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Manulife Advantage Account
April 12, 2014
4:51 pm
xxxx
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Those are great returns from your ETFs.
My brother was also big into ETFs particularly US markets and he did amazing. I think I will explore ETFs for next investments – perhaps sell some of the bank shares now and try ETFs.
My basket of bank common shares plus other common shares which I bought a year ago have given me a total capital gain to date of about 12% or so over the last year plus all the dividends, certainly not as good as your ETFs but I am satisfied. (certainly better than daily high interest accounts or GICs)
(Actually, as I recheck my figures, I see that 5%-6% return was incorrect and understated – eg I bought BNS at 56 and it is now about 64 and similar % gains on the other bank shares and less gain with other common shares I bought.)
Would be nice if we can count on the same level of gains on the bank shares/ETFs for the upcoming year!

April 13, 2014
8:37 am
GS1
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kanaka said

I like and will consider for sure. XDV so far has been good for me.
I recently purchased a mutual fund AIM58203 as per below in my RRSP. I know a mutual fund……I should not have!
http://quicken.intuit.com/inve.....chievers-A
Consists of.
https://www.invesco.ca/publicPortal/portal/retail.portal?_nfpb=true&_nfxr=false&_pageLabel=fund_card_page_label&brand=powershares#page3
https://www.invesco.ca/publicPortal/portal/retail.portal?_nfpb=true&_nfxr=false&_pageLabel=fund_card_page_label&brand=powershares#page6
It appears that this mutual fund consists of 2 American ETF funds. I have reconsidered and will no longer buy mutual funds because of the MER and the fact you really never know what your selling price is. But both my wife and I liked what was held in the funds. I see that INVESCO offers some products as both ETF and Mutual Fund but not this one. I am wondering if anyone knows of an ETF that would be similar to AIM58203 that is TFSA eligible.
Sorry if this is in the wrong forum.

Kanaka:

I just took a look at AIM58203 at Fundlibrary.com . I use it to discover where a fund ranks in the category and to compare fees.

A quick look shows it gets a "D" for FundGrade where "the FUNDATA FUNDGrade is a Mutual Fund rating system that is based upon independent measurement of risk, performance, and consistency. A fund must be strong in all three areas relative to its benchmark and to its peers in order to receive a good grade. The best selection would be an "A" fund."

It's performance has been in the 4th (or 3rd) quartile for the 3 month through 3 year range of its existence. It's MER is 1.89% where the MER, is the aggregate of all expenses related to the fund operation, including management fee, custodian fee, transaction fee, etc, on a percentage term over the net asset value of the fund.

So, without wanting to sound too judgmental, my question would be, "why buy a fund that is in the bottom half of it category from a performance standpoint and likely the top half of its category from a fee perspective?

I used to buy Mutual Funds, often buying poor performers with higher costs. Then I discovered all the tools out there to help me make good buying decisions. So, then, when buying Mutual Funds, I limited my purchases to those funds that were in the top two quartiles of performance and had lower fees than their counterparts.

I built a quick screen at my RBC DI site and used the following as criteria:

Fund Category: Global Equity
3 mo, 1, yr, and 3, yr returns - middle to highest
Load fees: no load
Expense ratio: Lowest to middle

That screen left 5 funds out of the 472 in the category.

They were four RBC funds and a TD Bank fund TDB304. I then looked at RBF1630 and invite you to compare it to what you are currently invested in. (Disclaimer: I do not own, nor have any interest in RBC or TD funds.)

Hope this helps!

Greg

April 13, 2014
7:11 pm
kanaka
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Greg....thanks my AIM is going soon!! It was going to happen soon anyways. My wife was disappointed to hear it had a D rating. I cant believe I have the similar tool in my iTrade account as well. I guess I don't play with it enough!!! And I should have checked AIM on my iTrade before I accepted the solicited offer from my adviser. I tried to mimic your search but did not narrow down as well as yours. So tell me....
I could find this in iTrade - Fund Category: Global Equity
What category did you use for this => 3 mo, 1, yr, and 3, yr returns – middle to highest
I could find this in iTrade - Load fees: no load
What category did you use for this as it appears I don't have => Expense ratio: Lowest to middle

They were four RBC funds and a TD Bank fund TDB304. I then looked at RBF1630 and invite you to compare it to what you are currently invested in.

I guess I need to play around more on iTrade for ETF's for sure.

Regards Peter

April 14, 2014
8:53 am
GS1
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Peter:

My RBC DI screen has selections for Fees and Management Criteria (Expense Ratio, Minimum investment, Load fees, Management fees are sub-crteria) and for Performance Criteria (Category Rank and a bunch of periodic returns are sub-criteria). When I select various levels, the tool updates the number of returns one might see. So, if my initial criteria is Global Equity I might see "500 matches". As I then add each criteria the match count reduces. Sometimes when I have 100 matches and add, say, lowest fees and highest returns my match count goes to zero.

I also use Fund Library to dig out this sort of information. Another tool I use is Morningstar.CA where I get lots of good info.

I have done lots of playing with the various tools to get well versed on what I need to know for me.

Greg

December 30, 2015
9:31 pm
Saver-Mom
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Given Brian's recent post in the TFSA thread, noting 3% for registered daily interest accounts, do you regulars still stand by your advice to avoid this bank?

December 31, 2015
3:38 am
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I looked at that ManuLife offer too, with interest.

I decided not to pursue it. It's only a short-term offer. I forget the details now, but it was just for a few months.

If you are transferring a TFSA in from another institution, you will almost certainly face delays this time of year, which will reduce the amount of time you will qualify for the offer. Such delays vary in length but can take more than a month.

If you already have all your cash ready to move into ManuLife directly (not by TFSA transfer), then you can do it quickly and will get more from this deal. This might appeal to people who did the 'December manoeuvre', which doesn't include me.

However, the most any of us are likely to have in our TFSAs at this time if we've been investing in savings or GICs is probably less than $50,000. With the 3% deal, I would consider that I was getting 1% more than I could get elsewhere. 1% on $50,000 for X months is not a huge amount of money (and many people will have less). There will almost certainly be a transfer-out fee when you choose to exit ManuLife, which will almost certainly be at the end of the current promo, which cuts into your gain as well. In addition, there may also be a transfer-out fee from one's current institution.

So, having deducted transfer-out fee(s), made allowances for delays in transfers, and considered the relatively small impact on $50,000 or less of 1% for X months, and the nuisance factors of moving the money twice, I felt it was not worth it to me. I don't know what their transfer-out fee is but would not be surprised if it were $100 although could be less.

I also think it's unlikely that any other institution will offer more than 3%. So this led me to the conclusion that any institution that offers it is really wagering that you will find it a pain to move your money out at the end of the offer, and they will be hoping to keep your money and/or entice you into other investments with them, in other words a loss leader. That would be the reason they are offering it (as opposed to the strategy of non-registered savings at Tangerine, which is a retention strategy). I think this is likely to be especially true of ManuLife because they are mostly an investment and insurance business, not so much savings accounts. At least that's the way I think of them.

So, if 3% is not really very useful, then the better promo, if any, would be for a GIC, if one were interested in a GIC.
With a GIC, you know you may have to pay a transfer-out fee (particularly since you would be depositing in January and unable to take advantage of December manoeuvre), but, over a period of X year(s), it may still be worth your while if the deal is good enough. I always assume there will be a transfer-out fee at the end even if it does not yet exist because they often introduce them in the middle of one's GIC term, when one has no option (which should be illegal IMO!).

The best deal would be if the institution where you currently have your TFSA would offer you a better deal to keep it there and add your 2016 contribution. Not too likely right now probably, but worth asking nonetheless. Let them know this is what we want!

I think kanaka is the reigning expert on ManuLife's deficiencies, so perhaps he will comment...

December 31, 2015
6:05 am
xxxx
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true, Loonie, 1% may not be much, as you say, but
1.) it is non-taxable which may equate to perhaps as much as 2% (on a taxable basis) for many Canadians.
2.) also interest rates most likely are going to decrease in Canada through 2016 so 1% non-taxable may not be far from what other institutions will offer as 2016 proceeds and the Canadian economy continues to weaken
3.) also it is likely the Liberal govts (Ont and Canada) and NDP govt (Alberta) will have to consider raising taxes - their spending plans will not be sustainable without considerably increasing their deficits / debt - so 1% non-taxable may look not so unreasonable.
4.) Manulife is a very large and high-rated financial institution so it does not normally need to pay the higher rates of say Peoples, Oaken etc. Guess they are trying to attract / build up TFSA product clients with this promo.

December 31, 2015
11:24 am
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from what I can tell, you cannot open this account by yourself. I asked my advisor and for whatever reason, does not have access to this institution. If there is a way other than 'courtin' a new advisor, I would like to hear.

December 31, 2015
11:35 am
Loonie
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Your points are valid as far as they go, Brian (although I don't know what said governments are going to do about taxes, especially since Federal Liberals just lowered my rate), but, overall, I still wouldn't bother with it personally due to all considerations combined. The value of the 1% as a untaxed benefit depends on one's tax bracket. In my tax bracket, that's worth less than $50 in 2016, which has to be balanced with the other considerations. In this case, 2016 is effectively all that matters as we probably won't get more than 2% next year, and 2% of 50 is one lousy dollar.

I agree with your last point, that it is likely designed to pull in more customers for the future. However, right now, nobody who has had their TFSA in GICs or savings has reached anywhere near the CDIC limit, and won't for several years, so the alleged advantage of the larger institution doesn't matter much.

I actually really like the smaller banks with higher rates within CDIC limits. Even if they should fail and we are bailed out by CDIC, CDIC would be able to manage it, precisely because they are small.

Are you going to go for it yourself?

December 31, 2015
11:59 am
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2of3aintbad said

from what I can tell, you cannot open this account by yourself. I asked my advisor and for whatever reason, does not have access to this institution. If there is a way other than 'courtin' a new advisor, I would like to hear.

This would not surprise me. The point of such a promotion is to build up their business, and, as I said before, they are not very active in retail banking per se.

kanaka, where are you?

December 31, 2015
12:46 pm
kanaka
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Loonie said

2of3aintbad said

from what I can tell, you cannot open this account by yourself. I asked my advisor and for whatever reason, does not have access to this institution. If there is a way other than 'courtin' a new advisor, I would like to hear.

This would not surprise me. The point of such a promotion is to build up their business, and, as I said before, they are not very active in retail banking per se.

kanaka, where are you?

I think kanaka is the reigning expert on ManuLife's deficiencies

I'm here. Brrrr it is cold outside!

From what I understand you have to have a Manulife advisor to get a Manulife bank account. In a previous post I should that then advisor gets $400 for every account they open. If you have a "good" adviser, which I don't, I can see some value to moving RRSP, TFSA or RRIF cash into the account to hold until you next investment and possibly it is easier to move funds from the Manulife account to one of your other personal accounts. But I have no issues not having a Manulife bank account and having funds moved to a personal account (RRIF or RRSP withdrawals). I never have that much cash in my RRSP account to get a decent amount interest from a Manulife bank account as when next GIC matures it is reinvested and the cash in my account is added to the GIC.

I guess there are theories why Manulife and the adviser would prosper by offering "it all" with the idea the client would be more loyal. But remember the old saying "Don't put all your eggs in one basket".

I have GICs with the adviser but none are from Manulife and also one mutual fund and one ETF and neither are Manulife products as he is not pro Manulife in regards to their products.

I am very close to the target value I need to sell off the mutual fund and who knows when the ETF will be at the desired value. I don't get it, the dropping price of oil doesn't reflect at the gas pumps but knocks the you know what out of the value of the Loonie and impacts on the value of shares. Would it not all improve if the Saudis would stop pumping for awhile? :)

But once the sales are done Manulife will be history with my wife and I.

And I think I mentioned earlier. The mutual funds we have bought, sold, and rebought others have made the MER and the adviser a fine and constant salary while doing little for me. In a quick review a month or so ago with my wife I showed her mutual funds we sold off about 10 years ago that made little to nothing.....pretty much flatline...we sell off and buy others...the flavour of the day that gives the adviser a trip to Jamaica.....and one has done well and the other 4% but will loose on both if I sell. Maybe the trips and perks aren't happening now but know up until a few years ago it was happening. And there is not doubt in my mind we were short changed buying a shoddy product that was suggested or recommended that was totally driven by the perk and our naive trust. Only if an adviser would not be influenced by perks and do a good job and build his portfolio by word of mouth. So in hind site if I had an adviser selling GICs , Oaken, or the Manitoba institutions were around decades ago and I had invested in guaranteed rates like 5 year GICs 4% to 18% I feel I would now be better off for acquired funds for retirement. I wish I had the fortitude years ago to go on my own to invest, as with an adviser there are just too many "money grabs" between the investor and the product purchased. Now retired...going on my own.....damn....that hindsight. ;)

So for new or newer investors.
Manulife and others
Mutual funds,...front end fees, back end fees....no cost to buy or sell.....you never know what the exact price is until you buy or sell.
Ask your adviser some do not charge front end and if back end often the fund drops the fee once you own it for 6 or 7 years......Know what you are buying.
Shares ETFs etc.
You can set the buying and selling price BUT Manulife charges $150 to buy and another $150 to sell.
Advisers intentionally set up one or the other to pay dividends into your cash account to pay for annual self directed fees.

December 31, 2015
12:59 pm
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Loonie - I took advantage of Manulife Bank's recent 2.5% 90 day GICs (not TFSA) so that suited me at the time. Otherwise, I have had MUCH better TFSA returns over the years with Cdn common bank shares, quality pref shares, Bell, Telus etc. - than these current TFSA bank/CU rates so NO I will not bother with this TFSA promo. (I do my investing myself with a discount broker) I only put this promo info out for information for others (realizing there is a negative attitude towards Manulife expressed by some in this forum.)
Re opening account and GICs at Manulife Bank - I only had to open my original Advantage Acct several years ago through an agent - there was no cost or fee to me and it was done in 10 minutes.
Once it was opened I only deal with Manulife directly - never with the agent.
Unfortunately Manulife has dropped its daily interest rates now to 1% so I do not deal much with them - will do so when a promo appeals to me - same as you and others are doing with the various institutions.

PS yes, Loonie, you are getting a tax cut from Federal in 2016 but let's see in a year or so what other "taxes" get increased or deductions lowered. Already, your TFSA (tax free) returns have been lowered by the Liberals by lowering the TFSA limit from 10K to 5500.

December 31, 2015
2:04 pm
Loonie
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Thanks for checkingi, kanaka. Sounds like you haven't dealt with them for TFSAs.
Does anyone know what the transfer-out fee is for TFSA at Manulife?

I think we're all agreed that it comes down to money more than the name of the institution per se.

Taxes, tax-like fees, surcharges, tax credits, and user fees are always in flux, not to mention reducing public services resulting in individuals having to pay more out of their own pockets.

I remember, a long time ago, when Harper said he was going to simplify taxes so that it would be difficult to reduce your taxes by qualifying for this or that. But, like every other PM before him, he found it was to his advantage to blur the realities and cater to some more than others by adding or keeping various provisions to tweak what people actually pay, the TFSA being one of them.

I expect the current PM will do the same. It is, however, quite complex to weight all of these provisions, simply because there are so many of them and each one is a little different. This is what keeps us scrambling!

December 31, 2015
2:40 pm
Saver-Mom
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Thanks guys! I agree with kanaka, have never made anything in mutual funds and am happy to invest conservatively by myself, with good advice from you pros. Ok, will keep looking for new promos!

December 31, 2015
3:46 pm
kanaka
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Loonie said

Thanks for checkingi, kanaka. Sounds like you haven't dealt with them for TFSAs.
Does anyone know what the transfer-out fee is for TFSA at Manulife?

I think we're all agreed that it comes down to money more than the name of the institution per se.

Taxes, tax-like fees, surcharges, tax credits, and user fees are always in flux, not to mention reducing public services resulting in individuals having to pay more out of their own pockets. I remember, a long time ago, when Harper said he was going to simplify taxes so that it would be difficult to reduce your taxes by qualifying for this or that. But, like every other PM before him, he found it was to his advantage to blur the realities and cater to some more than others by adding or keeping various provisions to tweak what people actually pay, the TFSA being one of them.
I expect the current PM will do the same. It is, however, quite complex to weight all of these provisions, simply because there are so many of them and each one is a little different. This is what keeps us scrambling!

Last I checked RRSP transfer out is $150. Assume TFSA would be same.

December 31, 2015
6:12 pm
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I called and asked, the clerk said there were NO fees to transfer out RRSPs and TFSAs. That they do NOT cover any transfer in fees. And that yes, you have to deal through an adviser.

January 1, 2016
1:33 am
Loonie
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Perhaps I don't know where to look but I couldn't find any statement about fees on ManuLife site. Nor could I find any info about this offer (or anything at all about rates for that matter). Maybe it came by email?

If you are thinking of dealing with them, make sure you get a copy of the Terms and Conditions and Fees BEFORE you sign up. Read these, then decide.
I would not trust info over the phone for this as you have nothing to back you up if there has been a "misunderstanding".

January 1, 2016
2:43 am
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Agreed, thanks, and I am following your lead and avoiding this one....keep us posted if you have recommendations for this new year and deposit-season. Happy new year!

January 1, 2016
7:47 am
Loonie
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Personally, I'm not too hopeful that we are going to see much in the way of offers this season in TFSAs. I hope I'm wrong.
A lot of people pre-programme their banking so that the deposit to TFSA is scheduled for Jan 1 (this year that may turn out to be Jan 4), so, if an institution wants to make an offer, they should have it on the table already.

ManuLife may be as good as it gets. You can probably make a few extra bucks with it if you want to take the time and put up with the mandatory advisor interview. For me, not worth the inconvenience.

If nothing else comes up in the next few days that is worthwhile, I'll probably stick with Peoples, as I'm there already. Can't afford risk of declining stock market even if dividends stable, although I did have a mutual fund once and made reasonable money on it - about 30 years ago! It was sheer luck, as I didn't know what I was doing but quit while I was ahead.

Transfer-out fees are a major hindrance to moving the account unless you are looking at longer term or liquidated your previous plan last year.

GICs can be an alternative to a savings account for those who don't expect to need to access the money any time soon. A reasonable compromise might be the 1 year cashable at Hubert. Divide your deposit into smaller amounts so that you can cash the portion you need and keep the rest invested with no loss of interest. It's best, financially, to cash it right after the quarterly interest deposits, should you need the money.

None of this is going to keep up with inflation this year, even without paying income tax on it, from what I can see.

January 1, 2016
8:50 am
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Loonie - fyi the Manulife Bank site does contain the interest rates on all their products as well as service charges. I was going to post the link, but will not as I see this is not of any interest.
As I indicated, I also am not interested in the Manulife Bank TFSA as I can do better elsewhere - but one would earn close to 2.5% on an annual basis tax-free if one put in their deposit Dec 1 for the six months @ 3% daily interest and then getting only 1% daily interest for the rest of the 6 months. As you say, for some of us these returns are just not worth the bother.
I also have not seen any TFSA promos as yet for 2016 so I do agree it is likely to turn out to be a low interest rate year.

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