My mutual fund problem with TD Canada Trust

I am so irritated with TD Canada Trust. In fact, I’ve had this problem with them since 2007, but I haven’t done much with my account until the past year or so, when I’ve wanted to switch up my mutual funds and buy a bit more aggressively for the long term.

Basically what is happening is, every single time I want to purchase higher risk mutual funds, I get the following decline e-mail:

Order # XXXXXX-XXXX-XXXXX

Dear Investor,

[...] We have not fulfilled your request because it may not be suited to your current investor profile. We have based this assessment on the information you provided us regarding your personal circumstances, investment knowledge, objectives, time horizon and risk tolerance. Not only do we want to help you make the best investment decisions, we are required to assess the suitability of all mutual fund account transactions.

Please contact a TD Investment Services Mutual Funds Representative to review and update the information we have regarding your Investor Profile.

Thank you,

TD Investment Services Inc.

The fact that I have to call in to fund my mutual funds is bad enough – especially when TD Canada Trust’s website states: “create and manage your own online portfolio or have us manage it for you. The choice is all yours.” Well apparently I don’t get a choice because I am not being allowed to buy the investments I want to buy.

When I called into customer service this morning, I got routed to a call centre in India. And fine, I get it, that’s what a lot of companies are doing. But I really could not understand what he was saying, and that’s a problem when it has to do with my money. He made me go through 10 or 11 questions to update my Investor Profile – which would be okay except that they make me go through those exact profile questions every single time I call in. It is a long process. And when I asked him to complete my transaction, he refused! He said I wasn’t allowed to do it online, and he wouldn’t do it for me. He said the mutual fund was too risky.

I asked him if there was something I need to do in order to have the freedom to buy whatever mutual funds I want to buy, and he said no. He said every single time I buy something that is high risk, I will get a decline e-mail and have to call into customer service, where they will also decline the transaction. This has happened 3 times in the past year. Do I need to switch over to a TD Waterhouse account? Why aren’t I able to spend my money on what I want?

Maybe I should make an appointment with a financial advisor.

About Krystal Yee

I'm a writer, personal finance blogger, and marketing professional based in Vancouver. I'm a former Toronto Star (Moneyville) columnist, author of The Beginner's Guide to Saving and Investing, and co-founder of the Canadian Personal Finance Conference. When I'm not working, you can usually find me running, playing field hockey, or plotting my next adventure.

21 comments

  1. Part 1: Risk Management is everything in regards to investing in the markets… Why? Because of all the unforseen events that have occured throughout history. Examples include the Tech Bubble Burst/ World Trade Centre in 9/11 in 2001/ US Subprime/ and all the recessions in the past. The Fact is that the marekts are unpredictable and you never know what will happen unless you are a fortune teller. These questions are there to protect the cusotmer based on their Risk tolerance/ Timeframe & Objecti ves; this is to ensure the cusotmers are in the the right investments and they feel comfortable & understand their Investments that they are buying.

  2. Part 2: The Truth hurts: Many people were in the wrong investments when these unforeseen events occurred in the past and the markets took a Big Negative downturn. The investments customers had were Higher Risk investments compared to the Risk they are willing to take; hence, many people lost a lot of money including their life savings which creates the emotional side of investing such Fear, Anger, Panic and Depression. Those who actually invested properly based on their Objectives were stable in their portfolios and were comfortable compared to those who were chasing the next big investment depending on the sector such as Energy, Resources, Precious Metals, Science & Tech etc… TD Mutual Funds has provided me with Comfort & Reassurance due to the Great Advice I received from their Advisors based on my Objectives for the long term and the Pay Off has been there!

  3. Part 3: If you do your research than you will know that TD has some of the Top Fund Mangers & Funds in the industry in regards to Balanced Funds & Cdn Equities. They have won many awards based on Risk Adjusted returns at the CDN Investment Awards & the Lipper Awards. Morningstar that looks at over 5000 mutual funds in Canada has some TD Funds as their Top Analyst Picks which is the Highest honour a mutual fund can receive in its category. In addition, their Fixed Income Team received an Award as the Best Team in Canada! This proves the Mandate & Merit of TD funds and the Mangers & their Risk Team who are in charge of managing the funds. They are Executing & Delivering to their Investors!
    Huge Thanks TD Mutual Funds for Making Me Money throughout the years & Looking after my future for the long term!

    GO TD Funds GO!!!

  4. ** I had to split my comment because it was too long. Sorry for the length :S

    It might take you some time to find a CFP your like but I would search until you find someone you like and that understands your financial goals! All the fees you pay when you meet with a CFP in regards to mutual funds or other products should be transparent, they should explain to you what and how they get paid! I work in the industry and having a professional manage your money or at least getting a free second opinion if you chose to manage it yourself should only benefit you in the long run. Again, just my long winded two sense.

  5. Possible Answer

    I think the investment risk questionnaire is there to ensure that a TD investor is coerced unkowingly into risking more than they are cofortable with losing. It's there to protect people who do not know the fine print about investing and the risks involved in losing your money or not making a high interest.

  6. You definitely should open a TD Waterhouse account. If you purchase TD funds then there is no commission. The $29 commission is for funds from other companies or stocks and bonds. There is a yearly account maintenance fee of $100, but that is waived if you have a balance of $25,000.

  7. Interesting! Thanks for the info. I will look into it once I get my RRSPs back up past $25,000. Which hopefully won't take too long…

  8. Had this problem once. Told them if my instructions were not carried out, I would transfer the entire portfolio to a competitor. No problems since.
    My recent post Can debt make you feel better about yourself when you’re young

  9. I had the same issue with TD and it was driving me crazy–especially since the performance of my portfolio weathered the 2007-08 crisis far than what I had been recommended by an advisor. I convinced them I knew what I was doing, peppered in a few threats to remove the money, and they finally removed that block. I can now buy whatever I want and move whatever I want. The annoying annual questions/review/profile thing once a year still has to be done though–I'm pretty sure that's the law.

    • So there is a way to remove the block… I doubt I have enough pull to do that, since my RRSP account has kind of been depleted by utilizing the HBP. But it's worth a shot!

  10. The problem you are having is because you are not answering the customer investor profile correctly. Due to compliance regulations TD is not able to sell you for example a 100% growth fund when your risk profile does not show 100% growth. You need to callback and answer all the questions with a long time horizon and highest risk tolerance then you can buy any of the funds you’d like. It’s like this at all of the banks unless you get a self-directed account. Hope this helps

  11. I think TD Canada Trust’s goal is to try and sell their managed portfolios so that they can make more money.

    I am going to switch to Waterhouse, I have had so many problems with TD CT. The only reason I am staying with TD is because of their mutual funds.

    About the fees being waived if you have more than 25,000$, can it be spread across multiple accounts (i.e. RRSP, TFSA, regular mutual fund account)?

  12. Not sure why I am even going to bother with this. For those of you like Bob who think that if you threaten to take your money elsewhere TD will accept your trade, you are mistaken. As well there is no ‘Block” on your account. When you open a mutual fund account you go through a customer investor profile questionnaire. All the questions asked are required by regulatory bodies and must be documented in the customers profile. These questions such as your risk, time frame and investment objectives allow for registered reps to determine what funds to advise for you, or if the trade is unsolicited, whether your request is suitable. If your KYC (the info from the questionnaire) does not fit with what you are asking they will reject your trade. They will inform you why what you have asked for does not match the information you had previously provided. If you have indicated you are not willing to accept substantial risk, and you ask for a high risk fund, how does it make sense for them to accept your trade? Think about it. No reps on the phone, or in the branch are commissioned. And to poster who ended up in India- you are wrong. TD does not have a mutual call centre in India. They are based in Markham Ont. They have telephone banking in India.

  13. Hey, Yeah if you want to manage your own portfolio i recommend you go to td water house, they are alot better! or you can ask for a unsolicited trade option which will allow you to buy from the branch.

    I also work at TD.

  14. This is a lot of hot air from people telling you that TD should have control over what you do.

    Its your money. Invest it where you want. And if TD is blocking your access to your money, or making it difficult to work with them, I’d say move on.

    Normally I have good experiences with TD. But some of their odds and ends have real issues – this is a good example. Personally, I don’t have the time or interest to do a questionnaire. And if I want to buy or sell, that’s my choice. I don’t want to speak to some yahoo, restricted to their call in hours, just to repeat the same request I made the day before.

    It is a waste of time. If you can, get away from companies that do these types of things, and ignore the TD employees above.

  15. NEWS TD raises rates/charges to finance Free Samsung Galaxy Tablets for new customers on the backs of existing customers!

    4 + months to close 4 mortgages. Terrible service
    3+ Weeks to transfer RRSP cash to TD Mutual

    Decreasing service and increased rates!

  16. Has anyone else had this problem with TD – I’m happy with my TD mutuals that I’ve weathered the storm of up and downs, now, they are telling me that 2 funds i.e.TDB158 & TDB673 are being terminated and when I asked why want me to reinvest in newer funds. When I said I would roll the money from these funds into my other TDmutuals they wouldn’t let me do it until I answered a profile questionnaire. I told them it was a waste of my time as I wasn’t buying any new funds, I was sticking with the existing funds I had. I did the questionnaire and like above comment I was told they were not allowed to transfer MY terminating mutuals (that’s if they are really terminating – I don’t believe any thing they say)- they said I had to go into a branch and that was the only way I could transfer the terminating funds. Since I already have mutuals with them I don’t understand why I can’t do this on line. Are the mutual funds mentioned above really terminating or do they want to steer me into buying newer and unchartered mutual funds which I’ve already told them I won’t do. Its my money and these funds are performing better than in the past, so why should I change if I don’t want to?

  17. If you think you know as much as a licensed mutual fund investment professional, then go right ahead and do it all yourself. I don’t believe everything in this world should be done online without the help of a pro, certainly not investing in mutual funds. In your case, you are trapped in “good luck with that-a do it yourself” system designed to protect the company from YOUR mistakes. Every mutual fund has a management expense associated with it, whether or not you use a professional, you still pay the same expense. So my advice is to seek out a pro, let them help you do it right, and stop whining about wanting to do it yourself. This industry is not what the internet was designed for.

  18. http://www.tdcanadatrust.com/mutualfunds/tdeseriesfunds/pdf/NewAccount.pdf. This will give you an overview of the questions and what type of fund you will be put in depending on your answers.

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