How much of a RRIF in one fund?

Zoomer | January 1st, 2006

I’ll deal with your second question first. No one can predict what will happen when one fund company is taken over by another. However, I would be surprised if there were any change in the management of the Ivy funds. They have been very successful and I don’t expect Investors Group to tamper with this success. So unless they indicate otherwise, assume the take-over will not have an impact.

As for Ivy Growth and Income itself, this is a fine fund, offering good diversification. However, it is a balanced fund, not an equity fund. If your goal is to hold 30% of your assets in Canadian equities, this fund on its own won’t achieve that for you because it also has fixed-income securities in its portfolio. Also, as solid a performer as this fund has been, I would question the wisdom of holding 30% of a RRIF in any single mutual fund. That’s a major commitment of your assets.

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As an alternative, you may wish to consider putting some of this money into a conservatively managed dividend income fund with another organization.
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You should also take a close look at the idea of holding 70% of your assets in GICs, which pay a very low rate of return. As option, consider some Government of Canada or senior provincial bonds, which would offer a better yield. Mortgage-backed securities are another low-risk choice. You may wish to discuss the possibilities with a financial advisor who specializes in RRIFs. – G.P.