Author Topic: RRSP Full, pay 10 bucks to reinvest distributions?  (Read 1752 times)

human

  • Pencil Stache
  • ****
  • Posts: 791
RRSP Full, pay 10 bucks to reinvest distributions?
« on: October 12, 2017, 05:55:51 PM »
So I never really thought of this problem as I started investing in my RRSP. I have no more contribution room left and got a distribution of about 200 bucks. I'm with BMO, I don't want to pay 10 bucks to reinvest this, I normally invest a couple of thousand at a time. What can I do here?

Going forward I assume I could set up DRIP, would that cause any tax problems? I assume not am I right? I'm real dumb about what can be done in each account without getting screwed in tracking etc.

human

  • Pencil Stache
  • ****
  • Posts: 791
Re: RRSP Full, pay 10 bucks to reinvest distributions?
« Reply #1 on: October 12, 2017, 06:13:28 PM »
Thanks Ben, I guess a whopping 200 bucks not invested won't hurt my returns all that much this year!!

Heckler

  • Handlebar Stache
  • *****
  • Posts: 1346
Re: RRSP Full, pay 10 bucks to reinvest distributions?
« Reply #2 on: October 12, 2017, 11:23:57 PM »
Set up DRIP.  Just call BMO to do it.

With BMO, it can only be done with $CAD funds, not USD. You will still end up with cash leftovers.

powersuitrecall

  • Pencil Stache
  • ****
  • Posts: 510
  • Location: Ontario, Canada
Re: RRSP Full, pay 10 bucks to reinvest distributions?
« Reply #3 on: October 13, 2017, 08:45:01 AM »
I'm with TD, but here's what I do.  I take my distributions plus my yearly contributions and invest in efund mutuals as per my asset allocation (there is no cost to buy/sell these at TD).  Once a year I sell the efunds and add to my ETFs.  The fees on the efunds are higher (~0.5%), but I feel it's worth it to stay invested and avoid a bunch of trade charges.

The other option is to go with Questrade where ETF purchases are free.

thriftyc

  • Bristles
  • ***
  • Posts: 410
  • Age: 46
  • Location: Somewhere just west of Toronto
  • Used to be thrifty canadian/thriftycanuck
Re: RRSP Full, pay 10 bucks to reinvest distributions?
« Reply #4 on: October 14, 2017, 06:55:47 PM »
DRIP is the way to go.... Use new contributions as your main rebalancing mechanism.
« Last Edit: October 21, 2017, 06:22:51 PM by thriftycanadian »

powersuitrecall

  • Pencil Stache
  • ****
  • Posts: 510
  • Location: Ontario, Canada
Re: RRSP Full, pay 10 bucks to reinvest distributions?
« Reply #5 on: October 20, 2017, 10:54:29 AM »
I know this is not my thread, but I'd like to thank everyone for the indirect nudge.  I called today and turned on DRIP for all my ETFs at TD.  So simple.  It makes much more sense than complicating things with eFunds.

Cheers!

human

  • Pencil Stache
  • ****
  • Posts: 791
Re: RRSP Full, pay 10 bucks to reinvest distributions?
« Reply #6 on: October 21, 2017, 01:00:19 AM »
Ughh thanks for the reminder I still haven't done it!!!!!

thriftyc

  • Bristles
  • ***
  • Posts: 410
  • Age: 46
  • Location: Somewhere just west of Toronto
  • Used to be thrifty canadian/thriftycanuck
Re: RRSP Full, pay 10 bucks to reinvest distributions?
« Reply #7 on: October 21, 2017, 06:23:30 PM »
I know this is not my thread, but I'd like to thank everyone for the indirect nudge.  I called today and turned on DRIP for all my ETFs at TD.  So simple.  It makes much more sense than complicating things with eFunds.

Cheers!

I use TD for my ETF's as well, super easy to have the drips reinvested, no cost.

GreatLaker

  • Stubble
  • **
  • Posts: 139
  • Location: Canada
Re: RRSP Full, pay 10 bucks to reinvest distributions?
« Reply #8 on: October 21, 2017, 07:23:24 PM »
I invest my distributions in either a broker HISA or low fee balanced index mutual fund.

Here are two articles on broker HISAs:
http://www.canadiancapitalist.com/high-interest-savings-accounts-at-discount-brokers/
http://canadiancouchpotato.com/2010/10/12/parking-cash-in-your-portfolio/

They are savings accounts that you purchase in broker accounts like shares of a mutual fund. Interest rates are not great but better than nothing.