Point 6. means “Buy a house” not, get a mortgage. They are all like that… basically assuming you have virtually infinite money. If you have the money to do all these things clearly you will retire in comfort. The advice is all foolproof, because it assumes you have the money to do each step - therefore it’s also useless - thus the joke - and I assume the comment on many of the “financial planning” plans.

Analyzing the points is… pointless. It’s the same joke really as “How do you become a millionaire? Well, first you get a million dollars…”

Anyway, that was my take, maybe I missed something.

Dilbert doesn’t want or need that kind of risk. He needs a roof over his head and a good long term investment in bricks and mortar.

One, in addition to translating points 4 and 5 into “Fund your RRSP to the maximum”, one might also want to say how the RRSP funds should be allocated, e.g. 60% stock index fund / 40% bond fund. The RRSP allocation does not necessarily need to match the non-RRSP allocation.

Also, the 70/30 allocation mentioned sounds o.k. for someone young who’s willing to take a moderate to high amount of risk, but it might be a little too agressive for someone nearing retirement.

Adams’ points 4 and 5 don’t say anything about what to do with the money in the 401(k) and IRA. I don’t know anything about those, but here in Canada you can have a self-directed RRSP where you can do almost anything. There is no easy answer here; for one thing, if you have money both inside and outside, you should take an integrated approach for tax reasons.

Point 8 is a tricky one because in the event of a serious market downturn most people panic and sell - usually at the bottom. So while “never touch it until retirement” is great in theory, in practice it may be wiser to replace the stock index and bond funds by things like principal-protected notes and a bond ladder respectively. As much as I respect Scott Adams, I doubt that he considered the psychological impact of a serious bear market, given that the last one (1973-74) happened when he was a teenager.

Mostly with 6. you need to be aware of what country you live in. If I am not mistaken, in the US the interest paid on your mortgage is tax deductable and it is not in Canada. Also you need to be able to understand the math between renting and buying. This is a good article that explains it.

It is also important to understand the concept of leverage. The people you know who made a killing in real estate did not buy something for $10 and sell it for $11. They bought something something for $10, only paid $1, borrowed the other $9 and then sold it for $11, making $1 on their $1, doubling their money, after returning the money they borrowed. If the thing went down to $9, they would have been wiped out. Leverage cuts both ways.

With mortgage insurance in Canada you are buying insurance to protect the bank, not yourself. And if you put the price of the insurance in your mortgage, you pay interest on it to.

With 7 there are more options than before. A money market fund works, but you can maintain the same liquidity ( ability to get your cash in a hurry ) in some short term bond funds thay pay a bit more. You should be careful with GIC’s as they can only be cashed at maturity which is usually a year. With these you give up liquidity and don’t get paid more for that. Laddering them is a way to get around this. Ladder by buying one a month, instead of buying them all at once. That way, one matures each month and you can either roll it over or spend it if you need to. Depending on the frequency you find yourself hitting this emergency fund, a bank line of credit or even your credit card can act as this safety net too if it is only once every 5-10 years.

8 is the equivalent of telling someone, “just get a Windows equipped PC”. It will do the job. Without getting exotic, two things to watch for are the ratio of stocks to bonds changes depending on the person and the amount of time they have left until they retire and, again maybe just in Canada, you need to be sensitive to your tax situation as returns from stocks, index funds and bonds are all taxed differently, depending on whether they are inside or outside of your RRSP ( Canada’s IRA / 401k ). Also not all index funds are created equal and as one part of a economy gets too hot ( tech in the US, commodities in Canada ) they can become very sensitive to the effect of this one sector, when the original goal was to maintain an even balance of all sectors.

Adding a bond fund is kind of like drinking mixed drinks instead of doing shots. The mix gets you there a little later but the ride is not as rough either.

Generally, taxes take the biggest chunk out of your investment returns. Commissions and fees are a distant second.

-E