📅 Hey It’s Me: This was originally written in 2012, but it captures the early days of DIY investing for me before robo-advisors, zero-commission trades, and Reddit-finance bros took over the scene. While many of the principles still hold, tools like Wealthsimple Trade, Questrade, and MyCRA have made it easier to start. That said, the “tyranny of choice” is worse than ever. This post remains a great reminder that the most important step is just getting started.
As I mentioned, one of the common themes I hear from folks is the Tyranny of Choice. When I talk to them about their future savings, it quickly becomes obvious. Mental gridlock occurs. This happens because of all the possible choices available for some folks.
I do get lots of questions about, “… what in your opinion is the best vehicle for investing?”, and the easiest answers are:
- Can you be more specific?
- It depends on what your goals are, what are your goals?
- Why does my opinion matter to you?
Note I never answered the question? My advice is usually to go learn some stuff. You should decide for yourself. I never feel too comfortable telling people what to do with their money.
As an example, you want to open an RRSP, what do you do? First, you find out whether you can put money into an RRSP. Do you have RRSP space? Check your My CRA account for that information. Then, you look into the various RRSP savings vehicles out there. If you are a TD Bank customer, you can set up:
- A TD Mutual Fund RRSP Account
- A TD Mutual Fund TFSA account
- A TD GIC RRSP Account
- A TD Directline self-directed RRSP account
- And many, many other ways.
Notice, what vehicle you can choose ends up being dictated depending on which savings vehicle you try to use (i.e. if you choose a TD Mutual Fund RRSP account, you can buy TD Mutual Funds (and not all of them either)), so the advice here is try to keep as many options open, and set up as flexible an account as possible. In my case I set up a TD Directlin Self-Directed RRSP account. If you bank with BMO, you can set up a RBC Investments account. With other banks, you can use their brokerage house. You can also consider some of the online brokerage firms.
Self-Directed RRSP accounts are more flexible. They are also more expensive administratively (for the account) (usually). You need to figure out what makes you comfortable. The other thing with Self-Directed accounts is the SELF-DIRECTED part of it. You are going to make the trades and handle such activities in the account. If you don’t feel safe doing this, then maybe you need a full service brokerage house?
I haven’t really even touched on the title of this post in the past few paragraphs. As you can see, which is the better choice ETFs, Mutual Funds, Index Funds, etc.? And you know why? It’s nearly the last decision you make. You have to set all this stuff up first.
Don’t worry about deciding, worry about getting started on getting the infrastructure in place. You’ll have time to finally decide what you want to buy. However, first, you need to do a lot of groundwork.
It took me about 3 weeks to get my Self-Directed RRSP in place and running. I needed this time so that I could actually make a trade. Anybody got it set up and flying sooner?
Follow-On: The Value of Persistence
Getting started in investing isn’t glamorous. It's 10% choosing what to buy. It’s 90% dealing with paperwork, passwords, and platforms that feel like they were designed in 2008. But here’s the thing: the folks who stay with it are the ones who get ahead.
Persistence isn’t sexy. It’s opening a CRA account even though you forgot your password. It’s calling TD Direct Investing for the third time because the transfer still hasn’t gone through. It’s figuring out what an “in-kind transfer” is at 11 PM on a Tuesday. But every step and every boring click helps you advance. You move further ahead than the person who’s still waiting for the “perfect” time to start.
Insider Jokes, Red Flags, and What Newbies Don’t Know
Ask any old-school Canadian investor about TD Mutual Fund accounts, and you’ll get the same smirk. Everyone started there, and almost everyone regrets it (I know I do). The limited fund selection, high MERs, and no access to TD e-Series Index Funds unless you did a weird workaround? Classic. We call it the Training Wheels of Regret.
Red Flags to watch out for when you start:
- If your bank “advisor” can’t explain MERs, walk.
- If they tell you “mutual funds always outperform ETFs,” walk faster.
- If you don’t understand what you're investing in stop and read before clicking anything. There are no take-backs in finance. If that theory is good enough for the Wizard of Omaha, it's good enough for you.
🧠 Helpful links:
- Canadian Couch Potato Model Portfolios
- Questrade a good place to start your odyssey.
- Wealthsimple another good place to start.
- MyCRA Account Setup
A Simple Perspective (TL:DR)🧾📉🧭
I’ve been watching people fall into the same investing traps for over a decade. Here’s what I know: most folks never invest because they freeze at the first decision point. The endless choices are overwhelming. These include ETF, mutual fund, GIC, growth, value, passive, and active options. People feel like they need a finance degree just to open an account.
Here’s the truth: the best investors I’ve seen didn’t start perfect they just started. They opened a TFSA, dropped $100 in a boring index fund, and kept going. What most people get wrong? They treat the account setup like it’s optional. It’s not. It’s the foundation. No one builds a house starting with paint swatches. Get the structure right, and everything else becomes easier.
- Reduce choice paralysis by committing to action before optimization. Open the account first, perfect the portfolio later.
- Break big decisions into micro-steps. Logging into CRA to check RRSP room is easier than "planning retirement."
- Avoid perfectionism there’s no perfect investment, just good enough to get started.
FAQ on Choosing investment accounts
Set up your investment account infrastructure first like a TFSA, RRSP, or self-directed account. You can’t buy anything until those accounts are properly opened and funded.
They are more flexible but require more diligence. You’ll need to place trades yourself and monitor your investments. If that sounds terrifying, start with a managed account or robo-advisor and ease into DIY investing.
Trying to invest without becoming a finance bro, this article is both hilarious and painfully real. It hits on something that many personal finance influencers skip: before you invest, you have to open the right kind of freakin’ account. You don’t need six tabs open comparing MERs if you haven’t even logged into My CRA to check your RRSP room. (Guilty.)
That said, I’d love a checklist or flowchart. Most of us are visual learners with limited attention spans and lots of debt. Tell me: TFSA or RRSP? Bank or brokerage? Robo-advisor or couch potato? Still, the voice is warm, smart, and like talking to that uncle who knows what he’s doing but never makes you feel dumb for asking.
TD’s investment accounts are RIDICULOUS for fees. Even their e-series index funds have fees that are at least five times the MER of the cheapest Vanguard fund. As you noted, they’ve jacked up their safety deposit box fee. Their accounts are extremely expensive. They are masters of tacking on charges. Canadians get gouged by fees because they’re either too polite or too dumb to change to a credit union and a fee-free institution like ING. All TD does is run ads with two cranky old men, who are probably cranky from a lifetime of getting screwed by TD’s fees. MBNA, the issuer of Canada’s best credit card the SmartCash MasterCard, just got acquired by TD. I am waiting for when they sneakily eliminate the 3% cash back program on gas/groceries. When they do, I’m sure they’ll institute a crappier program and outright lie that it’s better for some reason. I have US money (that’s one decent account; I keep the minimum 3k balance to keep the $0 perks for travel since even at ING, $US cash earns only 0.5% a year) and my backup Visa at TD.
I find it expensive to use the self direct RRSP in TD. I was using it before and am paying $100 per year? Half a year ago, I decided that RRSP is not for me. So I withdraw all my money and lose around $1000 in total. i am happy now because I feel that RRSP cannot steal the $100 from me every year. By the way, I put all the money in TFSA instead. At least they do not steal $100 from me every year.
Interesting, I always find that moving money that is Tax Free into the Taxed side of the world always makes me queezy.