Budget Beavers

Couch Potato Rebalancer

Cash-flow-only mode: rebalance with new contributions without triggering capital gains.

This shows what trades would achieve your chosen target allocation. It is not a recommendation to change your target. Consult a fee-only financial planner for personalized advice. All calculations happen in your browser — no data is sent to any server.

Current Holdings

2025 · Source: Canadian Couch Potato / PWL Capital

Target Allocation

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CA Equity %
US Equity %
Intl Equity %
Bonds %
Cash %
$
Total portfolio Sum of all holdings before adding your new contribution.
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After contribution Total portfolio value once your new contribution is deployed.
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Max drift (before) The largest deviation from your target allocation, before rebalancing. e.g. 8.5 means one asset class is 8.5 pp above or below its target.
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percentage points
Trades needed Number of buy or sell actions required to reach your target allocation.
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Allocation Overview

Current
Target

Trades

Action Asset Class Ticker Amount Before After
Add holdings and a target allocation to see trades.
Next step: ETF Comparison — check your ETF's MER before committing to a fund. · Compound Interest — project your rebalanced portfolio forward.

About the Couch Potato Rebalancer

What is Couch Potato investing?

The Canadian Couch Potato strategy, popularized by Dan Bortolotti and endorsed by PWL Capital advisors like Ben Felix and Cameron Passmore, is a passive index investing approach using low-cost ETFs. Instead of stock-picking, you hold a small number of diversified ETFs (like VEQT, XEQT, or a three-fund portfolio of Canadian, US, and international equities plus bonds) and rebalance once or twice a year to maintain your target allocation.

Why rebalancing matters

Over time, different asset classes grow at different rates. Equities might outperform bonds for several years, leaving you more exposed to equity risk than you intended. Rebalancing restores your target allocation and, importantly, enforces a "buy low, sell high" discipline automatically — you trim the overperformers and add to the underperformers.

Cash-flow-only mode: the tax-efficient Canadian approach

In a non-registered (taxable) account, selling appreciated positions triggers a capital gain, which is taxable in the year of the sale. The cash-flow-only mode lets you direct new contributions exclusively to underweight asset classes, bringing your portfolio closer to target without selling anything. In a TFSA or RRSP, capital gains are not taxable and you can freely rebalance with sells. In a non-registered account, cash-flow rebalancing can defer taxes for years.

How the rebalancing math works

The calculator computes each asset class's current dollar weight and target dollar weight (target % × total portfolio including new contribution). The delta between them is the trade amount. In cash-flow-only mode, the contribution is greedily allocated to underweight classes from largest gap to smallest — no sell orders are generated even if the contribution cannot fully close the gaps.

Model portfolios

The four preset model portfolios are derived from the Canadian Couch Potato and PWL Capital recommended allocations as of 2025. "All-Equity" mirrors the one-ETF approach of VEQT or XEQT (the underlying breakdown at approximately 30% Canadian, 45% US, 25% international). The other three are bond-inclusive for risk-adjusted returns over different time horizons.

Not financial advice. This tool shows what trades are mathematically required to reach your chosen allocation. It does not recommend a specific allocation for your situation. Your ideal allocation depends on your age, risk tolerance, time horizon, tax situation, and other factors best evaluated with a qualified fee-only financial planner.

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