# fund management companies-need some direction



## awesomeame (Nov 15, 2011)

Hey, I'm new to the site.

My parents started some RRSP's with TD canadatrust for me years ago. This past summer I moved it into TD's "comfort aggressive growth" portfolio. Anyways, the point is this money has gone practically nowhere over the past 5yrs. MER on comfort aggressive growth is 2.09%. (is this high??) I think TD is doing a crap job of managing this money.

So I'm wondering what companies exist out there that can do a better job of managing and making me money. At this point in my life I just want to make regular weekly deposits into some RRSP account, and have someone else take it from there.

I'm not really interested in a self directed account right at this moment, maybe when life slows down a bit 

Any opinions welcome

Matt


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## Spudd (Oct 11, 2011)

Isn't "comfort aggressive" a contradiction in terms?

I would recommend the TD e-series mutual funds instead. Google "canadian couch potato" to find some suggested portfolios that use them.


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## the-royal-mail (Dec 11, 2009)

If you want someone else to manage your money, you'll have to pay them, period, end of sentence.

If you don't want to run your own brokerage, then your choices are cash, GIC or status quo with some better choices of more aggressive mutual funds such as precious metals, cdn index and the like. Check the performance reports of your funds on websites like morningstar etc.


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## andrewf (Mar 1, 2010)

First, you have to realise that TD is not 'managing' your money. They are just investing in a portfolio of index funds (or quasi-index funds) and collecting their 2%. If you want an alternative that is relatively no fuss, look at Claymore's Balanced Growth ETF (CBN). It has a MER of 0.85%. You are probably better served by looking into something like a couch potato portfolio of funds (either ETF or low-fee mutual fund like TD e-series).


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## OhGreatGuru (May 24, 2009)

2.09% is not bad for a "managed" portfolio fund. But you can do better with a portfolio of index funds such as TD's e-series or ING's Streetwise funds.

I agree "Comfort Aggressive Growth" is a contradiction in terms. NOTE THIS IS NOT A BALANCED FUND- it is 100% equity - about 50% CDN and 50% international.

The performance of your account is likely a reflection of what's been happening in stock markets for the last few years as well as the fact that this is not a balanced fund. This fund has 27% US and 16% European stock. No wonder it has tanked. 

You don't say what you had it in for the first 4+ years, but then a few months ago you moved it into a global equity fund when both the US and EU economies are in serious trouble.

You can't blame TD for the state of the world's economy or your poor choice of funds.


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## andrewf (Mar 1, 2010)

You also can't blame TD for your decision to let them take 2.09% off the top every year. For that you need to blame yourself.


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## Oldroe (Sep 18, 2009)

You want to make nice comfortable weekly contributions and somebody else take it from there. 

AND THEY DID, check somebody else pocket!


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## larry81 (Nov 22, 2010)

I would strongly consider either ING DIRECT Streetwise Funds or TD E-Series


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## awesomeame (Nov 15, 2011)

OhGreatGuru said:


> You don't say what you had it in for the first 4+ years, but then a few months ago you moved it into a global equity fund when both the US and EU economies are in serious trouble.
> 
> You can't blame TD for the state of the world's economy or your poor choice of funds.


Thanks for all the replies everyone!

For the first 4+years it was in TD's comfort series low risk portfolio-whatever it's called exactly I'm not sure. I agree I made a poor choice, I haven't lost any initial capital, and I'm here on this forum so I can make positive changes 

I'll check out ING and the other info posted!

Matt


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## awesomeame (Nov 15, 2011)

OK, so if I were to go the self-directed RRSP account, which company would be the best to go with? I see TD charges an annual fee if you have the self directed account

Matt


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## OhGreatGuru (May 24, 2009)

I believe that's only for TD - Waterhouse, which is a brokerage account. If you only want to buy TD's in-house mutual funds or e-series index funds you don't need a trading account.


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## awesomeame (Nov 15, 2011)

I looked at ING streetwise funds, and TD e series...looks like everything averages around a 5-6% net return. I was looking for..well, more.

Where do I go or what should I do to get a higher return? I need some direction, 'cause 5% isn't going to cut it. And speaking with the 20yo's at the bank pushing their own product isn't much help either.

Matt


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## Causalien (Apr 4, 2009)

Anything that promises more than 5% means you have to be ready for losses. A risk free fund that generates more than 5% is unheard of. And if you think about 5% compounded till retirement. It's a lot.

So you are faced with a dilemma now. To go above 5% you'll have to start doing your own due diligence to minimize loss. Which means take the same learning path that most of us on this forum went through and span years. Or you can just settle with 5% and get on with enjoying life.


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## andrewf (Mar 1, 2010)

What time frame are you looking at? 5% might be on the low side of what you can expect from a balanced portfolio going forward.

Keep in mind that past returns are not indicative of future returns.


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## awesomeame (Nov 15, 2011)

Well I'm 30 right now. Starting with $7k, and I can contribute about $125 per week. That, at 6%, comes out to $565,565.49, or at 5%, 406,033.65 over the next 35 years.

I just...want more, lol. I almost regret buying and furnishing a house last year...should've put that money into RRSPs or a better investment.

Matt


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## awesomeame (Nov 15, 2011)

Well, I guess the simplest solution would be to put more than $125/week into it, eh, lol. So now I have to think of where to get more moneyyy 

Matt


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## the-royal-mail (Dec 11, 2009)

Matt, where did you get the idea that investments were a better bet than real estate? You seem fixated on high investment returns no matter what. Too many conversations with over-hyper salesmen? 

Causalien is right - you should re-read his last post. This isn't an issue of not saving enough capital, this is an issue of your expectations.

And BTW getting reliable 5% annual returns is not as easy as it sounds. That in and of itself takes a lot of WORK and time on the computer.

Don't quit your day job.


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## awesomeame (Nov 15, 2011)

I shouldn't say real estate is a bad investment..but maybe not purchasing top-of-the-line appliances, top-of-the-line snowblower etc etc would have been smarter. I could probably exist without my $3200 fridge, ya know? lol. But, anyways, all those things are paid for. No debt here minus the car and the house.

I guess I'm just 'down' about what I've spent money on in the past, not realizing what that money could do, even at 5%, over many years. Like maybe I didn't need that brand-new 'vette when I was 23...or the brand new Camaro at 21, or the brand new truck at 19...arrrghhh!!! I should probably make do with a cheap American car now, but I have a luxury Euro car instead. I'll admit I'm an extremely spoiled private-schooled brat. I shouldn't have to save a dime for retirement, but someone recently said to me: "what if they go crazy and leave everything to the church?" And that thought scares me, bigtime  You never know, or maybe they'll live to 110 and then there's nothing left!

It's good I'm getting a reality check from you guys, now 

Matt


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## the-royal-mail (Dec 11, 2009)

Fair enough.

You're actually hitting on a number of different points here. Your last post described a spending problem, not an investment or a RE problem. It almost looks to me like you lack focus and have fixated on a desire to be a race car driver (+5% investment returns) when you haven't even learned to ride a bicycle. Personally, I think you need to bring some focus to your financial house. You've taken an important first step by coming here and acknowledging the error of your ways. If you're prepared to listen, most of us here will be happy to help you gain control of your finances and focus in on realistic goals.

1. stop wasting money
2. establish a simple monthly running budget in excel or some other offline format, even if it's a napkin or piece of scrap paper, start somewhere
3. cut down on your fees, ie. use cash, not debit for every little purchase
4. it's good that you have no debts, so start to channel the savings into "buckets" that make sense to you, following the goals you have identified
5. prioritize where your savings will go (ie. where the money will be spent or what types of accounts the cash will be held in)

Only once you've gotten yourself organized, will you have a chance to be on the right road towards proper money management and growth for the future. And like driving a race car, it's not something you can do instantly. Work towards that in steps and start with something like the above.

Make sense?


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## kcowan (Jul 1, 2010)

Further to what TRM said, one of your buckets should be a rewards bucket. This will enable you to enjoy the journey. Also:


> 3. cut down on your fees, ie. use cash, not debit for every little purchase


Cash does give you a sense of reality but there are also many other fees that would eat you alive. Always pay your credit card balance on time. Look at the fees you are paying. (MIL kept her auto club membership after she stopped driving because she liked the magazine. We got her a magazine subsription instead.) The first thing we did after retirement is cancel all unnecessary fees like multiple credit cards, those with an annual fee, bank accounts etc. We could have done it decades earlier.


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## awesomeame (Nov 15, 2011)

the-royal-mail said:


> Fair enough.
> 
> You're actually hitting on a number of different points here. Your last post described a spending problem, not an investment or a RE problem. It almost looks to me like you lack focus and have fixated on a desire to be a race car driver (+5% investment returns) when you haven't even learned to ride a bicycle. Personally, I think you need to bring some focus to your financial house. You've taken an important first step by coming here and acknowledging the error of your ways. If you're prepared to listen, most of us here will be happy to help you gain control of your finances and focus in on realistic goals.
> 
> ...


Hey thanks 

I do have a running spreadsheet, it's located here

http://www.execulink.com/~wscholtes/BUDGET.xls

I always pay my bills on time, so no fees there, and all my banking is with PC, so no fees there either. But as you can see I do SPEND. Note there are -negative months, but that doesn't mean I've gone into debt.

So far this week I've cancelled the extra channels on the TV, (still stuck with the basic) switched to "lite" highspeed, and managed to drop my cellphone bill by $20. Also back in August I got a hair trimmer so that's almost paid for itself now..  I also told my boss at work today that I need another $3/hr, and if that doesn't come inside six months or sooner I'm out of there.

The other areas where I'm going to work on: quit buying lotto tix and coffees, damn! Also the booze is killing my numbers, I def like to party. And in the spring, I'm ((gasp)) going to cancel the lawncare guy :O I also drive, a lot. Mainly because all my hobbies involve being up North and in the bush....so perhaps I need to find some hobbies closer to home...gas adds up.

Other than that, I'm just going to have to watch what I buy...now that I've woken up a bit...I definitely need to get my **** together, despite what my parents tell me...even this wknd they're like "enjoy your youth, you don't need to be saving, there's lots there.." BUT ya never know what might happen!!

Matt


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## donald (Apr 18, 2011)

Your demanding a $3 hr raise from your boss?And playing "hard ball"with timelines?You either got that "right moxie"/&goods or your up [email protected] creek.

Doesnt normally work that way,sounds like your bossing your boss.

Make sure your reading the lay of the land-your boss might have your exit plan in place and your not aware(if you dont care about the job its a wash,but thats funny)


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## awesomeame (Nov 15, 2011)

donald said:


> Your demanding a $3 hr raise from your boss?And playing "hard ball"with timelines?You either got that "right moxie"/&goods or your up [email protected] creek.
> 
> Doesnt normally work that way,sounds like your bossing your boss.
> 
> Make sure your reading the lay of the land-your boss might have your exit plan in place and your not aware(if you dont care about the job its a wash,but thats funny)


I didn't say it in a real demanding voice just stated it...there are two other jobs that I know of paying $3 more per hour for the same thing I do now...and they both called me. So it's not like I don't have options...I like where I am, I'd rather not leave, but I will. And I made that clear too 

Matt


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## the-royal-mail (Dec 11, 2009)

Hi Matt, please note it is not necessary to quote everything you respond to. This is a linear thread, esp when it's the post above yours no need to copy the text and cause constant scrolling. Hope you can understand.

Otherwise I think you're in decent shape, cut out the frivolous spending and you should be fine. Worry about investing once you've got some savings and investment play money built up. The markets suck now anyway, no rush to invest.


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## awesomeame (Nov 15, 2011)

Roger on the quoting.

I do have about $7k sorta just sitting at TD in that comfort aggressive fund that I mentioned earlier, that I could/should do something with. Seems overall people prefer the -e series, and going the self directed direction...but like how do you choose which funds? 

Couch potato suggests:

Canadian equity 20% TD Canadian Index – e (TDB900) 
US equity 20% TD US Index – e (TDB902) 
International equity 20% TD International Index – e (TDB911) 
Canadian bonds 40% TD Canadian Bond Index – e (TDB909)

Are there any books or something I could read to better understand?

Matt


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## the-royal-mail (Dec 11, 2009)

IMO you can learn a lot about how to invest by taking part in the threads in the investing section, lurk, ask questions etc. But yes, the consensus seems to be that retail mututal funds are not the secret to growth and that self-investing in a brokerage is the key to making your money grow. It takes WORK though. Lots of time spent on the computer etc.

I finally had a look at your budget sheet. I like the way it is laid out. But I am concerned with how severe some of your monthly overages are. For four of the months, you were spending more than income, by as much as $1100 in one case!

As I said, I think a little more time spent on money management skills and a little less on investing would serve you better.


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## awesomeame (Nov 15, 2011)

Hey, well I'm doing some reading over here-"investing, demystified," and they say building up some savings that will last you six months, prior to investing anything anywhere. So that'll be my goal for now I think!

Matt


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## the-royal-mail (Dec 11, 2009)

That's an excellent goal!!!

Actually 6 months is a minimum. I think a range of 6-12 months is best but you can read more about this in my sig file.

Remember, these savings are NOT to be invested anywhere. If you need/want money for investing that needs to be an additional and separate pool of money to save. You were asking about TFSAs in another thread -- a TFSA cash balance (typically these pay the same as high interest accounts) is an excellent holder of your emergency money.


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## Causalien (Apr 4, 2009)

Can't see your budget XD any version of it in the cloud? I like stalking people's finances. It's so rare to get the chance.


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## awesomeame (Nov 15, 2011)

Causalien-I don't know why you can't download it...I know the host is slowww

Matt


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## Causalien (Apr 4, 2009)

Nevermind. Just opened it with something else.


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## Causalien (Apr 4, 2009)

I assume there's only two people in the house?

Your gas and hydro is pretty high. I am running two servers at home 24/7 and your one month bill is higher than two months of mine.

The gas bill is weird too. It only dropped off during the summer by $20. March and April are probably anomaly from vacation?

Mortgage insurance? Is this the one that pay the mortgage for you while you are injured but you still have to pay the insurance company back for the amount they paid for you? Or is this because you have less than 20% down payment?

Holy gas hog for your car.

Cable TV can be cancelled all together once it's up.

Internet is fair

Keep the coffee, gift, lotto. They contribute nothing to your savings and is necessary for the "feel good" factor.

From the expenses. The 3 area that you can improve which has the most impact for you are: Fuel, Meds/Body Care/Clothes, Food and drinks.

For clothes. I have to recommend Steve Job's way of Zen dressing. Buy 7 of the same thing and rotate them so you never have to waste time worry about it. It also builds your personal brand image. Splurge on them as a one time cost.


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## awesomeame (Nov 15, 2011)

Causalien:

It's just me, noone else  The gas bill they call "balanced," so basically I pay the same year round. I use more gas in the winter, so I "owe" them money, but use less gas in the summer which is when that money gets paid back. There's no interest$ involved with this, it's just a way of keeping the gas bill the same. Oh, it also includes hot water rental.

Hydro...we have time-of-day-use here in ON, over 80% of my hydro is used during the cheapest hours, so I can't really make that cost go down any further...

One thing with both hydro and gas is that I've only been in my house for 13 months now....they guesstimate my usage, and only read the meter every other month or 3. I use consistantly far less than their guesstimation...I don't know how long they do this before they realize my avg usage is far lower than the avg they use. So that's why some of the pricing looks funky.

The mortgage ins is in case I get sick/injured. With my health it's something I need to have...which is also why my meds/bodycare/clothes catagory is so high...most of that is medical stuff. Insurance money back is down at the bottom of the page. I think for 2012 I'm going to break those catagories up.

I'm def working on the drink part. Been sober a week now, which is good  Food...I never go out, it's all farmer's markets and grocery stores. Very little processed anything over here....I just eat a lot! I'm trying to slow down in the driving dept, lol. Maybe I don't need to be driving everywhere at 145...

the-royal-mail:

I read your link. I'm unsure if a TFSA is a good holder for tier 1 or tier 2 for me, just because from reading the government site, putting money into a TFSA isn't tax deductable like an RRSP. If I do some consulting I could up to double my monthly income-$130k gross/yr..it really depends how much I would want to work. But then I would need to pay income taxes on that amount, too, at a high marginal rate.

Wouldn't it be smarter to put tier 1 and tier 2 into a low risk registered-_something_ and not pay taxes on that money at this time? Presumably I wouldn't be touching tier 1 unless I was jobless, in which case when I withdraw funds from there I would be taxed at a lower marginal rate than I would be now. And accessing tier 2 would [hopefully] only happen a few times, if at all, before retirement.

Thoughts?

Matt


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## MoneyGal (Apr 24, 2009)

Mortgage life/disability insurance is a pretty crappy product. I'm not sure why you say "with your health" this is a product you need - if you have a pre-existing health condition, you are unlikely to get the coverage approved in the case of a disability related to that condition in any case. 

If you genuinely need disability insurance, you should get disability insurance, not mortgage insurance.


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## Causalien (Apr 4, 2009)

It's better to have 1 year of mortgage payment in your checking account saved up (hence the buffer money) then pay insurance on it. Because in the end once you are back from your injury, you still have to pay them back on the amount. Which further screws you up because you are likely to have a huge bill outstanding.

Can't comment on the meds.

As for the hydro, is it possible to switch to the "non averaged" billing? This way you can see what's costing you so much. I recently bought a kill-a-watt for $30 and phased out outdated appliances that's leaking power or uses too much power. Old microwaves are big problems. 

My server drains 1500 watt per hour 24/7. It's a pretty big output and maxes out one fuse's load completely. So unless you have 4 electricity hogging floodlight on all the time, it's hard to surpass that. It's worth changing these flood lights to LED ones if that's the case.


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## the-royal-mail (Dec 11, 2009)

No. Tier 1 and 2 must be cash and NOT taxable when you withdraw it. When the bill for the roof comes it has to be paid in full. They won't accept partial payment because the rest went to taxes. If you lose your job you'll need every penny of your income.

Cash only. Or GIC. TFSA is good because any growth would be tax free and you would have free access to the full amount of your principal (unless you foolishly invested/risked it).


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## awesomeame (Nov 15, 2011)

Hey Moneygal! You're right, it's not mortgage insurance...it actually is total disability insurance, I just called it mortgage ins on my spreadsheet since that's what it covers. It pays the mortgage in case I can't perform the majority of my duties at work, also pays the house taxes. 

That isn't money I would have to pay back to them...I just read through the paperwork to make sure! I had to go in for an interview and assessment, I am covered should anything arise. I do agree it's throwing away money if I had enough money in the bank to cover all my expenses incase of an injury....and once I have that money in the bank, I'll think about cancelling the ins!

Causalien, how much hydro are you using? Last month I used 175.5kwh...124of them "off peak," 23 "on peak," and 28 "mid peak." I really don't know how to use any less, I'm in the dark here most of the time, lol.

As for tier 1...I calculated things up and looks like my costs to live are roughly $40,389.97/yr, assuming $200 for car fuel every month.

I found that PC financial has an RRSP savings account. It's registered, and returns 1.5%. _"no risks, no fixed term, no fees or penalties for early withdrawals, so your RRSP is always cashable"_

http://www.banking.pcfinancial.ca/a/products/ripsa.page

I think that's a good place for tier 1. If I were to earn additional income NOW and put it into a TFSA, it's going to be taxed at 27+%. If I had to access tier 1 with no other income, my income would only be taxed at ~19%. So on $20,000, that's a $1600 difference (8%) and it goes up from there if I earned more. That's a pretty good return if you look at it that way.

I hear the point about withdrawing the money from an RRSP and then not having enough to pay the taxes, (or viseversa) so what if I just put an additional 19% into tier 1. Then I'd be covered in case I did actually have to take it out.

Does that make sense? I hope so lol

Matt


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## Causalien (Apr 4, 2009)

I finally realized what's bugging me.
What kind of job, not salary based, pays you around $5000 after tax per month?


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## awesomeame (Nov 15, 2011)

I'm an aircraft maintenance engineer. Basically a jet mechanic. 2yrs of college, 2yr apprenticeship, $55k/yr in the last year of my apprenticeship. Not too shabby for a 21-22yo

I AM actually paid salary, I just break it down to an hourly rate to be able to compare it better to other companies. Salary isn't the norm, it's just the nature of where I'm at. And I'm on the lower end of things-like I mentioned before I should be getting an additional $3/hr ($6240) for what I'm doing right now...especially if I have better options.

Lots of opportunties to make more $$ doing consulting/contract of some sort....either actually wrenching on aircraft, doing quality assurance, importing/exporting aircraft, training people etc. Tons of overseas work as well...in west africa one can make $130k just wrenching. There's a huge shortage of people in the industry, jobs everywhere once you have your licences...it all comes down to how much do you want to work. And I don't like to work, but to reach my financial goals it looks like I might have to..put out more effort 

Matt


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