The following text may have been generated by Optical Character Recognition, with varying degrees of accuracy. Reader beware!

I Fund Facts: an improvement for educating investors Dollars & Sense Peter Watson Guest Contributor 21 | Thursday, June 19, 2014 | OAKVILLE BEAVER | www.insideHALTON.com nvestors are going to receive better mutual fund information before they make that fund purchase. This is a welcome upgrade to the existing system. It will help millions of Canadians who own mutual funds and have them as their investment vehicle of choice. The value of Canadian mutual funds is approaching $1 trillion. About half of all Registered Retirement Savings Plans and Registered Retirement Income Funds are invested in mutual funds. In the past, the requirement was for investors to receive a simpli ed prospectus for each mutual fund they purchased. The simpli ed prospectus appeared to be anything but simple. Many investors and advisers considered this to be a complicated document written by lawyers for lawyers. Most investors did not have the patience to attempt to read it and many who did, found the information difcult to understand. Now, investment advisers must give investors a short Fund Facts summary of the mutual fund investment. The Fund Facts are simply written and easy to understand. It will communicate what every investor wants to know. How does the fund invest, who is the manager and, most importantly, what the cost will be? The cost of owning mutual funds has been the little dark secret of the investment business for decades. Now, mutual fund fee information is more accessible instead of being hidden in the complex legal jargon section of the mutual fund prospectus. The standardized Fund Facts have been listed on mutual fund company websites since the year 2011. As of June, you must receive a copy of the Fund Facts within two days of purchasing that fund. The ultimate goal is to get that document into your hands before you purchase the fund so you can understand the information before any purchasing decision is made. You might nd it helpful to read the Fund Facts for all of the funds you own. Go online to the fund company's website or ask your adviser to send you a copy. Investment costs are broken down into two segments. First, there is the Management Expense Ratio, often referred to as the MER. Second is the Trading Expense Ratio. Trading costs are in addition to the management costs. That is important for you to know because it allows you to compare the costs of trading between different managers. Managers who trade more often than others will have higher trading costs. In my opinion, the single, biggest bene t Fund Facts will have for you is the disclosure of investment fees. In a perfect world, all advisers would FINANCING ON TDI MODELS 0.9% THESE NEW ENHANCEMENTS WILL PUT A SMILE ON ALL OUR CUSTOMERS! M I L E S 2225 **Passat Up to verbally communicate all fees to all investors. This will be the start of a healthy learning process for clients who have been unaware of the high cost of owning mutual funds. Now that you see the cost, you will be able to make a value judgment about whether the fund and the nancial advice for which you pay are worth the cost. Are you getting good value? Fees are one part of the equation. Financial planning and investment advice is the other part. Virtually all areas of consumerism in Canada require buyers to know the price of what they purchase. That has not always been the case for those owning funds. My prediction is many conversations between an investor and adviser will be dif cult as a result of this new level of disclosure. Investors will want an answer to the obvious question about why mutual fund fees were not clearly explained in the past. The next question brought forward will be whether or not there was enough investment advice to justify the fees. As dif cult as those discussions will be, it will cause the nancial services industry to adjust. Fees should be fair and transparent and advice should be worthwhile. There has to be good value received by investors and the introduction of the Fund Facts disclosure of fees is a good start to improving the investment business. -- Submitted by Peter Watson, MBA, CFP , R.F .P ., CIM, FCSI., Certi ed Financial Planner INCREASED INCREASED DEALER DEALER CASH CASH ON ON JETTA*, JETTA*, PASSAT**, PASSAT**, TIGUAN***, TIGUAN***, CC CC **** **** AND AND GOLF GOLF WAGON***** WAGON***** FOR THE 1ST TIME EVER 0% FINANCING TO 84 MONTHS ON JETTA, PASSAT, TIGUAN, GOLF WAGON AND CC $ *Jetta Up to $ 2500 ***Tiguan Up to $ 3000 OPFFA car wash Saturday supports Distress Centre Local re ghters are getting sudsy Saturday (June 21) in support of Distress Centre Oakville. Members from the Oakville Professional Fire ghters Association will be hosting a car wash from 10 a.m.-2 p.m. at Gears Bikes, 547 Trafalgar Rd. Distress Centre Oakville helps people in the community cope better with crisis, loneliness and emotional stress. "We listen, we empathize, and we're non-judgmental. We provide telephone support on our Distress Line every day of the year. We also provide an outbound-call reassurance program with TeleCheck and online support with crisis chat/text," stated a press release. "All of our services are free and con dential, and staffed by volunteers who receive extensive training in communication, sensitivity, crisis management, active listening, and more." For more information on the United Way-funded agency, visit www.dcoakville.com. $ ****CC Up to 4000 2000 on Gas $ and 1750 on TDI $ vw.ca *****Golf Wagon Up to *Limited time finance purchase offer available through Volkswagen Finance, on approved credit. Example: Base MSRP of $16,385 for a new and unregistered 2014 Jetta 2.0L base model with 5-speed manual transmission, including $1,395 freight and PDI. Financed at 0% APR for 84 months equals 182 bi-weekly payments of $84. $0 down payment. $29 EHF (tires), $5 OMVIC fee, $58 PPSA fee and up to $499 dealer administrative fee are extra and may be financed (OAC) or paid at signing. Cost of borrowing is $58 for a total obligation of $15,876. License, insurance, registration, options and applicable taxes are extra. *Example: Base MSRP of $18,995 for a new and unregistered 2015 Golf 1.8L base model with 5-speed manual transmission, including $1,395 freight and PDI and $2,763 in Fees & Taxes. Financed at 0.9% APR for 36 months equals 36 monthly payments of $652.12. $0 down payment. $29 EHF (tires), $5 OMVIC fee, $58 PPSA fee and up to $499 dealer administrative fee are extra and may be financed (OAC) or paid at signing. Cost of borrowing is $322.62 for a total obligation of $23,476.32 License, insurance, registration, options and OMVIC Fee are extra. Offers end June 30, 2014 and are subject to change or cancellation without notice. Vehicle may not be exactly as shown. Visit your Volkswagen dealer for details. "Volkswagen", the Volkswagen logo and "Jetta" are registered trademarks of Volkswagen AG. © 2014 Volkswagen Canada.