I started my investment journey at age 21 by making my first contribution to my RRSP. If memory serves, I’d learned about passive income through dividends and had become enthralled with with idea of living off dividends in retirement. Information about investing wasn’t as pervasive back then as it is now, so going online to learn more about dividend investing vs. growth investing didn’t occur to me. Younger Me’s goal had been to build a portfolio that generated enough dividends to cover all my annual expenses while also being able re-invest atleast 20% of that passive income. In short, I wanted to live completely off my dividends.
Fast forward several decades and I’m happy to share that I reached my goal of being able to retire early. For the same of transparency, you should also know that I made plenty of mistakes along the way. Here’s a quick snapshot of my three biggest mistakes:
- I paid off my primary residence in my early 30s after selling two rental properties. I could’ve (should’ve?) just plowed that money into the stock market while continuing to make my regularly-scheduled mortgage payments. A six-figure sum dumped into a well-diversified, equity-based ETF likely would’ve allowed me to retire even sooner! Instead, I chose to become free of the biggest debt most people ever owe to the bank.
- Another big mistake occurred when I temporarily suspended my automatic contributions to my stock portfolio during the 2008 stock market crash. I believed the Talking Heads of the Media, instead of following the wisdom of buying low. During a stock market crash, all prices are low so I should’ve been checking the couch cushions for loose change to buy as much as possible. It took me 6 months to re-start my automatic contributions, which means I missed investing at the very bottom.
- My third biggest mistake related to the fact that I devoted years to investing in dividend-focused ETFs instead of growth-oriented ETFs. Young people should be investing in well-diversified, equity-based ETFs, and they should be ignoring the siren song of passive income from dividends. With decades to compound, growth ETFs are best suited for young people who want to build wealth for their later years. Time is on their side.
This sample of my biggest investing mistakes ought to reassure you that making mistakes need not stop you from retiring when you want. Hopefully, you’ll course-correct today if you see that you’re making the same mistakes I did. Ideally, you will get yourself to a fee-only financial planner as soon as you possibly can and you’ll obtain a custom-designed plan for your money.
If I’d known then what I know now, I like to think that I would’ve made smarter decisions. After decades of investing and correcting errors along the way, I retired at the end of 2025. The mistakes slowed me down but they didn’t throw me off-track. Automatic contributions, sinking funds, and using low-priced ETFs all helped me to retire earlier than planned.
Sadly, I didn’t meet my stated goal by the time I retired.
As of today, my dividends only cover 82% of my annual expenses. The other 18% are covered by my pension.
Am I successful even though I didn’t hit my dividend-goal?
I would say “YES!!!”
Hindsight offers a new perspective on success. Intellectually, I know that I could’ve kept working longer to amass more money until such time as the dividends completely covered my expenses. The mathematical answer to meeting my dividend goal was to simply generate a paycheque for a longer period of time. Automation would’ve ensured that a portion of my paycheque went to my investments. The dividend re-investment plan would’ve ensured that my dividends continued to compound without any effort from me. The engine of wealth-creation could have continued unabated had I simply chosen to stay yoked to my employer.
Dividends paying for everything would’ve been ideal, but the trade-off was not one I wanted to make. It would’ve meant more years in a job that added no joy to my life. Truthfully, I wasn’t happy at my job and that unhappiness bled into other areas of my life. I had little motivation to find another position when I had another realistically feasible option at my fingertips, i.e. retirement. I have a limited time here on Earth and I decided not to spend any more of it at work.
My decades of employment and my habit of investing a good chunk of my paycheque every two weeks granted me the option to leave the workforce of my own volition. No one forced me out before I was ready. My portfolio offered the comfort of financial security without drastic cuts to my lifestyle. For the first time in my adult life, I could put an emphasis on my own happiness without worrying about how I would pay for my continued care and feeding.
In short, I chose my happiness over additional dividends and that was the right choice for me. I wake up happy now. My time is my own to fill as I wish – whether that’s reading a book, seeing friends & family, going to the movies, tending to my garden, celebrating milestones with friends. No longer do I have an employer hijacking my precious, precious time in the furtherance of goals that are of little importance to me.
There was nothing wrong with my original dividend-goal and I might have been even happier had I achieved it, but life doesn’t always go according to plan. Younger Me thought my investing choices were bullet-proof. My ideas at the time were founded more on hubris than on experience & knowledge. It doesn’t surprise me in the least that things didn’t go exactly according to plan. Age and experience have taught me that success might not look precisely how I’d imagined, but it’s success nonetheless.