ETFs have grown in style and popularity in Canada over the last number of years. In fact, over half of the ETFs in existence in Canada today were launched in the last five years! We have seen the ETF universe grow to include broad market, ESG-oriented, thematic, and alternative products in a variety of actively managed or passive index tracking structures – and even some known as smart beta ETFs that combine both actively managed and passive index tracking techniques. For many, ETFs are known as great tools to execute quick, short-term trades because of their low costs and ease of transactions (unlike mutual funds which are priced daily at the end of the day, ETFs trade on an exchange and therefore they are priced throughout the day). The greater amount of ETF options however has made them a mainstay for longer-term portfolios, like RRSPs as well.
I used Morningstar Direct to screen the Canadian ETF universe to find broad market ETFs that have earned either a 4- or 5-Star Morningstar Rating as well as either a Bronze, Silver or Gold Morningstar Analyst (MAR) or Morningstar Quantitative Rating (MQR). The list also distinguishes between actively managed and passive index-tracking products.
The list features some well-known players in the ETF market – for example, iShares, Vanguard, Horizons and BMO, but the rise in ETFs has also fueled the creation of standout products from TD Asset Management, PIMCO, Dynamic, Fidelity, Desjardins and Mackenzie. Investors diving into the list above should also consider that these ETFs represent a variety of asset classes which may impact their suitability in portfolios.
For those Canadian retirees who prefer Canadian-listed ETFs on the TSX, the equivalent ETFs for health care are Harvest's HHL and BMO's ZHU; for consumer staples, BMO STPL Global Consumer Staples (STPL/TSX), and iShares XST for Canadian grocers; and for utilities, Harvest Equal Weight Income ETF (HUTL/TSX).
For those Canadian retirees who prefer Canadian-listed ETFs on the TSX, the equivalent ETFs for health care are Harvest's HHL and BMO's ZHU; for consumer staples, BMO STPL Global Consumer Staples (STPL/TSX), and iShares XST for Canadian grocers; and for utilities, Harvest Equal Weight Income ETF (HUTL/TSX).
You can gain a diverse RRSP portfolio by choosing ETFs. Depending on your choice in ETF, you can invest in many securities in a particular industry. Or, you can go even further with a more diverse ETF.
How much does the average Canadian have in an RRSP at retirement? While the average amount held in an RRSP is $144,613, for households aged 65 and up, that amount is $283,000 (including RRIFs).
Monthly Maintenance Fee. Forbes Advisor Canada has named Motusbank the best bank in Canada for April 2024, and its RRSP savings account is a key contributor to its stellar ranking. You can open an account online and earn 2.50% interest on all deposits right away.
However, if you are in a lower income year and expect to be making more money next year, you might be better off holding off on that RRSP contribution, says Ian Black, a registered financial planner at Macdonald, Shymko and Co. Ltd., a fee-only financial planning firm in Vancouver.
Ms. Hasan says anyone making under $50,000 should focus on their TFSA or FHSA, since the tax deferral benefits for the RRSP are quite small if you're in a lower income tax bracket.
Introduction: My name is Dr. Pierre Goyette, I am a enchanting, powerful, jolly, rich, graceful, colorful, zany person who loves writing and wants to share my knowledge and understanding with you.
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Recently, I made some suggestions for investors looking to allocate their Canadian Registered Retirement Savings Plan (RRSP) contributions to mutual funds and today I would like to focus on ETFs, or Exchange Traded Funds.