Investing

Couch potato investing for the last 18 years - tracking my progress

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Deal Guru
Feb 4, 2015
10328 posts
6693 upvotes
Canada, Eh!!
Charles wrote: do you pay taxes on profits earned if the same stock is held over a year in canada? stupid question i know...but i recall reading about that a while ago..it may have been USA
Canada has same rate on capital gain, not matter if short or long term hold [different then USA].
2022/3: BOC raised 10 times and MCAP raised its prime next day.
2017,2018: BOC raised rates 5 times and MCAP raised its prime next day each time.
2020: BOC dropped rates 3 times and MCAP waited to drop its prime to include all 3 drops.
Deal Addict
Jul 15, 2009
3647 posts
3043 upvotes
TuxedoBlack wrote: Because of this and for the basic fact that I want to keep things quite simple, I've decided to use TD e-series mutual funds only for my non-registered accounts.
Don't TD e-series mutual funds also have return of capital and reinvested distributions?
Deal Addict
Jul 8, 2013
4498 posts
6934 upvotes
Somewhere in AB
bubak wrote: Don't TD e-series mutual funds also have return of capital and reinvested distributions?
Possibly, but from what I know, mutual funds track it more accurately.
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Deal Addict
User avatar
Feb 1, 2012
2213 posts
3798 upvotes
Thunder Bay, ON
bubak wrote: Don't TD e-series mutual funds also have return of capital and reinvested distributions?
Mutual funds have reinvested distributions but they handle it differently. Here is something from the Globe and Mail that explains it:
John Heinzl: More fun with phantom ETF distributions
Mutual funds also pay reinvested distributions, but they handle the math a bit differently. Investors receive additional units in the fund, but the price (or net asset value) of the units drops to reflect this. The total value of the investor's holdings (number of units multiplied by their price) remains the same, just as with an ETF.
Mutual funds can handle reinvested distributions that way because they can issue partial units, thus enabling all of the distributions to be reinvested down to the cent. ETFs can't do that since they don't issue partial units, they cannot reinvest all of the distributions, so they must handle it in a way that adjusts the unit owners' cost base up rather than increasing the number of units held.

I'm not sure if mutual funds handle RoC the same way. I do not hold any e-Series funds but I do hold two Mawer and one TD mutual funds. I don't recall any of them ever reporting RoC.

TD Asset Management has a document on RoC that indicates it typically only issues RoC on "TD Cash Flow Series/TD Monthly Fixed Pay Solutions", i.e. funds like T-Series that are designed to pay a fixed distribution even if it means returning the unit holders' own capital. Those funds are typically targeted at investors such as retirees that need steady income even if it means eroding their capital (or their kids inheritance). See the table at the top of p.3 in this document:
https://www.tdassetmanagement.com/docum ... ool_en.pdf

RoC should be easy to spot since it gets reported in Box 42 of the T3.
When I was young, I was poor. Now, after years of hard work, I'm no longer young.
Deal Addict
Apr 5, 2017
1115 posts
233 upvotes
Hi folks,
I have an investment account with TD direct investing, could you please let me know what is the best thing to buy now towards my RRSP and kids RESP.
I have $30,000 cash in RRSP and $20,000 cash in kids RESP account, sitting there as cash since 2 year's or so ?
I'm 33 years old, so retirement will be only after 25-30 year's. I won't be having any pension from work once I retire. My kids are 6, 4 and 15 months old.
My mortgage balance is 336000. My first 5 year renewal is coming on Dec 2020, can I take some kind of equity, HELOC and invest in a second home (rental) ?
Kindly share your ideas and suggestions.
Newbie
Dec 28, 2008
64 posts
Hi all!

Hope you are keeping healthy!!!

I have a question for the peeps who know more than I do. I have some e series finds with TD. I’m invested rather aggressively. I do have time but I’m worried I might need to access them and they have gone down a lot. I’m not doing PPP at the moment so I’m not buying. Are any of you moving your investments into something safer? If so what?

TIA
Jr. Member
Jun 17, 2018
123 posts
100 upvotes
Hamilton, Bermuda
ljones20 wrote: Hi all!

Hope you are keeping healthy!!!

I have a question for the peeps who know more than I do. I have some e series finds with TD. I’m invested rather aggressively. I do have time but I’m worried I might need to access them and they have gone down a lot. I’m not doing PPP at the moment so I’m not buying. Are any of you moving your investments into something safer? If so what?

TIA
I think most people on this thread would agree it's not really the time to move to something safer. Markets have gone down sharply already. Expected return going forward is now higher. I'm not realizing any loss, but will add new funds when available and average down my cost...

If your equity allocation has shrunk faster than your bonds allocation, it might be time to rebalance.
Now if you expect to need the funds any soon, they shouldn't have been invested in equities in the first place...
Newbie
Dec 28, 2008
64 posts
Thanks for your input. I’m just worrying and not thinking straight. It never occurred to me to just rebalance. Duh. I wouldn’t have needed it if I was still working but things are so uncertain at the moment... So they don’t anticipate anymore losses? Isn’t that a little premature?
Newbie
User avatar
Jan 8, 2018
69 posts
10 upvotes
TORONTO
MK1986 wrote: Hi folks,
I have an investment account with TD direct investing, could you please let me know what is the best thing to buy now towards my RRSP and kids RESP.
I have $30,000 cash in RRSP and $20,000 cash in kids RESP account, sitting there as cash since 2 year's or so ?
I'm 33 years old, so retirement will be only after 25-30 year's. I won't be having any pension from work once I retire. My kids are 6, 4 and 15 months old.
My mortgage balance is 336000. My first 5 year renewal is coming on Dec 2020, can I take some kind of equity, HELOC and invest in a second home (rental) ?
Kindly share your ideas and suggestions.
Rental homes are always a good idea for cash flow purposes. I would speak with your accountant or advisor before borrowing anything, especially in the time we are in now.
We run a family business so no such thing as a pension with us as well.
Deal Fanatic
Mar 24, 2008
6278 posts
2753 upvotes
Toronto
MK1986 wrote: Hi folks,
I have an investment account with TD direct investing, could you please let me know what is the best thing to buy now towards my RRSP and kids RESP.
I have $30,000 cash in RRSP and $20,000 cash in kids RESP account, sitting there as cash since 2 year's or so ?
I'm 33 years old, so retirement will be only after 25-30 year's. I won't be having any pension from work once I retire. My kids are 6, 4 and 15 months old.
My mortgage balance is 336000. My first 5 year renewal is coming on Dec 2020, can I take some kind of equity, HELOC and invest in a second home (rental) ?
Kindly share your ideas and suggestions.
What is your and your spouses income level? Contributing to RRSP (or not) will be based on that answer. Have you maxed out your TFSAs? Max those out before you think of putting any more money in your kids RESPs. I would also encourage you not to borrow to invest as that is very risky. Do you have an emergency fund? I'd recommend to put away at least $5,000 in a high interest savings account for emergencies.

In terms of investing the money that you currently have saved up, you should open an e-series account at TD and invest in a balanced portfolio. Look at option 2 on this page. Good luck!
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Deal Addict
Apr 5, 2017
1115 posts
233 upvotes
User698854 wrote: Rental homes are always a good idea for cash flow purposes. I would speak with your accountant or advisor before borrowing anything, especially in the time we are in now.
We run a family business so no such thing as a pension with us as well.
Unfortunately I don't have an accountant nor an advisor :)
Deal Addict
Apr 5, 2017
1115 posts
233 upvotes
ksgill wrote: 1)What is your and your spouse's income level?
Mine is around $100K & my wife works only part time and brings around 25-30K.

2)Contributing to RRSP (or not) will be based on that answer.
Yes this year, I had contributed $15,000 CAD. Not yet started for my wife.

3)Have you maxed out your TFSAs?
No TFSA's yet as I have zero knowledge in investments.

4)Do you have an emergency fund? Yes I do. Around $20-$25K. Have some funds in home country as well (Around $40K CAD).

5)In terms of investing the money that you currently have saved up, you should open an e-series account at TD and invest in a balanced portfolio. Look at option 2 on this page. Good luck!
I have TD direct investment account, that where my RRSP and RESP money is hanging around as cash.
Deal Addict
Mar 16, 2018
1529 posts
2457 upvotes
Hamilton
The past week has been a dramatic reminder of how employment and the financial markets can be so tightly linked and why it's so important to have a liquid emergency fund. I work in healthcare, so I'm not going anywhere, but seeing vast swathes of my city laid off at the very moment my investment account was wiped out really drove that message home in a way that's been difficult to verbalize in the past.
Deal Expert
User avatar
Dec 12, 2009
29536 posts
20456 upvotes
ownthesky wrote: The past week has been a dramatic reminder of how employment and the financial markets can be so tightly linked and why it's so important to have a liquid emergency fund. I work in healthcare, so I'm not going anywhere, but seeing vast swathes of my city laid off at the very moment my investment account was wiped out really drove that message home in a way that's been difficult to verbalize in the past.
The current situation is really bad. It is worse than having layoffs in economic bad times. People can at least go out and try to look for work. Right now, anyone laid off due to covid-19 can't really go look for work. What sectors are hiring and will do interviews?
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Deal Addict
User avatar
May 23, 2008
2417 posts
3847 upvotes
Toronto, Ontario
Hey all, quick question about RESPs:

I have just under $22,000 in an RESP at BMO for my 12-year-old nephew. $7,000 of that is in a Target Education 2025 fund, $9,000 is in a SelectTrust Balanced Portfolio, $5,000 is in GICs. Right now, I have it set up to transfer $75 every two weeks into the Target Education fund (which has only lost $200 in value compared to the $1000 that SelectTrust Balance has lost).

I'm wondering if I should switch the automatic transfers to the RESP savings account for the time being or just leave everything as is and let dollar cost averaging sort it out.
Deal Addict
Dec 19, 2009
1955 posts
2985 upvotes
Ottawa
Great thread.
Admittedly haven’t read through the whole thing so this may have been addressed somewhere.
I am intrigued by a “passive” investing approach but I have some questions for the approach that many other couch potato style investors would take in a downturn like we are currently in:
- do you buy more in times like this? Or stick with the strategy of dollar cost averaging and not worry about buying more when the market is down?
- do people keep much money on the sidelines for times like this? Or are you almost fully invested at all times...taking the approach that’s its “time in the market” not “timing the market”.
- do people rebalance in downturns or just ride it out?

Also, curious as to what people think of this article as it relates to passive investing?
https://thefelderreport.com/2020/03/18/ ... -now-face/

In my short investing journey so far (less than 2 years) I would say I’ve been more influenced by a value investing approach where you buy seemingly undervalued businesses with a buy and hold approach. However I have several friends that are true passive investors and it makes a lot of sense.
Deal Addict
Oct 1, 2006
3249 posts
4472 upvotes
Montreal
Hi @mikek33 Since I am always fully invested I cant just buy more in times like this, except for my regular monthly purchase. For my regular monthly purchase I purchase the asset class furthest away from its target allocation.
Newbie
Dec 19, 2019
9 posts
7 upvotes
What is current recommendation on bond etf? Vab or zag?

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