# How to Convince My Wife to Dump Her Mutual Fund(s)



## Xoron (Jun 22, 2010)

So here is my dilemma, my wife has an investment adviser at TD who she's been with for 7+ years. She's fully invested in a single RRSP, the Russell LifePoints LT Growth B (FRC301). Now I hate this fund, it charges an abysmal 2.7% MER and is meant to be a single fund to cover all of the bases (Domestic, US, International, Emerging Markets and bonds). I've been trying ton convince her to dump the fund for a few years, but no success.

http://www.theglobeandmail.com/globe-investor/funds-and-etfs/funds/summary/?id=68987&cid=Russell%20Investments%20Canada%20Limited

I've been telling her over and over that we need to get her out of this fund and into ETFs. 

Now for the hard part:
1. This MF is a mish mash of a few underlying Russell Mutual funds. (check out the top 5 holdings on Morningstar: http://quote.morningstar.ca/quicktakes/Fund/f_ca.aspx?t=FRC301&region=CAN&culture=en-CA)
2. My wife wants me to show her, with graphs or numbers, that this MF isn't a good investment.
3. Because of point 1, it's hard to prove point 2. There is no ETF which I can easily compare against to show her the drag of the MER for the past 7 years.

Any suggestions on how to make her a believer?


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## avrex (Nov 14, 2010)

Tell her that, "the MER on her investments, make her expenses look fat."


She probably believes the managers of this MF are experts and that the high MER is justified for the returns she gets. Many people seem to take this view.
If you've tried for years, I honestly don't think you can change her mind.


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## Xoron (Jun 22, 2010)

avrex said:


> Tell her that, "the MER on her investments, make her expenses look fat."


I'm looking for advice, not a divorce


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

How has the fund been performing for her in the past 7 years?


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## Xoron (Jun 22, 2010)

the-royal-mail said:


> How has the fund been performing for her in the past 7 years?


Not too badly actually, but the constant drag of 2.7% is going to kill the performance longer term. There is no way that any MF can even match the markets with having to outperform by 2+% per year.


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## Charlie (May 20, 2011)

per the Globe links, the fund has basically mirrored the S&P total return index over the last 10 years. Morningstar rates it 3starts...3 yr annual return of 7% and 10 yr of 2%. 

Despite the high fee, it seems to be doing OK and she's happy with it. At least the FP has her in one encompassing fund rather then a hodge podge of who knows what. Maybe leave well enough alone?


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## Xoron (Jun 22, 2010)

Charlie said:


> per the Globe links, the fund has basically mirrored the S&P total return index over the last 10 years.


But that is a bad comparison, this MF has only 20% US exposure. I'm looking for a more representative benchmark to compare against. 


Russell Canadian Equity....23.76% 
Russell Fixed Income.......20.79% 
Russell US Equity..........19.80% 
Russell Overseas Equity....15.84% 
Russell Global Equity......11.88%​


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## Charlie (May 20, 2011)

I get what you're saying. I'm not a fan of MFs either -- especially with such high mgmt fees...but:

this fund's seems to be doing relatively well
the FP appears to be taking good care of her (no churning / dumping /chasing).

...and the most important points:

She's comfortable with the approach
She's not comfortable with your approach.

...so maybe appease yourself that having a diversity of approaches may be a plus overall -- even if you're not crazy about hers??? I guess if you could objectively determine what you would have invested her in over a period of time you could compare to that??? I don't know that it's too relevant to mirror the fund exactly if she wouldn't have bought such a basket of ETFs? 

But I'm sensing a losing battle, my friend. Unless she's wanting you to take over -- and it doesn't seem she is... 

And a happy marriage is....by far....your soundest financial plan .


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## OhGreatGuru (May 24, 2009)

It's not a mish-mash. It's a portfolio fund. The asset class is Global Equity Balanced. According to Globegund it is slightly outperforming the Group Average for this Class. But in fact it closely tracks the Globe Global Equity Peer Index, which implies it may be a kind of closet indexer in disguise.

http://www.theglobeandmail.com/globe-investor/funds-and-etfs/funds/summary/?id=68987&cid=5320

Globefund and Morningstar Ratings are both only 3 Star. 

I agree the MER is high, but it not unusal for this asset class. The performance is unimpressive, but that is a reflection on the whole asset class and what has been happening to global markets over the last decade, not a reflection on the fund itself.

Is the question whether she could have done better with index funds or ETFs emulating the same asset allocation; or whether she could have done better with a different asset allocation? These are 2 different arguments.

Proceed with caution - it's her money.


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## Xoron (Jun 22, 2010)

OhGreatGuru said:


> Is the question whether she could have done better with index funds or ETFs emulating the same asset allocation; or whether she could have done better with a different asset allocation? These are 2 different arguments.


I'd propose a little more aggressive portfolio, but overall it isn't too far off the mark. We're both mid 30's and this is RRSP money, so we have the time to be risky.

My allocation is 
30% US 
30% CA TSX ETF
25% MSCI ETF
5% Emerging Market ETF
10% Bonds

And I'd do the same allocation for her. 

She is onboard with letting me handle her RRSP, she just wants to make sure it is the right choice with some evidence to back it up.


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## Four Pillars (Apr 5, 2009)

I think you have to consider that you might not get her to change her mind.

You've already told her you don't like the fund, maybe try to show why. If that doesn't work, then just drop it. Will she read any investment books?

As far as finding an appropriate index - I wouldn't bother. If the fund is supposed to be a complete portfolio, then just find compare to returns from a basic couch potato portfolio like the Sleepy Portfolio that CC has on his site.



avrex said:


> Tell her that, "the MER on her investments, make her expenses look fat."


Lol.


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## doctrine (Sep 30, 2011)

Contrary to the talk on this and other forums, 95% of the population is in mutual funds because they are simple and managed for you. If they perform OK, then maybe that is good enough for most people. At least no one convinced her to buy Nortel and RIM stocks and nothing else.


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## tombiosis (Dec 18, 2010)

I'm not sure where, but I saw a chart on here somewhere that shows the drag that the MER has over time on returns...
go to the library and get "The Naked Investor"...its in there.


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## onomatopoeia (Apr 8, 2009)

My wife has her RRSP in completely safe investments - savings accounts and GIC's. 

I'm not a big fan, but it makes her happy, and she isn't losing money, so we let it be. She's risk adverse and wouldn't sleep well knowing her money was at risk. If she was invested in something that was losing principle we'd have to talk about it.

My RRSP is almost all equity, and swings in the market like tarzan, but I sleep fine at night, so we let each other do our own thing.

If it gives her piece of mind then I'd let it slide...the fund your wife is in seems to be fine to me. not anything i'd invest in, but most of us on this board aren't "regular" investors. 

I'd let sleeping dogs lie until that fund starts to underperform your needs.


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## fatcat (Nov 11, 2009)

first, before beginning the conversation, tell her she looks like she's lost a little weight or, you like the way she's doing her hair lately ..

then translate the difference in dollars between her high mer fund and a lower etf balanced growth fund ... like on a 100K it's like $2100.00 a year more for her fund in expenses and ask her what she could do with an extra $2100 bucks

like "how many shoes can you buy for $2100.00"

you gotta get out of the abstractions and appeal to the basic dollar difference in costs and say "the saving go right in your pocket honey"



> Contrary to the talk on this and other forums, 95% of the population is in mutual funds because they are simple and managed for you. If they perform OK, then maybe that is good enough for most people. At least no one convinced her to buy Nortel and RIM stocks and nothing else.


 great point, it's important to remember that we are mutants and freaks and don't represent the majority of canadians, most of whom don't even want to think about their investments

and lately, who can blame them ?


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## balk (Dec 6, 2010)

I hear your problem. I have the opposite problem in that my wife wants nothing to do with our portfolio, any investment decisions, or personal finances. She just asks me if we have money to buy stuff, which can be frustrating. I have been trying to at least show her what we are holding and what the risks are so that she is aware and won't be shocked if our investments go one way or the other. 

As for your problem, why don't you build a portfolio of etfs that mirrors the exact breakdown of her MF and track it for a year or two. You can show her that the holdings are essentially the same but you can show her the true drag effect of the MER. I know this will take longer but maybe having the ghost account for a while will allow her to be more comfortable leaving her advisor and realizing that he and the MF might not be adding much value. The other advantage of this is that she will see that her returns are similar to her MF and won't blame you for any loss in the portfolio. The worst thing would be for the stock market/your portfolio to tank and it drive a wedge between you and your wife.


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## leoc2 (Dec 28, 2010)

balk said:


> ...
> As for your problem, why don't you build a portfolio of etfs that mirrors the exact breakdown of her MF and track it for a year or two. You can show her that the holdings are essentially the same but you can show her the true drag effect of the MER. I know this will take longer but maybe having the ghost account for a while will allow her to be more comfortable leaving her advisor and realizing that he and the MF might not be adding much value. ...


Why not build a portfolio of etfs that mirrors the exact breakdown of her MF and and use historical data and show her today.


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## humble_pie (Jun 7, 2009)

_
" I've been telling her over and over that we need to get her out of this fund and into ETFs."_

too much control of the wife going on imho. It's her money, she has a good track record over many years, what's not to like.

plus how can we know, for sure, just by reading anonymous messages in the internet, that the OP is not a speculating loser while the wife may be the better investor of the 2. 

and cat i'm disappointed in you. What's with all these suggestions pumping stereotyped sexist manipulation about her hair & her shoes.


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## MoneyGal (Apr 24, 2009)

This is, to be frank, in my experience, one of the main motivators for using financial advisors: they provide a way through the power struggle between spouses. 

It's actually not a bad reason to use an advisor - that is, as a way to come to an agreement about how money is managed/invested and the role of each spouse in the other spouse's finances.

(I'm not suggesting it in this or any other case - in this case, I don't think a conventional FA would be of any help.) But the problem isn't (as Humble points out) necessarily that one spouse is investing "the right way" and the other is investing "the wrong way" - it's that they don't seem to have an agreement about how this issue is handled, including an agreement not to do anything differently than they are doing now.


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## Belguy (May 24, 2010)

Use a tool such as 'Watchlist' at the Globe and Mail website to compare the performance of whatever mutual funds you choose with those of index funds or ETF's from the same sector.

Some of your findings may surprise you.

Consider especially some funds from low fee providers such as Beutel Goodman and Mawer for starters. These companies manage large amounts of money for large pension funds etc. and you can tap into their expertise for relatively low MER's.

From Morningstar's 2011 Top Funds list, here are some funds to consider including on your personal 'Watchlist':

RBC Cdn. Equity Income D
Mawer Cdn. Equity
PH&N Bond D 
Beutel Goodman Small Cap
AGF Emerging Markets
CI Signature High Income
Mawer Global Small Cap
TD Health Sciences
Mawer World Investment
RBC Global Resources D
RBC Global Precious Metals D
Trimark U.S. Small Companies

Try these for starters on your G&M 'Watchlist' and then add some ETF's or index mutual funds from the same sectors and then your 'Watchlist' will allow you to compare the performance for various time frames whenever you wish to do so.

It's worth the time and effort. Let us know how you make out and what you discover!!

Low fee, managed funds can play an important roll in portfolio construction. A mix of ETF's for North American large caps and managed funds for international, small caps, and specialty sectors can lead to a well structured portfolio.


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## humble_pie (Jun 7, 2009)

belguy consider it yourself & stop joking. You are so not getting it.


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## Belguy (May 24, 2010)

I hold three of the funds listed:

RBC Cdn. Equity Income Fund D
RBC Global Precious Metals Fund D
PH&N Bond Fund D

I also think that holding top performing managed funds for North American small caps, international, emerging markets, and specialty sector holdings is not a bad idea even though I do hold ETF's for these areas myself.

I also have a Globe and Mail Watchlist of ETF's and some managed mutual funds.

And so, pardon my stupidity, but what am I not "so getting"????

And, I wasn't even aware that I was joking????


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## larry81 (Nov 22, 2010)

tombiosis said:


> go to the library and get "The Naked Investor"...its in there.


+1

Dont try to "convince" your wife, give her the tool she need to convince herself !!!

A copy of "the naked investor" will do just that !

/endthread


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## balk (Dec 6, 2010)

leoc2 said:


> Why not build a portfolio of etfs that mirrors the exact breakdown of her MF and and use historical data and show her today.


You could do that but I always feel someone will pay more attention and become more comfortable with it when they witness the process happening over time.


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## Xoron (Jun 22, 2010)

*Update*

So I spent some time this weekend comparing her MF with a basket of ETFs. I modeled it back to 2007 (where she started with the LT Growth MF). 

Russell LifePoints Long Term Growth Breakdown:
Percent....Fund Name
24.00%.....Russell Canadian Equity Fund Series B Units
21.00%.....Russell Canadian Fixed Income Fund Series B Units
19.00%.....Russell US Equity Fund Series B Units
16.30%.....Russell Overseas Equity Fund Series B Units
15.80%.....Russell Global Equity Fund Series B Units
3.90%......Russell Smaller Companies Pool Series O Units
Russell Overall Fee: 2.76%

ETF Comparable
Percentage	...Equivalent ETF..........Fees %
24.00%........CRQ.....................0.71%
21.00%........XSB.....................0.25%
19.00%........CLU.....................0.72%
16.30%........CIE.....................0.71%
15.80%........CIE.....................0.71%
3.90%.........XCS.....................0.55%
Blended MER: 0.609%

What this means, is that on a sample, $100,000k portfolio, you'd pay $2,760.00 in fees for the Russel Funds per year, and the ETFS would be $609.06 per year. 

When I track the performance of the two sample portfolios from Aug 2007 to Oct 2011, I see that the russell fund underperformed by ~5.0% over that time frame. Or approximately 1.77% per year. So most of the difference is obviously the higher MER (2.7% - 0.609% = 2.15%). 

So back to my original point, I showed my wife these calculations and she seems more comfortable with talking about it with her investment adviser. I'm pretty sure the IA is a Mutual Fund only rep, so the IA probably won't be willing / able / inclined to help with switching to ETFs. But, I think it's time to setup a meeting and discuss.

As for some of the other comments: No, this isn't a power struggle at all. My wife really would rather not deal with investing and finances. I've had her read a few books on finances, and she really has no interest. And I'm fine with that, but it kills me to see her paying higher fees than necessary for no good reason.


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## Xoron (Jun 22, 2010)

larry81 said:


> +1
> 
> Dont try to "convince" your wife, give her the tool she need to convince herself !!!
> 
> A copy of "the naked investor" will do just that !


This is one that I haven't had her read (nor have read myself yet). I'll have to put that one on the "to read" list.

Thanks for all the comments and suggestions from everyone.


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## doctrine (Sep 30, 2011)

I saw one chart that showed how long it would take, at 2% a year, for your fund manager to have more money than you.. I think its around 25 years. There was a chart that went with it. Quite interesting. Xoron, your comparison above is very informative and well done. Hard to argue 1.8% a year.


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## Cal (Jun 17, 2009)

Best comparison, is to compare the funds results vs an etf over the same period of time. You can probably set up a dummy acc't w globeinvestor.com, and make purchases on the same dates at the market daily rate to compare.

You are right, IMO a 2.7% MER is not something I would be interested in having.


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## joncnca (Jul 12, 2009)

i looked into this exact question with my wife's MF at scotiabank. looked at all her holdings and (on paper) replicated her MF holdings using various ETFs. the MF were basically just tracking various indexes anyway.

anyway, i factored in the historical growth and projected future growth, effect of MER on final returns, and generated an excel spreadsheet to show her what a difference this change would make over 30 years.

it replicated her existing MF, which she chose using some prepackaged scotiabank tool (pick conservative vs aggressive, etc, no real additional research), so discussing whether or not she was comfortable with the holdings i chose was painless, as they were the same as what she had anyway.

anyway, the difference came out to tens of thousands of dollars for no additional work on our part, other than to switch to lower MER investments. this seemed to sell it to her when i showed her the spreadsheet.

i think it's worthwhile. keep in mind that my wife works part time (by choice), so the lower MER makes even more of a difference if you contribute more to the investments (i.e. your wife makes contributions based on full time salary, etc etc etc)

it's like lowering your overhead for very little more work than what you'd do anyway for an MF. people agonize over which cell phone company to go with to save on the monthly bill, effectively a MER. people jump all over sale prices on designer clothing, which is already overpriced in almost all instances. and yet this idea of a lower MER seems to be elusive because all of a sudden, finances is less familiar territory than a cell phone bill or the sale price of a shirt.

go with the lower MER etf. that's what i think. particularly if you can recreate what you're doing currently anyway in an MF, if you don't want to change the types of investments you have. lower overhead is lower overhead.


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

This is certainly a very good thread. I agree with pretty much everything that has been posted here, including the idea that low-MER ETFs are a better deal than MFs.

The issue for myself (as well as a lot of people I think) is that the only two options to solve this seem to be to buy status quo retail MFs through our banks (as most people do) or to get involved with a brokerage account. Both seem to be rather extreme options. For those of us who just like to pick our own funds without any "advice", it would be nice if banks could offer a barebones MF or ETF lineup with lower MERs to compete, and where we wouldn't need to fuss with a brokerage account.

Am I expecting too much?


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## Sampson (Apr 3, 2009)

the-royal-mail said:


> it would be nice if banks could offer a barebones MF or ETF lineup with lower MERs to compete, and where we wouldn't need to fuss with a brokerage account.


They already do this. The TD e-series is the cheapest out there, but BMO offers a tonne of high-fee ETFs, but much lower than standard MFs.

CC has a bunch of great articles on the TD e-Series.


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

Oh okay. I thought those were only available via brokerage accounts such as TDW and the like. Might be worth opening up some tax shelter accounts with TD as I do like some of those e-series funds. I also like some of the Claymore ETFs.


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## Xoron (Jun 22, 2010)

the-royal-mail said:


> Oh okay. I thought those were only available via brokerage accounts such as TDW and the like.


They are ONLY available through TDW, no other Discount Brokerage can sell them (at least that was the case 3 years ago when I was setting up my kid's RESP account at CIBC. I had to do a transfer over to TD go get access to the E-Series)


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## HaroldCrump (Jun 10, 2009)

Actually, you don't need a TDW account for e-Series funds - a regular TD account will do.
The funds are available online only, so you can open a TD account online, fund it through direct debit, and buy those funds.


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## Xoron (Jun 22, 2010)

HaroldCrump said:


> Actually, you don't need a TDW account for e-Series funds - a regular TD account will do.
> The funds are available online only, so you can open a TD account online, fund it through direct debit, and buy those funds.


Side Note: I know for sure that my wife's IA can't sell the E-Series Funds (I've asked). The E-Series funds are strictly for people purchasing them online. In fact, you can't even call TDW traders up at the 800 number to place the trade for you.


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

Are the e-series funds no load? Or will I get hammered with fees everytime I make some sort of a change, sale or switch?

Also, I looked around the TD website but wouldn't there be some sort of a monthly account fee? The last time I looked into TD there was no free account option.


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## Xoron (Jun 22, 2010)

The E-Series are no load. But the standard "Early Redemption Fees" may apply if you buy then sell the same Fund within so many days (not sure if it's 30 or 90 days). 

As for account fees, it's all in their fee schedule:

http://www.tdwaterhouse.ca/document/PDF/apply/forms/tdw-apply-forms-521778-pdf.pdf


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

Thanks xoron.

Doing some more research, I see that RBC launched some ETFs a few months ago.

http://etfinfo.rbcgam.com/exchange-traded-funds/overview/default.fs

But they are a long term bond ladder. Need more low-cost options such as many of the cool Claymore ETFs and TD e-series funds.

Apparently investors have been fleeing MFs in droves lately, nearly as much as they did in late 2008.


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## Xoron (Jun 22, 2010)

the-royal-mail said:


> Need more low-cost options such as many of the cool Claymore ETFs and TD e-series funds.


You can certainly buy both in a TDW account. The nice thing about the E-Series funds is that you can buy fractional shares and in very small quantities. And with no Load / Trading costs, it makes the E-Series a very attractive investment choice.

I calculated that you'd need about $100,000.00 of investments (assuming quarterly buys) to make the iShares ETFS MER + trade costs to be the same as the higher MER of the E-Series funds.


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## joncnca (Jul 12, 2009)

the-royal-mail said:


> Am I expecting too much?


yes TD offers the E-series of funds, which are pretty good, relatively low cost, no monthly fee, no load, but early redemption fee within 90 days of purchase, and ZERO customer support from the branch. you don't need a TDW account, you purchase with a MF account (will only allow you to buy E series funds, you'll need a TDW account to buy other actively managed funds)

anyway, the only reason why banks are offering these lower cost index funds is to compete against low cost ETFs offered by claymore, ishares, and the like. otherwise, they wouldn't even want to offer such low cost products when they make a lot more money off of you on high cost actively managed funds. it's purely a survival tactic, the bank is not trying to 'help you out' they're just out for their own bottom line. they are totally preying on the 'i don't want to go with another brokerage independent form my bank' mentality that many people have (myself included, though i have some questrade accounts).

as inexpensive as the E-series funds are compared to the other banks, you can relatively easily recreate these funds using even lower MER etfs.


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## Belguy (May 24, 2010)

Invested in mutual funds? Do you wonder where a lot of your money goes? Read on:

http://wheredoesallmymoneygo.com/de...esallmymoneygocom+(Wheredoesallmymoneygo.com)


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## newbie (Dec 12, 2009)

Belguy said:


> Invested in mutual funds? Do you wonder where a lot of your money goes? Read on:
> 
> http://wheredoesallmymoneygo.com/de...esallmymoneygocom+(Wheredoesallmymoneygo.com)


hey bud
whats wrong with the people on this board?
this guy harold crump now this guy humble pie are on my back.
this crump guy has a bif with u apparently.
what is going on here?
thks


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## Belguy (May 24, 2010)

newbie, thanks for noticing. Bullying is a widespread problem and is prevalent in our society and all the more so on the web in general and on this forum but only from a small minority. It is part and parcel of being able to remain anonymous and hide behind a pseudonym. If they had to reveal their real identity, they might not be as personal and hurtful in their comments.

Apparently, they consider themselves to be the policemen of the forum.

I would prefer that they just put me on their 'ignore' list and desist from their bullying.

I have learned to be thick skinned about it but it is hurtful. Maybe I am not the brightest bulb on the Christmas string of lights but I do feel that I have something to offer, especially for newbies such as you.

Thanks again!!!


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## humble_pie (Jun 7, 2009)

belguy what makes you think that you were not hurtful & cruel when you used to swagger around with your BH & P investments.

you used to routinely threaten, insult & belittle every single other poster who did not bow to your narrow dictums & invest exactly the way you dictated.

of course, this was BYNB. The NB was quite recent.


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## Four Pillars (Apr 5, 2009)

humble_pie said:


> of course, this was BYNB. The NB was quite recent.


Not to take away from this important topic, but I googled BYNB and got two different answers:


Buffered Yeast Nitrogen Base 
Buffered Yeast Nitrogen Broth

So which one is it Humble?


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## Belguy (May 24, 2010)

humble-pie, please show me where I directed any personal slangs against any specific forum member!!!

On the other hand, I did often state my strong opinion that index or 'Couch Potato' investing was one of the best, if not THE best way for the small investor to invest.

Apparently, the strength of my conviction turned some people off and led to the personal attacks from a small minority of forum participants which did feel hurtful at the time. 

I never responded in kind but it does feel like bullying to me.

Please remember that their is an 'ignore' tool that you can use whenever you feel like launching another personal attack.


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## Toronto.gal (Jan 8, 2010)

Belguy said:


> 1. Apparently, they consider themselves to be the policemen of the forum.
> 2. I have learned to be thick skinned about it but it is hurtful.
> 3. I am not the brightest bulb on the Christmas string of lights but I do feel that I have something to offer....


1. LOL, but that is why CMF is such a well run forum; I mean swearing is not even allowed here [sh1t]. 

2. Yes, you have to be somewhat thick-skinned to join an anonymous public forum, but instead, you're sounding like the victim that you're NOT; behaving a little bit like a child & being unfair too Belguy. Let me share with you six basic core values: 

Humility - Being grounded in character and free of arrogance.
Humanity - Possessing compassion and serving others.
Integrity - Being true to yourself, your principles, your people, & your mission.
Surrender - Capable of delegating, sharing responsibility, and empowering others.
Humor - Not taking ourselves too seriously and capable of laughing at ourselves.
Optimism - Keeping a positive outlook.

*Source:* http://christianwarren.com/2009/01/the-positive-aspects-of-being-thick-skinned/

How many of the above characteristics do you possess? 

Please, do not forget that you were disrespectful first & offered the non-passive investors, snarky remarks on an ongoing basis [no need to give you proof of your own posts as you know this well], and you hardly ever participated in positive arguments/discussions & simply because you did not agree. Further, most here were trying to help you whenever you came asking/crying, no? 

3. It is not about being the smartest & this forum warmly welcomes newbies [I certainly felt very welcomed when I joined 2 years ago] & encourages polite discussions/disagreements, but you offered mostly criticism & failed to recognize the more knowledgeable & experienced investors here [not talking about myself, lol].

Having said the above, you're a funny person & have been entertaining to read Mr. Belguy, albeit not always.


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## humble_pie (Jun 7, 2009)

oh, don't play so innocent. Everyone remembers you. You used to go ballistic whenever a whippersnapper dared to whisper he had earned better than the index. In between ballistic you used to fawn all over yourself & your infamous BH & P which is a phrase that, in fact, you had stolen from michael lee chin.

this issue arose previously when mockingbird & i reproached you after years of your harassing the stock traders, who are numerous in this forum.

after that episode you managed to pull yourself together slightly. Although periodically the native aggression would leak through & you'd blast some poor kid who'd merely asked about selling his recent purchase.

and then came the infamous NB. When you drank the yellow Nitrogen Broth. And you went completely to pieces. Because. You had lost a bit of money. And europe was being mean to you.


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## Guigz (Oct 28, 2010)

I don't understand! This is not a discussion about mutual funds?!

What are all these acronyms?


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## kcowan (Jul 1, 2010)

It is a deep-seated resentment to a certain passive aggressive investor who is of the "hope" variety rather than the responsible investor category. Just ignore it. I do.


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## Dmoney (Apr 28, 2011)

Love that Newbie is into 3x leveraged ETFs and Belguy is into couch potato investing and we've got them both agreeing on a topic. 

That's it.

Dmoney out.


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

Folks, the user "newbie" is nothing more than a troll. Just ignore him, don't feed him and he'll get bored and go away.


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## cannew (Jun 19, 2011)

1. Buy her some investment books for Xmas, such as:

The Single Best Investment, Lowell Miller
Bouble Your Money with Dividends, Bill Staton
Ultimate Dividend Playbook, Josh Peters

2. Tell her to visit the Connolly Report website, www.dividendgrowth.ca
and read the home page and information pages.


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## humble_pie (Jun 7, 2009)

for 2012 i'd like to raise a glass to No More browbeating, manipulating, persuading, forcing & otherwise "having" the wives do anything whatsoever that's not of their own volition.

so here's a toast to the lassies & an invitation to come join cmf forum. Enuf with this nonsense about they'd-rather-buy-cutesy-pie-shoes-they-don't-care-about-finance.

the truth is, independent women are pouring into discount brokers. Have been since the early part of this century.


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## Toronto.gal (Jan 8, 2010)

Dmoney said:


> Love that Newbie is into 3x leveraged ETFs and Belguy is into couch potato investing and we've got them both agreeing on a topic.


LOL, so true, but that's because the agreed topic was not investments.


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## Toronto.gal (Jan 8, 2010)

humble_pie said:


> for 2012 i'd like to raise a glass to No More browbeating, manipulating, persuading, forcing & otherwise "having" the wives do anything whatsoever that's not of their own volition.
> 
> so here's a toast to the lassies & an invitation to come join cmf forum. Enuf with this nonsense about they'd-rather-buy-cutesy-pie-shoes-they-don't-care-about-finance.
> 
> the truth is, independent women are pouring into discount brokers. Have been since the early part of this century.


Great post!!!!!!!!


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## somecanuck (Dec 23, 2011)

I'm in a similar position, with our money tied up in Mackenzie mutual funds that we'd like to move. Unfortunately they're all DSC's, and my wife does not want to take the hit to make the switch. I'll have to do some Excel wizardry here.


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## Xoron (Jun 22, 2010)

I figured I'd provide a followup of our meeting with the IA. One word: anticlimactic

I spent hours doing a best possible comparison of the MF to ETF. Sent the details to the IA before our meeting. Had all of my answers ready for every possible thing she could throw at us.

Pretty much all we did was fill out forms to transfer everything over to a self directed RRSP account.. My wife was like "we came here to met her for this? We could save done it over the phone.. after 10 years of being with her that's all?. Not even a fight to try and keep my business?"

What a waste of time. Both in prep and going to see her. At least now we're free of those MF i guess there was no arguing she cold do against hard numbers


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## avrex (Nov 14, 2010)

That is good news. A self-directed RRSP to invest in as you please.

Just to confirm, are you saying that the Russel mutual fund is now sold?


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## dave2012 (Feb 17, 2012)

somecanuck said:


> I'm in a similar position, with our money tied up in Mackenzie mutual funds that we'd like to move. Unfortunately they're all DSC's, and my wife does not want to take the hit to make the switch. I'll have to do some Excel wizardry here.


We're in similar position, still stuck in some MF (including AGF, Mackenzie, Trimark, worthless Labour Sponsored Funds). WAY too many funds, overlap all over the place. Some of the same funds in our biz account, my wifes 3 RSP accounts, and my RSP. After doing some analysis via Morningstar it turned out we had nearly 30% in foreign (non US/Can) MF's! I'd like more like 15% tops.

Our last sales advisor would always just suggest switching between funds because of the DSC. I ended up discovering on my own that we could sell 10% a year at no charge, which I have been doing until the DSC's are reasonable to just dump most of the rest. Wish I had known about that a long time ago.

They were charging 2.5% to sell one stock and another 2.5% to buy another! lol. Mind you if I complained he would reduce it to 2% each way. Sadly at the time I didn't know any better, and I had to pay the full 2.5% when I asked to buy AAPL at $98 back in 2006 (which I had to sign off as AAPL was not on their sales sheet). I don't think twice now doing my $6.95 trades


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## Belguy (May 24, 2010)

For anyone contemplating a 'Couch Potato' portfolio, the main advice that I would give is to keep it simple!! Just invest in a diversified portfolio of the lowest fee, broadest-based ETF's and then just hold them 'forever' without second guessing yourself. Trade only once or twice a year, as needed, to rebalance back to your original target asset allocation and only adjust that target allocation as you approach retirement to a more conservative approach.

You want to keep it SIMPLE and CHEAP!! No more than a half a dozen investments should do the trick.

Reference: www.canadiancouchpotato.com


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## Xoron (Jun 22, 2010)

avrex said:


> Just to confirm, are you saying that the Russel mutual fund is now sold?


Not Quite. What the IA is doing is transferring the Russell Funds in kind over to the SDRRSP account. There we can sell it at our leisure and buy ETFs to get our couch potato portfolio going. 

I didn't want to risk selling the MF, then the market move on us in the time it takes to do the transfer, then be forced to buy ETFs at a higher price. 

But it feels good to finally be rid of the IA and have control over the investments.


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## 44545 (Feb 14, 2012)

joncnca said:


> ...as inexpensive as the E-series funds are compared to the other banks, you can relatively easily recreate these funds using even lower MER etfs.


I am just now skimming this thread and will delete this if it's been said later.

For small portfolios, the TD e-Series still represents the most cost effective entry into index investing than ETFs. Commissions on ETFs start to add up to more than the MER delta between them and the e-Series.

See this post for more on that: http://canadiancouchpotato.com/2010/06/25/should-you-use-index-funds-or-etfs/


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## caricole (Mar 12, 2012)

Xoron said:


> So here is my dilemma, my wife has an investment adviser at TD who she's been with for 7+ years. She's fully invested in a single RRSP, the Russell LifePoints LT Growth B (FRC301).
> Any suggestions on how to make her a believer?


Very simple..back to basics

4 years existance

-0,17% return :hopelessness:

http://www.fundlibrary.com/funds/li...00&ps=25&p=1&s=F.EnglishName50&sd=asc&rating=


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## Eclectic12 (Oct 20, 2010)

Xoron said:


> I figured I'd provide a followup of our meeting with the IA. One word: anticlimactic
> 
> I spent hours doing a best possible comparison of the MF to ETF. Sent the details to the IA before our meeting. Had all of my answers ready for every possible thing she could throw at us.
> 
> ...


Hmmm ... I'm not sure the prep was a waste of time. Others in similar situations have had reported drawn out disagreements. You may have avoided similar (which would have been a bigger waste of time!).


Congratulations on being free of the high MER MF!


Cheers


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## joncnca (Jul 12, 2009)

i don't understand why an IA would have any power over whether or not you and your wife wants to dump her fat MFs.

i made a pretty sophisticated spreadsheet with side by side comparison of returns over the 35 years we have until retirement between high cost MFs and similarly represented index/ETFs. my wife couldn't argue against 10s of thousands in difference simply due to MER, all else being equal, with a conservative growth rate and assuming she moves from full to half time. i like numbers. just make sure you use your own.


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## Xoron (Jun 22, 2010)

I know this is an old thread, but I figured I'd circle back with the results of the switch so far. I realize it's only been a few years, but so far I'm happy with the results.

The change was made in April 2012. For 2012, the all ETF portfolio lagged slightly, but 2013 blew it out of the water, and 2014 is shaping up nicely so far (XIRR returns):


*Year**ETF Return
**Lifepoints (MF) Return*2012 (Apr-Dec)10.12%11.78%2013 (Jan-Dec)23.99%17.22%2014 (Jan1-Jan23)3.36%2.87%

Lifetime returns:


*Year**ETF Return**Lifepoints (MF) Return*Apr 2012 - Jan 23 201412.32%10.28%


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## lonewolf (Jun 12, 2012)

Xoron said:


> So here is my dilemma, my wife has an investment adviser at TD who she's been with for 7+ years. She's fully invested in a single RRSP, the Russell LifePoints LT Growth B (FRC301). Now I hate this fund, it charges an abysmal 2.7% MER and is meant to be a single fund to cover all of the bases (Domestic, US, International, Emerging Markets and bonds). I've been trying ton convince her to dump the fund for a few years, but no success.
> 
> http://www.theglobeandmail.com/globe-investor/funds-and-etfs/funds/summary/?id=68987&cid=Russell%20Investments%20Canada%20Limited
> 
> ...


 Hi, Xeron

Tell your wife there is a conflict of interest with the bank. The bank is in bussiness to make billions of dollars of profit each year not to make you & your wife rich. It is like giving your hand to your opponent in a poker game & letting them play it for you. Who is taking the other side of the trade ? Why go into market warefare & give your opponent the sword & the platter to serve your head on ? Show your wife a chart of mutual funds cash levels compared to the dow. It will show that mutual fund cash levels are highest @ market lows & cash levels are lowest @ market top. A few years back I remember reading that the best performing mutual fund of the last 10 years actualy lost the average investor in its fund to lose money because they sold low & bought high.

The bank pays it employees to make money for the bank & not to line the pockets of the banks clients. Avoid conflict of interest deal with credit unions.

To put money on the table then give your opponent your cards to play ???????????????


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## richard (Jun 20, 2013)

Xoron said:


> I know this is an old thread, but I figured I'd circle back with the results of the switch so far. I realize it's only been a few years, but so far I'm happy with the results.
> 
> The change was made in April 2012. For 2012, the all ETF portfolio lagged slightly, but 2013 blew it out of the water, and 2014 is shaping up nicely so far (XIRR returns):
> 
> ...


Nice returns - the dollar value that adds up to should help drive it home. If the fund does happen to have a good year some time in the future just look up Bill Miller to avoid temptation.


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

Richard, please note it is not necessary or advised to quote everything you replied to. Better just to reply normally without quote, addressing the person by name if need be. We have already read what they wrote once.


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## PatInTheHat (May 7, 2012)

I can't convince my girlfriend to invest in anything but GICs. Consider yourself lucky


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## Ponderling (Mar 1, 2013)

Thanks for this thread. I have edited it in a document for my wife to read. Our IA is a bit of a pal to her - past Beaver Group co-leader. 

There was a rerun of a PBS FrontLine program from last fall on the secondd over the air PBS channel, and we both watched it for a bit. It was an expose of the US retirement industry/brokerage situation.

It gave a good overview of opinions from people independent from the industry on what is wrong with the present situation, and inteviewed people who thought they had been doing the right thing, and guess what; fees and advisors with no fiduculary duty did not get them where they thought they wer going. 

The time may be ripe for us to start walking towards the couch world of investing.


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## joncnca (Jul 12, 2009)

i read your first post and then skipped to the end..., sorry, baby's crying and can't go through 8 pages

anyway, i actually did plot everything into excel earlier this year and put in the proper formulas for returns, accounting for MER, inflation, rate of return, initial investment, periodic contributions, and one of the simulations lays out how much money she's losing based on MER alone...we're early 30s, so over the next 30ish years, my low-cost hypothetical portfolio with MER around 0.3 compared with her mutual funds at MER 2.01 amounted to a difference of hundreds of thousands of dollars after inflation in total value. that extra 0.7 percent your wife pays will make an even bigger difference. 

and i specifically changed the font of the total value after 30 years to be huge, coloured the result of her MF red, and coloured the result of my hypothetical portfolio green =) after that, she has been on me to get things set up..in progress right now. 

i like numbers. sure, they can lie if you abuse them (as with marketing types), but they can also be very effective. give her the numbers.

good luck


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## none (Jan 15, 2013)

I did the same thing. I was surprised that a MERe 2% (haha nice pun!) makes such a huge difference.

I find the couch potato approach so liberating as it the optimal investing strategy for those not willing to put in a lot of time into investing (and even that's arguable). Now when my sister in law asks how my couch potato is doing I simply say 'about 2% better than I would be doing otherwise'. FREEDOM!


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