ite

] OW THAT Christmas is over, most tax-
payers. are about to embark on another
busy shopping season. During January and

February, financial institutions on every Street cor-
ner will be exhorting us to buy Registered Retire-
ment Savings Plans (RRSPs). Our friendly stock-
broker, Mutual Fund and Life Insurance sales-
person will also be urging us to buy their fatest

plan.

Gs
retirement

planning

by Bert
Wickham

Certainly, most taxpayers
should be taking advantage
of this valuable tax conces-
sion: The intent of govern-
ment is quite-clear: they are

prepared to,-give. us a tax”

break to encourage us to
make provision for ourselves
in retirement rather than rely
on government welfare plans.

Since 1957, the only changes -

‘to the rules have been to: in-

crease the contribution limits -

and to enlarge the maturity
options.. Some _ restrictions
have also. been added to pre-
vent obvious abuses such as
premature redemption of
_. spousal plans, but the general
principle remains the same,
which is’ ta.encourage us to
save for our owi::retirement.
So, how do we cut through
all the confusion? The first
thing is to take the time to ex-
amine the various alter-
natives carefully rather than
wait until the last moment to

’ buy whatever happens to be

available. A little time spent
now studying the various
alternatives can save literaily
thousands of dollars that

may otherwise be lost in in-.

terest and unnecessary
charges. :
The most important fac-
tors to consider are:
- Safety and security
- Rate of interest
or return
+ Flexibility
- Fees and charges
(if any)

Obviously, we cannot have
everything. What appears to
offer a high rate of return
may also be risky. Converse-
ly, complete flexibility and
absolute safety will usually
give a low rate of return.

In general, an RRSP
should provide safety of prin-
cipal combined with a good
rate of return and reasonable
flexibility and minimal fees
or charges. There are many
excellent plans available to-
day which impose no charges
at all. Should we buy our
RRSP from a Bank, Credit
Union, Trust Company,
Mutual Fund or Life In-
surance Company, or should
we create our own self-
directed plan?

There are advantages and
disadvantages depending on
our own particular needs and
circumstances. For example,
many people use the banks
exclusively for their financial

“dealings as a matter of conve-
nience and because they feel
‘safe with them. Alter-
natively, many Credit Union
members enjoy the spirit of
co-operation and self-
ownership with the protec-
tion of Provincial Legisla-
tion. Still others are attracted
by the higher rates of interest
paid by Trust Companies and
the higher level of services
frequently provided by these
competitive institutions.
Canada Deposit Insurance
has helped many of the

income for you!

Masininm |] tndust ria
Thule Annual Growth
Deopustts

Proof Industrial Growth Fund’s
consistent returns meana
significantly higher retirement

it. .. Bian]
ae Saungs | ved just

smaller Trust Companies to

succeed in this highly com-

petitive marketplace.

Those of us who suffer
from inertia and pro-
crastination will frequently
appreciate the services of the
Mutual Fund and/or Life In-
surance Salesmen who may
be more than happy to make
house calls to earn a commis-
sion. The hope of larger gains
through equity investments

Account: | teumateh
tmihition

sae
Venn
Yan

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¥
yea

Fat
j2gay

A
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988-6737

561 Croydon Place, North Vancouver

How to choose an RRSP/

will also be a factor, par-
ticularly for the younger
generation.

Over the next few weeks we
shall be examining alt of
these matters in greater
detail. In the meantime, look
for the ‘‘Delaney Report on
RRSPs" which is available
yearly at this time. For the
serious student of RRSPs this
is a publication not to be
missed.

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Starting Sunday, January 13

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980-1585 Manager

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