Investing Master Class

Lesson 7:

Should I Pay Someone to Help Me?

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Armed with new knowledge and confidence, you're ready to start investing. In this episode we help you weigh all the pros and cons of paying an advisor to invest for you. We'll tell you what to look for in an advisor (and what to avoid). And, we'll also teach you everything you need to know if you choose to start doing it yourself.

Full transcript

Make a deal with yourself. Five minutes of this and you can watch one minute of Russian dashboard cams.

Look at you, you're really doing it. You're investing and you're smart about it, because you know what you're doing. You're harnessing the unparalleled engine of financial growth that is the stock market.

You know how to do it. Automated, diversified, long term investing. And you know when to do it. Right now.

First, there are two things you need to consider when deciding who to trust to help you invest. Or, if you need anyone at all. One, what you're paying for. And two, how much you're paying for it.

Whether you go with us or someone else, make sure you know what you're paying in fees. Are you already invested and you're not sure what you're paying in fees? Now might be a good moment to press pause and check that out.

Now, while we can't speak for everyone, we can tell you that Wealthsimple charges a fee that we're 100% transparent about. It's 0.5% and that goes down to 0.4% for clients who invest $100,000 or more with us. Statistically those are very small fees for the services we offer. But more importantly, let's look at what that fee gets you.

The first thing you get when we invest your money is a very efficient, very sophisticated portfolio, personalized for your needs — how old you are, what you're saving for, when you'll need money and how comfortable you are with risk. We spend a great deal of time and energy building next generation portfolios that are diversified. You might be saying, couldn't I just buy a bunch of ETFs and do it myself for less? Sure, you absolutely could, you'd just have to calculate the right mix of funds for your risk appetite and then buy that balance at regular intervals without letting emotion get involved.


When we design a custom portfolio for you we put your money into many different kinds of investments. And, we'll adjust your risk level based on your goals. That's called your asset allocation, but markets never stand still. And, as they go up and down, your asset allocation can get all out of whack. So we constantly rebalance your assets for you.


We also do something called dividend reinvestment. Now sometimes the companies in your portfolio give a little kickback to the shareholders. This is called a dividend. And rather than blowing your dividends on lottery tickets, we put your dividends right back to work for you so they can earn even more money without you having to make a decision or lift that little finger.


We also want to make your account as tax efficient as possible. When the value of an investment goes down, you're allowed to deduct the losses from your taxes. Wealthsimple uses a feature called tax loss harvesting to automatically save you a ton on taxes.

If you want advice on how much to invest or how much risk to take on, that small fee gets you free unbiased advice from our expert team of portfolio managers. But I guess if you love Microsoft Excel spreadsheets and tax law, and still want to do all the work of maintaining a portfolio, you can.

And, be sure to check out our other video series, How to Alter the Wills of Rich Relatives.