[Doctor_Ed]

I recently converted my various accounts with TD to Direct Investing. With that, the TD advisor drummed me out of his office. I am on my own now.

I have an RIF with 13 different funds plus a bunch of non-registered funds spread over 4 different institutions (TD, RBC, BNS, Tang). My wife is in a parallel situation with an RRSP containing 10 funds. The allocation is very conservative with only about 31% equities. We have some uninvested cash.

I want to get into these accounts and start making changes. My immediate goals are as follows:

- Simplify the portfolio (reduce the total number of funds)
- Improve the tax exposure
- Invest most of the loose cash
- Stay conservative.

I have done some direct investing before, but it has been very intermittent. I feel very green about it. That's why I am asking for advice and confirmation of what I want to do.

As a first step I thought I'd convert all the bond-rich registered mutual funds (mostly TD and Fidelity) to the TD Can Bond Index Fund, but with a portion going into GICs. We have around $300k there. In the non-reg accounts, I will put funds and cash into the TD Can Index Fund to preserve the equities content.

With the accounts we have, I don't think I have access to e funds. It took months to set our accounts up as they are now and I don't mind using them as they are for now. e funds can come later, I'm thinking. I am not too smart on ETFs and don't know if I have access to them.

There's lots more stuff to do with these accounts, but I want to get started, and I'm considering the initial moves as stated. Any comments?

 

[humble_pie]

I recently converted my various accounts with TD to Direct Investing. With that, the TD advisor drummed me out of his office. I am on my own now ...

My immediate goals are as follows:

- Simplify the portfolio (reduce the total number of funds)
- Improve the tax exposure
- Invest most of the loose cash
- Stay conservative.

I have done some direct investing before, but it has been very intermittent. I feel very green about it. That's why I am asking for advice and confirmation of what I want to do.

As a first step I thought I'd convert all the bond-rich registered mutual funds (mostly TD and Fidelity) to the TD Can Bond Index Fund, but with a portion going into GICs. We have around $300k there. In the non-reg accounts, I will put funds and cash into the TD Can Index Fund to preserve the equities content.

drummed you out, isn't that terrible? but it happens all too often. They (advisors) are basically salesmen.

turning now to your immediate goals, are these all within registered accounts? i ask because selling the mutual funds will trigger capital gains/loss tax consequences whenever these are in a non-registered account. One would want to determine the extent of the gain/loss before acting.

i'm no mutual fund expert, so i don't know if your Fidelity funds would have any rear-loading commissions that are still due? this would be another factor to consider when planning to exit the funds. I believe rear loads would apply in both registered & non-registered accounts.

yes you can buy e-funds within a TDDI discount broker account. If you're buying TD index funds, why not go straight to the horse's mouth & buy the e-fund version? you can find the list of e-funds on the TD bank website, under investments.

you can also buy ETFS within any kind of TDDI account. Favourite families for many on here are vanguard, plenty folks go for iShares, fewer seem to be into the BMO ETFs, however the Bimmers are all built somewhat differently from vanguard & iShares offerings, so it's educational to read up on them.

won't you please be prepared to take quite a long time to accomplish all that you have undertaken. Might i suggest a year. Fortunately the markets seem to be drifting sideways so hopefully the probability would be that you would not be losing as you cruise steadily forward.

lastly, TDDI offers webinars (on website) plus live conferences on multitudes of investing topics in all large & medium canadian cities. I believe they have many conferences on ETF investing, the whys & how-tos of it. Might you be interested in attending some of these? you could bring your own personal questions & it's my belief that the TD representative giving the talk will endeavour to help.

wishing you every success.

 

[Doctor_Ed]

Yes, the bond-rich funds I want to consolidate are in the RIF and RRSP. But to preserve the equity content, I will convert some non-registered cash and funds to TD Can Index.

The Fidelity funds are all more than 6 years old and won't have rear-load fees.

 

[humble_pie]

... in the RIF and RRSP. But to preserve the equity content, I will convert some non-registered cash and funds to TD Can Index

but as mentioned, why TD Can Index? why not go straight to the e-version?

 

[Doctor_Ed]

Sorry, checking again re the e funds. I will have a look to see if I can access them.

 

[humble_pie]

of course you can access

https://www.tdcanadatrust.com/produ.../mutual-funds/td-eseries-funds.jsp#what-is-it


scroll down to Take a Look, etc. Click there.

on the next page, scroll down for the list of TD e-funds.

 

[Cal]

I am willing to bet that you can access them too, you just won't get much help from TD with them. It's like they offer them, to say they have low MER funds, but they don't really want you to use them, as TD makes far more off of the regular funds.

I use the e funds for the RESP's....no complaints.

 

[Doctor_Ed]

Thanks Humble and Cal, you guys were right. Did my first transaction today in this new account, converting a non-e to an e fund (Can Index). Now to wait a couple days to see the result, and then onward.

 

[My Own Advisor]

Doctor_Ed,

I echo HP's comments...congrats on taking this step.

I laughed when I read "the TD advisor drummed me out of his office...."

First up, I fully support to simplify the portfolio.

Step 1. Read, lots and ask as many questions on this forum as you wish
Step 2. After done reading, asking questions, yes, move out of bond-rich mutual funds and into TD CDN Bond Index or ideally, some bond ETFs. You probably only need one and then some GICs if you are conservative as you wrote above.
Step 3. As you work through your readings or input here, devise a roadmap to get out of the 13 different funds plus a bunch of non-registered funds spread over 4 different institutions. You need one discount broker. Get your wife out of 10 funds. You likely need 2-4 equity ETFs at the most.
Step 4. Keep some cash and figure out how to create a cash wedge. An excellent book on this is:
http://www.boomersblueprint.com/

I think this is mandatory reading for all aspiring and current retirees.

 

[Doctor_Ed]

The TD guy was good about it. He knew I was keen on getting out of high MER funds and that I had contempt for the suits. But he waited until the Fid and some other funds had passed the 6 year point, making them load free. At that point I was free to reinvest them, and he knew I would go for index funds. He scorned index funds because they are so simple and therefore beneath the financial expert that he is. So he set me free for that reason, plus I'm not paying the suits any more.

Thanks for the tip on cash wedges. This might not be relevant to my needs as I get mandatory withdrawals from the RIF each year. I also have dividends coming in from a small company that I own.