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PAGE 16, WHMTY FRME PRESS, WEDNESDAY, WAUAR 919 Whitby Free Press rPinanciai! Planning-Report RR P:Mostgeneroustax,.inoentiveanywhere ByInve«té;,s Groupe mlu. Canadian, taxpayers are getting a break in at leant one direction this yeer -- on their Registered teirement Savings Plans (RRSPs). Described by financial planners as "the most generous tex incentive in - the. world," RRSPs permit Canadians to defer icorne tax on the money they inveet, up to alloweble mnaimums.. In the. case cf people who1 are not ' m a company pension plan, the . ceiling for RRSP contri- butions made up te Feb. 29, 1992 is $11»500, cýr 18 per cent cf earned ïnconie .- wbiciiever je leus. T e um invest.d cen la deducted fin 1991 earned income' before icorne tex le calculated. Tii. result je a semaller tex bll or, for those who pay tex ,via payroll deduction, a Ierger refund. RRSPs cen la purchesed tbrcugii mutual und or iveetment companies, bank, stock brokers, insurance compenies or registered sales representatives. 1Wayne Welker, vice- president, marketing of Inveetors Groupe Inc., Cenadae'ebiggest mutuel fond 'company, saye Canadie*ns put more than $11 billion into mutual funds in 1990. The amouint is expected te la even greater for 1991. UTii average centributor will S find that their tex-saving will represent enywhere 'labtween one-quarter and one-half of the. amount they're' investing," Walker says. This eaies aximm cf $11500wilbe ncraseby$1,000 eech year until 1995, when-tii. Maximum will la $15,500. Last year, thIz.liit was $7,500. Revenue Canada b as been mailing eut notices te texpayers who are enrolled 'i company pension plans, advising them cf the alloweble contribution they cen make in a personel RRSP. Most Canadiens entrust their RRSPs te an establisiied finencial istitution,, sucii as Investors Group, Walker saye, altiiougii self-adminietered plans are permissible. Hescompeny offere a *d arety of mutuel funde tiiat quelify as RRSP vebicles. A growing nunilar of Canadiens -- at leastone ifive texpayers -- inveets in RRSPs as a reirement- supplemhent te compeny or government pension plane. "The addition cf an RRSP te eisting pensions cen ensure on. of blig ia very comfortable financial position at .retirement time,"et ays Welker. "Tut tiioe dependent on government pnonalone will la idifficult sris"h. predicta. "E1ven new, government pension levels barely match tii. poverty lin., and wiio knows iiow mucii tieyTll laworth ithe~ future.' By National Trust Once you féel comforteble witu tue lanefits of an RRSP, you will need te, decide wbat kind cf RRSP plan is beet for you., Financial institutions citer a wide variety of options 'but basicelly.tiiere are two tyypes: 1. lnterest-b.aring deposits tuat give a flxed return over a selected term on your investment or variable rates. 2. Investment fonds known as mutuel fonds tuat pool' your aavings aleng witu others and in vest'-tuem in stocks, money mnarket instruments' or a combination cf investments. *Over certain periods, stock portfolios bave tended te citer reture superior .teitereet. bearing dpst. Generally speaking, thioug, tue bigher the. return on an investment, the Whulé meny texpayers .will la meking RRSP investmients in, January and Februaiyso es toD make the. deedline for a 1991 tex benefit, finencial plenners recommendl m-aking regular contributions,- sucii as once a meonth or witii eveiy pay chieque. The maximum cSilngs are now sogen erous'that few people will lea ble te teke, adventege of the* tex, lanefit through a one-ahot investment. By investing on a regular basis, one cen increase tbeir tex savingse and .njoy an eerlier return on their investment. Mutuel funds continue te b. the most popular RRSP vebicle, according to Walker." Mhier tii. potentiel riek cf fluctuation or lose. Eecii person'e circuinetences. and personality are unique, end it je importent te decide wbat kind. cf investment yeu feel comfort- able witii. There are some things you sbould consider' lafore mneling a decision: 1. How meny years do you have te go blfore you retire?, Younger people ce n afford te take a longer-term view of their reirement .tiian tuoe clos, te retirement.. Stock or bond investments, may make sens. for younger people. If you are close te, reVirement, you siiould look at investments that bave minimal or no isk. 2. How mucii wouldyou wor about your investments? -Wiien the stock markets are constently .clinbing, it's bard Vo think of tue downside but it dees bappen. If you won't la able te- sleep at nigiit worrying, about, pour retirement savinge invested ini stocks, then a depesit option may b blastfor you' Attending seminars an reading publications williielp you make an iformed decision. Pick en RRSP -option tuat you feel coniforteble witii and, that suite A variety of funds are available to meet ý the inidividuel needs. These: iniclude equity fumds that invest in the shares of public It is urgent that people realize that they are going to have to finance their own retfrement," companies and, funds with guarenteed* rates of return, such as money marlket -bond and mortgage funds. your circumetences. Once yeu've decided on 'the. investment laest sited Vo you, teke a close look at. the features and lanefits of the. plans ýbeing A Gallup ,Canada survey' sponsored by Investàors ýG concluded , fthatCanadinsw bave lVo start investngmrie ýif tiieyU l btn teraietheir' About one-third of Canadiens now. have" no reirement- fond, other then the Quebec r, Canada. Pension'Plan and the federel Old Age Security pension, Welker- "It is urgenttfor people_ ,toý' reelize tbat theyar ogt bave te finanhce t e.r.,own reirýîeent.Tières no laer a te do tuisthen bytain advantage of tii. taxbrastt RRSPe offer.0 offered. Read o ver the lega documentaton that, portaisnote tuete cf plan, you've selected andtUd l sue you, understand-, exactly what it is YOU are buying.ý Heres, a six-point checklist of thingas.» te consider, .before deciding where to invest ýyour RRSP contributions thus yeer. Chocs. wisemly now, and your nesi eggM will, growfester, helping yo afford the. lifestyle you want later. Set objeotivem The, types Of investment ýyou .meke will b. influencedt by your goalsend enticipated returns. Consider> time to r.tfroenU tii.e: furtiier 'away retirement is. for you,'tho m«ore empiiesis you should place on growth assets. Plan u .your future: The> way you. hope te live dur1n retiremnent, and the. emount of inco'me1 youl1 require, shoulÎ influence your investment decisioes. Celculats other sources of retrement, ioomo: If you¶l b. eeiving substntial fonds froni other msoucs, you may feel c orable intakring amore egresiveinves3tment pom*tion. Knwyour. rhsk toleraucm,.k he ohWld saW about not ivstnnything that will keep you aiaee night hl tre sPsawell.1, RLevIew 7zdn-RSP Ivetni If you have- a large portfolio outside, your RRSP, youd -be smar t te lai more equities (stocks eând,- stockoeinted- mutual ,fonds) ih - tus ~floemphesizing -interest-bearing investminents in the HÏ1-GHER RRSP RATES..' GUA RANTEED.- Hongkong Bank of Cm"ad We guarantee rates /igher thiant zse ' po.e<l li, R<>al Banik. CIBC. Bank of Montreal, Scotiabank, TD. Batik, Nationail Banik of C'anadaî. ý'alt fr iitî Royal Trust and MonîirttalTrt i J ixved-tîertm releeniable RRSPNv. Please contaic~t yvQr neairest hr<îli jrfii letails. > A..14 t (~'î~ ç,î4'~rflk' *ikf . i~Cè P hf'd'IrCF err i -~ .M kW, iwkL ........................................~ ~'*** 'PUONI: 66(~-23OO .Pickig the.est.RRP. fo m- ;&& 1 ý ý - ýý .,