# Almost Ready to Invest...



## RedRose (Aug 2, 2011)

Pension funds are at TDW now and transferred TFSA and took RRSP funds out of mutual funds.
All funds ($800K) are sitting in a basic account right now earning 1.25%
until I decide where to buy/invest. 
I will be following these threads and advice over the coming days or weeks.
Thank you to All who brought me this far.:encouragement::biggrin:


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## Ihatetaxes (May 5, 2010)

Congrats! No rush, you can enjoy $833/month in interest while you figure it out. Some dollar cost averaging over the next year or two would be smart.


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## RedRose (Aug 2, 2011)

Thank You for the praise.
Now to look up dollar cost averaging.
Yes, I will enjoy that $833 a month until I decide.
Financial products the banks etc...seem good regarding dividends.
Looking forward to learning how to invest and get it all in place.
Thank you all for your contributions over the past year, while I was struggling.


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## humble_pie (Jun 7, 2009)

Rose you are not going to like this, but please do keep in mind that i am one who has consistently supported you from the very beginning.

it never occurred to me that you would place your late husband's pension money in a DIY account at a discount broker. So i would like to launch the school of opinion that says you are not in any position to self-manage a portfolio of nearly a million dollars.

any person who says they need to "look up dollar cost averaging" is in no position to self-manage a portfolio of nearly a million dollars.

IMHO. 

Rose, in countless ways over the past year or 2, you have demonstrated to us that you are not a person cut out for DIYland at all. You might be, if you could restrict yourself with extreme & draconian discipline to a basic couch potato or sleepy portfolio; but at this point in time i tend to doubt that you know what these terms mean.

what i suggest you do is divide that brand-new account into quarters & hand 3/4 over to a qualified advisor tout de suite. As in pronto.

you could find one at your TD bank, if you wish. Tell your bank manager you wish either himself or herself to manage your account, or else you would like their best & most experienced financial manager even if the same has to come from another branch. Alternately, take these funds to TD investment counsel. Your bank manager will introduce you. This is a highly-qualified financial professional from TD wealth management who will no doubt attend at your bank branch to meet with you.

you could keep the remaining portion in DIY land, if you wish. This is a respectable amount of money - around 200,000 - & should satisfy your desire to play at investing.

Rose you are wildly, wildly dreaming if you believe that an anonymous internet chat forum is going to be able to properly advise a helpless widow about her crucial financial support for the rest of her natural life.


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## Toronto.gal (Jan 8, 2010)

humble_pie said:


> what i suggest you do is divide that brand-new account into quarters & hand 3/4 over to a qualified advisor tout de suite. As in pronto. You could keep the remaining portion in DIY land, if you wish. This is a respectable amount of money - around 200,000 -


I could not agree more! The above is excellent advice.

I even think $200K is too much for a novice investor, but to start with $100K, which is not an insignificant amount of money, and an amount that should be invested not all at once either, but in a good 6 to 12 month period. 

The above will ensure that you won't feel too overwhelmed; that you won't make mistakes with a large $ amount, and the experience will let you know whether DIY is for you or not. 

Good luck.


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## Spidey (May 11, 2009)

I respectfully disagree about handing the money over to a financial advisor. I've just seen far too much damage done. I've seen them decimate my parents meager portfolio by investing in high-risk, high MER mutual funds. If they picked a solid blue chip dividend portfolio and basically let it be, it could work, but advisors don't make much money from such a situation, so it rarely happens. 

Rose it is ultimately up to you to decide your level of competence in financial matters. A basic couch potato portfolio is not overly complicated. However, Humble's advice to start with 1/4 or about $200,000 may make sense depending on your level of comfort and understanding of the markets. But, rather than hand the other 3/4 to a financial advisor, I would rather see you place it in laddered GICs at the best guaranteed rate possible.


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## humble_pie (Jun 7, 2009)

600k or even better 700k in a laddered GIC portfolio is a truly excellent suggestion. 

spidey i am 100% on board with your concerns & hesitations over advisors. That being said, there *are* some ethical advisors. The trick is finding one. They may be needles in haystacks, but they can be found.

an investment counsel - correct current term is portfolio manager i believe - with discretionary control is held to a higher ethical standard than most other types of financial beasts. He or she or they are going to receive their fee based on the MI, so they tend not to sell self-enriching products, at least not nearly as much as commissioned salesmen.

one of the moderators is acquainted with an ethical financial advisor who does deal principally with etf accounts, because he believes wholeheartedly in these. He would be one of the rare advisors who do this. As it happens, he's located right in Rose's home town.

nevertheless what i discern in Rose's messages is that she innocently believes DIY investing is easy plus she believes this forum is going to guide her properly. May i say that, as an experienced investor, i am quite shocked & troubled by all this.


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## MoneyGal (Apr 24, 2009)

I will try to restrict myself to ONE comment, which is: this is NOT an investment account. This is an income account. It may contain "investments" (I mean, it surely will), but the purpose of this account is to provide the maximum sustainable lifetime income for RR, potentially including a substantial reserve component in case of financial emergency, and taking into account whatever her legacy goals are. RR does not just need a financial advisor, she needs one who is expert in constructing and deploying portfolios for lifetime income. (Unless, of course, she's prepared to live on a guaranteed base of her existing pension income + whatever random amounts a portfolio spits out.)


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## kcowan (Jul 1, 2010)

How about 100k each for 1 to 5 year GICs? 100k to play with individual stocks? 400k in a Canadian couch potato portfolio?


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## mind_business (Sep 24, 2011)

RedRose, I'm curious ... how much income do you need your $800,000 to provide? I'm not going to give any advice on how to develop and manage an income generating portfolio, simply because I'm not an expert. I am focused on investing and growth at this point in my life. However I am interested in your situation as I will be at this point in about 9 years. I do know that I'll be relying heavily on a professional advisor at that point in time, partly because I want to be focused on other aspects of retirement, not sweating the investment part. I will however meet with them on a quarterly basis to make sure they're looking after my portfolio to my satisfaction. I'm a strong believer in holding people accountable for their services they provide. 

I was curious what the potential, approximate income could be based on a few different scenarios from your $800,000. Here's what I came up with (Pre-tax Income):

1) 30 year retirement, 2% Income indexing (keeping up with inflation), and 4% Rate of Return: Year 1 Starting Income = $35,000 (indexed at 2% per year)

2) 30 year retirement, 2% Income indexing (keeping up with inflation), and 3% Rate of Return: Year 1 Starting Income = $31,000 (indexed at 2% per year)

Add this to CPP and OAS, assuming you have no debts going into retirement, and it's a pretty decent retirement income.


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## blin10 (Jun 27, 2011)

"professional advisor" is after his commission, they don't care if they make you money or not, they will position you so bad that to get out you would need to pay a ton of penalties... I would rather keep getting 1.25% then deal with "professional advisor"


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## humble_pie (Jun 7, 2009)

oh, blin, U R such a hardened cynic each:


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## leoc2 (Dec 28, 2010)

Karen has experience managing her own finances in a very risk adverse manner. She is a similar situation to Rose. Hopefully she can chime in here. 

I agree with Blin


> I would rather keep getting 1.25% then deal with "professional advisor"


I also like KCowan


> How about 100k each for 1 to 5 year GICs? 100k to play with individual stocks? 400k in a Canadian couch potato portfolio?


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## Belguy (May 24, 2010)

Don't take unnecessary chances with your retirement funds. Also, I do not trust bank branch financial services salespersons and their motives. You would be best served by next finding a fee-only financial advisor in your area who specializes in recommending income producing portfolios for seniors but who does not receive compensation from outside sources for any of the products that he or she recommends. You basically pay a one time fee for them to recommend a proper asset allocation, which is of primary importance, before deciding on the individual investments.

This is just my own personal opinion, but I am no longer an enthusiastic cheerleader for index or 'Couch Potato' investing given overall current economic conditions.

In some cases, the ONLY person who ends up making money off of your money is your financial services salesperson and the broader financial services industry which I find maddening. That is why I recommend a fee-only advisor who only makes money off of the one-time fee that he or she charges you and nothing off of the products that he recommends for your portfolio. That way, you avoid any potential conflict of interest.


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## zylon (Oct 27, 2010)

Admittedly, I know less than nothing about opening poster's situation.

However,
1/ 400k in Canadian Couch Potato?
2/ and then Belguy chimes in?

... excuse me while I go throw up.

I shall *not* revisit this thread; it's a disaster in the making.


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## Cal (Jun 17, 2009)

In this instance, seeking the counsel of a fee only advisor seems to make sense. Plan B would be the canadian couch potato portfolio.

Something to read up on.


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## Cal (Jun 17, 2009)

Belguy, when I do kid, you will know it by my use of the word... http://www.youtube.com/watch?v=u85u2ymDl8M&feature=related

Just for good measure I thought I would add: http://www.youtube.com/watch?v=0ERd3GlvxL8


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## caricole (Mar 12, 2012)

RedRose said:


> Pension funds are at TDW now and transferred TFSA and took RRSP funds out of mutual funds.
> All funds ($800K) are sitting in a basic account right now earning 1.25%
> until I decide where to buy/invest.
> I will be following these threads and advice over the coming days or weeks.
> Thank you to All who brought me this far.:encouragement::biggrin:


@redrose

I did not follow this saga since last year but to me it seems simple

I did the same thing with my registered accounts at the age oF 70

Life expetancy 86, (16 years), thus till age 86

Divided the total sum available in 16 equal parts

Both strip coupons or bonds ( only governement-provincial) 

Purchase price equal for every maturing year....thus maturing value INCREASES EVERY YEAR to make up for inflation
from A 30 year ladder should give you ± from 1½% to close to 4% 

No advisers needed just a waste of money

You will need some adjustments to amounts invested in strip bonds..but this is a detail

You start of with 5 eayr GIC, and from 6 to 30 years you take strip bond

No more problems and every eayr you collect an increasing amount

If you want to take a part in stock instead of everything in GOVERNEMENT bonds...thats YOUR CHOISE:encouragement:


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## boipinoi604 (Feb 13, 2012)

$800k is a lot. You should just seek out the advice of a reputable financial planner. A good financial advisor will construct a portfolio based on your investment needs, goals, tolerance..


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## boipinoi604 (Feb 13, 2012)

Basically, what belguy said...


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## Oldroe (Sep 18, 2009)

Be very clear with any advisers what you expected. You want to protect your capital and create income. They will have you sign a document to assess your risk tolerance. They will present it as a tool for them. It's really a legal document and if they step over your risk tolerance they are libel. Take great care in what you sign.

Do not let them be swishy washy on where your money is being invested if they won't present exact investments walk.

And remember this board has money in every legit investment.

Belguy you really don't know much about markets.

Your timing is good just don't invest to quickly. Looks like the Nov. time frame.


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## Causalien (Apr 4, 2009)

I suggest dividing the portfolio into equal parts. One is deposit earning fixed interest, one is managed by FA, one by CMS suggestions and one self managed.

Each year, do a rebalancing, take half of the worst performing in % terms and put it into the best.


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## kcowan (Jul 1, 2010)

boipinoi604 said:


> $800k is a lot. You should just seek out the advice of a reputable financial planner. A good financial advisor will construct a portfolio based on your investment needs, goals, tolerance..


A fee-only planner will not make investment choices. They will build you a plan and perhaps recommend how much income versus equity, but they do not make investments. It is still worth it to get a financial plan. But you will still need to make investment decisions.


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## marymouse (Jun 30, 2011)

This is an alternative to "typical" financial advisors. 
http://www.weighhouse.com/main/home.aspx
I used them and had positive a experience. do some reading so you understand what they are talking about.


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## RedRose (Aug 2, 2011)

My Sincere Thanks to All of You.
I can see there are varying opinions, which I like.
I am sitting tight, reading, digesting, asking questions, consulting experienced investor friends, one has already given me some great dividend paying stocks to generate an income, another is helping me decide whether to seek a FA or fee-only Portfolio Planner. 
This is a terrific forum to get an idea what is out there.

Thank you all for your contribution. I will weigh them all up carefully.


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