Author Topic: For Mom - Canadian WFG Life income Fund  (Read 1368 times)

CDN_Dreamer

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For Mom - Canadian WFG Life income Fund
« on: February 01, 2018, 08:10:36 PM »
120k invested in this Canadian Balanced (QV) :(
https://files.ia.ca/-/media/files/ia/placements/en/ecoflex/ecoa-fu553p.pdf

Invested through WFG. I've never really looked into these before but it seems to be jam packed with all sorts of fees.
We can move this LIF out of world financial group to at least avoid those fees? Can be moved / converted to a TD Bank RIF?
Better options?

Bit of context
66 years old, 10k Savings + the usual government pension, no other income or debt.
« Last Edit: February 04, 2018, 07:36:57 AM by CDN_Dreamer »

Miss Piggy

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Re: For Mom - WFG Life income Fund
« Reply #1 on: February 02, 2018, 08:16:08 AM »
I don't mean to be rude, but your post/link looks a little spammish. You're brand new; you have very few posts; and this post contains very little information other than a link and a company name, and no full sentences. It raises a few red flags for me.

If this is a legit post, can you share a little more about what you're asking?

CDN_Dreamer

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Re: For Mom - WFG Life income Fund
« Reply #2 on: February 02, 2018, 04:06:31 PM »
Sorry for the spammish looking post, not my intention. The link is just to  the fund overview, I cannot seem to paste it here nicely because it is a PDF.

I'm new (at best) to LIF's, what they can hold, if they can be converted or moved or just re-invested in vanguard, etc...
This one fund in particular is what my mother has, at the suggestion of a world financial group "adviser".
The fees seem really high to me and I'm seeking advice on what her options may be.
The fund makes money but after the MER's, advisor fee, WFG fee her balance is almost guaranteed to drop. I think these "guaranteed" income funds are federally regulated and locked in? There must be a better way, that's what I'm after.
« Last Edit: February 02, 2018, 04:34:17 PM by CDN_Dreamer »

snapperdude

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Re: For Mom - WFG Life income Fund
« Reply #3 on: February 02, 2018, 06:26:16 PM »
I don't mean to be rude, but your post/link looks a little spammish. You're brand new; you have very few posts; and this post contains very little information other than a link and a company name, and no full sentences. It raises a few red flags for me.

If this is a legit post, can you share a little more about what you're asking?


I don't think he is doing spam correctly if he is calling out the linked fund for high fees and is looking to get out of it.

Miss Piggy

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Re: For Mom - WFG Life income Fund
« Reply #4 on: February 03, 2018, 12:26:44 PM »
Life Income Fund...is that a Canadian thing? Kind of like an annuity? (Sounds like it based on the name, but it's not something I'm familiar with. Then again, maybe it's just the name of a mutual fund?)

The returns sure don't look very good to me. That said, I don't typically look at Canadian returns. And maybe this is simply a very conservative fund.

Do you have any details about all of the fees your mom is paying? I see some percentages listed on the PDF, but you mention other fees as well.

CDN_Dreamer

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Re: For Mom - WFG Life income Fund
« Reply #5 on: February 04, 2018, 12:01:22 AM »
If you're not familiar with these products, that's OK. Perhaps someone else will chime in to help.

Miss Piggy

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Re: For Mom - WFG Life income Fund
« Reply #6 on: February 04, 2018, 07:29:33 AM »
Agreed. We have many Canadians on this forum...please chime in!

(Actually, OP, perhaps you can change your topic title so it's clear you need advice from Canadians...they'll be more inclined to click.)

RichMoose

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Re: For Mom - Canadian WFG Life income Fund
« Reply #7 on: February 04, 2018, 02:32:22 PM »
120k invested in this Canadian Balanced (QV) :(
https://files.ia.ca/-/media/files/ia/placements/en/ecoflex/ecoa-fu553p.pdf

Invested through WFG. I've never really looked into these before but it seems to be jam packed with all sorts of fees.
We can move this LIF out of world financial group to at least avoid those fees? Can be moved / converted to a TD Bank RIF?
Better options?

Bit of context
66 years old, 10k Savings + the usual government pension, no other income or debt.
Yes, an awful high fee product typical of Canadian mutual fund and insurance companies. Get her out as fast as you can!

I'm assuming by LIF you meant that she had a LIRA or Locked RSP and it's converted due to her age? If so, you can start a self-directed LIF at most brokerages. Here we tend to gravitate to Questrade, but National Bank Direct has really stepped up their game if your purchases will consist of 100 units or more.

In a self-directed LIF, you will be able to invest in any ETF or mutual fund or other security of your choice. Here most of us use ETFs and follow a Couch Potato portfolio. Some (like myself) invest in ETFs following more active strategies. As a Canadian you cannot invest directly in Vanguard like U.S. clients can.

Vanguard has a new group of ETFs which have just been released that basically do the Canadian Couch Potato for you. This means you only buy one ETF and don't do any re-balancing or adjustments. https://www.vanguardcanada.ca/individual/etfs/about-our-asset-allocation-etfs.htm

CDN_Dreamer

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Re: For Mom - Canadian WFG Life income Fund
« Reply #8 on: February 04, 2018, 04:02:05 PM »
Thanks! Will check into questrade. What about TD bank, could do the same with her existing account & add webbroker?

It originated as a pension I think, from the large telecom that went bankrupt. It couldn't be cashed out as far as I know. Had to be invested.

It is through ia financial group, product is called, "Ecoflextra - LIF".
There is a minimum income withdrawl ($4240) and a max ($7649)
I see a $250 quarterly fee, I think is just to the WFG sales agent.

Rate of return since 2012 is %2.89 - I feel bad I didn't look into this sooner :(

RichMoose

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Re: For Mom - Canadian WFG Life income Fund
« Reply #9 on: February 04, 2018, 04:27:48 PM »
Thanks! Will check into questrade. What about TD bank, could do the same with her existing account & add webbroker?
You could also open an account with TD Direct which is another online self-directed brokerage. It works like Questrade but they charge more.

It originated as a pension I think, from the large telecom that went bankrupt. It couldn't be cashed out as far as I know. Had to be invested.
Makes sense then, yes was likely a Locked-RRSP at one point, or if she was over 55 when the pension folded it could have gone straight into a LIF account.

It is through ia financial group, product is called, "Ecoflextra - LIF".
There is a minimum income withdrawl ($4240) and a max ($7649)
I see a $250 quarterly fee, I think is just to the WFG sales agent.
Rate of return since 2012 is %2.89 - I feel bad I didn't look into this sooner :(
Ignore the branding. Ecoflextra is just a stupid name that is designed to sound sophisticated to dummies. It's really a LIF.
A LIF has minimum withdrawal rules that are age depended and line up with the rates of an RRIF. Here's a quick schedule so you can get an idea: http://www.investingforme.com/withdrawals

The $250 fee is probably an account fee. With Questrade you pay $0 for the same. What matters is the MER (the hidden management fee embedded into the product). If I'm reading it right, the MER is a whopping 3.16% with this product in a LIF. That means if the underlying investments return 10%, you actually only see 6.84%. It's why the fund is drastically underperforming. Your mom would have been better off investing directly in government bonds...

The agent will get the $250 fee plus probably around 1.5% of every dollar your mom has with them every year. (Around $1,800).