# Are TD e-series REALLY worth it over ING STREETWISE FUND in this case?



## youtoo (Apr 19, 2011)

I know how everyone recommends the e-series as one of the best options, and maybe the best options in cases like mine, _but_...

...really, what the e-series gives me is a lower MER (0.5% vs 1.07%) and flexibility to change the funds and distribution, thing that I don't need right now.

Me:
- I have everything at ING
- I will start very low ($150/m) as I have other saving goals right now
- My investment goal is looong term (retirement, I'm 28 now)
- I don't want to have to take care of the thing, or worry about ups and downs of the market. I just want the money to sit there. I'm not counting on that money at all for now

*ING STREETWISE (GROWTH)*
PROS

100% Convenient: all my money is there, the web works well. Signing up would be a breeze
Is a portfolio that fits my goals and I don't have to spend active time managing it
CONS

MER: %1.07 (which is already low)

*E-SERIES*
PROS

Lower MER 0.5% vs. 1.07%
Flexibility to choose the contents of the portfolio
CONS

I don't really wanna change my portfolio for a long time. I want a growth portfolio that will auto-balance
Dealing with another bank (opening TFSA, converting it to TFSA e-series, long signup forms, fees that I don't know of, transfers from bank to bank)

Don't get me wrong, I may get into the game later on, in a bunch of years. And if I was investing more money (5k a year or so) I would go for it, maybe then the lower MER would matter more. 

I know that if we are here in this forum is because we care about our money and we want to make the best decision but... is it really worth the hassle in my case? Is it really worth it that 0.5% MER?

--

PS: I know about some bad guys buying ING's US branch. Not worried about it, for reasons already written in this forum


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## Soils4Peace (Mar 14, 2010)

Do you want to pay someone $5 per year per $1000 invested to do a few mouse clicks for you? Is it worth the trouble to eliminate that cost?


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## m3s (Apr 3, 2010)

At this stage in the game the key is just to contribute money to your savings and the slight difference in MER or performance is negligible. Once you get to a certain amount, you could switch to ETFs when trading fees ($10/trade) are cheaper/equal to 1%. If you prefer the convenience and are happy with the Streetwise over time there's no rush really. The money you contribute will be most of the growth anyways. Once that changes, I would switch to ETFs


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## emperor (Jul 24, 2011)

Any one here have ING STREETWISE? I'm thinking of putting my TFSA into their medium-high risk (Equity growth fund, 50% Canadian stocks 25% US stocks 25% international stocks)

I was wondering if anyone else has this and if they are making decent returns?

They are giving a 1% bonus for all money added since the start of the year.


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## slacker (Mar 8, 2010)

I wouldn't stress about it. Yes, you'll save a few bucks with TD. But the couch potato police won't yell at you for not choosing the lowest cost option.


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## Dibs (May 26, 2011)

youtoo said:


> I know that if we are here in this forum is because we care about our money and we want to make the best decision but... is it really worth the hassle in my case? Is it really worth it that 0.5% MER?


Let's see what a difference in 0.5% MER can do. 

Case 1: 30 years, 10k starting, 5% annual gain, 1.07 MER vs 0.50% MER

```
Year    1.07%   0.50%
  1     10000   10000
  5     12094   12446
  10    14627   15492
  20    21396   24002
  30    31298   37185
```
Over 30 years, we end up paying 6k more in fees for 10k invested.


Case 2: 30 years, 50k starting, 5% annual gain, 1.07 MER vs 0.50% MER

```
Year     1.07%   0.50%
  1      50000   50000   
  5      60472   62234
  10     73138   77462
  20    106983  120010 
  30    156491  185926
```
Over 30 years, we end up paying ~30k more fees for 50k invested. 




youtoo said:


> Don't get me wrong, I may get into the game later on, in a bunch of years. And if I was investing more money (5k a year or so) I would go for it, maybe then the lower MER would matter more.


Case 3: (closer to your case) 30 years, 150$/month invested (i.e. $1800 a year), 5% annual gain, 1.07 MER vs 0.50% MER


```
Year     1.07%   0.50%
  1       1800    1800      
  5      10102   10282   
  10     22320   23081   
  20     54970   58841  
  25     76585   83522
  30    102728  114242
```
Over 30 years, we would invest 54k, and pay around 12k more fees with the higher MER.

A lower MER would make a difference in the long run.


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## Four Pillars (Apr 5, 2009)

youtoo said:


> I know how everyone recommends the e-series as one of the best options, and maybe the best options in cases like mine, _but_...
> 
> ...really, what the e-series gives me is a lower MER (0.5% vs 1.07%) and flexibility to change the funds and distribution, thing that I don't need right now.
> 
> ...


It sounds to me like ING is the best choice for you at this time.

As others have shown, the fee difference is significant over time, but if you are starting off small and will likely stay small for a while - there is no rush to switch.

Maybe in 10 years, you'll have a house/family etc and the account is a bit bigger - at that time, it might be more worthwhile to switch.


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## MrMatt (Dec 21, 2011)

In pure dollars the low MER matters.

For a small portfolio it's only a few dollars a year.
You've decided a few hours of you time is worth more than those few dollars a year.

If your time is worth less than that you should change, if it is worth more, you shouldn't bother. I've made the comparable decision myself, sometimes opting for the $ savings, sometimes not.


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## Sherlock (Apr 18, 2010)

emperor said:


> Any one here have ING STREETWISE? I'm thinking of putting my TFSA into their medium-high risk (Equity growth fund, 50% Canadian stocks 25% US stocks 25% international stocks)
> 
> I was wondering if anyone else has this and if they are making decent returns?
> 
> They are giving a 1% bonus for all money added since the start of the year.


I had a TFSA with ING Streetwise. I chose it over TD e-series because TD seemed to have no way to open an e-series TFSA online. You had to go to the bank and open a regular TFSA then mail in a bunch of paperwork to convert it to an e-series TFSA. ING let me open a streetwise TFSA over the web in minutes. I have since closed my ING TFSA (to free up more TFSA room for stocks) but maintain a non-registered mutual fund account with ING. This is my car fund.

As for returns, they have not been great. I think I am just about breaking even. However that is to be expected given what the market has done for the past 2 years since I opened my account.


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## somecanuck (Dec 23, 2011)

Personally I'd still go TD. Your two ING pros (which are really TD cons) are very minor. Switching accounts is a one-time task, and not a difficult one. Re-balancing is, at most, a once-a-year task and relatively painless. And you're not emphasizing the advantage of being able to move your money around in the future if/when you do become more interested in the allocation.

If someone told me that I could save over half the fees on something by spending 30 minutes now and 15-20 minutes once a year, I'd be all over it.


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## gibor365 (Apr 1, 2011)

I had RRSP Mutual fund account in ING for some time , than I transferred everything to TDW.... I didn't like very limited choice and performance on ING mutual funds.

As per MER....for some time I was paying too close attention to MER, but it's not always good thing to do...for example I hold in TDW TDB900 (canadian equity e-series) with MER = 0.33 , and I thought that this is a better choice than similar funds with higher MER..... however if you compare performance TDB900 with MAW106 (MER=1.22) for any period of time -> you 'll see than MAW106 ALWAYS outperforming TDB900 (and btw also XIU)... 
(1year : MAW106 = +1.5%, TDB900 = -7.6%)...
So, too bad for me that I was tempted by low MER and bought TDB900, just should've buy MAW106 and ignore MER...
Honestly, if fund manafer giving you better return, imho he's eligible to get reward for it.


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## uptoolate (Oct 9, 2011)

I have a TDW bias and have to point out that MAW106 does not ALWAYS outperform TDB900. 3 yr return is 10.76 for TD and 10.38 for Mawer. The current listed one year does favor Mawer -1.12 v 3.86. The funds aren't totally comparable as the TD fund is an index fund that is totally invested and the Mawer fund is not an index fund and holds about a 5% fixed income component that would have been helpful last year and over the 5 year interval. 

Anytime someone is offering me a 1% bonus on money I invest with them or transfer to them I am somewhat suspect. These are banks after all. They are ultimately making it back somewhere. My experience is that inertia gets greater as time passes and while higher MERs seem insignificant now they continue to add up over time. Einstein may have said that compounding is the most powerful force in the universe and banks certainly recognize this, individual investors seemingly less so.


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