Any time I receive a telephone call from my mother, who is a neophyte on financial matters or on an investment topic, I know the mass media must be giving it considerable attention. I was right. In this case it was the Canadian dollar. I asked her what she was so excited about to which she replied “it has been over thirty years since the two currencies were at parity.” I quickly corrected her grammar and said “Mom you mean par.” “Yes, parity,” she replied. What’s a son to do?

The media coverage was thorough. For about a week it was hard to go anywhere without getting bombarded from the mass media - newspaper, radio, Internet and TV - letting us know our dollar is equal in value with the Greenback. I know they are simply doing their job, yet experience has taught me that mass media coverage generally comes without perspective or wisdom.

So I started to think “just exactly what can us as investors learn from this historic attention grabber of the week?”

Before I address the answer to that question in more detail, I’d like to review some of the more visible facts related to our dollars staggering four and a half year ascent. I do think we can all agree its rise is a reflection of a strong economy and a weak US dollar. It’s great for snowbirds and bad for manufacturers who export; ideal for investors who recently invested outside of Canada, bad, at least for now, for those who did so when our dollar was notably lower. You get the idea.

Yet what really caught my attention in seeking an answer to my question were my mother’s words - thirty years. And what is so special about thirty years you ask? Lots actually! This relates to a topic that is far more important to you than the value of our dollar: the length of time you may be spending in your retiring years. The last time the Canadian dollar was par with the US currency until now is a neatly packaged set of symbolic retirement years.

To clarify, by retirement I mean someone who only chooses to go work with no financial reason to do so and/or enjoying a lifestyle of their choice from one’s income that is generated from either their pension, their investments or in most cases, the blend of the two.

The days are gone where the previous generation retired at 65 years of age and passed away at 72. Our generation is living longer, healthier, more active lives and requires more capital to fund their retirement than ever before.

According to actuaries, if a couple reaches the age of 65, one of them is projected to live, and at least do so until the age of 92. That’s 27 years beyond the official age of retirement. If you plan appropriately you might be fortunate enough to actually retire earlier, as many are now doing. Take for example my longest retired client who is now 68 years old. He retired when he sold his business in 1991 at age 52 (he recently got dethroned by another of my clients who just packed it in at age 49 years of age)! If he lives past age 84, and there is a good chance he might, he will be a part of a growing population that will be retired longer than they actually worked!

Since the last time Canadian and American dollars traded at par, a great deal has happened. I dare say a great deal more will occur in the next 30 years. So what is so special about this event in itself? Well nothing actually, unless of course you are part of the mass media. It’s an event to cover until the next one comes along. To the long term investor (especially one with a plan), it’s just noise.

To highlight my point, I want to take you on a brief historical journey to highlight some of the noisier events during this period. Understanding history has a way of making you a better investor. Why? Because history has a habit of repeating itself which, in turn, gives you about the most effective window to the future you can have.

As I list them please understand there is no intention on my part to down play these events, especially where human lives were affected. Each one of them on their own, let alone stringing a few of them together, caused some temporary, even some very painful, stock market declines. The key word here though is temporary.

Picture it, it’s the mid 70s…the North American economy was under economic siege with hyperinflation and 20% interest rates. Now to the late 80s…we experienced the single worst day drop in the history of the stock market. The late 80s and early 90s…North America experienced a severe real estate savings and loan crisis, Iraq conflict Part I. Mid-90s … Alan Greenspan’s sudden increase in short interest rates triggered one of the worst bond market declines on record. Late 90s…Asian currency crisis and the unwinding of the Hedge Fund, Long Term Capital management. Turn of the century… technology bubble bursting, second worst stock market decline since the great depression, 9/11, and the never ending Iraq conflict Part II. Today…. the sub prime loan crisis in the U.S.

It seems that whenever one crisis occurs, then comes to an end or at least it runs its course with the media or both, another one is just around the corner ready to take its place.

Yet with all those events, which seem like a distant memory now (when they were actually happening it seemed pretty real at the time), the stock market not only went up in value, but increased substantially. The New York Stock Market, the Dow Jones Industrial Average specifically, which is the most widely followed index on the planet, rose from a value of $997 in November 1976 which was the last time the Canadian and American dollar were of the same value, to $13, 916 at the time of this writing. That’s an 8.90% compound rate of return excluding dividends. Add in the dividends and the number is obviously higher, much higher.

And what did one have to do to experience this kind of return? Basically have a diversified portfolio of professionally managed equities under the guidance of a trusted financial advisor. (See my earlier article Cash, Bonds and Equities, dated September 28, 2006, to see how each asset class percentage is determined). Do I think many people did just that? My best guess is no. For the simple reason investors are now just beginning to experience the benefits of sticking to a plan of holding their equities through good times and bad.

Since that was then and this is now along with knowing what we know today, we can no longer plead ignorance to the benefits of this type of investing. An early and a long well funded retirement is appealing to say the least.

As for me, I can now say I am no longer plugged into making a great deal of changes to my or the portfolios of the families I serve especially on the basis of making decisions on matters that are completely out of our control. It’s both liberating and over the long term, financially rewarding.

I counsel you to do the same.