Mutual funds FAQ
Learn more about mutual funds by reviewing answers to frequently asked questions below. If you can’t find the information you’re looking for, contact your Desjardins Mutual Funds Representative.
Mutual funds offer you a diversified investment vehicle without requiring a great deal of money. Your investment is pooled with those of other investors to purchase securities.
A professional manager will closely monitor the securities in a fund portfolio to determine if they're meeting the goals of that fund. Managers will buy and sell securities to get the best return for investors while maintaining that objective. A fee is usually charged for the manager's services. Those fees are normally a fraction of what it would cost you to make stock or bond purchases independently. See the prospectus for complete information regarding fees.
First, determine your investment goal. Next, decide how much risk you're willing to assume to meet your goal. A Desjardins Mutual Funds Representative can help you determine your risk-tolerance level. From there, your representative will identify funds with investment objectives and strategies that are suited to your risk-tolerance level.
The number of funds to own is a personal financial decision requiring a careful review of your specific needs and long-range investment goals. Your Desjardins Mutual Funds Representative is a great resource to provide you with the information necessary for you to make a decision.
Yes, there is. While diversification may help, it doesn't assure a profit or protect against loss in a declining market. Different funds have different objectives—those with a higher risk have higher potential returns, whereas safer investments tend to offer more security, and less potential returns. You need to find a balance between returns and risk with a select number of quality funds fitted to your personal financial needs. Your representative can provide important guidance and support.
Visit your local Desjardins Mutual Funds Representative to get started.
During a volatile market period, it's important to remain focused on your long-term investment goals. There is risk involved when investing but working with a Desjardins Mutual Funds Representative will help you understand the benefits of investing for the long term, the importance of diversifying your portfolio and the value of making regular investments over a long period of time. Although such an investment program cannot ensure a profit, it can ease the uncertainty created by changes in the markets.
No. Your Desjardins Mutual Funds Representative is required to go through account opening documentation with you prior to establishing a new account. This will help ensure the funds selected are suitable for your investment objective.
Yes. An easy way to do this is through a Pre-Authorized Chequing (PAC) plan. You can take advantage of an investment strategy known as "dollar-cost averaging".
Investing is not a one-time event. As your needs and goals change over time, so will the type of funds that match those needs. Life events such as a change in occupation or income, marriage or the birth of a child may all have an affect on your overall goals in life. An annual meeting with your Desjardins Mutual Funds Representative is an excellent opportunity to keep your investments in line with your goals.
Questions about retirement
You have an annual contribution limit for your RRSPs and you will need to pay close attention or you can be penalized for over-contributions. The Notice of Assessment you receive from the Canada Revenue Agency after you file your taxes will show you how much contribution room you have for the year. Since unused contribution room is carried forward, your Notice of Assessment will include any unused contribution room from previous years.
You can make annual contributions to an RRSP from January 1 through the first 60 days of the following year. For example, contributions for 2018 can be made from January 1, 2018 through March 1, 2019 (you can only make contributions for the first 60 days of the new year, so this date may change).
If you can be disciplined about saving for retirement, you'll have the opportunity to accumulate money over time and be better prepared for your retirement years. Develop a mindset of paying yourself in addition to paying your bills. By doing so, you should have a steady flow of money going to work for you.
Questions about saving for post-secondary education
A Registered Education Savings Plan (RESP) is an account that is registered with the Canadian government that allows a person (subscriber) to save for a beneficiary's post-secondary education. Contributions grow tax-deferred and may qualify for a match from the government up to certain lifetime and annual limits.
You will need to complete an account application and make an initial contribution to establish an account for a named beneficiary. Contributions to your account will be invested in shares of the portfolio or portfolios you choose after deducting any sales charges that may be applicable. Educational Assistance Payments (EAPs) are made to help finance the cost of the beneficiaries’ post-secondary education.
When a student enrolls in a qualifying program, the subscriber can withdraw money from their Registered Education Savings Plan to help pay for their education. These withdrawals are called Educational Assistance Payments (EAP).
There are a number of options available if a beneficiary does not attend a post-secondary institution. These options will depend on your situation and are subject to applicable terms, conditions and taxes. Your Desjardins Mutual Funds Representative will be able to walk you through the options you have and help you select the one that suits your needs and goals.
There are no annual contribution limits to an RESP, only a lifetime contribution limit of $50,000 per beneficiary.
In order to take payments from an RESP, you must show proof that the beneficiary is enrolled in a qualifying educational program.
The subscriber will choose the amount and timing of the payments, which can be no more than $5,000 until the beneficiary has completed 13 consecutive weeks of their program. EAPs can be used for tuition, fees, books, supplies and equipment required for enrollment or attendance at an eligible institution of higher education.
Educational Assistance Payments are taxable income for the beneficiary.
Contact your local Desjardins Mutual Funds Representative to request EAPs from an RESP.
Mutual Funds are not insurance products and are distributed through representatives of Desjardins Financial Security Investments Inc.
Please read the applicable Fund Facts before investing. Commissions, trailing commissions, management fees and expenses may be associated with mutual fund investments.
Mutual Funds are not guaranteed, their values change frequently and past performance may not be repeated. Mutual fund securities are not covered by the Canada Deposit Insurance Corporation or by any other government deposit insurer.
Neither Desjardins Insurance nor its agents provide tax or legal advice. Please consult your tax, legal or investment advisor regarding your specific circumstances