Canadian Student, total Newbie. Please could you give me some feedback?

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scully_boy
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Joined: Tue Feb 13, 2018 9:47 am

Canadian Student, total Newbie. Please could you give me some feedback?

Post by scully_boy » Tue Feb 13, 2018 11:33 am

I am a Canadian student, 20 years old. I have ~12,000 in savings, and ~18,000 in student loans (liquid). The student loans money is interest-free until I graduate, which will be 3 years from now.

I am about to start a co-op job, which will add ~15,000 to my saving in 8 months.

I obviously have to pay for university. 3 years, including food/tuition/housing costs ~25,000.

I opened a TFSA (Tax-Free Savings Account) with Questrade, and was going to start with ~2000$ invested and add 100$ every month. My planned portfolio allocation is:
33% Vanguard FTSE Emerging Markets ETF (VWO)
33% Vanguard FTSE All-World ex-US ETF (VEU)
33% Vanguard Total Stock Market ETF (VTI)

These are all stocks, which is risky. However,
1. My parents serve as an 'emergency fund' at this stage in my life
2. I am investing very little, only ~6000 dollars at the end of the 3 years

Some questions:
- should I even be investing? should i be investing more?
- is it okay to be 100% in stocks? (Technically, this is just 'your age minus 20' in bonds).
- Have I picked solid ETFs? The 'emerging markets' one seemed good, but maybe I should replace it with VCN.

Very new at this -- hoping to keep it as simple as possible.

Thanks so much in advance.

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Tyler Aspect
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Re: Canadian Student, total Newbie. Please could you give me some feedback?

Post by Tyler Aspect » Tue Feb 13, 2018 3:34 pm

TFSA:

For US and international stocks there are unavoidable dividend with-holding taxes. Maybe you want to stick with Canadian equity and Canadian bond ETF in the TFSA account.

RRSP:

US equity dividends and capital gains are tax-deferred until withdrawal, but only if held in a US based ETF such as VTI.

US bond dividends and capital gains are tax-deferred until withdrawal if held in a US based ETF such as BND.

Taxable:

US equity dividends are fully taxable. Dividend with-holding taxes applies, but can be recovered with foreign tax credit.

International equity: use a Canadian listed ETF that holds the stocks directly, such as XEF.


(I am not a Canadian. It is possible that I have got some details wrong. Double-check me.)
Past result does not predict future performance. Mentioned investments may lose money. Contents are presented "AS IS" and any implied suitability for a particular purpose are disclaimed.

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Peculiar_Investor
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Re: Canadian Student, total Newbie. Please could you give me some feedback?

Post by Peculiar_Investor » Tue Feb 13, 2018 6:23 pm

scully_boy wrote:
Tue Feb 13, 2018 11:33 am
I am a Canadian student, 20 years old.
Are you studying and therefore resident in Canada or the US?
Normal people… believe that if it ain’t broke, don’t fix it. Engineers believe that if it ain’t broke, it doesn’t have enough features yet. – Scott Adams

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