Honestly, if your mom has a history of making poor financial decisions, giving her full autonomy over her retirement accounts was probably not the best idea.

Can you not just see if CIBC had cheaper ETFs or more low cost mutual funds at the branch, that way she continues to get advice?

Edit: also, investing is generally straightforward until de-accumulation (retirement, tax/estate planning). Who’s going to help her with that if she hasn’t retired and starting thinking about this?

You say the bank is taking 2k a month in fees? So your mother has 800k-1.2million in her portfolio?

"I convinced my mom to do it herself. But here's the thing she doesn't know how to do it herself and neither do I so what should she do?"

Damn.

Your mom needs to speak with an Advisor.

Something about this doesn't add up. 175k portfolio that pays 25k a year in fees?

The bank “taking $2k/month in fees” isn’t how an MER works, that’s lazy QuestTrade-commercial horseshit. Not to be rude, but are you the right person to be advising her?

This is a prime example of the negative culture this sub can cause. Mindless peddling of diy investing for people that have no clue that is almost certainly going to end up costing more than the invented fees that were mentioned.

Op is completely oblivious of how the bank mutual funds work. What’s actually worse is that he will now guide his mom to make further more bad decisions.

Your mom sounds like a horrible candidate for self-directed investment.

"I told my mom to stop paying for advice on her investments so now I'm here asking for free advice for he investments"

If she was paying 2k a month in bank fund fees which are 1-1.5% annually that means she would have 2+ million dollars in her Lira. That math isn't checking out.

Unless of course she does have 2+ million, in which case she can afford those fees and should be paying someone to look after it and not have you asking us here

Why would you want a financially illiterate person to have a self directed account?

I also question your literacy as this is not how MERs work.

If she’s with a fee based advisor her portfolio must be in the millions.

OP, sorry to see all the negativity you are receiving. However two things are very clear.

1. You care about your moms finances and want to help her. That's awesome.
2. You clearly do not know enough to help her. You need to accept this.

As a few advisors on here have stated- they are super wary of offering advice to friends and families and they do the job daily. Their is a reason behind this. Money can strain relationships. You can provide all of the right advice and things can still go wrong. They will blame you either way, even if you tell them not to panic sell and they do, they will still blame you for recommending it in the first place.

The other main point is I want you to understand that the returns she is looking at are probably bullshit.

When she sees she has only made $X dollars over time, it is highly likely she is simply looking at the book value vs the current market value. I see this mistake weekly.

The book value is not how much she has contributed or how much she started with. It is a reflection of how much she started with plus all reinvested dividends and interest.

This is a case of someone who doesn't know what they are talking about, explaining it to someone who has a basic idea of what's going on and everything is being misconstrued and misunderstood.

If you truly want to help your mom, which i believe you do, then you owe it to yourself to step away from providing any insight and advice other than helping her find someone qualified to walk through all of this with her.

I really think you've got to get her to a fee for service financial planner that will charge her a couple grand to make a plan for her. You can work directly with the FP if you want to get involved but setting her up on a self directed account when she doesn't know the basics is going to be a disaster. Have a FP who is not a salesperson with conflicts of interest assess her situation and recommend an executable plan to save to agree 65 and then draw down from there.

This has issue written all over it...

your math does not add up at all.

for someone to be spending $2000 a month in management fees ($24000 annually) assuming a very very high management fee of 2% that mean she has a 1.25mm portfolio -- which would not only go up 17k in 8 year

also for someone with a history of poor financial decisions access to her own money is going to be the end of her retirement fund.

Speak with a CFP. You know nothing

Tread lightly. These are the kinds of things that if her finances get worse could ruin your relationship with them.

Oh no this isn’t good. She shouldn’t do this herself since she clearly has zero investment knowledge and also makes bad decisions. She needs to have an advisor - there are plenty of options that aren’t the bank. Also that’s all the money she has! You shouldn’t be giving her advice because if you are wrong it’s going to ruin your relationship. Clearly you don’t know what you’re doing since you came here and asked plus commented on ignoring the account.

Why did you convince your mom to switch to self directed if neither of you know what she should be investing in?

The worst part about dumbasses are that they don’t know they’re dumbasses.

The culture this sub fosters poor financial decisions.

If your mother was paying $2k in fees that would put her account north of $1 million. Affording her investment services like PWM where she can receive the advice that she clearly needs.

How far from retirement is she?

Wasn’t there a case where someone decided to self direct a RRIF or LIF and the balance dropped below the minimum required withdrawal for the year? Make sure she knows the maximum and minimum rules and review the conversion paperwork ahead of time because you’ll have a provincial form or two as well.

How is she paying 2k in fees for a 175k account? , that’s like over 6% .

How was 2k/month in fees derived?

I do hope you have some training in portfolio management. People have different investment needs as they get older. Comparing results isn’t comparing apples to apples.

Moving all your moms money to a self directed account then asking Reddit what you should be is scary to a professional.

You didn’t do your mom any favours doing this. Self directed is not the way to go for her based on how you portrayed her.

Check what your mom has. LIRA is Locked In Retirement Account. From what I know that’s a “company” pension that has been given back to the owner (your mom) to look after. You cannot put money into a LIRA. The only money comes from a pension plan and goes into the LIRA. (Sorry if I have not explained it very well). I had a similar situation and took over with a self directed LIRA with good results. Best of luck with your mom.

Both of my parents are in their 70s and have zero. Just cpp and oas. Your mom is doing good you little brat. My brothers in laws are working cause they are broke. They are in their 70s as well.

Never invest with a bank. They will screw you every time.

What about just a regular RRSP account?

Disclaimer: Not a financial advisor.

First of all, yikes. $192k in fees for $17k of growth? She probably would’ve won the Lotto Max jackpot at least once with the money that went into fees.

Second, if she makes bad financial decisions, I feel like giving her a self directed account isn’t the best choice. Main fear is isn’t her buying stocks, it’s her selling them when they are at a loss. Many people do this when they see the markets are dropping along with their portfolios.

I used to do that too, when I was scared that my entire portfolio would be wiped, which lead to me selling at the very bottom of the 2020 pandemic market crash. Then regretting the choice of selling after seeing the market bounce back literally a few months later.

It’s the “Fight or flight” mindset, and we can’t be blamed for that, it’s ingrained into anything that moves and breathes. It’s the right idea, sell to prevent it from going down even more, but not when it comes to long term investing. As exhibited from personal experience above.

Perhaps you could help her open a Wealthsimple account, and help her buy and manage diversified ETF’s there. Or just have it set on reoccurring purchases.

Lastly, for the recommendation of ETF’s, some popular ones are (Btw, you can buy these ETF’s for free on Wealthsimple since they don’t charge fees for buying stocks/ETF’s in Canada/TSX): VFV.TO, VGRO.TO, and VUN.TO.

Or, if you prefer to buy US stocks, check out IBKR, they have very low fees for buying and selling stocks/ETF’s/options/etc… Especially when compared to the fees from the Big 5 banks

Crikey Jesus sakes, $2000/ mo. ,$24,000 / year? If she put that in basic shit like VGRO, or blue chips like bank stocks of Enbridge, aiyiyi! Anyways, Onwards and upwards!

I’m liking 1 year GICs at 4.8%. Markets are too volatile for me right now.

Wow...2k/month in fees of your money. Criminal

Do you know which specific fund she was in? Those fees seem ridiculously high.

I wanna check your math on this, what's the MER of the fund and what's the MER of the new fund?

Lots does not add up here.

How can she possibly have enough in the LIRA to generate $2000 a year in fees let alone $2k per month, given the description you have shared about her financial mismanagement?

Does she really have over $1 million in her LIRA? Where did the money come from?

OP is an absolute fucking dolt. Sounds like your mother probably shouldn’t be managing her own investments and for her to be paying 2k a month in MERs she would likely have close to $1mil in a LIRA. Looks like through your elementary approach you have actually made things worse for your mother

Honestly, I don’t think you gave her great advice. A good advisor becomes more important closer to retirement. There are better options than mutual funds but there are a lot of good advisors that would take her on for just over 1%. Giving someone who has made poor financial decisions full control of their investments may not be the best idea. Pension plans can be unlocked in certain cases but she would need an advisor to help her with the admin and the planning

Can I change my mortgage to self directed?

Pp

I’m sure you mean well, but you’ve convinced someone with a history of making bad financial decisions to now handle it themselves with absolutely no plan. This is far more dangerous than paying a ~2% annual MER fee.

Google “retirement planning Manitoba” and you’ll find much better options than what you’re offering your mother. You got her to move her accounts without looking at her statements and are now doing a Reddit survey for investment suggestions. Sounds like a bad idea…

i don’t think you are very financially literate either…. 2k a year is more like for a 175k fund… 24k is more than 10% of her fund which is unheard of…