Four financial advisers reveal their RRSP strategies

The Globe & Mail, Jennifer Lewington, February 2014

A modest U.S. recovery in 2014 is raising hopes for a global upturn, according to economic forecasters. But nagging uncertainty remains over the future direction of interest rates, the impact of a weak Canadian dollar and slowing growth in China.

Given all the "what ifs," we asked four certified financial planners to map their RRSP strategies for 2014. While they vary in age and investing philosophies, the planners agree on the need to look beyond daily headlines to put together an RRSP with staying power.

The advisers' strategies are their own, not recommendations for others.

Andrew Guilfoyle
Age: 41
Position: Partner, Guilfoyle Financial, Toronto
RRSP Profile: 90-plus per cent equities, balance in cash
Personal investing philosophy: Aggressive, but pragmatic

As a marathon runner and RRSP contributor, Andrew Guilfoyle takes the long view.

"Someone will ask, 'Who is leading after the first mile?' and I don't care," says Mr. Guilfoyle, who has raced in Toronto and Boston.

The same philosophy applies to his RRSP. "One mile I would be ahead and the next mile I might be in last place but I am not going to waver."

An all-equities focus, by definition, is aggressive. But Mr. Guilfoyle views his strategy as pragmatic since retirement is several decades away. "I think it would be ridiculous for a 41-year-old with positive cash flow to have fixed income," says the married father of three boys.

His equity holdings, half in Canada and the other half split between the United States and other foreign markets, are in low-cost, actively managed pooled funds (similar to mutual funds but used by higher-net-worth investors). He prefers funds with a strong bias toward dividend-producing companies.

With market volatility, Mr. Guilfoyle accepts that annual rates of return will fluctuate, too – with gains of 20 per cent some years and losses in others. But over time, he aims for an average return of 7 per cent a year.

In 10 to 15 years, Mr. Guilfoyle expects to add fixed incomes to his portfolio but sees no need to shift his ground yet. "Although the equities market is a rockier ride, if you have the stomach for it you are rewarded at the other end," he says.

This article appeared in The Globe and Mail in February 2014. It is reprinted with permission.

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