple read for retirees and retirement planners. The author, Frederick Vettese, is the chief actuary at Morneau Shepell. 

The 7 ETF Retirement Portfolio. 

In this article How to Create a Retirement Portfolio with Exchange Traded Funds, I offered that we don’t have to do anything ‘too fancy’. Simplicity works. The basic fundamentals of a well-balanced Balanced Portfolio might very well do the trick in retirement. In that article you’ll also find some help on what goes where. But of course you’re going to get some help in that regard, right? 🙂

For now, I’ll just offer the asset mix. The portfolio will rely on the growth of stocks with the support of bonds and a slight income booster. Once again, it is my opinion that we do not need to ‘live off of the income’. I actually think that is a trap that will close too many doors, and it will not allow us to hold enough of that growth engine known as stocks.

For this portfolio I offer Dividend Growth and High Yield Dividend ETFs. I also include the asset class known as REITs, real estate, for the US and Canada. Here ya go, in a conservative 50/50 model that is close to 50% stocks and 50% bonds. You may decide to go more aggressive or more conservative with your stock to bond allocation.

Cut The Crap Investing Retirement Portfolio

What About Cash, GICs and that Annuity? 

Yup. you might start with a very generous and guaranteed fixed income core. Most retirees are very conservative for very good reasons. Keep in mind that while secure income is good, and feels great, many retirees will need enough growth to combat that longevity risk and the inflation risk. Remember we might lose spending power by about 3% per year. That can add up over the decades. And you might live to age 85 or 90 or 95.

On how much you might be able to spend if you need to maximize portfolio income please have a read of my guest post on Boomer and Echo, here’s The 4 Percent Rule. Is There A New Normal For Canadian Retirees? I then followed up with this article on Seeking Alpha.

Keep in mind that the rules of thumb are guidelines and are made to be broken, especially when those stock markets break. We might need to bend those rules of thumb. Frederick Vettese suggests we might need a flexible or dynamic spending plan in retirement. That said, things might also continue to go swimmingly.

Be prepared to spend more or less.

The above ETF Portfolio mix might continue to deliver returns in the area of 5-6% over longer periods. That’s certainly not a growth portfolio. Again, you should know the math on how much growth is required to beat off inflation and longevity risk.

You might be able to create a GIC ladder that pays you in the area of 3%. You can have a look at Tangerine for the rates of the day. You might also consult

If your ETF Portfolio is delivering 6% annual (estimated not guaranteed of course) your return component might look like this for every $100,000.

  • Guaranteed income: $1500 annual
  • ETF Income: $3000 annual

You’re within that 4.5% spend rate. Once again, if you build up that guaranteed income component by way of annuities, that overall spend rate might get a boost. You might have a read of Pensionize Your Nest Egg from Alexandra Macqueen. If you then add more equities to your ETF Portfolio mix you might give that portfolio spend rate a boost.

Thanks again for reading. Please leave any questions in the comment section on this post. I’ll get some experts to stop by to answer any specific questions. Email me, Dale, at if you’re interesting in contacting a fee-for-service advisor, I can throw a few names your way.

While I do not accept monies for feature blogs please click here for more about Dale and ‘how I might get paid’ disclosures.

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6 thoughts

  1. 1. You should understand your personal tax situation.
    2. You should understand currency conversion charges and withholding taxes.
    3. You should know what goes where with respect to RRSP vs TFSA vs non registered amounts and accounts.
    4. You should know the most optimal order on how to harvest your assets with respect to account types.
    5. You should know when to take CPP and OAS.
    6. You should know how much you can comfortably spend each year.
    7. You should understand estate planning, hold the proper insurance and know how to set up your beneficiaries.

    Great questions Dale! I’ll add another:

    8. You should know what an IPS is AND have one! If you don’t here’s a link 👉

    You may want to start with Q#8. An option is to set up a robo advisor account and they will do as IPS with you. It’s not robust but it’s a start. Likely, 99% of investors don’t let alone what what an IPS is AND why it’s important let alone have one. And note this, if you have a financial advisor who sells investment products like mutual funds, it’s virtually certain you won’t have an IPS. The investment industry and their army of salesreps/financial advisors DON’T WANT YOU TO HAVE ONE, or know about them. WHY? …. because it makes them accountable to you, and that’s the LAST thing MOST financial advisors want! WHY? …… because most “financial advisors” are sales reps, NOT “financial advisers” with a Fiduciary responsibility. AND, if you don’t know what that means, start there and look it up, then maybe tackle Q# 8 above. And then, by all means Q’s 1-7.

    And ….

    Keep reading this investing blog, an article a week. It’s called “investing discipline”, and it’s what most often separates successful people and investors from the rest of the pack (join the IPS 1% and you’re in your way!)
    It’s a great resource for developing financial investment literacy and much more!

    Best of luck on your journey to achieving your financial and life goals, and remember, they’re intrinsically linked (via Q’s 1-7 above from Dale’s article)!


  2. Thanks so much poidaman for stopping by. Great comment. Yes investors should certainly get a plan. And most will need some help from a REAL financial advisor. A written plan is great. And sign it as a promise to yourself to execute with care. Happiness is a financial plan 🙂


  3. Dale, your 7 ETF Retirement Portfolio looks quite light in international content. It looks to be near 6%. Also no emerging market content. What is the overall allocation breakdown, ie; Cdn, U.S., Int’l, & fixed income? The overall MER?


    1. Thanks Bernie I will be back with a follow up article or three on this portfolio and other retirement ETF portfolio ideas. I’ll go into the rationale and income and fees; though the fees are quite ‘typical’. BMO Monthly Income is a little higher of course due to the unique basked of income producing assets. As per International, I am in the camp of keeping that modest especially in retirement, but certainly have some exposure. We also get International exposure by way of the US multinationals that we hold. I would not be a fan of developing markets and those many risks, for retirees. Others may choose to take on that risk. Again, a self directed investor should understand the assets and how they all work together. The goal of the above portfolio idea is modest growth with the equity risks managed by the way of a core bond ETF. It is certainly very conservative.

      Thanks again. Hit that Follow Button and you’ll get the full posts sent to your inbox. You can read them in your email and respond via your email 🙂



  4. Got a question for you Dale. (Turner won’t answer me) Retiring in 7 weeks. Will be receiving full CPP/OAS that will give me about 1/4 of my anticipated retirement income. Is it reasonable to factor that into the fixed income component of my portfolio. Right now the RRSPS/LIRAs are in the high end of the six figure range in ETFS, set up in a basis 60/40 and well diversified. Seriously looking at one ticket products from Vanguard/Blackrock/BMO for simplicity’s sake, adding a REIT. So the question boils down to ZGRO vs ZBAL, XBAL vs XGRO or VBAL vs VGRO. I’m not looking for a recommendation here, just an opinion with regard to the CPP/OAS as part of the fixed income component.


    1. Hi Rob, great question. Yes as you may know Jack Bogle said we should include pensions in our asset allocation decision. I did write on One Ticket for retirees, you may have seen that. I also just wrote on Annuities as those super bonds. So many moving parts. As you know it’s impossible to give advice not knowing the full picture and me not being a tax expert 🙂 My general observations or thoughts are that the most Conservative Vanguard One Ticket is too conservative, and then we do need some bonds in the portfolio to help with that sequence of returns risk. From there it might come down to your comfort level for risk and how much risk do you really need to take on to reach your goals. I like the idea of adding a REIT and perhaps some other income boosters and that might include annuities as a consideration. Wondering also if you have had an advisor look at your situation? There is the financial legacy question and estate planning and more 🙂


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