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National Post online GIC Rate Guide listing
January 6, 2016
11:37 am
Bill
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If you go to the link below you'll see National Post's online listing of today's GIC rates and I notice Peoples Trust is way off, near the bottom. So now I wonder about the whole list. Anybody have any observations / comments?

http://www.financialpost.com/p.....nnual.html

January 6, 2016
11:41 am
Bill
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Never started a new topic before and don't know how to do it right, that's why the incorrect reference to Implicity Financial - sorry.

January 6, 2016
11:45 am
kanaka
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Bill. Click Add Topic.....not Add Reply to do a new topic entry. Maybe a moderator can move this for you.

Good find. I always use the one below. The one you found is missing Implicity and Hubert and the one below is missing Implicity.

http://www.globeinvestor.com/s.....ndicator=N

I always verify to the financial institutions web site before investing.

January 6, 2016
11:47 am
Peter
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Bill said

Never started a new topic before and don't know how to do it right, that's why the incorrect reference to Implicity Financial - sorry.

I've moved it now :)

January 6, 2016
1:52 pm
Bill
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Thanks, kanaka, the Globe's looks better, at least regarding Peoples. I use these lists to order them by yield and only consider the top few, so I wouldn't have noticed Peoples as it was too far down the list (it's just that I happened to notice Peoples wasn't near the top and I knew it should be).

I know, but the Add Topic button is nowhere to be seen on my screen unless I'm already in another forum, then it's there beside Add Reply - ?? (And thanks for cleaning up, Peter.)

January 6, 2016
3:00 pm
kanaka
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Bill said

Thanks, kanaka, the Globe's looks better, at least regarding Peoples. I use these lists to order them by yield and only consider the top few, so I wouldn't have noticed Peoples as it was too far down the list (it's just that I happened to notice Peoples wasn't near the top and I knew it should be).

I know, but the Add Topic button is nowhere to be seen on my screen unless I'm already in another forum, then it's there beside Add Reply - ?? (And thanks for cleaning up, Peter.)

On the Globe Investor one....if you click the 1 2 3 4 or 5 it will sort highest to lowest for you. sf-laugh

January 6, 2016
4:15 pm
AltaRed
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So does the Financial Post one.

January 6, 2016
4:42 pm
Loonie
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I haven't looked at these lately, but have found in the past that they are never completely up to date. In particular, they tend not to pick up promo rates. I would only use them as a general guideline as to what's out there.

January 6, 2016
8:07 pm
AltaRed
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I don't look at them at all since I only buy GICs through one of my 3 discount brokerages and they give me the convenience of their full list as part of the Trading page.

January 6, 2016
8:21 pm
kanaka
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AltaRed said

I don't look at them at all since I only buy GICs through one of my 3 discount brokerages and they give me the convenience of their full list as part of the Trading page.

But aren't the brokerage GIC rates a bit lower....they do make commission on GICs.

January 6, 2016
8:45 pm
AltaRed
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Sometimes they are a bit lower, but not always. I just don't believe in proliferation of accounts (my executors/attorneys will thank me sf-wink).

It is my understanding issuers pay brokerages a commission of 25bp to sell their GICs.

January 6, 2016
8:54 pm
kanaka
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AltaRed said

Sometimes they are a bit lower, but not always. I just don't believe in proliferation of accounts (my executors/attorneys will thank me sf-wink).

It is my understanding issuers pay brokerages a commission of 25bp to sell their GICs.

Yes I agree. I have decided to sell my stocks all off on iTRADE at "my" price and buy from the variety of GICs they have. The best 5 yr is 2.4 which is only $1 less per 1000 per year.

January 6, 2016
11:05 pm
Loonie
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The differences between rates at varius institutions might be more significant if rates were higher in the first place - may it be in our lifetimes!

kanaka, I am curious about your decision to sell off all stocks in due course. I am wondering how you came to this conclusion, as I am constantly struggling to decide if I want to get INTO any stocks, and I am in your age range. My ability to survive financially is not dependent on higher returns, but, on the other hand, I am concerned about currency risk (being almost entirely in loonies), inflation risk, etc. Every decision has risk of some sort, seems to me. Do you have any insights you'd like to share about your decision-making? (It's OK if you don't want to talk about it publicly.)

January 7, 2016
6:57 am
Bill
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AltaRed, discount brokers have a limited selection of GIC issuers, in my experience (RBC Direct, TD Direct).

Loonie, though rates are low the relative differences remain, e.g. the difference (25%) between a 2.5% and a 2% rate is the same as between a 5% and a 4% rate. And I'm sure kanaka has some good advice but you are right, there's no way around risk. To give just one example from my long investing career, I bought some very solid, supposedly very well valued blue chip stocks (Enbridge, TransCanada Pipe, Canadian Utilities, as well as others not in energy) last year with very good, solid dividends and I'm down 20% or even more on these stalwarts, losing more almost every day with no prospect of a quick turnaround what with the price of oil, China's implosion, global economic stagnation, and the global move to get off fossil fuels which seems to be picking up every day, which is not good for Canada's economy, at least yet. (Darn it, I forgot about the macro picture!!) A 5% dividend is small consolation to me when I'm down 25% or more on the stock value (put the hankies away, I'm ok, done pretty good over the years and have only a small portion of my dough in stocks). But I've found that if one is not ready, I mean really ready, to write off any stock investments (even though the odds of it happening are small, it does happen), then it's an emotional drain that is unnecessary IF you're already comfortable. You might consider what I usually do, which is pay about 1% a year for a very good balanced global mutual fund - last year I think I still netted about 8% pre-tax on mine, zero time spent. (And I wouldn't worry about currency risk or inflation as long as you don't leave the country and don't lock up money for more than a year or so - you can always roll funds over as rates go higher.) But, as the ancients said, "those whom the gods wish to destroy they first infect with greed." (sorry if I've said this before, it's my favourite quote!)

January 7, 2016
1:44 pm
Loonie
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I appreciate your thoughts and experiences, Bill - and relieved I haven't been through the last year on the markets. I don't have an especially tough constitution.

The stickler for me remains inflation and currency risk, which, for my purposes, are almost one and the same. I would like to do some travelling but can't do it right now due to family concerns and may never get to it.

I may be wrong, but I see inflation looming large as a possibility due to our ever-sinking dollar. I think TPP will also be a factor, but others may not. At the very least, we haven't had inflation for a long time, so we're probably about due, as these things tend to come around every so often anyway. The question, given my suspicions, becomes what to do about it.

I was looking at my notes about real return bonds yesterday, but it seems they are only advised for longterm protection and within registered plans, whereas I am worried about the next few years and am more concerned with non-registered although could do either.

The only other protection I can think of is that, although my OAS and CPP started a while ago, we have decided to postpone spouse's until age 70. We can afford to do this; all four parents have lived to 93+; and I view it as a kind of inflation fighter because it will be worth a lot more later in income - just in case inflation gets to be more than I'm comfortable with. Hard to beat 36 and 42% over 5 years! I realize there's a loss on the short end but it matters less to me as I know we can get through that OK and I am looking for nice steady income streams for the future when I am perhaps less able to manage things myself (and more vulnerable to being financially "managed" by people less conservative than myself!). I am monitoring the situation annually in case it makes sense to take the OAS, given the clawback and potential future income, and may change that decision before 70. Fortunately, you have about a year's leeway to reconsider applying.

The other possibility, especially for the non-registered funds, is annuities, but this is a bad time to buy them (although could get worse!) and I think we are not old enough yet for this to be a good deal, so would postpone that to 70+.

It's hard to be one's own financial planner, having no professional background in it and knowing that most people make decisions they later regret. But, still, I have even less faith in most of the financial planning industry! All the advice says it's essential to find someone you "trust" and "feel comfortable with" but I have never found one who meets these criteria. They all have faith in something that I don't share. The only way they can make good money off me is if they are wealth managers who charge an overall fee, but with those people you have no say in the investment decisions but it still costs you 1%+ annually, which is an awful lot in this climate. And, amazingly (to me), there is no quality control or guarantee whatsoever. If they fail, well, too bad for me. I can't think of any other business that operates this way. In my view, compensation should be linked to benchmarks and returns. If they're going to say you're paying for the advice, as they do, then there needs to be some measure of quality of the advice, but I have never heard of any yet.

I think you have a good idea with your balanced fund, Bill. You mentioned it earlier, and it has certainly been very reliable. The problem with most managed funds is that they either don't really do any managing to speak of (the portfolios tend to look suspiciously similar and/or they simply invest in their other funds!) or they don't do it very well and/or they charge too much for not doing much.

January 7, 2016
5:14 pm
AltaRed
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Bill said

AltaRed, discount brokers have a limited selection of GIC issuers, in my experience (RBC Direct, TD Direct).

Agreed. Depending on broker, 10-20 issuers.

Regarding your recent experience in stocks, what matters ultimately is length of time in the market. Granted you bought some stuff at pretty high valuations (multiples) in 2015 but 5 years from now, you likely won't remember that and 10 years from now, you certainly won't remember. Between now and then, you will continue to have dividend growth, if not every year, every few years. Dividend growth that meets or exceeds inflation is what retired folk need.

Not trying to sell anyone on being a stock picker but having some skin in the equity market in some way, e.g ETF or low cost mutual funds (index or low cost provider like Mawer), is pretty much an essential component in any portfolio.

January 7, 2016
7:53 pm
Bill
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Loonie, as you note, you see a downside to every single alternative you mention. That's what is meant by risk, and it's completely unavoidable when you have extra money. You currently are living with currency and inflation risks, according to you, so to me the decision for you is whether or not you want to reduce some of those two perceived risks by exchanging them for some different risks. They say diversification is good, I hear.
I've heard some people say that stocks work out in the long run, don't worry about short-term ups and downs, but it all depends. For example, the market peaks of 1920s were not revisited again until the 1950s and in the meantime a lot of people could have used that lost money. Same with real estate - my father-in-law's grandfather bought a farm in Uxbridge in 1885 and in the 1950s, after World Wars and the Depression, that same farm sold for about the same amount as in 1885. So, rightly or wrongly, I don't pay much attention to what the investment, real estate or other financial industry folks say, I just don't believe their clichés because, never mind their obvious self-interest (we all have to make our money), history has shown anything can, and eventually does, happen. We just don't know what and when, plus we don't know how long we'll live, so it's a bit of a crap shoot.

January 7, 2016
8:23 pm
Norman1
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Bill said

If you go to the link below you'll see National Post's online listing of today's GIC rates and I notice Peoples Trust is way off, near the bottom. So now I wonder about the whole list. Anybody have any observations / comments?

http://www.financialpost.com/p.....nnual.html

The copyright at the bottom of the table is

© Fiscal Agents Financial Information Services

So, the Financial Post table data from Fiscal Agents, an Ontario deposit broker. The Peoples Trust rates in the Financial Post table agree with those shown on the table on Fiscal Agents' own web site.

Those rate are probably the rates one would receive if one bought the GIC through Fiscal Agents instead of directly from Peoples Trust. Peoples Trust's rate page has this note:

These rates are not applicable to agents. For agent rates please contact Peoples Trust Agent Services Department.

January 8, 2016
6:48 am
Bill
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Norman1, you are correct. If you go to Fiscal Agents site you will see those much lower rates available for Peoples on their listing. So much for using a deposit broker!

The GlobeInvestor GIC listing (link provided above by kanaka) comes from Cannex, and it shows the same rates as Peoples shows on its own website.

Incidentally, I have often wondered how one would prove to CDIC what deposits you have with a financial institution that goes belly-up so I phoned CDIC and they told me you don't do anything, you don't make a claim, they just pay out based on the listing of accounts and balances they get from the bankrupt. So we are relying on the failed institution's records. Apparently CDIC has an appeal process if you disagree and they will "launch an investigation" (impressive!). I told CDIC that I have never received a single statement or similar document from some of these online banks (e.g. Peoples) and for all I know some of these institutions could be just a few guys sitting in a room (I have no idea where, so I can't even go down there and grab my money back) working the phones or chatting online. Plus I don't keep paper records forever, maybe a few years or so, and then it's in the fireplace so I'd have no complete trail of transactions to prove the latest statement I've printed off is not counterfeit. She said don't worry, no problem. I immediately felt much better, the government (in this case a crown corporation) has assured me everything's under control.

January 9, 2016
1:06 am
Loonie
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Bill - re: your post #17- I have to agree with you, but I don't have to like it!

For what it's worth, I knew someone who got their money back from CDIC in the 1970s when one of the trust companies went under. It took a few months but it came on its own.

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