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Posts Tagged ‘Investments’

How Long Will It Take To Double Your Money?

If you’ve ever wondered if you are in a position to actually grow your money, there’s a simple test. Take the number “72” and divide it by the rate of return you’re getting. For example, if the interest rate is 2%, then the number of years it would take to double your money is 72 ÷ 2, or 36.

The “Rule of 72” is a simple formula that can yield powerful insights. (more…)

Nine Ways to Improve Your Finances in 2010

When it comes to our personal finances, it’s easy to set goals, and often hard to meet them. Here are nine financial resolutions you might want to consider.

Tax-Free Savings Account: Have you got yours?

We’re almost through the year 2009, and you most likely made a RRSP contribution at some point this year. But did you make a contribution to your Tax-Free Savings Account? If you haven’t opened one, you’re missing an excellent opportunity to save and invest without worrying about the future tax burden.

With a Tax-Free Savings Account (TFSA), if you are over 18 years old, you can save up to $5000 each year. You won’t get a deduction, like you would with the RRSP, but you do get a nifty bonus. Any investment return you get – interest, savings, or capital gains – is not taxed, not while it builds up inside the plan, and not when you withdraw it. This is a great companion strategy to help pay for education, plan for retirement, and buying a home. You can even set up a TFSA to help you budget for Christmas presents and annual vacations.

If you felt the crunch of the recession this year, and weren’t able to make a TFSA contribution, don’t worry. Any unused room from this year will carry forward. So if you only made a one-time $50 deposit into your TFSA, you still have $4950 in contribution room that carries forward to 2010. This means you have a total of $9950 of contribution room for next year. If you don’t contribute at all in 2010, you will have contribution room of $14,500 in 2011.

Another important item: if you are saving your TFSA for future use, the withdrawals won’t affect any income-tested benefits. The Canada Child Tax Benefit, Old Age Security, and the Guaranteed Income Supplement aren’t altered when you make a withdrawal.

If you are thinking about making some big personal and financial changes next year, the TFSA is definitely a good starting point. Keep in mind, though, that you need to put together a financial plan, and find out where the TFSA fits in, in order to get the most out of it.

Harmonized Sales Tax & Mutual Fund Investors

The Harmonized Sales Tax (HST) is simply the combination of the federal GST and provincial retail sales tax (RST) into one single sales tax, administered by the federal government on the majority of goods and services purchased by consumers. The stated purpose of the HST is to make businesses more competitive and to achieve cost savings by simplifying the sales tax collection process.

For the past several years, only Nova Scotia, Newfoundland & Labrador and New Brunswick have operated under the HST. Quebec introduced the Quebec Sales Tax (QST) in 1992, which quite closely resembles the HST. In 2009, both Ontario and British Columbia introduced plans to harmonize their respective provincial sales taxes with the federal GST to create an HST, effective July 1, 2010. In Ontario, the new HST would have a combined tax rate of 13 percent and would include the current general Ontario RST rate of 8 percent and the federal GST rate, currently set at 5 percent.* As a result, a greater proportion of Canadians will be subject to HST. This paper will discuss what harmonization means to consumers and more specifically, how HST will affect your mutual fund investments.

* In British Columbia, the new HST would have a combined tax rate of 12 percent and would include the current B.C. Social Service Tax (SST) of 7 percent and the 5 percent federal GST rate. (more…)

Over 50% of Canadians lack wealth building skills

As uncertainty about economic recovery lingers, a new survey reveals that 52% of Canadians are not comfortable with their current financial situation and 53% feel insufficient knowledge about investing is their top wealth-building barrier. The survey, released by real estate and investing training services firm Tigrent Inc., examined over 3,000 British, American and Canadian attitudes, definitions and self-limiting beliefs towards financial freedom and reinvention. It was conducted for Tigrent by Opinion Research Corp. from October 19 to 21.

The Lifelong Learning Plan

A lifetime of education opportunities

Have you ever thought about going back to school as an adult, but wondered how you would be able to afford it? In this post, we look at using money from an RRSP to finance a Lifelong Learning Plan. Click here for a comprehensive overview.

What is the Lifelong Learning Plan?

In 1998 the Federal Budget contained a new education funding plan called the Lifelong Learning Plan (LLP), which allows people tax-free withdrawals from an RRSP to finance post secondary education and skills training, either for themselves or their spouse, under certain conditions. (more…)

Starting late with your financial plan?

Now that you’re in your 50s you’ve probably asked yourself this question a number of times:

The answer to that question depends very much on the lifestyle you envision in retirement.

Perhaps you want to travel the world or trade your expensive house in the city for a smaller one in the country, and just enjoy yourself. But no matter what your goals are in retirement, financial planning at this stage forces you to admit that your retirement is almost here and you have to make some critical decisions. (more…)

Invest & Leave it Alone

If you’re like many investors, you’ve considered allocating at least a portion of your portfolio into a Guaranteed Investment Certificate (GIC). Why not? After all, GICs are secure investments that are guaranteed to pay back your money. On the other hand, many investors view mutual funds as being too risky, and so avoid them. But is this the whole story? (more…)

Same-Sex Couples and Tax/Estate Law

Under the Income Tax Act Canada, all common-law relationships, either opposite- or same-sex, are treated equally.

Common-law partners

Same-sex common-law partners are treated the same as opposite-sex common-law partners. Same-sex common-law partners are eligible for the same tax benefits, and are subject to the same obligations as married couples and opposite-sex common-law couples. (more…)

Understanding Mutual Funds

One of the simplest investment instruments available to a new investor is a mutual fund.

A mutual fund is a professionally managed pool of money invested by people like you. There are many different types of mutual funds, each designed for a different type of investor with a different financial profile. When you buy a mutual fund, you are pooling your money with other investors who share your investment profile and your objectives.

There is strength in numbers. By pooling your money with other investors who have similar objectives, you can enjoy increased purchasing power and reduce your investment costs. Professional mutual fund managers trade securities at discounted institutional rates. Consequently, the savings they realize are passed along to you.

Keep your options open. A key benefit available through mutual fund ownership is diversification. The range of security types and asset classes offered in mutual funds can help to shield your investments from market fluctuations. If the value of one security held in a fund falls, the loss may well be offset by a rise in the price of another security. By investing in a variety of asset classes, you can profit from the growth of one type of security, while shielding your portfolio from potential losses in another. Whether it is by security, company, industry, or country, mutual funds offer investors a level of diversification that would be difficult to achieve on their own.

Mutual funds come in a variety of shapes and sizes. The most familiar mutual funds are equity funds, bond or fixed-income funds, money market funds, and balanced funds. A basic equity fund invests in the shares of various corporations. Equity funds differ in their selections of individual company characteristics, industries, or geographic locations. Bond funds offer investors the benefits of steady interest income and the opportunity to realize capital gains over the long term. For the interim investor, money market funds provide the chance to insulate capital while receiving returns superior to those offered by a bank savings account. Finally, balanced funds (or asset allocation funds) exist for those investors who want the benefits of greater diversification along with the convenience of owning bonds, money market instruments, and equities in one mutual fund.

Do you need ready access to your capital? Mutual funds are structured in such a way that accessing your money is as simple as calling your Investment Professional. As your investment needs change, your personal financial plan can also be easily changed. Your Investment Professional can move money from one fund to another or cash in all, or part, of your investment at any time. To help build assets over the long term, you can institute a plan of regular investment contributions or, conversely, a plan of regular systematic withdrawals.

Mutual funds give every investor the advantage of continual professional money management. These mutual fund experts have access to some of the best quality investment research in the world monitoring both domestic and foreign markets around the clock. The knowledge, experience, and resources available to these professionals ensures that your investments will keep pace with today’s ever-changing markets.

When selecting a mutual fund, remember to choose a fund that matches your personal objectives. Look for consistency in the long-term performance of the fund and the professional who manages it. Try to select a mutual fund that invests in securities you understand and that has a portfolio manager whose style you are comfortable with. Your Investment Professional, who has reviewed your unique investment objectives and understands your concerns is positioned to provide you with information on mutual funds and help you select mutual funds that add value to your portfolio.

Mutual funds are an excellent way to protect and build your capital. As you go through life, your financial goals change, and so too should your portfolio. Your Investment Professional is there to monitor your investments and help you modify your portfolio on a regular basis to ensure long-term, consistent growth.

AndrayDomise.com

Posts Tagged ‘Investments’

How Long Will It Take To Double Your Money?

Nine Ways to Improve Your Finances in 2010

Tax-Free Savings Account: Have you got yours?

Harmonized Sales Tax & Mutual Fund Investors

* In British Columbia, the new HST would have a combined tax rate of 12 percent and would include the current B.C. Social Service Tax (SST) of 7 percent and the 5 percent federal GST rate. (more…)

Over 50% of Canadians lack wealth building skills

The Lifelong Learning Plan

A lifetime of education opportunities

What is the Lifelong Learning Plan?

Starting late with your financial plan?

Invest & Leave it Alone

Same-Sex Couples and Tax/Estate Law

Under the Income Tax Act Canada, all common-law relationships, either opposite- or same-sex, are treated equally.

Common-law partners

Understanding Mutual Funds

One of the simplest investment instruments available to a new investor is a mutual fund.

This article was prepared by Fidelity Investments for Andray Domise, Independent Financial Advisor, who is an Investment Professional with International Capital Management.

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