Want to keep more of your money?
Choose a better T-Rex Score!
That’s right. Your T-Rex Score is a choice. Successful investing is, first and foremost, a choice you make for yourself. Your investments will build wealth. But for whom? You choose.
1. Build your financial institution’s wealth
2. Build your wealth
Different Investment Approaches: Different T-Rex Scores
Typical T-Rex Score Ranges
Assumptions: 25 year time horizon and 6.4% annual compounded return on underlying investments. Range is approximate. Investors may experience fees and T-Rex Scores outside these ranges depending on, among other factors, amount invested, investment provider, changes in fee levels, etc.
Know Your Score
Make sure you know your T-Rex Score. If you own, or are considering buying, more than one investment product, you can determine your Score for each. If you are not absolutely certain you know your Score, ask your investment provider.
If you aren’t happy with your T-Rex Score, ask your provider for higher T-Rex alternatives. Remember, there is no better predictor of a fund’s performance (relative to other funds in the same category) than T-Rex Scores! Your investment provider may or may not be able to offer higher T-Rex products. If your provider cannot provide a satisfactory solution, you need to choose:
1. Accept the consequences of a low T-Rex Score, or;
2. Find a higher T-Rex solution
Learn Investment Basics
“The best investment you can make, is an investment in yourself…The more you learn, the more you’ll earn.” Warren Buffett
If you aren’t satisfied, what are you going to do about it? Would increasing your T-Rex Score and keeping more of your investment returns be worth spending some time to learn investment basics. Because basic investment knowledge is all you need to make better choices, achieve higher T-Rex Scores and keep more of your money.
We each have our own personal reasons to invest. What is your investment goal?
Financial Freedom (however you might define it)?
A secure and active retirement?
Having the option to retire early and live in your home as long as you wish?
Frequent travel or a vacation property?
Paying for your kids’ or grand kids’ education
Are you a younger investor? Retirement may be too far over the horizon to visualize so your investment goal may simply be long term portfolio growth. Every situation is unique but most of us have a lot in common. Most individual circumstances and investment goals are “unexceptional” and can be addressed with simple plans including:
- Target outcome
- Current annual savings
- Risk tolerance (willingness to tolerate market ups and downs)
- Mix of investment products
- Use of “tax advantaged” accounts such as TFSAs and RRSPs
- Adjustments over time
Most investors would benefit from some level of planning advice. The good news is there is lots of good advice available and most of it is free! The bad news is that most providers of free advice including banks, insurance companies, fund sales people, etc. only offer low T-Rex products. But there can be a rather elegant way to overcome this conundrum; take the free advice offered but set up your investment account(s) and invest in high T-Rex products elsewhere.
Here is an illustration of how that might play out for a medium/long term investor with a good understanding of investment basics:
- Meet an investment advisor at your local bank branch
- After asking a few questions, the advisor recommends you set up a TFSA account and split your investment between a stock market mutual fund and a bond mutual fund with T-Rex Scores of 50%!!!
- Go home, find your bank’s online discount brokerage site and set up your TFSA account
- Once your online account is set up, buy a stock market index fund and a bond index fund that broadly replicate the mutual funds recommended by the bank branch (this step takes about 5 minutes)
Congratulations! Your T-Rex Score is 90%+. You will keep a much greater share of your investment returns!
If you are considering this strategy, don’t feel too badly for your kind provider of free advice. They will somehow manage without you as they continue to make themselves rich signing up your friends and neighbors to a lifetime of low T-Rex products!
Traditional Mutual Fund Providers
Traditional mutual fund providers (banks, insurance companies and fund salespeople) offer “free” advice. But they are paid for that advice through the low T-Rex funds they sell.
Traditional Stock Broker
Traditional brokers provide advice. Many will only offer that advice along with low T-Rex products. Others may charge an ongoing fee (e.g. 1% of your total investments) packaged with low cost products such as index funds, ETFs or direct investment in stocks and bonds to produce a medium T-Rex result.
Lower Cost Mutual Funds
There are some lower fee mutual fund companies which offer a package of advice and medium T-Rex funds directly (minimum investment amounts apply).
Robo advisors are the new kids on the block. Go online, answer a few questions and a package of low cost index funds and ETFs will be automatically recommended to you. There may also be some access to speak directly to real human advisors. If, like most investors, your circumstances are “unexceptional”, a medium/high T-Rex robotic solution may be worth considering.
Fee Only Advisors
Unlike most other advisors, Fee Only advisors aren’t investment product sales people. They offer advice and plans for a fee while you implement those plans separately; for example through an online discount brokerage account. Depending on the level of fees and size of your portfolio, medium/high T-Rex Score can be achieved. But there aren’t many Fee Only Advisors around.
Do It Yourself
Advise yourself? DIY investors using discount brokerage accounts can achieve T-Rex Scores in the 90s, even up to 99%. That sounds great….actually it is great! But DIY investing is not for everyone. Before you consider DIY investing, make sure you have a good understanding of investing basics.
Make an Informed Choice
Learn investment basics and you will be in a position to make an informed choice as to the combination of advice and investment products, and the resulting T-Rex Score, that is right for you.
Choose to keep more of your investment returns for yourself!
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