tered »
“season...

ONCE AGAIN, iv? s ‘time to
- See about an RRSP. :

“Use: this “checklist of: “rules and

| strategies to'help you and your fi- ‘::

“nances * ‘through® the annual regis-
retirement savings . plan
remember

“Always the . basic

Oy three points: ,

“ay” You" can save tax’ when you
‘contribute. ,

(2) The money in an RRSP can»
_{BTOW tax-free.

(3) When. you take money out ofa
lan, you,"add it to. income for
that’: year and. in: most ‘eases “pay.

nvest another way (in property,

business, the stock market) only

if the bottom line is likely to beat
the RRSP approach. _

four, “maximu
ution forthe 1992. tax: year, i

rene by any-pension: adjustinent

(PA) iF: you: belonged to a, regis-' -

tered ‘pension ° or: deferred “profit:
sharing plan in .1991,*minus® (c)-
ny “net past \service. pension’; ad-
ju :

ax" year,’ you’ now may also put, in: :

this amount for 1992.

‘contribution

“regular. con-

after you filed your 1991 tax
return, should show the total you
may contribute. ©

If you received regular private
pension payments (but not CPP
or OAS) in 1992, You may also
put up to $6,000 of this money in-
to..a spousal {not your: own)
RRSP. ;

Contribution deadjine: March 1.

_ Why spousal?

If your spouse is likely to be in
a lower tax bracket than you when
the RRSP money comes out
again, he or she will pay less tax. *

When you ‘contribute to a
spousal RRSP, you get the deduc-
tion and tax break now. You con-
tribute up-to your own limit, ig-
noring whether or not your spouse
has earned income and contributes
toan RRSP. :

A spousal RRSP belongs to that
. spouse. The three-year rule, with
some .exceptions,
waiting period before withdrawn
funds. may.*be - taxed ‘in _. that
spouse’s hands.

. No money?

carry forward any unused ‘‘con-
tribution room’? —. usually up to
seven years — and make @ cat-
ch-up ‘contribution later. Do this

“only. if you expect to be in a

higher tax bracket in the near
future —. but if this is your plan,
(1) still make your maximum con-
tribution now, then (2) claim, the
in that higher-tax-
bracket year.:

Rather than miss out contribu- ;
tions —- which means you lose

enforces a’

both the tax: break now and the
tax-sheltered growth — consider
borrowing. But borrow only if
you can comfortably carry the
debt and pay it off within the
year.

You may transfer qualifying in-
vestments like stocks.or bonds in-
to an RRSP and. claim a deduc-
tion equal to the fair market
value.

Contributing a stock to an
RRSP could trigger a capital gain;
if you ‘have a capital loss, you
may not use such a loss to offset

other gains.

Over-contribute?

Let’s say you have extra money
earning investment income which
is, being taxed. You may put up to
$8,000 over your norma! contribu-
tion limit into an RRSP. You
can’t immediately ‘claim a deduc-
tion but you’ can shelter. the in-
vestment income from: tax. ,

Over-contribute only if you will
have enough years of earned in-
come ahead of you to use up the
over-contribution; “otherwise

you'll be taxed twice. Keep careful
stecords.
Under the new rules, you may” ‘

‘Choices, choices
You can have everything froma

; savings account to foreign’ stocks

in an RRSP.

'.A conservative investor. will lean
‘toward guaranteed. investment. cer-

tificates and safe bonds (stagger
the maturity dates as a hedge.
against interest rate changes). AC

more mutual funds which invest in

stocks. For more diversification, ,
consider, securities with an-inter- °

national flavor (maximum foreign
content for 1993"is 18% of the
cost of each plan).

’ A better way
Get ahead by making your 1993
tax year RRSP contribution now,
based on last year’s earned in-
come. If you don’t have the
money now, sign up for an

automatic monthly program at”

your financial institution starting
March 1 or April 1 at the latest.
Then by this time next ‘year,
you will have made your contribu-
tion. ; .

More info a

Start with Revenue Canada’s

Pension and RRSP Tax ‘Guide, °

available free from the ‘local, tax

_office:, Continue with background

'

more aggressive investor will lean ©

toward. stocks, : either. choosing

them. directly: or buying one ‘or

1 , : nos

You SHOULD THINK
ABOUT YOUR RRSP AS.
MUCH AS YOU DREAM

f ; “ABOUT YOUR RETIREMENT.

CASHABLE ANYTIME , |
*Rates Subject to Change
$50, 000 minimum.

For more information, please call F:

The North Shore’ 's only f full
’ Service Investment firm a

RBC :

DOMINION

SECURITIES
rae Rapa ek

925-3131. 6
201-250 15th Street, West. Vancouver

{as opposed to strictly sales) liter-

ature from your. financial institu-
tion. Check the library ; and
bookstore. for this year's crop of
RRSP guides,

Most major. ‘accounting ~ firms
also publish RRSP information,'
either separately or as part of
general tax planning booklets, and
provide this literature free to.
clients and contacts.

Mike Grenby ' isa North:
Shore-based  columnist.: and”: in-*
dependent: financial adviser who
works with individuals;. he’: will
answer. your questions “as space .
allows —— ‘write to him'c/o The
North Shore News, 1139:Lonsdale
Ave., North Vancouver

‘Michael V ‘Thornton a
~ President and C.E.0. |

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