Hey FB! Thanks for the mention and congrats on your success thus far.

Couple of weeks ago I met up with a financial advisor from TDMP (tdmp.com) who implement the smith maneuver. However, during the conversation I learnt that there was a large setup cost in order to setup the smith maneuver which they quickly passed over by saying it was just bad debt and over time it would be converted to good debt.

To give you a quick summary of the cost:

1. Each month I would be paying $39 for the monthly cost of running th smith maneuver
2. The cost of moving from my mortgage broker to their preferred mortgage broker
3. The initial setup cost of approx 1500

The total setup cost added together with my mortgage equaled my total bad debt.

Couple of questions

1. How does this compare with your setup cost or did you have any initial setup cost in order to implement this strategy?
2. In order to setup this strategy to companies such as TDMP charge a setup fee
3. How does one go about finding a good financial advisor that implement this strategy?
any recommendations ?

Cheers
Raj

Hello Raj,

I’ll answer to your questions in order:

1. I did my own setup since I am a financial planner. In general, if you change financial institution for your mortgage, you will have to pay for an appraisal fee (to determine the actual value of your property) and notary fees. That would correspond to cost #2 in your comment.

In regards to cost #1, it doesn’t cost me anything with the National Bank. Home Equity Line Of Credit fees are determined by the financial institution. However $39 a month seems unacceptable to me. For example, an Investors Group consultant would set it up for free. I set Smith Manoeuvre for free at my bank as a financial planner too!

In regards to cost #3, there should not be other initial setup cost than the legal and appraisal cost (which you can negotiate to have a part paid by your institution). I would ask TDMP what they do for $1500 plus $39 than another advisor doesn’t do!

2. As I said in my first answer, you can find financial advisor (preferably financial planner) that will set it up for free. Make sure that you find a reliable accountant that understands the strategy when it is time to fill out your tax report.

3. There use to have a list of “Smith Manoeuvre Professional” on http://www.smithman.net but I can’t find it anymore. I would strongly suggest that you go and see a few advisor before making your choice. It is hard to find a good advisor, but they exist

Good luck with you SM and don’t hesitate to contact me for more question at
thefinancialblogger (at) gmail (dot) com