A Would-Be Couch Potato Responds

Last week I posted an e-mail from Shannon, a reader who related her difficulties in opening a TD e-Series Funds account. That post (and an earlier one about her experiences with TD) generated a huge number of comments. Many were supportive; others were rather condescending.

Shannon sent along another follow-up, which I’ve posted below. (Note that you may have to refer back to the comments section of the earlier to post to follow the discussion.)

I’ve spent so much space covering Shannon’s story because I’ve come to appreciate just how much resistance many investors face from financial firms when they try to simplify their investments and lower their costs. Shannon and her husband were screwed by their first investment advisor. When she went looking for help elsewhere, she didn’t get it.

As she notes, many of us who are experienced DIY investors know what to expect, and we know how to push back against the sales pitches. But many people don’t have that knowledge or confidence. I hope by sharing these stories, this blog and its readers can be a supportive community for investors who want to take back control of their own finances.

Here’s the letter:

I’m Shannon, the woman the Couch Potato respectfully listened to and guided. Thank you, CP. I have a few additional comments to make based on some of the posts.

1. I did not begin this process as a “lark.” Some of my comments may sound funny, but that’s my way of coping, and they were only a portion of what I wrote. I was certainly not laughing while I was sitting through the session with the people at the TD branch.

My husband and I lost over 40% of our retirement portfolio with a well-known investment company, where we were in 90%+ equities. We didn’t know what a DSC was, or an MER, what a split between equities and fixed income meant, diversification, etc. Seven months from retirement, we had to go back to work, as many others have had to. I certainly wasn’t laughing then.

Perhaps, as Paul L says, I am too dumb to live (not an exact quote, but that’s the gist). All my husband and I can do is try and learn as much as we can and take advice from those who know better. At least those who are actually trying to help.

2. My experience with the TD branch in our community was factual. In my conversation with the Couch Potato, I even left out some really depressing bits. I appreciate that others have had great experiences, and that gives me hope. Perhaps it was a situation of a e-Series newbie (me) meeting a newbie mutual fund representative and her super-trained (in traditional mutual funds) supervisor. I don’t know, I don’t have anything to compare it to. But it was peculiar that even the EasyLine rep basically told me to lie to his own colleagues at the branch so as not to rock the boat. Perhaps, if I’d followed his advice, things would have gone better. But I’m not very good at lying, and I didn’t get why I should have to.

3. I did investigate the TD Waterhouse route. Since we do not have a household account of $100,000 stuffed under our mattress (in order to qualify for the cheaper trading fees), it would mean moving our money from our current investment company (which is currently holding our money captive with exorbitant DSC fees) into a kind of holding account.

To avoid the annual $100 fee on an RRSP account, we had to have a minimum of $25,000 in each registered account with TD. We don’t have that extra money. And this seemed too complicated for us, particularly since we simply wanted to determine how the e-Series process worked with a basic $1,000 deposit. In this, in my opinion, TD failed. As we have still not received notification that we can do the conversion online, we’ll see how the second part of the process goes. I am hopeful, based on the helpful experiences shared here.

4. After all we’ve been through this past two years, we are weary of more sales talk. Perhaps more sophisticated investors can shut it out, but that’s more difficult for me. My conversation with the TD branch supervisor and the TD Waterhouse rep involved the same spiel my husband and I have heard (and succumbed to) countless times before. Eventually the TD Waterhouse rep realized that not only had I been there, done that, and had the T-shirt, but a permanent tattoo on my backside. I wanted to hear about other possibilities, and I think by the end of our conversation he got that.

5. Finally, thanks to those who posted helpful comments. Knowledge shared between positive, helpful, concerned people is, I have come to believe, our only weapon against the investment industry juggernaut. As for those who can only make themselves feel superior with sarcasm, you are wasting my time. I consider it an achievement to have finally figured that out.