TFSA Transfer Fees when Funds are over CDIC Limit | Page 2 | Tax Free Savings Accounts | Discussion forum

Alexandre said

bobwatford said

Different strokes for different folks I guess. If I was of that opinion I'd have about 20% of the money / net worth I currently have and wouldn't have been able to semi retire at 45.

I am happy for you that you managed to retire early, and also happy for me that you didn't need my money for retirement. The money that I could have put in equities, to up their value for people like you, but I did not.

The share of U.S. equities owned by people at or close to retirement age has surged to record level of 80%.
While you managed to cash in, people like me who haven't yet dipped into their nest egg to fund their post-employment lifestyle might not be able to.

There are too many people aged 60, 65, 70, 75 and up ahead of me, sitting on too high ratio of equities to fixed income thinking that in their lifetime the market will only trend up.  

Market will always trend up if the time line is infinite. The issue is time is everyone's enemy. Thus an appropriate level of 'timing the market' is needed, the keyword is not aiming for perfection, and have the stomach to weather today's low may be tomorrow's high.
Its also important to realize only a handful of stocks one can hold a very long time. Even something as big as Nortel or Blackberry may / will not exist over time, just like the Roman empire.

I don't know, wasn't at all complicated for me, just kept buying solid equities for about 30 or so years, sold them all some years ago, now I just dabble in and out with a bit for fun and keep the rest in fixed income, done, worked out great. Big bank discount broker accounts were the key to the whole deal.

P.S. I don't have any confidence in the next 30 years so I'm not recommending anything to anyone younger, just saying it's actually pretty simple if you keep it that way.

Norman1 said
It's not complicated and timing is not needed.

Stock indices and the ETF's that track them don't do any timing, don't limit themselves to just a handful of worthy stocks, and don't do any of the nonsense described. They have done just fine over non-infinite periods of time and have outperformed 40% to 60% of the funds that claim to be actively managed.

S&P 500 has done just fine including the losses from Enron. TSX 300 has also done just fine including the losses from Nortel.

I used to believe that garbage about timing and needing to buy "undervalued" stocks when I started decades ago. People who believe those things today are decades behind.  

Except people that also believed buying Hang Seng in 2000, buying Nikkei in 1989 will be fine, as timing the market is nonsense and not needed in the long run. And those 2 are indexes not individual stocks.
Turns out if you buy the high in those 2 indexes, your long investment horizon may not be long enough to even get you to break even, let alone all the opportunities lost during those years.
Of course without a crystal ball, no one knows where the highs or lows are until after the fact.

I cannot edit, or add to, my prior post at this time, but I forgot to add the perpective of the MSCI World Index on a historical basis. https://curvo.eu/backtest/en/market-index/msci-world?currency=usd

The key points here are that, on a global basis, one can see 35-40% declines from time to time in the index, and it can take upward of 5 years to recover the losses from those downdrafts, but they will always recover. If one invests in such indices, one avoids individual stock picking disasters and if one has an appropriate equity/fixed income allocation for them, those valleys are mostly just speed bumps in one's investing journey.

It is up to each individual to determine what equity/fixed income ratio is right for them. My mother was conservative in her portfolio so it was never over 50% equity and by the time she passed some 20 years later at age 96, her portfolio was 15/85. The 15% equity component juiced her returns considerably (that 15% providing about 50% of the portfolio's return) while at the same time, that 15% would have made no difference in her lifestyle in later years had it imploded.

savemoresaveoften said

Except people that also believed buying Hang Seng in 2000, buying Nikkei in 1989 will be fine, as timing the market is nonsense and not needed in the long run. …

Only the uninformed believed those.

The Hong Kong market has third-rate enforcement and is rife with insider dealing.

The Nikkei index is one of those junk price-weighted indices, like the Dow Jones Industrial Average. No-one invests like a price-weighted index, which weighs the holdings by stock price.

No timing is required with those as well. Just don't ever put any money into the Hang Seng and Nikkei index tracking. Same applies to the index of that former Vancouver Stock Exchange that Forbes once called the scam capital of the world.

Loonie said
Almost all provinces offer unlimited insurance on registered plans through credit unions.

Alternataively, move it to Oaken, which consists of two CDIC-insured outfits - HOme Bank and HOme Trust. You can divide between the two and each is CDIC insured. That will last you a few more years. They currently have no transfer out fee.

Transfers don't necessarily take two months  

Bear in mind that provincial deposit insurance schemes are not equal to each other and may not be equal to that offered by CDIC, simply because some provincial deposit insurance corporations' liabilities are not direct or contingent liabilities of the provincial government (some are; I believe FSRA in Ontario may be one such provincial deposit insurance scheme that is). Practically speaking, if required, would a provincial government bailout an in-need provincial deposit insurance corporation/fund that isn't a direct or contingent liability of that province? Maybe, or maybe even probably. But it still requires a "leap of faith". For some people, that's a deal-breaker. For me personally, I wouldn't worry about it.

It's just like exceeding CDIC limits with financially stronger, larger financial institutions.

So, on that basis, I'd ask the OP in which deposit issuer are they exceeding their CDIC limit in their TFSA? If it's an institution like Tangerine or a Big Five bank, I honestly would just wait until December, then move the funds out and re-contribute elsewhere in 2025. 🙂

Cheers,
Doug