|
blah_blah posted:For US/international equities in your TFSA, you will be incurring foreign withholding taxes that you won't be able to recover. Does that include things iShares S&P 500 (XUS) and Vanguard US total market (VUN) or just ones traded in other currencies like VTI/VEA?
|
#
?
Jan 4, 2014 04:01
|
|
|
|
| # ? May 15, 2024 23:27 |
|
|
Guest2553 posted:Does that include things iShares S&P 500 (XUS) and Vanguard US total market (VUN) or just ones traded in other currencies like VTI/VEA? I'm almost certain it applies to both.
|
|
#
?
Jan 4, 2014 04:11
|
|
|
Lexicon posted:I'm almost certain it applies to both. Ah, so how does the RRSP mitigate those problems?
|
|
#
?
Jan 4, 2014 04:16
|
|
|
tuyop posted:Ah, so how does the RRSP mitigate those problems? Tax treaties. Basically, in the case of RRSP held US securities, the United States government agrees not to withhold those taxes that would otherwise be due (presumably for a reciprocal benefit somehow, but I'm not sure exactly how that would work given the asymmetric population sizes). This is a good explanation of it all, again at Canadian Couch Potato: http://canadiancouchpotato.com/2012/09/17/foreign-withholding-tax-explained/ It's complicated as hell. It seems a pretty tough task to be fully tax efficient.
|
|
#
?
Jan 4, 2014 04:30
|
|
|
It's not that bad. TFSA is the best place to put everything if there is room, but when room runs out, first move Canadian stocks into a margin account and bonds into the RRSP. Then move US/Intl funds into the RRSP if possible (and hold the NYSE equivalents for that foreign withholding tax exemption), or margin (doesn't really matter if you hold the NYSE equivalents.) Keep your Canadian (and global) REITs in your TFSAs always. Bonds should never be held in a taxable, buy GICs instead if you need fixed income.
|
|
#
?
Jan 4, 2014 06:01
|
|
|
rhazes posted:It's not that bad. TFSA is the best place to put everything ??? Are you trying to imply that paying US capital gains tax on your US stocks in your TFSA is somehow more advantageous than having them in RRSP?
|
|
#
?
Jan 4, 2014 06:13
|
|
|
Vehementi posted:??? Are you trying to imply that paying US capital gains tax on your US stocks in your TFSA is somehow more advantageous than having them in RRSP? You don't pay capital gains tax. There is only a withholding of 15% on US dividends.
|
|
#
?
Jan 4, 2014 06:19
|
|
|
Lexicon posted:I'm almost certain it applies to both. Guest2553 fucked around with this message at 05:29 on Jan 8, 2014 |
|
#
?
Jan 4, 2014 06:42
|
|
|
Furthermore, does the above US/Intl tax issue apply to Canadian-based funds which contain US/Intl equities (but which are still based in Canada/CND$)? Example: RBC International Index RBF559
|
|
#
?
Jan 4, 2014 12:12
|
|
|
Jolarix posted:Furthermore, does the above US/Intl tax issue apply to Canadian-based funds which contain US/Intl equities (but which are still based in Canada/CND$)? Example: RBC International Index RBF559 I believe so. The foreign withholding taxes (on dividends) are levied by the government on the fund/stock itself, you don't even see it. There is a tax treaty with the US, so you would have no issue holding US equities in your RRSP to get back the US FWHT (but not international). In a taxable account, you get a tax credit for tax paid on it, so you'd be fine holding US and Int'l there. The take-away message is that in a taxable account or RRSP, you can get US FWHT back, but not international ones. IE VWO, XEF, XEC, VEA, VDU, etc. (You would need a true Canadian version, as most of our ETFs just hold the US ETF that holds the international stocks). I believe that RBF559 would probably pay foreign withholding taxes on dividends for most countries unless we have tax treaties for them. In a taxable account RBF559 would pay them, but you could claim it as a tax credit- unlike holding NYSE:VEA or VDU, where you would only ever be able to recover the US FWHT. That said, RBF559 has a 0.71% MER and assuming realistic dividends of a total or large market index of 2-2.5% assuming a 15% FWHT is a 0.3% to 0.375% "drag" on return every year. If you're in mutual funds and thinking about FWHT, you shouldn't, you should buy ETFs to get an even better RoI. That said, to my knowledge, it's still cheapest to buy VUN, XEF, XEC, or if you are able, even better, VTI, VEA, VWO for your US market exposure. Canadian ETFs and mutual funds directly holding international stocks is only an advantage if you are forced to hold them in your taxable account, and the options available are very poor with high MERs and low diversification (CIE, CWO being the obvious examples, with 0.72%/0.69% MER)
|
|
#
?
Jan 4, 2014 17:13
|
|
|
Lexicon posted:You need to carefully read the fine print of whatever investments you're in. Some mutual funds have a poison pill trailing fee clause that generates penalty 'fees' if you withdraw before X years have elapsed. I looked into the abyss and I have seen terrible things...
|
|
#
?
Jan 5, 2014 08:28
|
|
|
Lexicon posted:It's not just capital losses you need to worry about though. If you put $X of RIM into your TFSA in 2011, and the stock plummets, you've lost the opportunity to write off against your gains and you've lost that TFSA room forever. That just magnifies greatly the already substantial loss of $X itself - you no longer are entitled to $X worth of tax free growth over the next 40 odd years. I think your RIM example is a little extreme, but I see what you're saying and it makes sense. Since I am maxed in my sheltered accounts, I think I will do what you're suggesting and actually put the safer index in the TFSA and the equities in my soon-to-be-opened non-reg account, so I might as well do it there.
|
|
#
?
Jan 5, 2014 19:13
|
|
|
It's not 100% topical for this thread, but may be of interest (pardon the pun) here regardless: http://www.cbc.ca/news/canada/british-columbia/couple-feel-robbed-by-25-interest-td-car-loan-1.2483342 CBC posted:A B.C. couple are speaking out about how they feel they were misled into a 25 per cent vehicle loan from TD, which has left them paying more than double the price of their car. It's hard to know how to think about this, for me anyway. The couple are clearly idiots - that's pretty hard to dispute. Pretty terrible behaviour by the bank/dealer though - at a certain point, you transition from 'providing a good/service at a reasonable return' to 'preying on the vulnerable'.
|
|
#
?
Jan 6, 2014 17:06
|
|
|
Lexicon posted:It's not 100% topical for this thread, but may be of interest (pardon the pun) here regardless: Good lord, and I felt bad for financing mine at 1.9%. Could they really not get anything but a brand new 22k car? I get that having bad credit limits your choice, but there had to be a used car somewhere they could have found for a few thousands. FrozenVent fucked around with this message at 17:15 on Jan 6, 2014 |
|
#
?
Jan 6, 2014 17:12
|
|
|
FrozenVent posted:Good lord, and I felt bad for financing mine at 1.9%. It would have been hard for them to make a worse decision than the one they chose, even despite the significant constraints that come with poor credit.
|
|
#
?
Jan 6, 2014 17:19
|
|
|
Lexicon posted:It's not 100% topical for this thread, but may be of interest (pardon the pun) here regardless: On CBC radio this morning they were digging into the story a bit deeper. The couple say they only agreed to the loan in the first place because the dealer promised them that if they made their payments for a year they could come back and refinance at a more reasonable 5%. So they came back a year later and then got turned down. They went to their local TD branch and apparently when they showed him the paperwork he had a hard time believing his bank would have given out a loan with interest that high. I guess TD has recently got into car loans in a big way after purchasing a big car loan company. I suspect that it's probably this previously independant company just continuing on the way it always has been giving out these crazy interest loans while TD was hoping nobody would notice their name on the top of the paperwork?
|
|
#
?
Jan 6, 2014 17:54
|
|
|
Can anyone in BC tell me if it's like in Quebec, where the dealer is required by law to show you the page in the contract where it says in big loving bold letter "THIS IS HOW MUCH THE CAR IS THIS IS HOW MUCH THE INTEREST IS THIS IS HOW MUCH YOU'RE GOING TO PAY TOTAL OVER THE COURSE OF THE LOAN DO YOU UNDERSTAND THIS ARE YOU REALLY REALLY SURE BECAUSE HERE'S HOW MUCH INTEREST YOU ARE GOING TO PAY DO YOU GET IT OK PLEASE SIGN HERE AND INITIAL HERE ON THIS VERY PAGE."? Because when my brother bought his car, that was like the one part of the contract I didn't have to explain to him; they made it extremely loving clear. (4.9% over 7 years, goddamn)
|
|
#
?
Jan 6, 2014 18:12
|
|
|
I saw that this morning eating breakfast. A couple of things that caught my eye:quote:“I know it’s our fault we got into it, but it’s ridiculous. It’s like rich people getting rich off the poor,” said Hauser. “It’s a way to loan-shark, legally.” quote:That left them locked into the full term of the original 25 per cent loan — a total of seven years. quote:She said the payments eat up one-quarter of her take-home pay. My best guess is they're paying almost $500/month on a 4 year old dodge. I agree that 25% from a mainstream bank is borderline predatory, but really, why on Earth people think buying a $22K car a year or two after you declared bankruptcy is a good idea is just  I have no sympathy for them, but the bank should never have made the loan in the first place. That's Avco or Rent-to-own bullshit right there.
|
|
#
?
Jan 6, 2014 19:03
|
|
|
FrozenVent posted:Can anyone in BC tell me if it's like in Quebec, where the dealer is required by law to show you the page in the contract where it says in big loving bold letter "THIS IS HOW MUCH THE CAR IS THIS IS HOW MUCH THE INTEREST IS THIS IS HOW MUCH YOU'RE GOING TO PAY TOTAL OVER THE COURSE OF THE LOAN DO YOU UNDERSTAND THIS ARE YOU REALLY REALLY SURE BECAUSE HERE'S HOW MUCH INTEREST YOU ARE GOING TO PAY DO YOU GET IT OK PLEASE SIGN HERE AND INITIAL HERE ON THIS VERY PAGE."?  ARROW LOOK HERE but it is plainly visible and not hidden. Shows basically price for car, extras (bullshit doc fees, whatever), taxes, finance term, rate, and total sum at the end of the day, even including total of interest paid.Double e: Sounds more like the people "trusted" the dealer/salesperson that they could refinance in a year or two. Why anyone would trust a car dealer, especially for anything supposedly to the consumers benefit financially is unbelievable. slidebite fucked around with this message at 20:04 on Jan 6, 2014 |
|
#
?
Jan 6, 2014 19:12
|
|
|
slidebite posted:I have no sympathy for them, but the bank should never have made the loan in the first place. That's Avco or Rent-to-own bullshit right there. Yeah. The only thing more questionable than the couple's financial decision-making is that TD would want their brand involved in any way with this sort of on-the-margin-of-poverty, loan-shark lending. You'd think they'd at least have the sense to have it buried below a dozen shell companies and subsidiaries.
|
|
#
?
Jan 6, 2014 20:51
|
|
|
Dick move by TD, but Rich_gettin_richer.txt So my Questrade account was finally approved today, now I'm in the process of transferring my  . CCP recently updated their model portfolios which is fairly close to what I was looking at anyways.How does a mix of the following sound? -30% Cdn Vanguard FTSE Canadian All Cap (VCN) -25% US Vanguard US Total Market (VUN) -20% Int'l iShares MSCI EAFE IMI (XEF) -25% Bonds Vanguard Canadian Aggregate Bond (VAB) or maybe DEX Short Term Bond Index Fund (XSB) Initial investment of at least 11k, maybe a few grand more if I there's a way to contribute from my US account without losing a bunch to fees in the process. On the fence about REITs, I'd like to get some but don't know if it's a good idea to spread myself too thin right now. vvvv - have you really sexed? is it true vagina simulates feel of fleshlight?  Really though most of what you said is way beyond where I am right now 
Guest2553 fucked around with this message at 04:23 on Jan 7, 2014 |
|
#
?
Jan 7, 2014 03:43
|
|
|
Guest2553 posted:Dick move by TD, but Rich_gettin_richer.txt Needs more sex. Consider some twitter and Amazon and maybe do a multi-leg short call on RIM.
|
|
#
?
Jan 7, 2014 04:07
|
|
|
Guest2553 posted:Dick move by TD, but Rich_gettin_richer.txt If you already have USD, you might consider substituting VTI for VUN. Lower MER (0.05% - yes, a twentieth of a percent), and it's arguably nicer to have the actual currency exposure (rather than via the proxy of VUN). It's probably not worth it if you need to convert CAD to get USD though.
|
|
#
?
Jan 7, 2014 04:38
|
|
|
Yeah I've heard good things about VTI. Fortunately I set up the account to use whichever currency I transfer into it. As long as there aren't huge fees to send money from my local US credit union it might be worth it. Thanks for the reassurance, I guess BRB, gonna join the 1%.
|
|
#
?
Jan 7, 2014 05:28
|
|
|
There was a bit of talk a while back about how Questrade sucks and might shut down or maybe the free ETF buys deal might end that we should maybe just do the TD account instead. Any further thoughts there?
|
|
#
?
Jan 7, 2014 05:44
|
|
|
Overal strategy question. Without getting into $$ numbers, I think I might want to bump up my foreign holdings. I am roughly 50% Canadian equity funds 15% Foreign equity funds (US and ROW) 35% Bond funds/GICs. Small smattering in individual equities, probably <5% (in the wiggle room of the plus/minus above, majority of which are big dividend companies held in the funds as well) Thoughts or generalizations? e: I am going to be moving my various funds to Vanguard as the loads come off. slidebite fucked around with this message at 07:01 on Jan 7, 2014 |
|
#
?
Jan 7, 2014 06:28
|
|
|
Vehementi posted:There was a bit of talk a while back about how Questrade sucks and might shut down or maybe the free ETF buys deal might end that we should maybe just do the TD account instead. Any further thoughts there? Might shut down? They are making huge strides in the Canadian market. They aren't going anywhere.
|
|
#
?
Jan 7, 2014 06:59
|
|
|
Thanks for making this thread, it's been an interesting read. I met with an advisor from BMO and to be honest I am more confused now than I was before. I do all of my banking through BMO and opened a TFSA this summer but it literally just has cash in it right now which I realize is wrong. What I want to do is contribute weekly to a mutual fund. Can I transfer my TFSA to TD and buy mutual funds within that account? Is buying mutual funds within a TFSA a bad idea?
|
|
#
?
Jan 7, 2014 07:06
|
|
|
Pympede posted:Can I transfer my TFSA to TD and buy mutual funds within that account? quote:Is buying mutual funds within a TFSA a bad idea? No, just choose the optimal type of funds with respect to tax consequences.
|
|
#
?
Jan 7, 2014 07:11
|
|
|
If it is a TD branch (and not an investment house) they may be limited or not willing to give you a broad range of funds and may try to steer you to one over another which may have very high fees compared to funds mentioned in the OP.
|
|
#
?
Jan 7, 2014 07:43
|
|
|
Pympede posted:Thanks for making this thread, it's been an interesting read. I met with an advisor from BMO and to be honest I am more confused now than I was before. You could do a lot worse than simply following Global Couch Potato: Option 2 listed here: http://canadiancouchpotato.com/model-portfolios/ Adjust the equity/bond ratio according to your age / risk-appetite / intended purpose for the funds. That's through TD mutual funds - you could do this in a TFSA.
|
|
#
?
Jan 7, 2014 16:21
|
|
|
slidebite posted:Overal strategy question. Seems high in Canadian equity to me. We have a small, poorly-diversified set of companies viewed from an international perspective. Also, from a hedging point of view - you're already highly-exposed to Canadian economic risk by virtue of living here (and being employed here) etc. I favour a somewhat light weighting in Canadian equities for this reason. For reference, once my rebalancing exercise is over, I'll be approximately 15% Canadian equity versus 24% US equity, 15% developed international (e.g. Europe, Australia), and 6% emerging market.
|
|
#
?
Jan 7, 2014 16:27
|
|
|
Lexicon posted:For reference, once my rebalancing exercise is over, I'll be approximately 15% Canadian equity versus 24% US equity, 15% developed international (e.g. Europe, Australia), and 6% emerging market.
|
|
#
?
Jan 7, 2014 19:31
|
|
|
cowofwar posted:What fund do you use for emerging market exposure? The cheapest ones that I can find are 1.8% MER, most are over 2%. I'm intending to buy XEC. 0.35% MER. I'm not sure if it's possible to get reasonably priced exposure to this outside of an ETF.
|
|
#
?
Jan 7, 2014 19:49
|
|
|
Kal Torak posted:Might shut down? They are making huge strides in the Canadian market. They aren't going anywhere. It's not really a reason not to use them, but I'll be astonished if they still exist as a separate entity in 5-10 years time. Anything moderately disruptive to banking in this country gets swallowed into the oligopoly.
|
|
#
?
Jan 7, 2014 19:53
|
|
|
Lexicon posted:It's not really a reason not to use them, but I'll be astonished if they still exist as a separate entity in 5-10 years time. Anything moderately disruptive to banking in this country gets swallowed into the oligopoly. I suppose they could get bought out, but I would probably take that bet.
|
|
#
?
Jan 7, 2014 20:02
|
|
|
cowofwar posted:What fund do you use for emerging market exposure? The cheapest ones that I can find are 1.8% MER, most are over 2%. I bought VXUS, but that's only if you have USD, I suppose.
|
|
#
?
Jan 7, 2014 20:06
|
|
|
tuyop posted:I bought VXUS, but that's only if you have USD, I suppose. VXUS is 'international' rather than 'emerging'. The former presumably implies the latter, but I'm not sure to what extent. It's weighted heavily at the top with Nestle, Royal Dutch Shell, etc.
|
|
#
?
Jan 7, 2014 20:17
|
|
|
Lexicon posted:Seems high in Canadian equity to me. We have a small, poorly-diversified set of companies viewed from an international perspective. Also, from a hedging point of view - you're already highly-exposed to Canadian economic risk by virtue of living here (and being employed here) etc. I favour a somewhat light weighting in Canadian equities for this reason. Yeah, I agree it's too heavily weighted to  and need to move money off shore. It's done pretty well for me, all things being equal, but you can only go so far with financial, utility and resource stocks.I'm going to actually crunch my numbers and get real % to know what I'm dealing with. I also need to compare my funds to an equiv Vanguard so I can start switching so I'll be looking at fund components pretty closely, probably this weekend.
|
|
#
?
Jan 7, 2014 21:17
|
|
|
|
| # ? May 15, 2024 23:27 |
|
|
Poloz is coming outright saying it is becoming more likely that rates will begin creeping up this summer. http://www.cbc.ca/news/business/long-term-rates-may-rise-soon-stephen-poloz-says-1.2487313 Will GIC rates possibly be effected before an official announcement or is it pretty lockstep with official policy?
|
|
#
?
Jan 7, 2014 21:31
|
|