Jean, 80, Sarnia, Ont., and his financial planner Jeff Burchill
Portfolio: 25% Balanced mutual funds | 25% Dividend paying stocks | 25% REITS | 25% Corporate bonds
Jean has an eye for distressed assets with upside. But before he turned 75, he’d never bought a single stock. In fact, the ex-car salesman from Sarnia, Ont., had only one preferred investment: real estate. Comfortably retired and with time on his hands, Jean (who didn’t want to share his last name) decided to invest his first TFSA contribution in stocks and see what happened.
“I had nothing to do with stocks before 2009,” he says. “But my daughter worked for a company that was at death’s door—on the verge of bankruptcy—and she felt the company would survive. So I invested that first $5,000 TFSA contribution in Nova Chemicals (NCX).” The Pittsburgh-based company’s stock was trading at $1.50. Three weeks later, a Saudi Arabian petrochemical firm bought out Nova for about $6 a share, almost quadrupling Jean’s initial investment. “I got lucky,” he says.
In early 2009, Jean was looking for another stock investment. After talking to friends and family, he invested in Guelph, Ont.-based Linamar (LNR), Canada’s second-largest automobile parts manufacturer. Linamar was going through tough times too. Trusting what he calls his “sixth sense,” Jean put the whole $18,500 from his TFSA into the company, then trading at $4 a share. “I was nervous,” he says. “As it started going up, I got even more nervous. So I sold a few weeks later at $10 a share, and it’s now at $35. I’m good with that, but the truth is that again, it was all blind luck.”
That summer, Jean took his TFSA portfolio to financial planner Jeff Burchill to manage for him. “I’m not that good at speculation,” Jean admits. Since then, Jeff has invested his money in balanced mutual funds, dividend-paying stocks, real estate investment trusts (REITs) and corporate bonds. “I’m a pretty conservative guy and don’t really need the money,” says Jean. “I plan to leave the TFSA to my four children and grandchildren. I’m happy with that.”