Reader,

Happy Labour Day Weekend!

It has been a relatively calm and grounding week in our household. Yesterday, Katie and I spent the afternoon celebrating our nephew Orion's second birthday; it was a lovely time. His mom is an expert pastry chef, so let's just say we left the event with a doggie bag of goodies. I also managed to sneak in three rounds of golf this week before the fall weather officially takes over. Tonight, we are capping off the weekend with a big family dinner with Mom, Dad, and our side of the family, and tomorrow, Katie and I are rolling up our sleeves to tackle some serious backyard work, after my round of golf. Tomorrow will be the 50th round of the season, to those who are counting 😅

Oddly enough, we've had a revolving door of Airbnb guests this month. September is usually a transition period, but between late-summer weddings and folks traveling early for the gorgeous fall foliage, the rental has been incredibly active. Let me tell you, the variety of guests have been all over the place, from long-distance relationships meeting at our place, a couple who is very interested in the Hamilton nightlife, and lastly a series of guests visiting family at the nearby conservation area.

As we transition out of patio season and back into "school mode," it is the perfect time to reset your financial strategy. Let's talk about what is happening in the markets this week and how it impacts your clinical exit plan.

Sticky Rates on Both Sides of the Border

If you have been waiting on the sidelines for interest rates to suddenly plummet back to pandemic lows, you might be waiting a while. The Bank of Canada and the US Federal Reserve have both been battling stubborn inflation. While we have seen some slight cooling, inflation remains sticky. Central banks are exercising extreme caution, keeping rates in a "higher for longer" holding pattern to ensure they don't reignite the inflation fire.

What does this mean for you?

If you are hoarding a massive pile of clinical earnings in a standard checking account, inflation is actively eroding your purchasing power. You must deploy that capital into appreciating assets, whether that is real estate, index funds, or your own clinic, so your money outpaces the cost of living.

The Retirement Reset: Is the 4% Rule Dead?

For decades, the gold standard for retirement planning was the "4% Rule". It originated when financial adviser Bill Bengen calculated that if you withdraw 4% of your portfolio in your first year of retirement and adjust for inflation each year after, your money should not run out over a 30-year period.

However, recent research by Morningstar's Christine Benz throws some caution into that assumption. Based on market conditions, Morningstar's annual research has recently suggested that a 3.9% (or even 3.7% in their 2025 data) starting withdrawal rate is a much safer baseline for a 30-year horizon with a 90% probability of success. It sounds like a minor tweak, but dropping from 4.0% to 3.7% on a million-dollar portfolio means $3,000 less in spending power in your first year of retirement.

The takeaway here is flexibility. You cannot just blindly rely on a static 4% math rule forever. To build true financial sovereignty, you need a dynamic strategy. This means adjusting your withdrawal rate based on current valuations, and ideally, building multiple streams of income (like those Airbnb guests!) so you aren't entirely reliant on selling off your stock portfolio when the market dips.

Take an hour this long weekend to review your own numbers.

Are you positioned for the new reality, or are you still operating on old math?

Enjoy the rest of your Labour Day.

​@financiallyfulfilledpro and Certified Financial Counsellor CFC™

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