The Raymond James Canadian Focus Picks Portfolio
Sources of financial advice are easy to find in Canada. From your uncle or in-law to your local bank there is no shortage of those who are willing and eager to offer their opinions on how best to manage your money.
What is maybe a bit harder to find is what you are really looking for — unbiased advice based on experience, expertise, and common sense.
Case in point: the Tax-Free Savings Account.
Since first offered in 2009 many people have followed the advice they have been given, and have opened TFSAs. But what many have not done is put those accounts to work for them — in a way that takes full advantage of the plan’s tax-sheltering benefits.
Instead, many have deposited their funds in TFSA savings accounts with their banks at low interest rates, resulting in very little actual tax relief.
As I have explained in recent articles, this happened in large part due to a lack of understanding as to how a TFSA works.
It was originally thought (by some) that a TFSA could be run like a bank account — with the ability to withdraw money and re-contribute at will.
In 2009, over 70,000 Canadians and some financial institutions discovered what some of us knew all along — that yes, you can withdraw from a TFSA any time you want. But there are rules on when you can re-contribute withdrawn funds. As a result, many are questioning the wisdom of using a bank account for TFSAs at all, since the resulting tax benefit is insignificant.
A better option is a Self-Directed Tax-Free Savings Account, or as I like to call it, a Tax-Free Investment Account. For many this is worth considering since it allows investors greater access to the types of investments that will benefit the most: investments with the potential to earn returns worth sheltering!
The good news is: should you open a Self-Directed Tax-Free Savings Account today, it is not limited to new contributions. You can also transfer existing funds from your TFSA bank account to your new Tax-Free Investment Account generally at no cost to you and without affecting your ability to make new contribution for 2011 and beyond.
As I mentioned, investment options in a Self-Directed TFSA are diverse. Today I’d like to tell you about one of my favorites — the First Trust Raymond James Canadian Focus Picks Fund.
I must admit I have been reluctant to recommend this particular investment product in the past for the simple reason that I work for Raymond James and am concerned about creating the perception of promoting products on that basis. But the truth is: the Focus Picks Portfolio has been very successful and when I do recommend it, I do so for no other reason than that it is in the best interests of my clients.
It has earned my support.
The process used to manage the portfolio is unique. Stock selection is based on recommendations from the same research analysts who recommend stocks for the Raymond James Focus Picks List — an annual publication of recommended individual securities.
Each month, analysts nominate appropriately-ranked companies from the Raymond James equity research coverage universe. Final selections are made following a review involving the Canadian Head of Research and other senior executives. The goal is to identify well-managed companies that represent the best investment opportunities.
The fund also differs from others in the way that fees are charged. There are no deferred sales charge options, and while there is a management fee, a portion of that is tied to performance — giving managers the incentive to make money for the investors.
For more information, including performance numbers, visit my website at www.jimgrant.ca and click on ‘RJ Canadian Focus Picks’ under the ‘Products and Services’ tab.
Also please join us Feb. 23 at 4:30 p.m. at the Qualicum Beach Civic Centre for more on this and other TFSA topics in our presentation entitled The Tax-Free Savings Account — it’s More than a Bank Account. To register please call (250) 594-1100, or e-mail paige.renouf@raymondjames.ca, or register online at www.jimgrant.ca.
Jim Grant, CFP (Certified Financial Planner) is a Financial Advisor with Raymond James Ltd (RJL). This article is for information only. Securities are offered through Raymond James Ltd., member CIPF. Insurance and estate planning offered through Raymond James Financial Planning Ltd., not member CIPF. Commissions, trailing commissions, management fees and expenses all may be associated with mutual funds. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.
For more information feel free to call Jim at 250-594-1100, or e-mail at jim.grant@raymondjames.ca. and/or visit www.jimgrant.ca.