Hi Kevin,
I use to be an investment consultant, here's a few tips:

The main thing to remember about investing, its all about how much risk you are willing to take for an expected gain in all forms be it mutual funds, real estate, art, ps3's whatever. The faster something rises the faster it falls, so if you want to manage your own investments, you will have to pay attention and do a lot of homework, the rule of thumb is about an hour of research per day (or like a fantasy NHL/NBA pool) per individual stock, thats why mutual funds are so appealing.
a few myths:
a diversified portfolio is made up of all stocks - no, it is a portfolio of investments it can be real estate, art, sports cards etc. the stock market can go down but other things will go up, thats why "canadian index fund is a diversified portfolio" is misleading

mutual funds are all tax - it depends, they are tax deductable when you declare them as RRSP's with the goverment in an established account w/ a bank or brokerage(which are taxed if you withdraw from the fund unless you are buying your first home) OR if you hold them outside an RRSP, ie trading account, then if you sell and lose money, the loss is deductable.


Real estate is a good idea - I'm not convinced that real estate offers such great returns, its only good if you can make more money renting it than your mortgage+maintenance, which is hard considering how expensive it is to buy vs the rental rate. With interest rates the way they are, the bubble will burst, they can't go anywhere but up. Long time investors in Calgary can remember the crash that happened after oil fell below what it costs to extract it from the tar sands.I think the magic number is 50something/barrel which it is dangerously close to right now. Location is everything they say it is and changes everything however.

** By the way if you are rushing to get your RRSP's for tax claim before the deadline, you can park them in a GIC then sell the gic and buy mutual funds of your choice when you are ready**

If you have paid down all debt except for a mortage, then for $2k, mutual funds are the way to go if you are going back to school. A good site to research mutual funds is Morningstar.ca they are the industry standard for measuring risk vs return and their higest rated funds are a legitimate independant source, beware your banker, some of them are paid to sell only certain funds.

BTW depending on your annual salary i think that for 2k (2k is not much, sorry), to drop it in an RRSP to reduce taxes is a bit premature ie. if you don't make more than the 50% ( i think its like 56k/yr?) threshhold it is better to save your contribution room for when you make more, hence taxed more so that you save a greater % on your declaration. What i would do is to pay down debt .ie if you owe on your credit card, a 2k payment saves aka earns you 18%+ on interest right there, guaranteed (for loans a bit less). The best mutual fund manager in the world couldn't guarantee you 18%.

live the phrase "Past results do not predict future returns".

Cheers

 

I think your second last line there was key.


Wanna make money fast? CC's charge huge intrest rates and if you're carrying a balance eliminate it with that money... best investment period.

 

man ... i tune into my fave rx site to get away fron the rrsp rush season that i am going thru as a financial planner ....and what do i get?! an rrsp thread! aaarrrggghh

seriously - dont have to have lots to invest, nor do you need a big income before you start into rrsp's (not everyone gets to the 50% teac bracket where the rrsp deduction is the biggest.

forget a bank too often you dont get the same person so the advice isnt always consistent ... go to a good local financial planner - get your $2000 in by march ist (park it in a money market fund if you dont like to make quick decisions) and start a monthly PAC contribution to build towards next year.