BORING IS BEAUTIFUL!!!! DOLLAR WISE........

Written by: Steve Proceviat Last updated on Thursday, Jul. 02, 2009 09:50 AM EDT
‘Boring is beautiful' says Lovett-Reid
The investor: Patricia Lovett-Reid, senior vice-president with TD Waterhouse Canada Inc.
My best investment: Having a plan and sticking to it.
At every point in our lives, we've known exactly how much money we've had coming in, and we've known exactly what we're spending it on.
We paid off a home, and we put four kids through university, and we're focused now on our retirement strategy – basically, we want to live well down the road and we want to retire well. I don't think it's an “either/or,” I think it's an “and.” I think you get to do both. And you get to do both when you do the numbers, and we know our numbers.
And it doesn't mean we don't spend, but we're very clear on what we're spending it on. And we stick to the parameters to which we've both agreed.
Trust me, I haven't always liked it, and I've challenged it, on occasion, but when we get back to our family's financial driving principles, that's what's seen us through.
We only have one account, and we balance the chequebook, collectively, together, every single week. We stick to these rituals and I think it's the rituals around the financial component of your lives that help you stay aligned and stick with the plan.
We've always had a plan, we've always had a budget. We've put thresholds in – what can be a discretionary expense, what requires both of us to sign – and while it may seem rigid to others, it's been a blueprint for us.
The return: With investing, I have subscribed to what I always talk about, and that is: Boring is beautiful. My whole life, I've erred on the side of caution – almost, sometimes, to my own detriment, if I'm honest. But I know, as we've gone through this period of turbulence in the markets, we've got through it much better than many of our counterparts.
We probably would have done better over the last decade than we did, but what we've come to terms with in our household is our tolerance for risk.
And so, I figured out what our required rate of return was, and therefore I took some risk off the table. I'm in the camp of, “Slow and steady is going to win this race.” And we're sticking with that strategy.
And that's been paying off. Our goals have been met.
We have no regrets. When we make the decision to buy or sell, we've done our homework – some would suggest we talk about it ad nauseum, and I think we probably do – and we will say, ‘okay, that's the decision.'
My husband at one point had some stock options in his company. We sat down and decided there was too much exposure in one sector, in one company, and we should take some off the table. And we did, recognizing that those could have been worth more, depending on how long we held them, or they may not have been.
But it's a decision we made, and you move forward. And we don't look back – and that can be a really hard thing to do: Not look in the rear-view mirror, but look out the windshield, because it's tough. But that's what you have to do.
I truly am boring, but I do like to believe that I practise what I preach.
The takeaway: I believe in having a plan – it's hard to stick with a plan, but we do. We've created family rituals around money, in terms of balancing the books, on a weekly basis. We set thresholds on discretionary spending. While our incomes and our portfolio may have changed, so has our plan. So we've not been afraid to make adjustments to our plan. And then once we do, we don't have any regrets. But I think having a plan is a blueprint that gets you to where you want to be. And we're pretty comfortable with where we're at.