If you feel confused when you look at your investment statements, you’re not alone. We often get asked how to read and understand the information on these statements. In this video, Kelley Doerksen walks you through the key information you will typically find on your statement and what it represents.
On a typical investment statement, you’re going to start by seeing the book value. The book value represents the cost of your investment, so the amount that you’ve purchased as well as any additional dividends or distributions that have been added to that particular position or security. That book value is going to be all of those contributions less any withdrawals that you’ve made on that security.
You’re also going to see the market value, which is the amount that particular position or security would sell for on the given day. Book compared to market value is important information when you’re looking at an investment in a Non-Registered account particularly because that’s going to indicate some of the taxation information that you might need to know.
The difference between book and market is going to be your gain or loss. If you’ve got an unrealized gain or loss, it means that you haven’t sold that position, and you are going to eventually realize that gain or loss when you make a disposition.
Our clients will also see income on current positions on their statements. This represents for most of our clients, the dividends that they’re earning on that particular holding. It could also represent the interest income that you’re earning on the bond position.
Another really important piece to your statement of course, is the performance. So, on your statement you’re going to typically see a net result – what your portfolio has done less fees have already been considered. That’s typically going to be a percentage, and you’re going to see that indicated for short, mid-term, and long-term performance. The most important indicators tend to be the longer-term history of your portfolio performance because it shows how consistent your performance has been and what a job your portfolio manager has done for you.
You’re also going to hopefully see fees in a clear and transparent way. Your statement should show what you’re paying for the cost of fund management and for the cost of advice that you’re receiving.
Another important element to your statement is going to be the asset allocation. That’s going to show you the amount of stock versus bond, or fixed income that your portfolio holds. Every client has a different asset allocation depending on their needs and their level of growth desired, and this is going to be indicated on your statement. You will typically see a listing of all of your stocks together with a percentage that you hold in stocks as well as a listing of your fixed income posted together with a percentage there as well.
It is with heartfelt congratulations that we welcome Kelley Doerksen, CFP®, CIM® as partner in Blackburn Davis Financial Inc.
Kelley has been a Financial Advisor for 13 years. She achieved her Certified Financial Planner designation in 2010 and her Chartered Investment Manager designation in 2017.
She has just qualified to be registered as a Portfolio Manager which allows her to manage client assets on a discretionary basis. This is the gold standard of financial advice in Canada. She is also currently working on her Trust and Estate Practitioner designation (TEP).
Obviously, self-development and education are a cornerstone to Kelley’s success. What is more remarkable is she has been able to accomplish these milestones while being a dedicated mother and outstanding Advisor.
She is a thoughtful, empathetic, and highly skilled planner who acts as our go to resource for many of the more technical financial planning issues we face. Congratulations Kelley and thank you for your dedication and service.
Stephen MacDonald, CFP®, CIM® & John Davis, CFP®, CIM®, CLU®, TEP
Here is a friendly reminder of the contribution limits and cut-off dates for RRSP and/or TFSA contributions if you are planning to make one this year, and have not already done so.
The cut-off date for your RRSP contributions to count toward reducing your income for 2020 is Monday, March 1, 2021. In order to meet this deadline, you should make your contribution by February 25th to allow for your deposit to clear your bank account. The 2020 contribution limit was 18% of your taxable income up to a maximum of $27,230, whichever is less. The 2021 contribution limit is $27,830. If you have unused contribution room from previous years, you may contribute more than the maximum, but one needs to be careful not to over-contribute.
If you would like to contribute to a TFSA for 2021 the limit is $6,000 for the year, unless you have not maxed out your contributions. The maximum one could have deposited into their TFSA account since 2009 is $75,500 as of 2021.
Contributions can be made through one of the following methods:
Transfer from Non-Registered Account: If you have a Non-Registered account set-up with enough funds in it, you can simply send us an e-mail indicating the amount you would like transferred from this account to your RRSP or TFSA. Instructions must be sent to us by 11:00am on Thursday, February 25 in order to meet the deadline.
Online Banking Transfer (Bill Payment): Add your Custodian (“Credential Securities” or “National Bank Financial”) as a “Payee” through your online banking and enter your account number as the bill account number. If you need assistance finding your account number or are unsure who your Custodian is, please contact our office. If you choose this method, please also notify us with the amount you are contributing, so we can have your Portfolio Manager watch for it. Please note this must be submitted before midnight on Friday, February 26 in order to meet the deadline.
EFT from your Bank: You will just need to sign an EFT form if you have not already done so, which allows your Custodian (Credential or NBIN) to take the money directly out of your account with your consent. Once you have signed the form, we will require an email from you indicating the one-time amount you are authorizing them to withdraw from your bank account and which account you would like it deposited to. We must receive these instructions by Thursday, February 25 at 3:00pm at the latest in order to process in time.
If you have any questions or would like to book a video or phone appointment to review your accounts, please contact our office.
You may have noticed we have adopted a new look. Some changes in Securities Regulations have made it necessary for us to hold ourselves out differently when discussing investment related activity as opposed to financial planning and insurance. As such, we have registered the names Blackburn Davis Wealth for investments and maintain Blackburn Davis Financial for our insurance and financial planning activity.
Because of this change we decided after almost 15 years, it was also time for a refreshed logo and brand. This new look has come with a new website and videos. We encourage you to browse our new website and would love to hear your feedback.
Please note that this is all that has changed. We remain the same people committed to your retirement and financial planning needs.