tuyop posted:I just ran that through a quick calculator (1k initial investment, 20k annual contribution), and over ten years that difference in MER accounts for $7 700 in additional fees, which is about 3.6% of your principal, so it's not insignificant. I don't think there's any danger of us contributing even close to $20K a year 
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Oct 31, 2013 15:31
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Holy gently caress I hate TD. I wish any other bank had these e-series so I could kick these fuckers to the curb completely. So according to the person I was just talking to, TD investing TFSA and RRSP are not self directing. So even if I have access to the e-series, I don't have control over it. On the other hand, with a TD waterhouse RSP and TFSA I have full control and access to the E-series. I just have no way to transfer money into them from other banks. So how the gently caress am I supposed to set this up so its usable? Does the TD financial/conversion form actually give you control and she was just wrong/lying? Edit: Or do I just have to suck it up and keep paying $4 a month to have a chequing account so I can actually move the money around? Demon_Corsair fucked around with this message at 20:04 on Oct 31, 2013 |
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Oct 31, 2013 19:57
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I believe "self directed" is bank nomenclature for "we don't 'oversee' or 'add value' to what goes on here". By contrast, any mutual funds including e-series bought through TD Mutual Funds (as opposed to TD Waterhouse) is "overseen" by the bank. If you frequently buy/sell to try and time the market or make purchases inconsistent with the bullshit risk analysis survey they have you do, they reserve the right to refuse it until they talk it over with you or some such. I do my weekly e-series purchase through TD Mutual Funds and it's been fine. I've changed various parameters and they haven't hassled me ever. But it's still not "self directed" as far as they are concerned. If they ever do make waves, I'll be moving these over to ETFs ASAP - though that would be unfortunate because I do like the zero-transaction-cost, low-MER, dollar-cost-averaging that only e-series provides. Oh, and you don't need a chequing account with them to be buying these. I do it directly from ING Chequing. The only product I have with TD is an e-series TFSA and non-registered account.
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Oct 31, 2013 20:12
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I just came from the bank and set up the mutual fund TFSA. Do I have to let it sit for a month as they say before making changes or can I start the e-series conversion right away?
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Oct 31, 2013 20:17
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So basically I should be converting my existing TD RRSP to e-series (Do I have to mail the form in, or can I go in to the branch with them) instead of getting a TD waterhouse account. She made is seem like self direct is when you control it, and other wise you have to come into the branch to manage changes to your portfolio. Time to call and cancel the waterhouse accounts I Was going to get set up. I have yet to have anything related to TD be easy or succeed on the first try. Edit: Yea, I just logged into my existing TD account, and there is the option to buy, sell, or move funds. So what do you think? stupid or lying? Demon_Corsair fucked around with this message at 20:20 on Oct 31, 2013 |
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Oct 31, 2013 20:17
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Lobok posted:I just came from the bank and set up the mutual fund TFSA. Do I have to let it sit for a month as they say before making changes or can I start the e-series conversion right away? Get it going right now All the "conversion" is them setting a bit on their database to allow you to purchase the exact same index funds at 1/3 the MER. Every other aspect of the account - the web UI, the account numbers, everything, remains the same. It's pure price discrimination, nothing more.
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Oct 31, 2013 20:19
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Lexicon posted:Get it going right now All right thanks. And thanks for the heads-up about the $100 bonus - I had wanted to do this for a while, especially since the thread began but that was the perfect impetus I needed to actually get to the bank and do it. (Though I misread and the bonus was up to $100. Still, free money.)
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Oct 31, 2013 20:22
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Demon_Corsair posted:So basically I should be converting my existing TD RRSP to e-series (Do I have to mail the form in, or can I go in to the branch with them) instead of getting a TD waterhouse account. If you have tons of cash, go waterhouse. Below a threshold, say, $50k, you're probably better off with e-series mutual funds. In the case of the latter, they don't consider it "self directed" but it will be de-facto self-directed. But don't make any moves that strongly contradict your risk profile thing (e.g. don't buy the emerging market index when you said you were a conservative/short-term investor). Just mail the form in - the less you deal with the branch jokers, the better. Demon_Corsair posted:Edit: Yea, I just logged into my existing TD account, and there is the option to buy, sell, or move funds. So what do you think? stupid or lying? Stupid. As I said: branch jokers.
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Oct 31, 2013 20:23
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Lobok posted:All right thanks. And thanks for the heads-up about the $100 bonus - I had wanted to do this for a while, especially since the thread began but that was the perfect impetus I needed to actually get to the bank and do it. (Though I misread and the bonus was up to $100. Still, free money.) No worries! That's what the thread is for
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Oct 31, 2013 20:25
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Lexicon posted:If you have tons of cash, go waterhouse. Below a threshold, say, $50k, you're probably better off with e-series mutual funds. In the case of the latter, they don't consider it "self directed" but it will be de-facto self-directed. But don't make any moves that strongly contradict your risk profile thing (e.g. don't buy the emerging market index when you said you were a conservative/short-term investor). Called TD, was able to get the waterhouse accounts cancelled. I wish I could do everything through phone banking, it has always been painless. Next step is going to be mailing in the form, and going back to open a Mutual Fund TFSA, since all I have is a regular savings TFSA. Sadly, they can't do that over the phone.
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Oct 31, 2013 20:44
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Demon_Corsair posted:Is the moneysense guide to perfect portfolio a good primer? Trying to dig up info on canada couch potato is just painful. 3 items per page? are you loving kidding me? I read this over the weekend and its definitely worth the time and money. I'm in almost your exact same position (just starting retirement saving with a TD e-Series) Edit: It sucks that it's taking so much effort for you to open up an e-series account. They did it for me at my branch. I specifically told them I wanted an e-Series account and the guy tried to steer me away from it for all of three minutes before he broke down and helped me submit the paperwork right there. Still had to wait two weeks for "processing" though. TheOtherContraGuy fucked around with this message at 04:46 on Nov 1, 2013 |
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Nov 1, 2013 04:26
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Lexicon posted:I believe "self directed" is bank nomenclature for "we don't 'oversee' or 'add value' to what goes on here". By contrast, any mutual funds including e-series bought through TD Mutual Funds (as opposed to TD Waterhouse) is "overseen" by the bank. If you frequently buy/sell to try and time the market or make purchases inconsistent with the bullshit risk analysis survey they have you do, they reserve the right to refuse it until they talk it over with you or some such. Self Directed means a bit more than that. A self directed RRSP is capable of holding a larger variety of securities than a run of the mill RRSP. Self Directed RRSP's can hold equities (stock, ETF) in addition to Mutual funds from all sorts of Fund providers. There are other types of investments that are only possible in a self direct RRSP, but that is one of the biggest differences. Otherwise you are right - another feature is that no one watches over your trades, which to be honest is great because when I want to buy and/or sell I want to do it immediately. I would argue that it is the only type of RRSP worth opening. Everyone needs to take an active interest in securing their future and it really is a drat shame they don't teach more about it in high school, at the very least. I read books and even took the Canadian Securities Course to shore up my understanding of investing and financial markets and under my own power am well on my way to reaching my retirement goals as well as saving for my daughter's education with an RESP I manage by myself. Anyone can learn about this stuff, and everyone should. Complicated investment schemes are actually the enemy when you get started anyhow, so there is no excuse. Saltin fucked around with this message at 13:19 on Nov 1, 2013 |
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Nov 1, 2013 13:11
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Saltin posted:Everyone needs to take an active interest in securing their future and it really is a drat shame they don't teach more about it in high school, at the very least. As a future high school teacher, I agree but I'm not really sure how to actually go about teaching saving, investing, retirement, personal finance in general. What sort of plan or activities do you see classes of teenagers doing to learn about this stuff?
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Nov 1, 2013 13:26
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While it sounds like a great idea on the face of it to teach high schoolers all about the financial world, would it even stick? I couldn't tell you the first thing about solving derivatives nowadays even though I took a couple calculus courses because I've never had the opportunity to actually use that info. If half the students in the class don't even have any income to speak of yet how would you get them all to remember the ins and outs of various investment vehicles? I feel like they'd be better served being taught about the financial myths and misconceptions to instill some positive confirmation bias early rather than teaching them the technical processes of going out there and growing their money. Stuff like "No Suzie, keeping a balance on your Visa does not help your credit score." Lobok fucked around with this message at 14:55 on Nov 1, 2013 |
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Nov 1, 2013 14:53
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Lobok posted:While it sounds like a great idea on the face of it to teach high schoolers all about the financial world, would it even stick? I couldn't tell you the first thing about solving derivatives nowadays even though I took a couple calculus courses because I've never had the opportunity to actually use that info. I agree, in my head I've been playing around with the idea of gamifying the process by trying to set up some sort of class stock market or even a board game. I'll also hopefully be teaching social studies so it has to tie into the whole secondary curriculum of explaining the basic -isms and the politics and sociology of identity as well. I'm pretty excited.
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Nov 1, 2013 15:13
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When I was in Grade 10 as part of CAPP we had a project where we had to find a "job" in the paper, and the find an "apartment" to live in and budget and figure out how much everything we had to buy would cost, basically make a fake budget for when we were adults. It was actually pretty useful, and I could see in grade 12 how taking it a step further and talking about investment would make sense too.
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Nov 1, 2013 16:30
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Saltin posted:Self Directed means a bit more than that. A self directed RRSP is capable of holding a larger variety of securities than a run of the mill RRSP Yeah of course, I just meant in terms of what the bank means what talking about a "mutual funds" account specifically.
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Nov 1, 2013 16:35
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HookShot posted:When I was in Grade 10 as part of CAPP we had a project where we had to find a "job" in the paper, and the find an "apartment" to live in and budget and figure out how much everything we had to buy would cost, basically make a fake budget for when we were adults. It was actually pretty useful, and I could see in grade 12 how taking it a step further and talking about investment would make sense too. In Grade 12 we had a project where groups had to run their own country with each member of the group managing a different ministry. Our group was a despotic hellhole for decades that only spent money on energy infrastructure and the teacher was really kind of eyebrow-raised-disappointed in us until the energy economy started taking off and we had enough money to turn our country into a paradise and blow past all the other groups who were using their piddly little democratic institutions to merely tread water. Years later it still gives me a strange perspective on global politics.
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Nov 1, 2013 18:20
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Lobok posted:In Grade 12 we had a project where groups had to run their own country with each member of the group managing a different ministry. Our group was a despotic hellhole for decades that only spent money on energy infrastructure and the teacher was really kind of eyebrow-raised-disappointed in us until the energy economy started taking off and we had enough money to turn our country into a paradise and blow past all the other groups who were using their piddly little democratic institutions to merely tread water. Isn't this how Alberta is run?
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Nov 1, 2013 19:27
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tuyop posted:Isn't this how Alberta is run? We turned out more like a tropical Norway.
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Nov 1, 2013 21:34
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tuyop posted:Isn't this how Alberta is run? We prefer referring to our leaders as royalty, not despots. 
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Nov 3, 2013 16:19
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Has anyone ever heard of National Bank? My new employer doesn't offer a traditional pension plan, rather after the first year you can buy "shares" in the company(it's not publicly traded) which they match 100% and a automatic RSP contributon to a National Bank account which they setup for you. As far as I can see it's just a normal higher risk RSP, but I would prefer to setup a RSP through my own bank(Scotiabank) if I'm going to go that route. Any advice here? EDIT: Guess I should also put in that I'm 24, salary is 58k a year currently starting and I have a mortgage if that makes a difference. DariusLikewise fucked around with this message at 16:34 on Nov 3, 2013 |
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Nov 3, 2013 16:29
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DariusLikewise posted:Has anyone ever heard of National Bank? My new employer doesn't offer a traditional pension plan, rather after the first year you can buy "shares" in the company(it's not publicly traded) which they match 100% and a automatic RSP contributon to a National Bank account which they setup for you. As far as I can see it's just a normal higher risk RSP, but I would prefer to setup a RSP through my own bank(Scotiabank) if I'm going to go that route. Any advice here? Is it possible to opt in to the share-matching program and opt out of the RSP thing? If yes, do the share thing - if those shares have some sort of liquid value, and manage your own automatic contributions to a tax-sheltered account at a discount brokerage of your choice. The funds that National Bank makes available to you are almost definitely going to be loving retarded.
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Nov 3, 2013 17:24
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Companies often partner with specific institutions for retirement plans, so that is not really all that strange. My company has its retirment plan with one institution and I do have all my accounts with another. It's not really a big deal but  . I do the minimum with them though since the funds they offer aren't really in my wheelhouse.Companies offering shares if its privately held is not rare either, and actually fairly common with some professional corporations. Often they'll limit share options to the "upper tier" of their core business. For example, if its an Engineering company, they may only allow shares to be purchased by Professional Engineers and not necessarily the secretaries or technologists.
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Nov 3, 2013 17:35
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Both are completely optional, both plans were incorrectly explained to me though. The RSP is a group RSP, the contributions come off my cheque before tax is deducted so I see the tax benefit right away and can't claim it at the end of the year. The company will cover the fees associated with the setup and year admin fees. The only restriction is whatever the yearly max that revenue Canada has setup for me. There isn't any info with when I can touch that money, but I'm assuming like any RSP it wouldn't be for awhile. The share plan is an employee ownership plan, which I am eligible for after three month of employment. You aren't allowed to deduct from each paycheque rather they offer employees a chance to buy a lump sum of shares in May/June, the limit is determined by how well the company did the previous year and how much you made. If I buy the shares with cash I have to hold them in an outside RSP, I can also chose to buy shares with the money in the group RSP if I'm contributing to that. They match the purchase to a maximum of 4% of my annual earnings+$100 for each year of service. The matching money is made available to me at the same time you are allowed to purchase shares and I can either take it, or put it towards more shares. Any money made on the shares held in an outside RSP is eligible for the LCGE when sold. Share price is 2.2% of the companies retained earnings at the end of the year. It's a short line railway that has grown by at 17%(on average) per year since 1996 so I think it's "safe" as far as investing goes. I think I would just want to buy shares and hold them in a outside RSP, but I also haven't made any contributions to a TFSA or an RRSP outside of my pension from my previous employer yet, so maybe just focus on that? DariusLikewise fucked around with this message at 18:06 on Nov 3, 2013 |
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Nov 3, 2013 18:03
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Always take free money, but with an eye to getting out of these horrible group things as early as humanly possible. They are always, always, poo poo.
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Nov 3, 2013 18:06
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I'm not a fan of employee share programs. They're usually poo poo, and not only is it not a balanced investment, you're increasing your exposure to a single corporation - If your employer goes under, not only are you out of work, but your retirement savings are worthless. And every company can fail - Remember when Montreal Maine Atlantic was a decent railway? Nobody'd touch their shares with their worst enemy's dick, now. (As an aside, I work in transportation management and I wouldn't invest in Canadian railways right now. The regulatory environment is likely to undergo major upheavals in the next few years, and a lot of people's profit margins are gonna go down the drain.) The RSP can be nice if they match contribution; my employer has a similar plan for permanent employees. I'd look at the funds they're offering and how quickly you can move stuff out, this'd be my preferred option over an employee ownership plan.
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Nov 3, 2013 18:22
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DariusLikewise posted:There isn't any info with when I can touch that money, but I'm assuming like any RSP it wouldn't be for awhile. I'm not sure but I don't think that this is necessarily true. To access your RSP money, you have to convert it - at least in part - to a Registered Retirement Income Fund (RRIF). The penalty is that the income from your RRIF is taxable, so if you draw the same amount of income that you had when you you deposited the money, there is no benefit. However, if you save a large portion of your income so that your living expenses fall within a lower tax bracket, then you stand to save a significant amount of money. For the sake of argument, let's assume (gross) earnings of 100k/year with living expenses of 25k/year. That means that during your working life, for just federal taxes, your net tax expense (on the 100k) is 19466. Then during your "retirement", for just federal taxes, your net tax expense (on the 25k) is only 3750. So, for example, if you decide to travel for a year or two when you're 30 and want to use your RRSP as your income, there is still a huge benefit to contributing fully to your RRSP. I think it's a pretty awesome program. Edit: These amounts seem a bit off to me, but I just plugged numbers into the tables found here: http://www.cra-arc.gc.ca/tx/ndvdls/fq/txrts-eng.html
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Nov 3, 2013 18:39
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I thought you had to be 55 or something before you could covert RSP to RRIF?
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Nov 3, 2013 23:20
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FrozenVent posted:I thought you had to be 55 or something before you could covert RSP to RRIF? I couldn't find anything on that, it just looks like there are minimum withdrawal restrictions based on age. So at 55 you have to pull at least 2.86%, up to 94 and over when you have to pull 20%. gently caress you if you live to be 110, I guess? If that kind of rule exists, it would really complicate things for how I'd like to do them some day.
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Nov 4, 2013 00:02
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tuyop posted:For the sake of argument, let's assume (gross) earnings of 100k/year with living expenses of 25k/year. Without doubt earners in the highest tax bracket benefit the most from the RRSP. Also without doubt, taxes will be higher in 20-30 years when you intend to draw on it, and 25k will be far less to live on than the already extremely modest amount it is today. Long story short - don't expect the spread between "tax benefit I enjoy today" versus "taxes I have to pay tomorrow" to be as big as you think it's going to be. I am not criticizing the RRSP at all, but, the TFSA is a million loving times better in almost every case, and should be topped out first, as a priority, by everyone who is not the very highest marginal tax bracket today (and even those who are in that bracket should max the TFSA every year). The TFSA is the greatest thing ever. If you need to understand why, just ask yourself this question... Where would you rather have most of your money when you retire? Anyhow - I realize you are responding to someone who has questions regarding an ESOP, and I would say that anytime the company is matching your money you should take a long hard look at it, regardless of the style of account it must sit in. The one caveat would be to read the ESOP agreement fully and understand it completely. The biggest problem with ESOPs is liquidity. There are often all sorts of stipulations about how much and when you can cash in - sometimes at the Boards discretion. Be very clear on what is what in that regard. Saltin fucked around with this message at 02:21 on Nov 4, 2013 |
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Nov 4, 2013 02:13
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Saltin posted:Long story short - don't expect the spread between "tax benefit I enjoy today" versus "taxes I have to pay tomorrow" to be as big as you think it's going to be. I am not criticizing the RRSP at all, but, the TFSA is a million loving times better in almost every case, and should be topped out first, as a priority, by everyone who is not the very highest marginal tax bracket today (and even then, those people should max the TFSA every year) This, a thousand times, this. RRSPs have two purposes, in my view, for a youngish person today: 1) For use by high-income workers who can't defer their income subject to tax by any other means (e.g. don't have the option to leave excess earnings in their corporation, for instance). If you are some kind of banker or rig worker or what not, you probably want an RRSP. 2) For strategic use outside of retirement - to finance a sabbatical type thing, or possibly take advantage of home buyer's plan, income splitting, etc. Outside of those two cases, I don't think they are that great of a deal. My retirement strategy is centred on my TFSA, and non-registered holdings.
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Nov 4, 2013 02:21
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ninja edit
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Nov 4, 2013 04:36
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Kashwashwa posted:I still don't understand how that can be true, when you get all of the taxes on the money contributed to an RRSP back... for me that's like 25%. If I had put that into a TFSA, I'd be making let's say around 6%... You've missed the point entirely - which is perfectly ok, because that's why this thread exists An RRSP trades taxation today for taxation in future. A contribution generates a tax saving now... But the government gets its cut when future withdrawals happen. This is entirely unrelated to the return generated by the holdings in these accounts. A TFSA and all its earnings belong fully to the owner, now and in future. No downstream tax on withdrawal or earnings.
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Nov 4, 2013 04:40
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So I got married this year, it's pretty great, but I'm trying to make a list of financial and bureaucratic stuff that we have to take care of. Do we just wait until it's tax return time to worry about CRA?
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Nov 4, 2013 14:37
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tuyop posted:So I got married this year, it's pretty great, but I'm trying to make a list of financial and bureaucratic stuff that we have to take care of. Not sure. A major life event like this is probably worth paying for a couple of hours of an accountant's time just to learn new rules, benefits, options, etc. That's what I'd do. (Congratulations though!)
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Nov 4, 2013 14:45
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tuyop posted:So I got married this year, it's pretty great, but I'm trying to make a list of financial and bureaucratic stuff that we have to take care of. There's nothing you need to do yet. Come tax time you will both check the married box and there is a box where they ask for your partner's income. Expect to get less back as a result. There are all sorts of strategies available to you with regard to RRSP/TFSA and it is worthwhile knowing them.
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Nov 4, 2013 16:17
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I have six months of expenses holed up, but keeping it completely liquid is only getting me 1% interest. Is it a bad idea to keep one month completely liquid and invest the other five in low-to-moderate risk portfolios to try and get a little more? My ultimate plan would be if life went sideways, live on the one month money while I withdraw the other five.
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Nov 4, 2013 17:02
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reflex posted:I have six months of expenses holed up, but keeping it completely liquid is only getting me 1% interest. Is it a bad idea to keep one month completely liquid and invest the other five in low-to-moderate risk portfolios to try and get a little more? My ultimate plan would be if life went sideways, live on the one month money while I withdraw the other five. It varies by circumstance, but "6 months of expenses" has always struck me as an overly conservative position. If you have a good line of credit and several credit cards, or better yet, the ability to borrow against an investment portfolio, that strikes me as a far better contingency plan. You want some access to liquid funds of course, but 6 months seems a little excessive.
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Nov 4, 2013 18:06
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Saltin posted:There's nothing you need to do yet. Come tax time you will both check the married box and there is a box where they ask for your partner's income. Expect to get less back as a result. There are all sorts of strategies available to you with regard to RRSP/TFSA and it is worthwhile knowing them. This is not true. You are required to advise CRA of your marital status change by the end of the month following the month of the status change. http://www.cra-arc.gc.ca/bnfts/mrtl/menu-eng.html#when
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Nov 4, 2013 18:39
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