It has been a little over a year since reaching the million dollar net worth milestone and a number of you have emailed me requesting an update on what I’ve been doing since, how it feels to be a millionaire, and mostly, how my new financial goals are progressing.

Life Since Becoming a Millionaire

Back when I was in my teens (or younger), imagining being wealthy, I always thought that hitting the millionaire label would be a life changing event. At the end of the day though, it’s just a number, and on a number of levels, nothing has changed.  Now mind you, it feels great to hit goals, but for me, it was far from life changing.

Since hitting the milestone, our family still lives within our means.  Our means have actually decreased since we’ve recently decided to become a single income family.  With tight fiscal management, we’ve discovered that we can live well on one government salary while raising two kids who can still enjoy their extracurricular activities.

We still use credit cards to funnel our spending for the points, which also has the added benefit of expense and budget tracking through online programs like  All in all, it’s business as usual.

Passive Income

In terms of financial goals, I’m mostly concerned about how much recurring income that our savings can generate – perpetually.  Many years ago, my original plan was to generate passive income through real estate, a side business, and investment income.

I realized a number of years ago that I don’t have the aptitude and tolerance to be a landlord.  So I quickly sold off my rental properties and never looked back. In terms of the online business, it works well for my skill set, interests, and temperament.  However, running and growing an online business is an active pursuit. While satisfying, the business is nowhere close to the definition of passive. I continue to run the online business, but it has slimmed down a lot over the years. First when I gave up the consulting side of the business, and second when I sold my half of CanadianMoneyForum in 2014.

For me, passive income will come from investments that pay dividends.  While picking and watching your investments may not be all that passive for some, for me, I generally buy and hold dividend growth stocks for the long term.  So once I buy a dividend stock, I generally do very little except watch for further buy signals.  Now mind you, I also enjoy watching over my portfolio, doing research, and watching those dividends collect in my account.  Dividend growth investing really works for me and my financial goals (it’s not for everyone).

It may make some readers happy to hear that I’m currently dabbling in private equity, mostly to help a friend in growing his business.  Right now, the investment is in the form of a convertible loan that produces a small amount of interest every month. I have until October to decide either to convert the debt to equity, or to move onto the next deal.  Stay tuned for the next update to see what I decide to do with the investment.

Financial Goals

So now that I’ve declared that recurring income is what I’m really after, how much am I looking after and by when?  As with the original Million Dollar Journey goal ($1M in net worth by 2014), I believe in setting specific, measurable, achievable, realistic, and timely (SMART) goals.  While the financial industry wants you to believe that your retirement income goal should be a percentage of your current income, I believe a more accurate and dependable method of determining retirement needs is to look closely at your expenses.

Our current annual recurring expenses are in the $50-$52k range, but that’s without vacation costs.  However, while travel is important to us, it is something that we consider discretionary. If money became tight, we could cut vacation for the year. In light of this, our ultimate goal for passive income to be have enough to cover recurring expenses, and for business (or other active) income to cover luxuries such as travel, savings for a new car, and just simply extra cash flow.

Major Financial Goal:  To generate $60,000/year in passive income by end of year 2020 (age 41).

Reaching this goal would mean that my family could live comfortably without relying on full time salaries.  I would have the choice to leave full time work and allow me to focus my efforts on other interests, hobbies, and other capitalistic pursuits.

Current Financial Numbers

So now that I’ve declared my financial goal, where do I stand now? Here are the annual dividends generated by account:

 Account Dividends/year
SM Portfolio $5,786.67
 TFSA 1 $1,508.50
 TFSA 2 $1,873.35
 Non-Registered $750
 Corporate Portfolio $2,369.10
 RRSP 1 $3,520.84
 RRSP 2 $282.90

Total Dividends: $16,091.36/year

While we currently generate around $16k a year in dividends, there is potential to deploy more cash towards income producing investments.   In other words, we are not 100% invested.  The accounts with the most potential for income growth are the non-registered and the corporate portfolio.  Both of these accounts are still sitting on a significant portion of cash (bad habit that has persisted throughout the years).

Final Thoughts

With a goal of generating $60k/year passive income in less than 5 years time seems like a tall order, especially starting with a passive income of $16k/year.  We will continue saving, investing in dividend growth stocks and perhaps this will light a fire under me to be more aggressive and active in my business interests.  Stay tuned, more updates to come!


  1. Russ on August 10, 2015 at 10:15 am

    Is your goal of $60K in annual passive income to be achieved strictly from dividends? A “total return” approach to your portfolio might have you close to $60K per year already (a not unreasonable total annual return of 6% on $1 million when including capital gains as well as dividends).

    • FrugalTrader on August 10, 2015 at 10:20 am

      Hi Russ, yes, the goal is $60k in passive income. Now mind you, that may come from dividends or other investment income (private equity etc).

  2. Sampson on August 10, 2015 at 1:19 pm

    Hi FT, looks good!

    Just one question, maybe I missed this since I’ve been ‘away’ for a while.

    Have you paid down the investment loan? I don’t see any mention of interest expense in the ‘breakdown of expenses’ post. Our do you present net dividend income after servicing the loan expenses in the table above?

    Last question, do you think the private equity ventures will get you where you need on the single income? Based on your current numbers, you’d need a portfolio of $1.6M with present yield to get your $60k/yr and with the reduced family income, this seems like quite a sizeable goal.

    Seems 1 year ago, you had about $850k. Will that double in 6 years? Pretty steep rate of return to achieve that.

    • FrugalTrader on August 10, 2015 at 1:56 pm

      Hi Sampson, good to hear from you! We still have the investment loan which is capitalized. I don’t count it as an expense as it does not use any of my own cash flow. However, you may be onto something with adjusting to “net” dividends.

      Yes, it is quite a sizeable goal but I need the challenge to keep me focused.

      What about yourself? What is your investment strategy?

    • SST on August 10, 2015 at 9:31 pm

      re: “Seems 1 year ago, you had about $850k. Will that double in 6 years? Pretty steep rate of return to achieve that.”

      Isn’t there some kind of formula which claims you can double your money in 7 years if the return is 10%/yr? ;)

      Pretty sure Fruggie’s rate of return/growth rate over the last 7 years has been more than 10%/yr. Easy peasy, right, FT!

  3. Sampson on August 10, 2015 at 3:01 pm

    Hi FT,

    We will continue to earn + save more with the 2 salaries, although my wife and I have discussed ‘work wind-down’ strategies such as going part-time, or unpaid sabbaticals. Trickier now our kids are about to go to school, but part-time is an option.

    We live quite humbly and much of what you have posted over the years mirrors us. Where we differ: we never did the SM (still paying mortgage on primary residence), instead using capital on-hand to invest. Our most recent mortgage has a HELOC, so I might begin (been saying that for 5-6 years now) more leveraged investing. I still maintain a rental property and will likely continue to do so into retirement – we have considered putting more money into real estate, and if there is a big down turn in prices in Canada, that could be the trigger.

    Overall, our strategy is similar to yours, I’m hoping for a portfolio of $2M. That plus rental unit, and we should be good in our 40’s and beyond until pension from work, and other government payouts kick in. Our investment portfolio isn’t fully geared towards dividends, so we might draw income differently (sell off portions at the beginning of the year).

    • FrugalTrader on August 10, 2015 at 7:46 pm

      Sampson, sounds like you guys are well on your way to financial independence. If you are waiting for a downturn in real estate to buy another property, perhaps the next downturn in the markets would be an ideal time to leverage the equity in your house. Do you have an ideal age for retirement? Will you have any issues with stepping away from work?

  4. rgz on August 10, 2015 at 6:56 pm

    -Have you considered making say $40,000 in dividends, then switching to part time work to reach your total?
    -Would you ever take equity from your home to increase stock money?
    -What is your target yield in %?
    -Do you think that focusing on dividends will too much reduce the focus on other aspects of stock selection?

    • FrugalTrader on August 10, 2015 at 7:44 pm

      Hi RGZ, to answer your questions:
      1. When we get to $40k in dividends, it’s possible that I move to part time. It really depends on how strong “other income” is at the time.
      2. The SM portfolio is funded using a home equity line of credit (HELOC). I have about $120k borrowed on the house.
      3. When I purchase dividend growth stocks, I aim for a 3-4% yield that grows annually.
      4. I’ve thought about the lack of diversification, but in reality, if you own the biggest dividend stocks out there, you pretty much own the biggest companies in the world. If you get exposure to different sectors, it should provide diversification. I also have other portfolios that are indexed, like our RESPs, my wife’s RRSP and a portion of my RRSP.

  5. My Own Advisor on August 10, 2015 at 8:00 pm

    Nice update, very inspired to read this and your capitalistic pursuits :)

    I haven’t calculated our NW in some time but if I include any pensions from work, we’re over $1M. We still have mortgage debt but we’re slowly building our passive income war chest as well. I figure a $1M investment portfolio outside our pensions, and any house assets, is what we should be striving for to leave the workplace.

    I can make a few bucks per month from the blog and likely work part-time seasonally. I’d love to be able to do that in another 7-8 years before age 50 but so many things in the plan need to come together.

    Question: when are you going to kill off the HELOC entirely and just go with a non-registered account and corporate account? Or is that even a plan FT?

    Continued success to you – you are a financial role model to many investors like myself.


    • FrugalTrader on August 12, 2015 at 10:22 am

      Thanks for the kind feedback Mark. Honestly, I’m not sure if I’m ever going to kill the HELOC. It doesn’t impact my cash flow, and provides an annual tax deduction. As well, congrats on hitting the $1M mile stone. No doubt that you will hit your financial freedom goals sooner rather than later.

  6. Karl on August 11, 2015 at 11:36 am

    “We will continue saving, investing in dividend growth stocks and perhaps this will light a fire under me to be more aggressive and active in my business interests.”

    Love this. Finding the fire is so important. Team MDJ has done this for me and I can’t thank you enough.

    • FrugalTrader on August 11, 2015 at 2:53 pm

      Thanks for the feedback Karl, and I’m glad that MDJ is helping you as well.

  7. CJL on August 11, 2015 at 2:52 pm

    I was wondering if your investment portfolio had decreased this year? If so, are you getting close to dropping below your million dollar level. I have noticed a sizable decrease to my portfolio due to Canadian resource companies and banks. All the best on your 2020 goal; you can do it.

    • FrugalTrader on August 11, 2015 at 2:55 pm

      Hi CJL, my SM portfolio which has a lot of energy has taken a hit, but my RRSP is mostly US dividend stocks which has been mostly flat. However, with USD being strong vs CAD, it has held up the account. I also have a significant amount of USD in my corp account which has also been boosted due to FX.

  8. BeSmartRich on August 18, 2015 at 8:51 pm

    Thanks for the good read. I am always inspired by your goals and look forward to seeing your progress down the road. The passive income goal would be challenging but that’s what makes it interesting. Keep up the good work!


  9. Underground Woman on August 25, 2015 at 12:53 pm

    So how are you feeling about having lots of cash in your non-registered and corporate portfolios this week? Thinking about some buying opportunities?

    • FrugalTrader on August 25, 2015 at 1:02 pm

      I’m rooting for a bigger sell off. However, I did add international exposure to my wife’s RRSP, family RESP and big blue chip dividend stocks (US) to my RRSP. How about yourself?

  10. goal Achiever on September 1, 2015 at 8:36 am

    Hey FT,
    I have been following you since 2010, and I am very impressed with what you have achieved so far!

    I have about half of my net-worth in rental properties and the other in my non-registered Questrade account, holding majority USD stocks.

    With the $Cdn\usd at a 6 year low ($0.76 today I believe) I am contemplating selling some of my usd stocks and exchangimg to Canadian (using NG) and withdrawing to invest in more real estate (or pure Canadian stocks).

    Since you are sitting on a decent amount of usd securities yourself, would you ever consider this?

    This is assuming our $Cdn grows back to near par in the next 2 years? It’s risky, but gives almost 25% immediate return on usd securities.

    Keep up the goals!

    • FrugalTrader on September 1, 2015 at 9:10 am

      Thanks for the kind feedback. I know, it is tempting to ditch USD and convert back to CAD for the easy gain. I have some USD in my corporate account that I will likely move over to CAD at some point. However, I will be leaving my RRSP intact (I like my USD dividends). The only thing I would comment is to watch out for diversification. If you sell your USD holdings and invest in CAD or real estate, you may be overexposed to one asset group. Keep us in the loop as to what you decide!

  11. Small Steps of Sustainability on September 3, 2015 at 8:22 pm

    Thank you for posting your update, very motivating!

  12. Steve on October 12, 2015 at 1:45 pm

    Ya a million isn’t what it use to be. It’s a nice milestone for goal setting though. I’ve followed your blog with interest (no pun intended) but when you mentioned “you can live off of one government salary” I know see how you made your goal.

  13. Dividend Growth Investor on December 15, 2015 at 1:14 pm

    Hi FT,

    I like your idea of living off passive dividend income. I myself focus on dividend growth stocks with long histories of dividend increases. The dividend cuts I have experienced have mostly come from those which have not raised dividends for at least a decade. I have a couple of questions:

    1) Is it possible to decrease your expenditures from $52K/year? For each $1000 reduction in annual expenses, you need $25,000 – $30,000 less to invest in dividend paying stocks

    2) In addition, what percentage of your portfolio is investable? I know your net worth is over $1,000,000, but given the $17K in annual dividend income, I would assume that less than 40% of it is investable? If you “cashed in” on those other assets that do not produce income for you, wouldn’t you be able to easily generate $30,000 – $40,000 in annual dividend income?

    Good luck in your financial independence journey!

    Dividend Growth Investor

  14. Eastcoaster on February 12, 2016 at 5:11 pm

    Apologies if this comes across as a long post, just want to share some hard learned experience.
    Getting to 60K a year is going to be awfully slow using dividends only and the more you can do to add leverage (of a number of kinds,not only purely financial) to that process the faster you’ll shorten the trip. Like many bloggers out there, we were really frugal for years and years. It works, had no debt and bought a house etc, but its pretty slow, saving your way to freedom. Then we figured out how to leverage in creative ways. We paid off our home mortgage in 4 years by leveraging a federal job with mat leaves (mom) and an easily relocated emergency health services career (dad) into both of us having an income but only one of us working as we had three consecutive children and moved province for each birth… a lot of work but effective and we wanted 3 kids spaced at two year intervals anyway. We then refinanced the house and used the 200K we pulled out to buy a 24 unit apt building in 2010. I’ll never forget the first day I deposited 14000 dollars and thought this was how it should be done. We haven’t looked back since; that building now has a rent roll of 20K – the math is pretty good. Every month on the 1st we take 5-6000 $ out of the property managers accounts and our net worth has quintupled as we branched out. We now own 5 single families, half of an 18 unit townhouse and apt oceanfront development and of course the original 24 suiter. I am truly not trying to brag; the leverage of real estate is what has permitted us, a family of 5, to pick the sunniest part of France to move to and put the kids in the local schools (where they get a 5 course meal for lunch for 2.50 euros per kid!). We live in the heart of the peach and wine growing region on the Meditteranean; the mountains in Spain are visible 20 minutes away to the south; and the low cost European airlines flying out of Barcelona are taking us to Morocco next week for 20 euros per person per trip – a family of 5 flying to Marrakech return for 202 euros, taxes in. We had no idea how much you can leverage that kind of passive income if you have the flexibility of time. Once you generate 6-7-8-9000 $ every month in cashflow without requiring your presence (we have 2 good managers), your next challenge is to find the lifestyle and places where that money goes furthest. Value focused people like the ones in this community can REALLY squeeze a lot out of it – we took a French country farmhouse with pool that rents for 2500 pounds per week in the summer high season and by renting it for the whole 10 month low season we only pay 1500 euros per month incl utilities. I found this blog because I was reading the post about how much it costs to start a blog, I’m kicking around the idea of starting some kind of web blog to monetize what we learned during that path to freedom, but wanted to really share what that 4 or 5:1 leverage that a mortgage means can do for you with people who think money and value. Frugality got us on the path, but it was real estate and leverage that gave us the keys to the mansion.

  15. Eastcoaster on February 13, 2016 at 8:55 am

    An addition to the above – my wife read over what I had posted and gave me heck for glossing over the challenges of accomplishing a significant “passive” income in real estate.
    This writer behind this blog – Million Dollar Journey – mentions they found they didn’t wish to be a landlord for reasons that can probably be summed up under the headings Tenants and Toilets, to quote David Lindahl, a US RE multi-family “guru” who has probably set more people free of paid employment than anyone else I’ve heard about. You can access Dave’s knowledge through his 3 books, or speed up the journey with ultimately less cost if you pay him 10K for coaching, the best 10K you’ll ever spend in your life if you follow the principles it teaches as it will get you to financial freedom in 3-5 years even if you have nothing at all right now. But it will always take 100 % focus, discipline, dedication and just the will to chew through whatever is in your way to get there. Nobody wants to deal with tenants or toilets, those things will drive you out of the real estate investment business after a few years. But you don’t have to, avoid being the landlord and stop managing the property yourself after a few months – it is useful just to get the hang of how to do it properly. But even better, learn from someone like Dave and learn how to manage property managers, not tenants.
    For us, we moved province every year and set up new lives in each new place in order to have one of our salaries pay off the mortgage. That frugality and focus part is pretty common to almost all financial blogs. The less common part is the crucial and emotionally difficult decision to take all the equity we had gained and put it all into one single decision. Concentration builds wealth, diversification preserves it. Having 20 dividend stocks is fairly diversified (although in major declines everything goes down fast – 2008-9 shows that) but at an average dividend yield of 3 % in a stable market you’re going to have save 2 million to buy stocks to get to 60 000$. On salaried income, even with reinvesting the entire dividend flow that is going to be a sure but very slow way to get to freedom.
    I guess the part that has been the most difficult, and the part I rarely hear talked about in these blogs, is the emotional journey to face one’s fear and push through the boundary as it is always fear of something or many somethings that ultimately prevents people from doing anything they otherwise want. No one wants to work 4-6-8-10 years, “risk” everything and then lose it.
    The key thing we learned was that by not succumbing to the fear and following the advice of other RE investors to go as big as possible as fast as possible, you leave the realm of single unit residential investing and go to commercial mortgages. In commercial lending, the bank does not look at you as security other than your net worth. It looks at the property. That means they send their own underwriters to look at the property and all the due diligence with a fine tooth comb to make sure you aren’t overpaying for the building, that it isn’t going to sink you and leave them with an over-leveraged building they will lose money on when they have to take it back and resell it. In the case of multi-family, if you choose to have CMHC insure the mortgage, then the government sends a team of underwriters to the property to make sure it is worth what you are buying it for and they are very very conservative to protect the governments interest since they are now insuring the banks from loss on the mortgage.
    I don’t know of any form of investing in the stock market where you get leverage of 4 or 5 to 1 that comes with two levels of independent review of your deal to make sure it is a good one that makes you money. Its both safeguard and imposed discipline to dig until you find the deal that meets those requirements. Only 1 real estate deal in 50 or 60 really is a great deal. You have to look at a lot and know what you’re looking for.
    There is a ton more to it than that of course, but above is all anyone should need to get to financial independence in 3-5 years. A good friend of mine started with nothing but 32 000 $ in credit card debt and a bicycle, riding his bike to meet prospective financial partners. The price he paid to get started was sleeping in his car for 4 months while he rehabbed the first triplex with a money partner providing the capital. 4 years later he own 62 units concentrated on 3 streets in one town and is free for life. He focused, did whatever it took to get started, and then leveraged the many different forms of leverage that real estate entails. Everybody can do it and you can too.

  16. Thomas on February 2, 2017 at 4:49 am

    With all due respect, I also agree with Eastcoaster that investing long term in dividend-paying stocks with a decade or more of record of increase in dividend is an awfully slow and inefficient way of growing one’s net worth. At around 5% in the better cases, a passive strategy like this is probably only marginally better than investing in mutual funds or managing one’s own index fund.

    That said, I do believe that there is a mindset issue that needs to be addressed here. In the investment world, it generally holds that one exchanges passivity with substantially less yield. For example, there are increasingly more people spending 1+ year of hard work building online product-based businesses, and derive financial freedom right from it within 2-3 years or so. It’s a form of efficient, long-term passive income stream that looks like a short-term job in disguise. And it makes sense and jive well with the principle of capitalism as well — since the fastest way to grow is to provide inmense value to the world.

    For people who are deep into passive, long-term form of stock investing, it’s a good idea to take the concept of investing more seriously, and venture into highly-leveraged financial products such as futures and options. And as Eastcoaster alluded to earlier, there are also countless people who attained financial freedom through investing in large-scale real estates — not through a decade, but in a span of years. Sure, cutting down expenses is a common-sensical advice, but in all honesty it would be pretty hard to save one’s way to wealth.

    In brief, it’s fair to say that the basic tenet to wealth actually has more to do with the know-how, the discipline, and the willingness to put in hard work in the short-term to set up a system that would benefit oneself many decades to come. It’s also a good idea to learn from the billionaires, avoid common advice requiring middleman or little work. Keep in mind that while in the old days a million adds a lot to the net worth, a millionaire today corresponds more or less to someone in the upper middle class strata.

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.