Raise a Toast to the GIC
Today is the day my 1-year GIC finally matures, and I expect the money to hit my account tomorrow. Then I will have a new problem of what to do with that cash.
Until now, I’ve been counting the GIC as “invested,” so the “percent invested” stat will fall tomorrow.
I think I will put that into the market right away. No sense holding it as “checking account” cash. I will distribute it as follows:
- 34% VTI – Vanguard Total Stock Market Fund
- 33% VIG – Vanguard Dividend Appreciation Index Fund
- 33% MOAT – VanEck Morningstar Wide Moat ETF
I will distribute it this way to avoid the “money market/US T-bills” problem I have been facing. I’m already over-invested in cash and short-term interest assets. And I need to move into stocks in a reasonably bold manner.
VTI invests in every public company in the United States. It’s a broad play on the US economy as a whole. The US will go through its ups and downs, but generally, it outperforms all the other major economies. Canada, Australia, the UK, and Europe are anemic compared to the performance of the US economy.
VIG holds many of the top names that also pay a dividend. Microsoft, Apple, Exxon Mobil, and Johnson & Johnson, to name a few. These companies are not going anywhere. Some tech and financials are in there, which can be volatile but should be fine.
And one new ETF to me is MOAT. This ETF holds companies with a wide moat, which means it’s difficult for competitors to catch them. These companies can also generally set their prices to offset inflation and are more profitable than others without a wide moat.
MOAT holdings include Domino’s Pizza, Salesforce, Transunion, and Polaris stocks. These are not generally held in the high-dividend fund and represent a good selection of highly profitable companies.
I will need to have a buy-and-hold mentality for this. I should never sell these ETFs for years. This money is as locked-away as my GIC was.
