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Is there a minimum age to turn an RSP in RRIF?
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Jun 17, 2014 15:05
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reflex posted:Is there a minimum age to turn an RSP in RRIF? I've asked this question before and the answer seems to be a pretty solid "No." http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/rrif-ferr/menu-eng.html Though I'm wondering if it makes sense to stagger your RRIF accounts. So if you have 50k in an RRSP, can you open an RRIF, transfer 35k to it and set a transfer rate that empties it in a year and then go back to work once it's empty and continue contributing to the existing RRSP, planning to open another RRIF later? There doesn't seem to be a reason why not, since an RRIF is just another type of registered account.
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Jun 17, 2014 15:12
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Anyone have any thoughts on Virtual Brokers Kick Starter Investment Program https://www.virtualbrokers.com/contents.aspx?page_id=119? I've been looking at either Questrade or VB for a TFSA, and this offer with VB looks pretty sweet with the automatic contributions according to asset allocation. I'm also a bit wary about ECN fees. VB doesn't charge any ECN fees, and though I could probably avoid this with QT by using limit orders, it seems the VB is the better option.
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Jun 18, 2014 18:32
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Annual fee is $50. VB commission is only 1 cent. Doesn't seem really worth it unless you're a student and that annual fee is waived or you plan on purchasing more then 5000 shares a year from a selection of 5 companies..
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Jun 18, 2014 20:42
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I'm a recent grad, so I wouldn't be interested otherwise.
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Jun 18, 2014 21:02
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Lexicon posted:Holy gently caress, VTI is north of $100 USD. I last bought some at $93 and was a bit nervous about that. I've had basically my entire net worth in the market since the end of January and VTI is up 9.6% since then. Cultural Imperial posted:Anyone got VWO? Yeah, the equity portion of my taxable account is VTI/VEA/VWO/VIG.
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Jun 18, 2014 23:04
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Is there a logical reason to put more than 20% down on a house? At 20% you don't need mortgage insurance, but beyond that it seems you would come out ahead if potential investments can beat your mortgage rate (at current rates that doesn't seem impossible). Then only reason I can think of is that you really hate having a mortgage.
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Jun 19, 2014 15:43
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reflex posted:Is there a logical reason to put more than 20% down on a house? At 20% you don't need mortgage insurance, but beyond that it seems you would come out ahead if potential investments can beat your mortgage rate (at current rates that doesn't seem impossible). Yes, the more you put down, the less you have to borrow thus the less you have to pay the bank for the privilege of borrowing that money. You absolutely want to minimize the amount of money you borrow and you want to pay that mortgage off as quickly as possible.
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Jun 19, 2014 15:46
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Might be a pretty dumb move if you dump 20% + 50k into your house to save ~4% on a mortgage and the market returns like 27%. Might be a pretty dumb move if the market instead falls 15% and your cash is all locked up in a house so you can't get in on the ~*~stock sale~*~. Might be a smart move if you suddenly need to move and aren't underwater on your home. Just saying. Edit: I mean, I know I'm kicking myself for paying off my 1.9% car loan instead of investing the money in January. But not really.
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Jun 19, 2014 15:52
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Cultural Imperial posted:Yes, the more you put down, the less you have to borrow thus the less you have to pay the bank for the privilege of borrowing that money. You absolutely want to minimize the amount of money you borrow and you want to pay that mortgage off as quickly as possible. Ever heard of opportunity cost? If you can borrow at 3%, and have a reasonable long term expectation of an average 6% balanced portfolio return - why would you pay off quickly?
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Jun 19, 2014 17:18
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The richest people are the ones who best use leverage. Borrowing to invest can be a good strategy provided you know what you are doing.
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Jun 19, 2014 17:23
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Lexicon posted:Ever heard of opportunity cost? If you can borrow at 3%, and have a reasonable long term expectation of an average 6% balanced portfolio return - why would you pay off quickly? Because unlike every other Canadian, I'm not holding much hope that the housing market is going to land softly. Do you think Canadian portfolio is going to do well in the near future? What about if the housing market starts to go?
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Jun 19, 2014 17:24
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Kal Torak posted:The richest people are the ones who best use leverage. Borrowing to invest can be a good strategy provided you know what you are doing. Yup. Totally agreed.
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Jun 19, 2014 17:24
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Cultural Imperial posted:Because unlike every other Canadian, I'm not holding much hope that the housing market is going to land softly. Canada is like 15-20% of my portfolio. edit: and when the housing market goes tits up, I don't personally think the banks will be overly affected. It's the taxpayer via the CMHC who'll be over a barrel.
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Jun 19, 2014 17:32
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Lexicon posted:Canada is like 15-20% of my portfolio. I hope you've done your homework into how housing bubble collapses affect consumer credit products across the entire spectrum! Canadian banks are going to get hosed, whether or not they get away with offloading all of their risk onto CMHC with no blowback whatsoever. Franks Happy Place fucked around with this message at 17:37 on Jun 19, 2014 |
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Jun 19, 2014 17:35
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Cmon man. Haven't you been following what happened with securitization during the great recession? Do you think institutional investors aren't gonna get hosed when their cds's go to zero? E: Lexicon, this is all beyond my point. I don't think it's prudent for amateur investors to come in here and ask general questions when the real answer is incredibly complicated and gilded with terrible consequences. namaste friends fucked around with this message at 17:42 on Jun 19, 2014 |
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Jun 19, 2014 17:39
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Franks Happy Place posted:I hope you've done research into how housing bubble collapses affect consumer credit products across the entire spectrum! A balanced global portfolio has returned north of 6% over the past 20 years, and that's including 2008 - so you can probably deduce how worried I am about the short term effects on Canadian banks of Johnny Canuck borrowing less money for Silverados in a portfolio with a multi-decade horizon. Not very. I'm fully bought into the belief that this country's housing is hosed - but that's not stopping me investing the way I have for years.
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Jun 19, 2014 17:40
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Cultural Imperial posted:Cmon man. Haven't you been following what happened with securitization during the great recession? Do you think institutional investors aren't gonna get hosed when their cds's go to zero? So I should liquidate my relatively-minor VCN holdings then? And buy what? Gold and tinned food?
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Jun 19, 2014 17:42
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You guys keep advertising a stock sale but it never happens!
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Jun 19, 2014 17:43
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Lexicon posted:So I should liquidate my relatively-minor VCN holdings then? And buy what? Gold and tinned food? Not you. The poor guy who has no idea if it's a good idea to slap 20% down to experience pride of ownership.
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Jun 19, 2014 17:44
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Cultural Imperial posted:Not you. The poor guy who has no idea if it's a good idea to slap 20% down to experience pride of ownership. Well we're clearly taking about different things. I'm just saying: assuming one is buying, and assuming one has at least 20% as a downpayment (take those as baseline facts) then it likely does not make sense to pay any more than 20% once you're over the insurance hurdle. Don't worry, I'm a scumbag renter. Bad investments, especially illiquid ones, would keep me up at night.
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Jun 19, 2014 17:47
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Lexicon posted:A balanced global portfolio has returned north of 6% over the past 20 years, and that's including 2008 - so you can probably deduce how worried I am about the short term effects on Canadian banks of Johnny Canuck borrowing less money for Silverados in a portfolio with a multi-decade horizon. Not very. Hey, if you want to leave 20% of your portfolio exposed to an undiversified one-trick petrostate with a shrinking economy and the world's biggest asset bubble, go hog wild. I just take the view when investing that I should probably, you know, limit exposure to ticking time bombs.
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Jun 19, 2014 17:53
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That's not helpful frank. For a sophisticated investor, absolutely now is the time to be going all Gordon gekko and poo poo on equities. Money is loving cheap as hell to borrow. Margin that bitch son. For a layman, this is hardly good advice, considering their goals are to figure out how to make a life out of this miserable country.
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Jun 19, 2014 17:57
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What, is it illegal for Canadians to buy U.S. and international index funds now? Having to rely on the Canadian economy for employment is all the exposure I am willing to stomach. If I felt some compunction to staying in the TSX, you'd better believe it would be at 10% or less right now.
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Jun 19, 2014 18:02
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Franks Happy Place posted:I just take the view when investing that I should probably, you know, limit exposure to ticking time bombs. You're welcome to take that view. I even agree with you. But I limit exposure via asset allocation, not outright avoidance. It's one thing to be correct about the future outcome of a market; quite another to get the timing right. We had a massive housing bubble in 2010. Yet, staying out of the Canadian equity market between then and now would have been an enormously costly decision; thankfully one I didn't make.
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Jun 19, 2014 18:03
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Franks Happy Place posted:What, is it illegal for Canadians to buy U.S. and international index funds now? So we're really just quibbling over asset allocation then. You say 10, I say 20. Fine.
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Jun 19, 2014 18:04
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Lexicon posted:So we're really just quibbling over asset allocation then. You say 10, I say 20. Fine. I say zero, ten is acceptable, twenty I'm scheduling you an intervention. But yes, this is in the spirit of debate, aka just bullshittin'  Edit: For more content, my biggest objection to the TSX/Canadian indexes is their heavy exposure to banks. Even if you think the bubble could drag on for a while yet, the banks are going to start dropping profits as credit levels max out and people start defaulting on unsecured credit first (there's a ton of research that people give up on their credit cards/LOCs/car loans long before the mortgage goes). So really, to me, the best case scenario is that the Big 5 zombie along for a while, squeezing out ever-declining profits and dragging down the TSX, before finally making GBS threads their pants. Worst case, they poo poo their pants sooner. No thank you. Franks Happy Place fucked around with this message at 18:08 on Jun 19, 2014 |
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Jun 19, 2014 18:05
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Franks Happy Place posted:I say zero, ten is acceptable, twenty I'm scheduling you an intervention. That said in the event of a Canadian recession, speculation will result in a massive sell-off because Canadians are not at all savvy about finances so it will be an excellent time to buy buy buy. cowofwar fucked around with this message at 23:05 on Jun 19, 2014 |
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Jun 19, 2014 23:00
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cowofwar posted:The Canadian banks are massively diversified globally Can you quantify that with numbers?
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Jun 19, 2014 23:43
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cowofwar posted:The Canadian banks are massively diversified globally so you are kind of arguing against yourself. The Canadian equities markets are actually loaded with banks and miners that have international presence and under-represented compared to the United States in terms companies driven by domestic consumption. So the Canadian market in the event of a domestic recession is actually more resilient than one might think. This is pretty much my exact stance. Bolded part especially true.
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Jun 19, 2014 23:43
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cowofwar posted:The Canadian banks are massively diversified globally No they aren't. The most diversified is BNS, who definitely qualify as an international bank with about 30% of loans dispersed internationally and a sizeable retail presence in Mexico and South America. The next highest is Royal, with only 6% of loans dispersed internationally. CIBC and National are almost all Canadian loans (95%+). These are loans, not mortgages, but it serves to demonstrate the strategic differences amongst the banks. TD and Royal have been scaling back retail exposure in the US substantially. CIBC, then BMO, then TD are most exposed to the Canadian mortgage market. Royal is generally known to be most highly exposed to un-insured mortgages, but they tend to be of higher credit quality. You can actually see the market starting to favour BNS starting in about February this year if you use google finance to run a comparison of BNS with RY, BMO and TD. Co-incidence? Who knows. I know one thing, even in the event of a downturn it is stupid to bet against the Canadian banks long term. Look for a place to back up the truck if and when it happens. For example, $24 BNS from 2008 is not only paying a 10% dividend right now, its also grown by almost 150%. That's pretty much the only way to get "richer than you think" with Bank of Nova Scotia ; ) Saltin fucked around with this message at 02:29 on Jun 20, 2014 |
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Jun 20, 2014 00:41
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On the topic of diversification, I currently have a questrade TFSA and my wife is looking to get one off the ground. Do you guys think we'd be better off opening a questrade account for her (and probably buy the same securities I have) or pay the extra 50 basis points for her to purchase something different - in this case, RBC indexes in her existing TFSA? Or would it not make a significant difference?
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Jun 20, 2014 01:49
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Saltin posted:For example, $24 BNS from 2008 is not only paying a 10% dividend right now, its also grown by almost 150%. That's pretty much the only way to get "richer than you think" with Bank of Nova Scotia ; ) Boy do I hate that slogan. "No, no. You're much poorer than you think. Stop borrowing money for cars and consumer goods."
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Jun 20, 2014 01:54
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Rick Rickshaw posted:Boy do I hate that slogan. Yep. I especially like the "here's a loving marching band for paying off your (historically obscenely low rate) mortgage in a hurry".... wait....How's your consumer debt and/or investment portfolio doing? You put all your money where? gently caress the ads, but man has it paid to own them since this time last year, and if you bought on real weakness you are minted right now. You can't beat them, so join them. (not right now) Saltin fucked around with this message at 02:37 on Jun 20, 2014 |
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Jun 20, 2014 02:31
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Saltin posted:No they aren't. The most diversified is BNS, who definitely qualify as an international bank with about 30% of loans dispersed internationally and a sizeable retail presence in Mexico and South America. The next highest is Royal, with only 6% of loans dispersed internationally. CIBC and National are almost all Canadian loans (95%+). These are loans, not mortgages, but it serves to demonstrate the strategic differences amongst the banks. TD and Royal have been scaling back retail exposure in the US substantially. I've done so well on my bank investments that I'm now massively overweight them. Need to sell some down I think. Unsure what I want to buy in this market though.
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Jun 20, 2014 08:38
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Kalenn Istarion posted:I've done so well on my bank investments that I'm now massively overweight them. Need to sell some down I think. Unsure what I want to buy in this market though. I'm kind of in a similar boat. I am too invested in Canada so I'm looking at some other model portfolios to duplicate or base off of. Potato linked to these guys which seem to have several alternative ETF models but they seem pretty weighted in Canada too. https://www.shareowner.com/selecting.html Thoughts? Lexicon posted:A balanced global portfolio has returned north of 6% over the past 20 years, and that's including 2008 - so you can probably deduce how worried I am about the short term effects on Canadian banks of Johnny Canuck borrowing less money for Silverados in a portfolio with a multi-decade horizon. Not very. I am not entirely convinced the Canadian real estate market is going to utterly implode. It's been going to happen anytime now for years. That said, I'm not so comfortable with it I'd be willing to put all my eggs in it by any means. It's treated my family extremely well for my adult life. Not saying it's never going to happen but I'm not losing any sleep over it either. If I were to wake up and my personal house dropped 20% I wouldn't be happy about it, but I'd be far more concerned about the macro impacts. e: That said, if interest rates take a faster turn than has been expected it could get really interesting really fast. slidebite fucked around with this message at 20:10 on Jun 20, 2014 |
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Jun 20, 2014 17:51
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slidebite posted:
Sure. US: VTI International: XEF with a smattering of XEC Beyond some VCN as mentioned, and some bonds (VAB) and REITs (XRE), that's all I hold. I had some AAPL a while back, on which I made a minor profit (would've been much more if I'd held till now), but now I'm down to those 5. It's actually very liberating to have such a simple portfolio.
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Jun 20, 2014 19:14
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Quick question for y'all: I have a Scotia iTrade RRSP account with $200 in it right now (ridiculous, I know). It's clear to me now it's not going to get used and paying $150 year for it is crazy. Is there a way to close the account without paying fees? According to their website the transfer out fee is $150, but there's no account closure fee.
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Jun 20, 2014 20:22
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rrrrrrrrrrrt posted:Quick question for y'all: I have a Scotia iTrade RRSP account with $200 in it right now (ridiculous, I know). It's clear to me now it's not going to get used and paying $150 year for it is crazy. Is there a way to close the account without paying fees? According to their website the transfer out fee is $150, but there's no account closure fee. I think this is a lift the phone moment. You'll want to find out from the horses mouth directly in case there's any edge cases to think about.
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Jun 20, 2014 20:25
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Saltin posted:No they aren't. The most diversified is BNS, who definitely qualify as an international bank with about 30% of loans dispersed internationally and a sizeable retail presence in Mexico and South America. The next highest is Royal, with only 6% of loans dispersed internationally. CIBC and National are almost all Canadian loans (95%+). These are loans, not mortgages, but it serves to demonstrate the strategic differences amongst the banks. TD and Royal have been scaling back retail exposure in the US substantially. There is some info on that that I found in these PWC reports. http://www.pwc.com/ca/en/banking-capital-markets/canadian-banks.jhtml
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Jun 20, 2014 21:20
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