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Help me invest some money :)

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  • Jun 24th, 2005 7:20 pm
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Oct 18, 2003
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Help me invest some money :)

Hey guys, would like to get your take on what I should be doing with our (just got married) money. We are both students, at least for one more year, and after that I will hopefully have a full time job. The money I am looking to put away is the money we got from our wedding. We will probably be looking to use this money for a downpayment on a home in the next 2 years. We have only a smaller amount of about $5000-7000 to invest. It needs to be safe as we cannot afford to lose money right now :) .

I bank with the CIBC and talked to them a bit so I know some of the basic and more safe investments, but I would like your guys take on things and some advice, as many of you have probably tried many different things over the years. I know it is not a lot of money to invest...but it is something...and investing is better then it just sitting in the bank right :) .

If you need more info just ask.

Thanks!
Scotty is a cheap mofo and loves to get a deal!

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Dec 3, 2002
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kinda off topic, but congrats on your marriage. :) You two looked like a nice couple. gl on the investment.. but for 'safe' short-term (two years isn't really a lot of time)... I don't think you can do too much better than ING or PCfinancial.
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put it in an rsp and invest in a zero coupon bond. While inside the rsp, you get an rsp deduction, the zero coupon bond accrues tax free, and once it matures in 2 years you can make a withdrawal under the home buyers plan.

thats the best i can think of since safety of pricipal is a priority. keep in mind though, rates are pretty low for a 2 year ride.
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I hear the "ronny1980 911 turbo fund" gives about 300% yearly returns.

Might wanna look into that.
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15-20_God wrote:put it in an rsp and invest in a zero coupon bond. While inside the rsp, you get an rsp deduction, the zero coupon bond accrues tax free, and once it matures in 2 years you can make a withdrawal under the home buyers plan.

thats the best i can think of since safety of pricipal is a priority. keep in mind though, rates are pretty low for a 2 year ride.
Thanks for the info. I know we aren't going to make a ton of money or anything...but by doing nothing we are just losing money due to inflation. I heard there are some home buyer type investments and that is kinda what we were leaning towards. I will have to look into this zero coupon bond thing more.

If you don't mind...what are some typical interest rates we should be expecting. What would the interest be on this RSP/bond plan? All approximate I understand.
Scotty is a cheap mofo and loves to get a deal!

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ronny1980 wrote:I hear the "ronny1980 911 turbo fund" gives about 300% yearly returns.

Might wanna look into that.
lol...trust me...it would go to the "scotty needs a new car fund" first.
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scottrempel wrote:We will probably be looking to use this money for a downpayment on a home in the next 2 years. We have only a smaller amount of about $5000-7000 to invest. It needs to be safe as we cannot afford to lose money right now :) .
If you have the contribution room, I'd put it in an RSP if you are absolutely sure you'll use it to buy a house. If you're not sure, then don't use the RSP, because then you can't get at your money if you need it (like if you don't get a job after you're done school).

Also, are you certain you "cannot afford to lose money"? Can you afford to potentailly lose 5%? Can you risk a small loss or zero for a potential 10% gain, or are you only prepared to take a maybe 3.5% secure investment (aforementioned bond)? These are questions you really need to know the answers to before you make your decision.

Bond-based mutual funds are good low-risk non-guaranteed investments that can yield better than GICs or AAA bonds. Also, if you're using a non-RSP investment strategy, MFs may save you tax $.
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scottrempel wrote:Thanks for the info. I know we aren't going to make a ton of money or anything...but by doing nothing we are just losing money due to inflation. I heard there are some home buyer type investments and that is kinda what we were leaning towards. I will have to look into this zero coupon bond thing more.

If you don't mind...what are some typical interest rates we should be expecting. What would the interest be on this RSP/bond plan? All approximate I understand.
2.50% - 3.0% tax free, yield depending on issuer.
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scottrempel wrote: If you don't mind...what are some typical interest rates we should be expecting. What would the interest be on this RSP/bond plan? All approximate I understand.
GICs - maybe 3% if you're lucky
Bond MF can go between 3% and 12% example
Individual bonds really depend a lot on the issuer. Government bonds won't differ much from GIC rates, while junk corporate bonds might offer 7-8% with a commensurate risk of losing your principal.
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TheDude79 wrote:Bond-based mutual funds are good low-risk non-guaranteed investments that can yield better than GICs or AAA bonds. Also, if you're using a non-RSP investment strategy, MFs may save you tax $.
loads may be prohibitive for a 2 year holding period, and in a rising interest rate environment bond funds don't look too good.
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TheDude79 wrote:If you have the contribution room, I'd put it in an RSP if you are absolutely sure you'll use it to buy a house. If you're not sure, then don't use the RSP, because then you can't get at your money if you need it (like if you don't get a job after you're done school).

Also, are you certain you "cannot afford to lose money"? Can you afford to potentailly lose 5%? Can you risk a small loss or zero for a potential 10% gain, or are you only prepared to take a maybe 3.5% secure investment (aforementioned bond)? These are questions you really need to know the answers to before you make your decision.

Bond-based mutual funds are good low-risk non-guaranteed investments that can yield better than GICs or AAA bonds. Also, if you're using a non-RSP investment strategy, MFs may save you tax $.
Pretty much 100% sure it will be used for a house...seeing as we don't currently have one. I have survived this long on only a summer job, so once school is over I do not plan on being any worse off then I am now. The only thing I can think of that may arrise is we need the money to pay off teh wife's student loans...but I plan to have that taken care of since I will be out of school a year before her.

I suppose we could afford to lose a little money...I just really hate to lose money lol. My thinking is that we are working with so little money it doesn't matter too much what interest rate we make as there will not be a large difference in financial gain. No use potentially losing money for the chance to make an extra $100. Basically, I just want to do something that will make the most money possible without much risk at all. We are not going to make much...but I just figured leaving it sit in the savings acct would be stupid and lazy of us.
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15-20_God wrote:loads may be prohibitive for a 2 year holding period .
Find a no-load fund... there's lots out there.
and in a rising interest rate environment bond funds don't look too good
True enough, but they're still likely to do just as well as an individual bond bought presently, due to interest accrual on longer-term fund holdings with higher interest rates.
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TheDude79 wrote:True enough, but they're still likely to do just as well as an individual bond bought presently, due to interest accrual on longer-term fund holdings with higher interest rates.
The interest payments on long term debt would be offset by a decline in mkt value of the fund should rates go up. and maturing money in the fund really don't have anywhere to go right now.
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15-20_God wrote:The interest payments on long term debt would be offset by a decline in mkt value of the fund should rates go up. and maturing money in the fund really don't have anywhere to go right now.
Depends a lot on how fast interest rates rise, but then again so do a lot of things financial!
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Send it to me, I'll take care of it for you. :cheesygri
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