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Discussion Starter #1
I have been with a Financial Adviser for a few years and he is a decent person. That said, some of the MF's he has suggested haven't been the best. The high MERs plus the pending HST in Ontario (plus this website) have got me thinking about switching things up.

If I wanted to go Self-Directed with my RRSP, what would be the best route?

If I transfered everything to TD Waterhouse Discount Brokerage Self-Directed RSP, who gets the MERs? How do I figure out exactly when the DSC have expired?

I have a ton of other related questions, but I'll wait until some of you weigh in on the subject.
 

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The fund companies still get the Management fees. TD Waterhouse will be paid the trailer fees. To find out when the DSCs on your funds expire, there are several things you can do. You determine it from your account statements, assuming that you know how many years the DSC is supposed to apply; you can call TD Waterhouse; or you can call the fund company. Even though the funds are no longer held in an account in your name, you still own the funds through your nominee (TD Waterhouse), so you should be entitled to information from the fund company.
 

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The easiest route for going on your own is referred to as the "couch potato" portfolio which typically consists of index funds with 25% CDN equity, 25% bond, 25% US equity and 25% international equity. You would regularly rebalance if one index outperformed the others. I personally, would favour a higher ratio towards CDN equity and less towards US and international, but that's a personal choice.

This can be easily set up with TD "e" funds which have MERs in the neighbourhood of 0.3% for their index funds.
 

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You can transfer all your holdings over in kind (as opposed to in cash) and then progressively buy more index funds with your fee-free units (assuming you have DSCs on some or all of your funds).

You will always have some free units even in a freshly DSC'd fund.
 

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Discussion Starter #5
Getting Back Trailer Fees

Thanks for the info. I would be looking to transfer my MF holdings at the start without selling them.

I was leaning the TD Direct Brokerage way simply because I dealt with them many moons ago (had some Disney stock which I had to sell to build a fence :( ) and the simplicity of the TD eFunds.

Regardless of what I do with new investments in ETF or whatever, I suspect I will have MFs for a long time yet.

I know Questrade has the Mutual Fund Maximizer Program that gives you back the trailer fees (minus a cut). People seem to have a real strong "love them"/"hate them" opinion on Questrade. Is there any other company that has a program like this to maximize the portfolio? Or is that just a red-herring too?
 

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Thanks for the info. I would be looking to transfer my MF holdings at the start without selling them.

I was leaning the TD Direct Brokerage way simply because I dealt with them many moons ago (had some Disney stock which I had to sell to build a fence :( ) and the simplicity of the TD eFunds.

Regardless of what I do with new investments in ETF or whatever, I suspect I will have MFs for a long time yet.

I know Questrade has the Mutual Fund Maximizer Program that gives you back the trailer fees (minus a cut). People seem to have a real strong "love them"/"hate them" opinion on Questrade. Is there any other company that has a program like this to maximize the portfolio? Or is that just a red-herring too?
I am sorry to hear this. I hope that you will do better going forward.

It is sometimes difficult to unwind the damage that the average financial planner does to an individual's portfolio.

Good luck!
 

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Regardless of what I do with new investments in ETF or whatever, I suspect I will have MFs for a long time yet.
Arcaneind, I find myself in a similar situation, nice guy Financial Advisor who really, outside of some interesting face to face chats, hasn't offered a whole lot of value outside of selling me some DSC 2.41% MER mutual funds a couple years back.

I'm in a similar situation, looking to move my money out of these funds and into a low cost ETF.

I'm considering on the anniversary date, breaking out of this fund, eating the associated fee (about 1500) and moving to a self-directed (TD eFunds perhaps) account.

Have you considered eating the penalty cost of the MF to move into another vehicle?
 

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The Questrade "Maximizer" program is only appropriate if you are looking at staying in retail mutual funds.

If you stick with e-Funds or ETFs, you can get your cost to participate down low enough that getting the MERs rebated will not make anywhere near as much difference.

You should run some scenarios to figure out when the cost of the penalty is offset by the lower fees of ETFs to help figure out when to make your moves.

(I remember doing this for a client who moved to our brokerage after his previous broker put all $2M of his funds into crappy DSC funds. Woot! What a nightmare.)
 

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Discussion Starter #9
You should run some scenarios to figure out when the cost of the penalty is offset by the lower fees of ETFs to help figure out when to make your moves. QUOTE]

"When" would be the question. Will the MF companies give me that info or do I have to fight them for it? Is there a "catch phrase" report that I can request from C.I. or Mackenzie than gives all the specifics for my account?
 

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The MF companies will give you that info. You will need to phone each company and ask them about the status of your units:

- how many fee-free units (that can be sold without penalty)
- what the remaining DSC charges are (by percentage and by dollar value)
- the DSC schedule (calendar dates and rates: i.e., your DSC anniversary is June 19, you hold 112 units of this fund, and if you sold them now you'd incur a 4% penalty, which moves to 3.5% next year, then 3%, then 2%, then 1.5%, then 1%).

You must also ask if the dollar value of the DSCs is based on their current value, or the value at the time of purchase. Very important distinction!
 

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Discussion Starter #11
Thanks Moneygal. That's great information for finding out the fees and alike. I will have to get all my stuff together and make some calls.

That said, I'm not really any closer to where I should go with my self-directed RRSP. It seems that the big bank-owned brokerages all have a minimum $28 commission until you have over $100,000 in assets (except for Scotia iTRADE which is $20 until > $50,000).

Has anybody dealt with National Bank's Direct Brokerage before?
 
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