Savings Portfolio

[farmaholic]

How many people self direct their savings/RRSP portfolio. Does anyone have faith in the people that call themselves Financial Advisors who show up once a year, sell them a mutual fund and don't see them for another year. Does anyone have a "Financial Advisor" who will actually move investments around for them(after consultations). I don't expect perfection(out on the exact high and in at the exact low). I have come to hate mutual funds. Maybe I am getting what I paid for... If all I am is getting a "salesman" once a year do I have any right to complain??

[cottonpicken]

Reminds me of that saying"i'm no gynaecologist but
i'll have a look" although its not surprising i was
reminded of the phrase because i think of it several
times a day and it might not actually be a "saying",it
could be something i made up in my head which is
not as terrifying as the possibility of my best friend
of thirty years "joe" who nobody has seen or met
not actually existing,my therapist is letting me
cross that bridge when i get there....babysteps.

Anyhow....self directing is easy.You can set up your
own account through a bank or you can simple tell
your advisor to purchase whatever it is that you
want to purchase,as long as the investment is rrsp
eligible your good to go.Dont take any lip from the
pin heads and if the heshe says anything with the
word "bond" in it,trying selling him your "prime"
lake view property i.e.-in front of a dugout in the
middle of nowhere,they just maybe stupid enough
to go for it.

[farmaholic]

Cotton: Are there two many layers of people between me and the actual investment(stock) when a mutual fund is bought. Financial Advisors and Fund Managers all want a small piece of the pie. I think they are all lazy, they just want the money and no one looks back after they have the cheque. What's wrong with strong dividend paying bluechip companies?? If you want more risk(higher return) those are out there too.

[Hopperbin]

Farmaholic, self directing is the way to go. RBC can set you up in one hour.
Then it is a matter of studying a bit. You can set up a practice account. Watch bnn for starters, I was a little bored trying to just figure out the grain prices and trend so buying stocks really made things exciting. I would say I am addicted and am kicking the shit out of the last mutual funds that I cannot transfer over, oh by the way double check your mutual funds with their statisics some of ours are out 10 percent on the year from their actual advertised claims. Some of my big gainers were UUU, RIM, YRI, TKO, to name a few. Anyways the mutual fund managers do take 2 to 3 percent of your gross investment per year weather you make money or lose money that is hidden, you don't know who is getting paid how much. Compound that over 20 years. I don't sweat over anything I purchase, AAA has been a disappointment so far. My dad is heavily into the dividend paying stocks I can see everything he does from my account, he does follow an advisor and gets better gains when he takes his advice. For now I want to be a little riskier.

[Hopperbin]

Cotton you don't have to just have an
RRSP account. In the RRSP your account gains tax free and your deposit is tax deductible.
RSP investment account is tax paid money and your gain every year is taxed as a capital gain, pay tax on 50 percent of the gain, then when you take it out there is no tax, it is tax paid money,
RESP_ is the education savings plan for the kids, you will get a 20 percent top up from the federal gov't as you make your deposit. You would deposit tax paid money but the gain is only taxed when you use the money for kids education. The kids won't be paying any tax when furthering their education.
TFSA you use tax paid money to build that one up, the gain is tax exempt, and taken out tax exempt.
These accounts can all be self directed.
Someone correct me if I am wrong on the TFSA

[cottonpicken]

My understanding of the tfsa is that anything that is
rrsp eligible is tfsa eligible so my thinking is your
knockout high yielding and dividend paying
investments should go into the tfsa because all
gains and dividends are tax free.

Many things are rrsp and tfsa eligible,single
equities and even options i think are now aloud(i
don't know how that exactly works).

You could pile your whole contribution into
something like potash corp.

Financial advisors are always pumping the mutual
funds.My guess is the safety of very little downside
which also means very little upside,so they never
end up looking bad.

i cant believe the number of people who own a lot
of mutual funds but don't have a clue of what those
funds are comprised of.

As far as charges,the fund managers do it a variety
of ways with set in stone charges to benchmarking
of the funds performance against something like
the s&p 500,it sucks but even when you self direct
there are brokerage fees.

My opinion on blue chips has more to do with
sector performance.

I love commodities,so i like big commodity related
companies

Self directing isn't for everyone but it can be sort of
a fun hobby when its minus 40 out.

And after having said all that,a very strong case
could be made to pile your savings into yourself and
your farm.

[mcfarms]

Hopper
The resp is a tiny bit off you pay on the gov't side but not on yours however with the tuition write offs and low tax rates at "student" income levels it would be very low at best I should think. I borrowed this from a financial site.

"The subscriber contribution portion of payments to the beneficiary or subscriber is not taxable, and there is no restriction on how these funds are used.

The CESG and accumulated earnings on all contributions are paid out to the beneficiary as Educational Assistance Payments (EAP), and are considered taxable income to the beneficiary. However, the beneficiary may claim tuition tax credits and education tax credits to offset the income.




If the RESP is not going to be used by the beneficiary for qualifying educational programs:

the assets of the RESP can be transferred to another RESP under certain circumstances

subscriber contributions can be refunded tax-free to the subscriber or beneficiary, after all fees are paid to the promoter out of these contributions.

CESG must be repaid.

earnings are forfeited with some plans, or

earnings may be paid out to the subscriber, under certain conditions, as Accumulated Income Payments (AIP). The subscriber must be resident in Canada

AIP are subject to regular income tax plus an additional 20% tax

both taxes may be avoided if the AIPs are transferred to the RRSP of the subscriber or the subscriber's spouse. There must be sufficient contribution room in the RRSP, and the transfer is limited to a maximum of $50,000."