Karen from Makin the Bacon (who used write here!) wrote a two part series where she interviewed female investors to get their perspectives on why more women don’t invest. I provided a quote and very much enjoyed the rest of the interviews on the site as well.
Then my friend Cait from Blonde on a Budget posted about her investing journey, which made me think a bit about my own and how I got started in investing.
1. Investing Within A Tax Free Savings Account
I got my start in investing when the Tax Free Savings Accounts opened in Canada.
Unfortunately, I lost some investing time (and therefore money) by starting my TFSA in a high interest savings account instead of investing the money.
Because my money was with Tangerine, I still made around 2% at that time, but the smarter thing to do would have been to invest the money in a mutual fund or ETF.
I caught on in early 2013, however, and moved my TFSA into a Tangerine Tax-Free Investment Fund Account. This allowed me to make greater returns, making my money work harder for me.
(If you’re Canadian, I would highly recommend Tangerine for chequing, savings, and investing – sign up with my Orange key 35611511S1 and we’ll both get $25).
I started with a Tangerine Balanced Income Portfolio, which has a management expense ratio (MER) of 1.07% and an average rate of return over the past year of 12.03%.
After while, however, as I began to increase my income and learn more about investing, my risk tolerance increased as well. I realized that I’m young and have no reason to hold back so much on risk, so I transferred the funds I’d already invested in my TFSA into a Tangerine Balanced Growth Portfolio. The average return over the last year is 15.49% with he same MER, so my money has been working even harder for me.
2. Investing Within My RRSPs
When I was 21 and in my third year of school, I started my first RRSP.
I was taking a business finance course, but my professor insisted that we should be considering saving for retirement. I knew that this was the case (after all, I’d already been blogging about personal finance for awhile at that point), so I decided to start saving what I could.
I started with $25 per paycheque – so $50 per month, plus any “found” money I could muster.
I was paying for school as I went through it at the time so it was slow moving, but I followed the same model as my TFSA.
I started with the Balanced Income Portfolio before deciding to change to the Growth Portfolio.
Before I graduated, I landed a regular job from my internship, and therefore made a lot more money. I was able to invest up to $200 per month at that point in my RRSP, and $100 into my TFSA.
I still had to pay for my courses, so when I graduated, I upped the ante even more.
My job had a pension, so while I continued investing in my TFSA and RRSP, I wasn’t as aggressive as I could have been because a portion of my income was automatically invested in the Municipal Pension Plan.
3. My Favourite Investments
When I graduated from school, I became interested in continuing my learning about personal finance and began some serious self-learning about different investments within Canada.
I read some books, blog posts, and picked the brains of many investors I knew, and decided to begin investing in dividend-paying ETFs – exchange traded funds.
I slowed my contributions to my Tangerine RRSP and TFSAs and, after a lot of research into investing platforms, started a Questrade account.
I find it really easy to use, it’s low cost, you get free ETF trades, and you can open up an account easily (instead of the rigamarole you must go through if you are using TD e-Series, for example).
(If you sign up for Questrade with my affiliate link I get a small kickback – which will be reinvested in ETFs. Plus, you’ll get $50 in free stock trades which is a nice bonus. Just click on the link here to sign up for an account).
I invest in several Canadian dividend paying ETFs, including:
- Vangaurd’s FTSE All Cap Index ETF – VCN.TO
- FTSE Canadian High Dividend Yield Index ETF – VDY.TO
- FTSE Canada All Cap Index ETF – VCN.TO
- BMO Canadian Dividend Fund – ZDV.TO
I invest in ETFs within my TFSA. So my TFSA is split between Tangerine’s Growth Portfolio fund and ETFs within Questrade.
4. The Plan Moving Forward
Moving forward, my investment plan is simple:
1. Invest my RRSP savings in the Tangerine Growth Portfolio
2. Invest my TFSA savings in Questrade ETFs
3. Re-invest dividend income into Questrade ETFs (this is called DRIP – Dividend Re-Investment Plan)
4. Continue to learn and grow as an investor and try new things!
I’ve considered investing in individual stocks based on the companies in the ETF funds, however, my individual stock investing experience is limited to a few American stocks.
Do you invest? If so, how did you start?