Where to get FREE unbiased mtg/rrsp fiancial advice?

[$stretcher]

I think I need some financial advice from a professional. My problem is I feel like financial advisors are only out to sell me products, and therefor bias. Is this true? Can I get good financial advice just doing my own research, and trying to figure things out myself? Or is this risky, I don't want to 'miss' any thing and look back years from now and have financial regrets because of my ignorance. I also HATE giving anyone else my hard earned money if I don't have to.

If I should go to an investor, who? My bank (RBC?), someone else? Can I pay a flat $200-300 and get some solid advice/planning?

My situation/financial questions are:
How can I reduce my household taxable income, should I borrow to buy rrsps OR pay down my mortgage first (when the interest is ridiculously low)? Then wait 7 yrs and pile mtg payments into rrsps then? I feel like I should be putting rrsp money away now...like there won't be enough room in my rrsps for my extra money, and it won't have given me 7 yrs of tax/investing benefits.

42 & 45 yrs old
Income= $140k/household-taxes paid brutal!
Mtg $140k - 6-7yrs left to pay off at this rate, variable 2.5% today
Equity in home total value - $600k
3 teenagers, one in University, 2 up and coming, have been investing in resps= no cash left each month, but no residual debt as kids will absorb rest themselves, done in 7 years as well.
One car payment, $400/month, 2 years left, 0% interest
No other debt (yay)
One ok/good work pension to rely retirement on
Other investments under $5,000 (ugggh)

[mandolinatou]

If you want to pay 200-300 dollars to get unbiased financial advice. I recommend buying books in lue of going to get advice and reading up on your options. I subscribe to moneysense which I find helpful and I got a subscription during an airmiles sale so I think it was 70 airmiles...but it is around 25 dollars regularly and that is worth the expense in my opinion but you have to realise they could be biased by their funders...not that I find that particularly but I am suspicious of everything that has to do with personal finance.

I would never go through RBC or any major bank for RRSP because of the MERs. They are like 2.5-3.5 % in canada while that does not look like alot. If you have a good nest egg it is a lot! We are talking hundreds of thousands in lost gains by your retirement. The lower the MER the better off you are...so looking at vanguard or ING direct streetwise funds for RRSP mutual funds is a good initial RRSP investment. There are other options but you need to be self informed to start investing in more complex things in my opinion.

The most important thing I think is educating yourself on investing. Read a lot, start slowly and you might just turn out rich.

[lilo0003]

If you or your spouse have an EAP (Employee Assistance Program) start there. Most offer Financial counselling which is really consultation and education. They wont give advice as to what and where to invest. But they can help you decide what makes sense for you and it is free so only costs you the time & some will offer resources such as books. We did it years ago and it really helped just to start the process and I agree read a lot. Education is the key and really at the end of the day you need to be informed before you let go of your money for any reason.

[MortgageQueen]

I won't pretend I know anything about investing, but borrowing for an RRSP is not a bad idea as long as the interest is good on the loan. . .and make sure to pay it down with the tax refund.
I would also talk to a well referred accountant if you have to pay a lot of tax. They have fabulous ways of helping you in that respect. If you have no savings, you might also be wise to put some away in a TFSA for emergencies.

[super807]

I also HATE giving anyone else my hard earned money if I don't have to.

Just a thought. If you are not well informed financially, don't have a solid plan for your retirement, are over-paying in taxes and/or not taking advantage of the tax breaks that are available to you, you likely have been giving away your hard-earned money for years and might continue to do so. If you become better informed and change some things, even if you need to pay someone to help you get the information, you likely will keep more of your income in the end.

[super807]

I second the suggestion of an accountant. There are a lot of options for financial advisor out there, but I wouldn't choose one affiliated with a bank for broad financial planning. Talk with friends and co-workers, and get referrals/recommendations. That should help you.

Some thoughts about some of the questions you are asking yourself.

Deferring investing into your retirement income reduces how much retirement income there will be when the time comes. The earlier you start investing, the more it can grow through interest.

So paying off the mortgage now, and then investing in RRSPs later, will likely leave you with less money for retirement.

I once heard Gail Val-Oxlade advise a couple who disagreed about if they should put extra money into RRSPS or into paying off the mortgage state that if you are 10 years or less from retirement, focus on the mortgage. If you are more than 10 years from retirement, put it toward retirement savings.

If you do choose to invest in RRSPs, the amount that you put into RRSPs each year reduces your net income by that amount, so it reduces the amount of income tax you will pay in that year. RRSPs don't eliminate tax, they differ tax. Usually, once you retire and start drawing income from your RRSPs, your income is lower than when you were investing in the RRSPs, so it should also reduce the overall amount of tax you pay in the end.

[$stretcher]

Thank you for the suggestions!

[Carlotta]

I always find that "free" advice is usually worth exactly that. Would you like to have your tonsils removed by someone who read some stuff on the internet, or by someone who trained for 7+ years? Do you pull your own teeth, or do you go to a dentist? So why would you trust your money, your family's financial security and your retirement to someone who has no training or expertise? And why would you begrudge paying a professional person to ensure you are looking after your finances and your future properly?

YOU get paid for doing your job. Why would you want to trust someone to look after your future without paying them to do THEIR job? I don't get it!

[blueeyetea]

Carlotta, exactly how are you interpreting the message that the OP doesn't want to pay for advice? She's specifically asking the question "can I pay a flat fee and get some solid advice?".

[Carlotta]

Carlotta, exactly how are you interpreting the message that the OP doesn't want to pay for advice? She's specifically asking the question "can I pay a flat fee and get some solid advice?".

Well because the title of the thread is "Where to get FREE unbiased mtg/rrsp financial advice" ?

[blueeyetea]

Well because the title of the thread is "Where to get FREE unbiased mtg/rrsp financial advice" ?

Oh, my bad. I just read what the OP actually wrote below the title.

[blueeyetea]

$stretcher, you can certainly get advice for a flat fee, but you need to find a fee-only planner. MoneySense has a list of planners, with varying fee schedules. Some will charge by the hour, others will charge a certain percentage of the amount of investment you have, and still others will charge a flat fee to do it all.

Having said that, I think the best advocate you can find for your planning and investment is yourself. Most of the information you’d get from a financial planner is already out there and free. Start with getting yourself a book on personal finance to get at a sense of the things you need to think about.

To save on taxes, go through your tax declaration with a fine tooth comb to see what you deduction you might have missed. You have one child in University, get his receipts for tax tuition and books. Apart from that, if you’re a salaried employee, you’re limited in how much you can save on taxes apart from using RRSPs, if you have the room that is.

Investment wise, if you’re a complete novice, look at the Canadian Couch Potato website which talks about index investing, which keeps investment simple. (Index investing are mutual funds that buy the same shares that compose stock exchanges.) I’d also suggest you get yourself the book “Count on Yourself” by Alison Griffiths for more detailed explanations on index investing.

Finally, on the question of borrowing to buy RRSP or paying down the mortgage, that’s a tough one to address. If you haven’t been able to save monthly towards a RRSP, I’m not sure why you think borrowing is a good idea. Yes, you’ll get a tax refund that will pay back part of your loan, but not all of it Essentially, if you put $1000 in an RRSP, you’ll get back the taxes you would have paid on $1000, which is anywhere between $300 and $500 depending on your tax bracket. Then you still have to figure out how you’ll pay back the difference of $700 to $500 throughout the year, not leaving much room to start saving up towards your 2014 contribution. My advice is to forget about borrowing and instead work monthly RRSP contributions in your budget. Although I like the DIY approach better, you can also buy mutual funds by making automatic monthly withdrawals at any bank.

Another reason why borrowing isn’t a good idea, average returns on investments are around 4% these days, when you’ll be paying more than that in interest on the loan. The worth of your investment will be even lower than what it cost you by the time your loan is paid off.

As for your house, don’t forget that it’s an investment in itself, as long as you don’t borrow against it. When it’s time to retire, you’ll have a big leg up because your accommodations won’t be as expensive (as compared to renting), and/or you can sell it to buy a cheaper house.

[$stretcher]

blueeyetea - thank you for your comments, some great advice in there!

[sjw80]

My mother was a fee-only financial planner. NEVER borrow money to buy RRSP's or to pay down a mortgage for the same reason blueeyetea said - the return on your investment will be lower than the interest you pay on the loan.

The best idea is to either use a fee-only planner or educate yourself.