This handy guide can help you start investing in registered retirement savings plans or suggest ideas you may not have considered.
DIY investors need an overall portfolio strategy
- Your portfolio should include both stocks and bonds. Tradition says the percentage of stocks in your portfolio should be equal to 100 minus your age, but long lifespans have prompted some experts to say 110 or even 120 is a better starting point in the calculation.
- Most online brokers offer asset allocation tools to help you plan your portfolio.
- See the benefits of a diversified portfolio using our investing calculators.
If you want a low-maintenance portfolio, choose mutual funds or ETFs.
If you're more hands-on, choose stocks or bonds.
Consider funds from
- Beutel Goodman
- Phillips, Hager & North
- Leith Wheeler
- TD e-series
Some of these fund families require minimum investments of $5,000 or more. But there is usually no fee to buy them, and the continuing fees are lower than average.
Three things you need to know about ETFs:
- They trade like a stock, so you need a brokerage account to buy them.
- You'll have to pay brokerage commissions to buy and sell them, although some brokers waive commissions on ETFs.
- There are hundreds of ETFs available — look for funds that have low fees and track widely followed indexes.
You can cover the investing world with as few as four ETFs spanning these core categories:
- Canadian stocks
- U.S. stocks
- International stocks
Consider blue-chip dividend growth stocks such as the ones you'll find here:
In addition to low-cost bond mutual funds and ETFs, check out guaranteed investment certificates as an alternative to individual bonds — they offer better yields, with deposit insurance.
- Compare rates using our Savings Rate and GIC comparison table.
The quick and dirty approach
Go to your bank branch and ask to buy the following:
- A dividend fund
- A Canadian bond fund
- A global equity fund
Consider including some GICs as well, but only if you can get a bonus of half a percentage point or more over the quoted rate.
Use tools to find an adviser:
Having someone manage your investments for you makes sense if you don't have the necessary time or knowledge. Advisers should also provide help in estate and tax planning, and managing debt. Use tools like these:
A financial plan created by your adviser should consider your age, your current investments, your savings and debt, and your goals for retirement, as well as your strategy for helping your children cover their college and university costs.