How to choose index funds and brokerages

Like TD e-Series funds but not a TD brokerage customer? Try this instead.

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From the April 2014 issue of the magazine.

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Q: I currently have funds deposited with Scotiabank for the purpose of investing in RESPs. Am I able to purchase the TD e-Series index funds through Scotiabank? If not Scotiabank, what about through Scotia’s brokerage, iTrade?

—Ryan G., Hamilton, Ont.

A: I really enjoy drinking President’s Choice coffee, but my local supermarket isn’t a part of the Loblaw chain so unfortunately I can’t buy it there. You would like to buy the TD e-Series funds. But neither Scotiabank nor iTrade are part of TD so you can’t buy them there. I understand the appeal of the TD e-Series: the funds have super-low management expense ratios, like exchange-traded funds. And they are easier to buy in small amounts than ETFs because you can purchase just part of a unit and you don’t pay a trading commission each time. So you could open an RESP at TD or choose a traditional index fund from Scotia. But in this case, you can’t have your PC Red Velvet Cake and eat it too.

Bruce Sellery is the author of The Moolala Guide to Rockin’ Your RRSP. Do youhave your own personal finance question? Write to usat ask@moneysense.ca

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