Quote:
Originally Posted by kl83
Not quite how this works. The way this investment works is that you need to contribute a definite amount each year until age 17 to qualify for the bonus.
If you contribute $100 per year, MER would be $3.50 and they would provide you a $15 bonus. And this would be the same each and every year.
This would not be a good plan for someone that isn't committed to doing this until age 17. If your planning to stop or do sporadic contributions, this would be horrible.
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I think it's pretty likely that you have to pay the $3.50 every year. So the example I gave was for the first year's contribution, where you put in $100, pay a cumulative $70 in fees and get $15 back.
The next year, you put another $100 in, get another $15, and pay $3.50 per year for 19 years, or another $66.50 in fees.
So the deal gets better every year, but its not very good overall.
I'm not trying to convince you, since you have an incentive to not be convinced, but I think the vast majority of people are better off with something with lower fees.