4 top financial planners on big money mistakes, RRSPs and the best investment they ever made
A Postcity.com Partnership
With RRSP-contribution season in full swing — March 1, 2018 is this year's deadline for a contribution to be eligible for a credit on your 2017 tax return — Torontonians are looking for financial advice.
Where are interest rates going? What are the biggest investment mistakes people make? What financial considerations should we be paying more attention to?
We put these questions (and more) to four top financial planners. Here's what they had to say:
The McClelland Financial Group Assante Capital Management Ltd.
Robert McClelland, Vice President, Co-Branch Owner
7787 Yonge Street, Thornhill, 905-771-5200
What’s your top Canadian bank stock? I would prefer to own all five of the major banks.
What is the first piece of advice you give new clients? The first piece of advice is to ignore all of the noise around financial markets. Trust that the markets and the plan will work over time.
What are the biggest mistakes you see (investment, management, taxes)? The biggest mistake investors make is they are impatient. Today a great example with novice investors is them chasing Marijuana stocks and crypto currencies. This will not end well.
Is it better to invest in a RRSP or your home? That is a difficult question to answer as each individuals situation is unique. Owning your own home is a great investment and tax strategy (tax free growth of your principal home). Having money in your RRSP is a great way to start saving for retirement because of the tax savings you receive.
What are the key items to insure your financial success?
1. Have a plan.
2. Stick to the plan.
3. Save regularly.
4. Diversify as much as possible.
5. Keep your fees low
6. Review your plan regularly.
Should I only focus on my rate of return? Return and taxes are equally important over time.
Who is your financial mentor/hero? Eugene Fama-Nobel Prize Winner and the father of modern finance.
CIBC Wood Gundy
Duarte Barcelos, BA, PFP®, Senior Private Banking Advisor
150 Bloor Street West, 416-306-9137
Why Yorkville? People want to deal locally, people are retiring here.
How would you describe your team? Our team is made up of highly experienced and motivated financial professionals working within an integrated office. We’re proud that we can all come together to achieve one goal, to put our clients’ needs first.
What makes your service offering unique? Our ongoing focus on partnership and a holistic approach to wealth management. Managing the big picture and executing on the day-to-day, while managing our partnerships. We all work together to meet the end goal of all our clients’ needs.
What does your branch do best? Advocate for clients. If we can’t provide the answers, we’ll find someone who can.
What’s your favourite thing about Yorkville? The vibe, energy and history in the area. It attracts business people, residents, shoppers, students and tourists yet it still feels like a community.
What interests you the most about your field? Meeting clients, problem solving & looking for opportunities. Every day is new and unique.
What is the Integrated Wealth Management Approach? We take a comprehensive approach to managing, building and protecting your wealth. Your wealth and aspirations are unique and command a personalized approach, including access to experts who can assist with life’s most significant decisions.
High Rock Capital Mgmt.
Scott Tomenson and Paul Tepsich, Managing Partners
1 Toronto St., Suite 210, 416-642-5707
What is the first piece of advice you give new clients? To stick to the long-term Wealth Forecast and Investment Policy Statement we create for them when they join High Rock.
What are the biggest mistakes you see (investment, management, taxes)? New clients who transfer into High Rock from an Investment Advisor tend to have 100% of their money in stocks and expensive mutual funds.
What can my kids do early on to set themselves up for financial success? Start with a Wealth Forecast so they can understand the power compounding. If they are 18 or older they should have a TFSA. If they are under 18, they should have an "In Trust For" set up so they can start and convert to a TFSA when they turn 18.
How do you manage risk? We run regression models that compare historical returns, risk and correlations between diffierent asset classes to calculate assets we believe have the strongest risk-adjusted returns. We manage risk first and foremost - returns are the result of well-managed risk.
What is your education? We hold the highest levels of education in the investment management industry: a Chartered Financial Analyst, a Chartered Invesment Management, and a Certified Financial Planner. Combine that with the fact Paul managed $13bln of risk at Merrill Lynch and Scott has spent over 35 years as a senior bond trader and an Advisor/PM.
Diana Dowhaluk, SR. VP. Investment Advisor
675 Cochrane Drive, Suite 700, Markham, 416-512-3656
Best investment you ever made? Buying in the dip in 2009!
What is the first piece of advice you give new clients? To do an asset allocation analysis of your portfolio.
What are the biggest mistakes you see (investment, management, taxes)?
1. Clients not minimizing their tax burden.
2. Clients not being aware of the fees they are paying.
Is it better to invest in a RRSP or your home? It depends on the client and if they need the tax deduction that comes with investing in an RRSP. RRSP's still provide a tax sheltered vehicle and it's a nice nest egg to build for your future.
What can my kids do early on to set themselves up for financial success? Open a TFSA in order to get their feet wet with investments and learn about making money grow.
What is the biggest fear on the horizon? Interest rates rising rapidly.
What’s happening with interest rates? Interest rates are rising, albeit slowly. The Bank of Canada, U.S. Federal Reserve and Bank of England raised interest rates in 2017.
Gold or Bitcoin? Neither. I like to buy good value companies that pay out good cash flow and have dividends that grow over time.