# How to execute a couch potato portfolio in LIRA/Unregistered Savings/TFSA Accounts



## axle (Jan 27, 2020)

My wife and I are in our late 40's and have retirement savings (primarily ETF's) strewn throughout various accounts:

Me: LIRA
Me: Pension Plan (defined contribution)
Me: Unregistered Savings
Me: TFSA

Spouse: RRSP
Spouse: Unregistered Savings
Spouse: TFSA

Joint: RESP

For 6 of the 8 accounts, we've been following a couch potato investment strategy that would be somewhat similar to this: https://cdn.canadianportfoliomanage...-ETF-Portfolios-Vanguard-2020-09-30-Plaid.pdf. In short, we have 4 or 5 ETF's in each account. I'm finding it to be a chore to rebalance everything as there is 6 accounts times 4 or 5 holdings in each account. Is there an easier way to do this? Perhaps rather than every account having 4 or 5 well diversified ETF investments, perhaps I don't need diversification in every account. Perhaps my bonds are held in one account, and my equity are held in another so instead of owning 4 or 5 ETF's in every account, I only need 1 or 2 in each account and less duplication/overlap between accounts? I'm sure this has been discussed numerous times before. Could someone provide advice or direct me to advice on this topic?

Thank you


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## AltaRed (Jun 8, 2009)

Consider collapsing each of your accounts into ONE asset allocation ETF holding as per Step 2 in Canadian Portfolio Model Portfolios using either of the Blackrock iShares or Vanguard options.



https://cdn.canadianportfoliomanagerblog.com/wp-content/uploads/2020/11/Model-ETF-Portfolios-Vanguard-2020-09-30-Light-2.pdf




https://cdn.canadianportfoliomanagerblog.com/wp-content/uploads/2020/11/Model-ETF-Portfolios-iShares-2020-09-30-Light-2.pdf



It is all that anyone actually needs. My own RRIF will become 100% VCNS and my TFSA will become 100% VEQT. Investing has never been as simple and effective as it has become today.


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## MrMatt (Dec 21, 2011)

AltaRed said:


> Consider collapsing each of your accounts into ONE asset allocation ETF holding as per Step 2 in Canadian Portfolio Model Portfolios using either of the Blackrock iShares or Vanguard options.
> 
> 
> 
> ...


What about the tax impact of holding non Canadian assets (VEQT) in your TFSA?


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## AltaRed (Jun 8, 2009)

Withholding tax loss for the ex-Canada portion of distributions is negligible leakage. Mere basis points that should never let the tail wag the dog.

Added: From Investment Products the foreign tax lost for 2019 was 0.03897 per unit. Hardly something to be concerned about in a couch potato set and forget portfolio.


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## GreatLaker (Mar 23, 2014)

For the ultimate in simplicity go with what AltaRed suggested. It's not the lowest cost or the most tax efficient, but it depends on how you value your time vs. a small tick of lower cost or lower taxes.

I have not gone that route (not yet anyway). My portfolio is an older style couch potato with different ETFs for each region and asset class (Can / US / Global / Emerging / Fixed income). It is set up the way you are thinking of going. I have 5 accounts (non-registered, TFSA, RRSP and 2 LIRAs). My smaller LIRA has one bond ETF. Larger LIRA has a bond ETF and GIC ladder. TFSA and non-reg only have equities. My RRSP has a bit of everything: Can/US/global equities, bond ETF and GIC ladder. Plus in each account I have a low-cost balanced ETF or broker HISA to keep distributions invested. 

Overall it's simple to manage. I never make any contributions to the LIRAs and only one annual TFSA contribution. Since I am retired I make one annual withdrawal from my RRSP and non-reg accounts. My RRSP has a bit of each asset class so that is the one I use for rebalancing (if I can't keep things balanced through my withdrawals). 

I'm happy to keep that portfolio design for now. It's easy to manage, simpler than having identical allocations in each account, lower cost than asset allocation ETFs, and tax efficient. I may switch to asset allocation ETFs at age 71 when I will need to convert my LIRAs to LIFs, but I am not ready to cross that Rubicon yet.


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## AltaRed (Jun 8, 2009)

It is indeed possible to have lower MER cost and higher tax efficiency by slicing and dicing according to account type. The OP is already doing that if he is essentially following the Plaid concept he linked in his first post. The Plaid example is 60/40 on an after tax basis (70/30 before tax) based on the contents of the link. My take is the OP is looking to get even simpler by avoiding multiple ETFs per account. 

Hence the KISS principle of Asset Allocation ETFs for the ultimate in simple. Since I don't know the OP's percentages of assets in non-reg, RRSP and TFSA, I can't recommend (opine) on which of the AA ETFs to hold in which account to stick with the 70/30 principle, but I'd put the Growth in the TFSA, Conservative (or Balanced) in the RRSP and Growth (or Balanced) in non-reg. It can be sliced/diced the way the OP wants. It really won't make that much difference. Perfection gets in the way of Good sometimes.

I am 71 now and have declining interest in screwing around with portfolio maintenance. Time is too precious.


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## MrMatt (Dec 21, 2011)

AltaRed said:


> Withholding tax loss for the ex-Canada portion of distributions is negligible leakage. Mere basis points that should never let the tail wag the dog.
> 
> Added: From Investment Products the foreign tax lost for 2019 was 0.03897 per unit. Hardly something to be concerned about in a couch potato set and forget portfolio.


Didn't realize that tax leakage was so small 0.1% is tiny


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