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- , 20- PORT PERRY STAR - Tuesday, March 23, 1999 Everyone should have an RRSP. It is the best tax shelter available to us in Canada. You can hold many different types of investments in an RRSP from cash to mutual funds. With the tax savings you get on the original deposit and not tax on the invest- RRSPs are your tools ment returns, the value grows very quickly. Following is an illus- tration: A. $200 per month placed into a non-regis- tered investment earning 8% Monthly investment $200 x 12 x 35 years = _ SCUGOG FINANCIAL J ~ SERVICES INC, GUARANTEED INVESTMENTS. e Annual Rates GIC RRSP 1 YEAR........ seeseesunse . 2 YEAR..................... 3 YEAR.................... g 4 YEAR..................... 5 YEAR...................... 5.45% - 30' DAYS casHaBLE $1,000 minimuMme.eeeee 5.10% -5.20% .5.30% 5.35% 5.00% 5.20% 5.30% 5.35% 5.45% -4.55% Rates subject to change without notice ad B "Serving Scugog For Over 15 Years" 250 Queen Street, Port Perry 905-985-3832 (next to Shoppers Drug Mart) | SHEPHERD & POWELL _ OIE RVRU N03 003 DJENGIGI0] BAY IAW \f 1 Jppum-- Accounting, Income Tax, Financial and Estate Planning & Consulting Services INDIVIDUALS e BUSINESSES FARMS TAX 'E-Filing' at No Extra Charge RETURNS Assistance in filing Government Forms and Returns New Business Planning and Startup PREPARED Evening and Weekend Appointments available FREE INITIAL CONSULTATION Personal, Confidential Service DAVID R. POWELL, s.comm., ms.a., CA., CFP 250 Queen Street, Port Perry 985-9791 (next to Shoppers Drug Mart) ROGER B. MOASE CHARTERED ACCOUNTANT Income Tax Return Preparation . Electronic Filing + FH Ne Individuals, Small Business, Farms, Corporations "Personal, Confidential Service... and a Real Person Answers the Phone" oh 175 North Street, Port Perry (905) 985-8893 Email: rbmoaseca@sympatico.ca $84,000 Total Value in 35 years (after 40% tax) = $217,380 B. $200 per month placed into an RRSP earn- ing 8% Monthly after tax investment is the same $84,000 Monthly tax credit of 40% = $333 contribution Total Value in 35 years (pre-tax) $763,863 As you can see, it pays to invest in an RRSP where you can have the income tax dollars work- ing to increase the value of your investment. The Advantages of Starting Early Assume Susan and Bob both contribute $2,500 per year to an RRSP earn- ing 10% return. Susan started at age 20 and When you buy Canada Savings Bonds through a payroll deduction plan, you always pay an interest premium over and above the actual cost of the bond. Don't forget to deduct this amount as an interest charge on your tax return. Personal Wealth Management™ Education Savings Plans | The Smart Way to Talk with Investment Advisor RBC DOMINION 434-7156 or 1-800-267-1522 SECURITIES 111 Simcoe St. N, Oshawa, ON LIG 454 Save! Robert J. Gow Van Camp & Keller CHARTERED ACCOUNTANTS aE for a great retirement: Use them wisely investments. If you plan stopped after 15 years. Bob begins contributing at age 35 and continues to contribute until age 65. Results: at age 65 - Susan $1,525,000; Bob $455,000. Tax on Business and Investment Loans Any money borrowed to fund a business or an investment outside an RRSP is deductible for tax purposes from the income generated. Favourble tax treatment is available for dividends and capital gains generated from to invest in a business, it 18 wise to consult an accountant for tax advice before you begin. If you plan to invest in an invest- ment portfolio, consult a financial advisor for investment and tax advice. Courtesy of, John Walhout, CMA Independent Financial Advisor, Balanced Planning Financial Group, Prince Albert, ON Interest should be your main target when paying off bills and loans How much of your weekly or monthly income is eaten up by various interest payments? The average couple with a mortgage and a car loan may devote 30 percent or more of their take home pay toward various interest charges. Who are you sup- porting - the lender or yourself: For example: A couple earning $50,000 per year with an $125,000 mortgage, a $20,000 car loan and an the following interest: 1. Mortgage: Principal $125,000 at Income tax planning and return preparations ® Personal tax returns electronically filed Financial, estate and retirement planning Personal Tax Returns are being processed now. OFFICE HOURS UNTIL APRIL 30. Monday to Friday 8-6, Saturday 9-1 204 Casimir Street, Port Perry, Ont. LIL 1B7 (905) 985-9725 © Toll Free 1-800-215-3852 7% with 25 year amorti- zation First year payments ($883 x 12) = $10,602 First year principal paid $1,912 Interest paid $8,690 2. Car Loan: Principal $20,000 at 8% for 4 years First year payments ($488 x 12) = $5,856 First year principal paid $4,419 Interest paid $1,437 3. Credit Card $2,000 at 2% per month $480 Total annual interest paid in the first year - $10,607. Take-home pay $50,000 x 70% = $35,000 - 30%. As you can see, if there is any way to improve your disposable income, the interest that you pay should be the number one target in any financial planning process. The degree to which you are ~ successful in reducing that interest payment each month will be the degree to which your financial plan is successful. The sooner you make that interest payment nil, the sooner you will be able to meet your other financial objectives. Courtesy of, John Walhout, CMA Independent Financial Advisor, Balanced Planning Financial Group, Prince Albert, ON RS eda aia A a i A SB AG a + po