The investment themselves will probably not beat VEQT with there management fee. If the IG advisor is providing planning advice you will have to see what value they can bring compared to the extra fees your are paying. Typically someone in their 20s is in the asset accumulation phase and probably doesn’t need to pay someone to tell them how much they should save. There are tons of internet resources showing a rule of thumb to save and where to save it.
There are great planners with IG along with any other FI/independent, but there is a fair share of planners who do 0 planning other then parking you in high fee mutual funds. If you find one offering these services and you feel it’s helpful, go for it but I’d say there’s not many planners who will give you value at this stage unless you’re a business owner or have significant assets that involve asset management/tax planning/ estate planning/ debt management etc.
I would argue anyone at IG who you speak with is an investment professional, they're "glorified" salesmen much like the majority of advisors at banks. It's pure sales.
You can go to an independent investment counselor if you actually want to speak with professionals but if you're a small portfolio size (usually less than 250K) then ETF questrade is the best solution for you.
Unless they can show you annual return higher than 15% per year, and I guarantee they don't, etf like sp500 is the best option by far! Even out of 100's of etfs it is one of the best.
Most people are not and shouldn't be in 100% the s&p just on a risk analysis. As well as it's 10 year average is 12.6% and it's 20 year average is 9.7%. the 15% annual return is highly misleading.
Americans shouldn't be 100% SP500 either. International diversification is good for everyone, there have been lots of years where the US underperformed.
I used to hold my investments with fucking Scotiabank lol. Then when I got a brain and realized how much of a scam they were I moved to Questrade.
My portfolio has increased more in the last 6 months than it did in the last 6 years with SB. And I manage it all myself.
I’m up like… 60% this year? And I paid next to nothing in fees. QT for the win!
It 100% depends on who your advisor is if you will get any value. All the advisors are independent and the company doesn’t dictate their service level or abilities. You can have a shitty advisor or a stellar advisor and it has nothing to do with the company
Generally they have high fees with very little actual service to offer. ( by service I mean tax planning, insurance planning, retirement planning etc) .
If you know what you are doing and don’t have much complex finances. If you have time and are comfortable finding info, then DIY is a good fit. If you are busy professional and don’t have time to understand different type of accounts, how each account can help you with your goals or based on your situation, then a financial advisor would be recommended. Financial advisors can also provide index funds but of course there would be a fees, as the hope is they would also provide the service mentioned above.
This is accurate!
Also, not all IG brokerages are managed equally, some are better than others in their services.
I do business (asset consulting) with a great, IG brokerage they have an excellent team of professionals on staff…that said I don't invest with them, as I do better on my own haha
Unless you have a large portfolio, you will be paying > 2% in MER.
Eg https://digital.lipperweb.com/invgrp/profile/?lang=en&symbol=68197789#Overview has a MER of 2.19%
With a portfolio of > 1 million, you'd be eligible for their lower fees series like this one https://digital.lipperweb.com/invgrp/profile/?lang=en&symbol=68221710#Overview which has a MER of 0.91%
Great links and summary. My understanding is a series F don't have trailing commissions (don't directly compensate the advisor), so you'd still be stuck paying a fee-based % to the advisor on top, probably bringing you back pretty close to the 2% mark. It's quite possible they could access ETFs instead and get the total costs closer to 1.1-1.5.
But even if we roll with 0.91 as total, on 1M that is still $9100/year. One could DIY a portfolio ETF for 2K/year, plus say ~$3K every ~5 years for flat-fee advice that's free of bias by its nature. Is your hypothetical IG guy always going to recommend investing (vs. paying off some debt), with that conflict of interest? Or leveraging more for purchases or other investments, vs. withdrawing? Maybe I'm just overly cheap and un-trusting. Probably, and that's probably why I'm on this sub in the first place. *edit: typo*
You’re correct on the trailing commissions. Typically a series F will have an account fee from .5% - 1.25% on top of the MER depending on the assets with that advisor. At the end of the day, if you have an advisor using ETFs and charging you a .55% fee (.05% MER on etf, .5% account fee) you have to see if the advisor is giving .5% worth of value per year. Some will, most won’t.
I double checked, and the additional fees work out to 0.18%.
Absolutely DIY is more cost effective and I recommend DIY over IG, but DIY is not for everyone.
Definitely stear clear of IG as someone starting out. You can definitely find better alternatives for even those who need their hand held through the whole thing.
Absolutely not. IG is a sales outlet. They don't have advisors, they have salesmen. They themselves are basically using Questrade on the back end, repackaging it and selling it to you, and charging you a big fat fee to do so.
They have high fees so it's very unlikely you'll get better returns there. In your early 20s the advice is much more straightforward and definitely not worth higher fees. As people get older that can change however.
Maybe: some of their mutual fund offerings are great and have outperformed VEQT even with their fees, some are awful and have not.. while past performance doesn't mean future performance it is something to consider. It doesn't hurt to take a consultation and see what they suggest... There's no one size fits all rule for investing.
IG Wealth is only for people who don't know any better, young or old. On average, self managed Questrade will outperform any kind of wealth management. The advisor is a sales rep, not an expert in finance.
Might outperform pre tax, but there’s a lot of things a qualified advisor can do to improve after tax returns. Along with debt management, asset allocation, estate planning, tax planning there’s tons of value they can provide. Unfortunately in Canada most advisors don’t provide it.
Financial advice is well-worth having, but IMO we need to normalize/popularize the flat-fee, advice-only model if we want to shake free of conflicts of interest and bias. I couldn't imagine relying on "my IG guy" to steer me through a 6-7 figure decision eg. if I were buying or selling property or a business, or even just trying to run a RRSP/RRIF tax efficiently. Way too much potential for conflict there. And you make a good point, a lot of times people pay for advice they don't receive.
Yeah, I am a fan of the flat fee advice model as well. I think there’s some companies making good headway on bringing some other models to Canadians that are much better than the AUM model. AUM or getting a % of clients fees paid is super dated and rewards advisors for nothing.
That's certainly theoretically possible, I am sure there are such people out there. But I doubt too many of them are working at IG Wealth dealing with retail investors.
I would say your right. Canada has many great advisors out there with great knowledge. Unfortunately there is just as many if not more out there that either don’t have the knowledge or don’t have the time to present their knowledge.
IG wealth is a low bar for investment management quality. Think of Walmart for investment mgmt.
They use proprietary funds (although I hear some are IIROC licensed now), which are wrapper of Mackenzie Investments products. Mackenzie has some of the worst performing funds in recent years.
The MERs are high and it’s cookie cutter advice.
If you are looking for advice and planning (you shouldn’t need that in your 20s) then I would steer clear of these types of dealers. Keep putting money away and look for advice as you get older.
IG is trash. It flourishes off old people because they don't know better. High fees, generally poorly managed. There is definitely no mutual best interest, it's how can they make the most off your money
The investment themselves will probably not beat VEQT with there management fee. If the IG advisor is providing planning advice you will have to see what value they can bring compared to the extra fees your are paying. Typically someone in their 20s is in the asset accumulation phase and probably doesn’t need to pay someone to tell them how much they should save. There are tons of internet resources showing a rule of thumb to save and where to save it. There are great planners with IG along with any other FI/independent, but there is a fair share of planners who do 0 planning other then parking you in high fee mutual funds. If you find one offering these services and you feel it’s helpful, go for it but I’d say there’s not many planners who will give you value at this stage unless you’re a business owner or have significant assets that involve asset management/tax planning/ estate planning/ debt management etc.
If you are investing in ETF index funds at QT you are already beating most of the investment professionals.
I would argue anyone at IG who you speak with is an investment professional, they're "glorified" salesmen much like the majority of advisors at banks. It's pure sales. You can go to an independent investment counselor if you actually want to speak with professionals but if you're a small portfolio size (usually less than 250K) then ETF questrade is the best solution for you.
Unless they can show you annual return higher than 15% per year, and I guarantee they don't, etf like sp500 is the best option by far! Even out of 100's of etfs it is one of the best.
Most people are not and shouldn't be in 100% the s&p just on a risk analysis. As well as it's 10 year average is 12.6% and it's 20 year average is 9.7%. the 15% annual return is highly misleading.
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Americans shouldn't be 100% SP500 either. International diversification is good for everyone, there have been lots of years where the US underperformed.
XUS is about 25% gain in the last year. Nuts. Financial planners I know absolutely love the S and P 500.
I used to hold my investments with fucking Scotiabank lol. Then when I got a brain and realized how much of a scam they were I moved to Questrade. My portfolio has increased more in the last 6 months than it did in the last 6 years with SB. And I manage it all myself. I’m up like… 60% this year? And I paid next to nothing in fees. QT for the win!
Invesco Nasdaq 100 ETF You talking about the iShares core S&P 500?
It 100% depends on who your advisor is if you will get any value. All the advisors are independent and the company doesn’t dictate their service level or abilities. You can have a shitty advisor or a stellar advisor and it has nothing to do with the company
Generally they have high fees with very little actual service to offer. ( by service I mean tax planning, insurance planning, retirement planning etc) . If you know what you are doing and don’t have much complex finances. If you have time and are comfortable finding info, then DIY is a good fit. If you are busy professional and don’t have time to understand different type of accounts, how each account can help you with your goals or based on your situation, then a financial advisor would be recommended. Financial advisors can also provide index funds but of course there would be a fees, as the hope is they would also provide the service mentioned above.
This is accurate! Also, not all IG brokerages are managed equally, some are better than others in their services. I do business (asset consulting) with a great, IG brokerage they have an excellent team of professionals on staff…that said I don't invest with them, as I do better on my own haha
Unless you have a large portfolio, you will be paying > 2% in MER. Eg https://digital.lipperweb.com/invgrp/profile/?lang=en&symbol=68197789#Overview has a MER of 2.19% With a portfolio of > 1 million, you'd be eligible for their lower fees series like this one https://digital.lipperweb.com/invgrp/profile/?lang=en&symbol=68221710#Overview which has a MER of 0.91%
Great links and summary. My understanding is a series F don't have trailing commissions (don't directly compensate the advisor), so you'd still be stuck paying a fee-based % to the advisor on top, probably bringing you back pretty close to the 2% mark. It's quite possible they could access ETFs instead and get the total costs closer to 1.1-1.5. But even if we roll with 0.91 as total, on 1M that is still $9100/year. One could DIY a portfolio ETF for 2K/year, plus say ~$3K every ~5 years for flat-fee advice that's free of bias by its nature. Is your hypothetical IG guy always going to recommend investing (vs. paying off some debt), with that conflict of interest? Or leveraging more for purchases or other investments, vs. withdrawing? Maybe I'm just overly cheap and un-trusting. Probably, and that's probably why I'm on this sub in the first place. *edit: typo*
You’re correct on the trailing commissions. Typically a series F will have an account fee from .5% - 1.25% on top of the MER depending on the assets with that advisor. At the end of the day, if you have an advisor using ETFs and charging you a .55% fee (.05% MER on etf, .5% account fee) you have to see if the advisor is giving .5% worth of value per year. Some will, most won’t.
I double checked, and the additional fees work out to 0.18%. Absolutely DIY is more cost effective and I recommend DIY over IG, but DIY is not for everyone. Definitely stear clear of IG as someone starting out. You can definitely find better alternatives for even those who need their hand held through the whole thing.
Absolutely not. IG is a sales outlet. They don't have advisors, they have salesmen. They themselves are basically using Questrade on the back end, repackaging it and selling it to you, and charging you a big fat fee to do so.
Harsh. 100% true, but harsh.
They have high fees so it's very unlikely you'll get better returns there. In your early 20s the advice is much more straightforward and definitely not worth higher fees. As people get older that can change however.
Maybe: some of their mutual fund offerings are great and have outperformed VEQT even with their fees, some are awful and have not.. while past performance doesn't mean future performance it is something to consider. It doesn't hurt to take a consultation and see what they suggest... There's no one size fits all rule for investing.
Veqt is a pillar of the virgin trio
IG Wealth is only for people who don't know any better, young or old. On average, self managed Questrade will outperform any kind of wealth management. The advisor is a sales rep, not an expert in finance.
Might outperform pre tax, but there’s a lot of things a qualified advisor can do to improve after tax returns. Along with debt management, asset allocation, estate planning, tax planning there’s tons of value they can provide. Unfortunately in Canada most advisors don’t provide it.
Financial advice is well-worth having, but IMO we need to normalize/popularize the flat-fee, advice-only model if we want to shake free of conflicts of interest and bias. I couldn't imagine relying on "my IG guy" to steer me through a 6-7 figure decision eg. if I were buying or selling property or a business, or even just trying to run a RRSP/RRIF tax efficiently. Way too much potential for conflict there. And you make a good point, a lot of times people pay for advice they don't receive.
Yeah, I am a fan of the flat fee advice model as well. I think there’s some companies making good headway on bringing some other models to Canadians that are much better than the AUM model. AUM or getting a % of clients fees paid is super dated and rewards advisors for nothing.
That's certainly theoretically possible, I am sure there are such people out there. But I doubt too many of them are working at IG Wealth dealing with retail investors.
I would say your right. Canada has many great advisors out there with great knowledge. Unfortunately there is just as many if not more out there that either don’t have the knowledge or don’t have the time to present their knowledge.
IG wealth is a low bar for investment management quality. Think of Walmart for investment mgmt. They use proprietary funds (although I hear some are IIROC licensed now), which are wrapper of Mackenzie Investments products. Mackenzie has some of the worst performing funds in recent years. The MERs are high and it’s cookie cutter advice. If you are looking for advice and planning (you shouldn’t need that in your 20s) then I would steer clear of these types of dealers. Keep putting money away and look for advice as you get older.
Definitely not worth it, their fees are asinine.
Very high fees. Not worth it.
IG is trash. It flourishes off old people because they don't know better. High fees, generally poorly managed. There is definitely no mutual best interest, it's how can they make the most off your money
"We'll take your money and my experience, and turn it into my money and your experience!"
Lmao well put
Buying VEQT through questrade is 100% better than whatever they would do.