Author Topic: Looking for advise from fellow Canadian mustachians  (Read 1127 times)

Coco365

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Looking for advise from fellow Canadian mustachians
« on: March 21, 2018, 12:14:08 PM »
Hello fellow Canadian mustachians,
Ive been lurking the forum for a while reading on ways to save and invest as I want to FIRE. I am a novice when it comes to investing and would love to pick your brains on this portfolio as I want to start investing now
1.   EQ bank cash savings account at 2.30% - available cash for unexpected events.
2.   TFSA and RRSP maxed out and invest in the following portfolio:
Fund   Allocation   Type
VTI   35%   Equity
VUS   30%   Equity
XHC/IXJ   10%   Equity
XSH   20%   Bond
IEMG   5%   Equity
3.   Non registered investment unsure how to invest remaining cash any ideas will be welcomed. Ive read about swap based etf ( HSX.TO) but not sure how it will help or if its the best way to invest the fund
Does the above plan seem solid (Im in mid 30s)? Or should I consult a financial planner to build a plan for me was thinking of fee only based advise.
Any advice or insights will be appreciated

Cheers

Tawcan

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Re: Looking for advise from fellow Canadian mustachians
« Reply #1 on: March 21, 2018, 12:52:56 PM »
Maxing out your TFSA and RRSP is a great start. For taxable investment, why not just keep it simple and stay with the same allocation as your TFSA and RRSP?

One thing I'd say is perhaps to look at Canadian based index ETFs so you don't have to worry about currency conversion.

Coco365

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Re: Looking for advise from fellow Canadian mustachians
« Reply #2 on: March 21, 2018, 01:04:17 PM »
Maxing out your TFSA and RRSP is a great start. For taxable investment, why not just keep it simple and stay with the same allocation as your TFSA and RRSP?

One thing I'd say is perhaps to look at Canadian based index ETFs so you don't have to worry about currency conversion.

Does the portfolio allocation look right for the registered accounts? I did some research and came up with those ones so im not sure if they are the best one i can use to allocate funds

Wouldnt i be paying more taxes for the non registered if i go with the same portfolio?

RichMoose

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Re: Looking for advise from fellow Canadian mustachians
« Reply #3 on: March 22, 2018, 09:43:45 AM »
Not sure how big your accounts are, but it's probably not worthwhile to use US-listed ETFs as Tawcan states. US-listed ETFs used to be better than Canadian ones because the fees were so much lower. However, fees here have come down significantly to the point where it's hardly worth the currency conversion hassle.

On the allocation specifically, here are some thoughts:

1. You're basically duplicating VTI when you buy VUS.TO, so why buy both?

2. You are very heavily tilted to US stocks. VTI + VUS.TO = 65% of your portfolio plus XHC.TO is 70% US as well. That adds up to ~72% US stocks.

3. XSH.TO is a corporate bond product. Corporate bonds yield a bit more, but they act more "stock-like" in a recession than government bonds. If you went with the bonds for portfolio stability, as opposed to yield, then XSB.TO or VSB.TO could be a better choice.

4. Your international exposure is very low at just 8% of your portfolio and all of that is Emerging markets or healthcare stocks.

5. Swap ETFs are pretty great products for international exposure (HXS.TO) and bonds (HBB.TO). If you're seeking some Canadian stocks, swap ETF (HXT.TO) is only better if you are low income with several kids (to max your CCB) or if you earn over $92,000 per year. If you're not in those categories, then XIC.TO or something similar is better.

Heckler

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Re: Looking for advise from fellow Canadian mustachians
« Reply #4 on: March 24, 2018, 03:04:15 PM »
VTI and VUS are essentially the same. Do you mean VTI and VXUS?