Margot Bai

To read the article in it's entirety, visit the Globe and Mail's website for Saturday November 10, 2007, page B17.
The Globe and Mail
From the article by Jason Chow in the GLOBE AND MAIL
Saturday November 10, 2007

Financial author has a balanced long-term view


AGE: 33

LOCATION: Markham, Ont

OCCUPATION: Licensed insurance representative and a financial educator, Ms. Bai wrote a personal finance guide titled Spend Smarter, Save Bigger and runs the website

RATE OF RETURN: In 2006, her return was 12.9 per cent. Over the past 12 months, 6.8%.


"I would call myself a balanced investor with a long-term investment horizon.

"Since I am in my thirties, I appreciate the importance of equities in my portfolio. However, I like to hold some bonds to provide a buffer against market fluctuations. I'm human and I don't like to see my retirement account take a steep nosedive during a market correction. Currently my portfolio consists of 70 per cent equities and 30 per cent fixed income/cash."


"I chose Phillips Hager and North several years ago to manage my family's retirement savings. About 70 per cent of my holdings are in the PH&N balanced fund. To boost the equity portion and geographic diversification of my portfolio, I invest another 10 per cent each in their U.S.Equity and Overseas Equity funds. The final 10 per cent I invest in the PH&N Dividend Income Fund, which has long been one of their top-performing funds. "I like PH&N's balanced fund because they charge a lower management expense ratio (MER) on their balanced fund than on their equity funds, to represent the bond portion in the fund. I get the benefit of having them do the rebalancing for me without having to pay higher fees on the fixed-income portion of my portfolio."


"Investing directly with a low-fee mutual fund company instead of entrusting my savings to a financial advisor. The weighted MER I pay across all my investments is 1 per cent. Compared with the 2.5 per cent charged by the funds recommended by advisers, I'm saving 1 per cent on my investments each year. That's 1.5 per cent more for my future every single year."


"When I was very young and knew very little about investing, I put my money in one of the big bank's equity funds. The MER was around 2.8 per cent. I later found out that the fund was a closet indexer, a fund that is supposed to be actively managed, but in reality mirrors the index. Index funds are very easy to manage and should charge low fees.

"Also, my US equity fund continues to perform poorly as it has for several years. Part of me wants to get out of it, since the prospects for the U.S. economy are so poor. But I believe in the importance of having an investment strategy and sticking to it. If I hold to my mix and lo-fee investments, over the long run I should do very well."


"I'm very interested in investing in more real estate. I already own one rental property in Newmarket, Ont., and I'm looking at other residential property. Everyone needs a place to live, right?"

Jason Chow
© 2007 The Globe and Mail