26 - Sunday, February 9, 1986 - North Shore News Business Options for a matured RRSP ONE FREQUENTLY hears the lament that the government has got Regis- tered Retirement Savings Plan proceeds all tied up. ‘By MARGARET LEMAY: The maturity options are suid to be so limited that the retired per- son loses control over his savings. Actually, the options are much wider than many people realize, but retirement savings investments take some very careful thought. The first option, of course, is simply withdrawing the money from your RRSP. This can be done all at once, or in stages. You will pay taxes on the withdrawn RRSP savings as if they were regular income. You might want to regulate the amount you ‘ withdraw so it does not kick you _ into a high marginal tax bracket. This might require shifting funds you do not-wish to withdraw into another RRSP - work this out with your bank or trust company man- ager. _ You might choose this option, for example, if your RRSP is too small to provide a significant in- come if invested in an annuity. However, this system works only until age 72, when all RRSPs must be closed. The second likely option is to purchase an annuity, from a life insurance or trust company. Annuities are frequently misunderstood as ‘‘straitjackets” because the monthly income you receive is'’ fixed at a_ certain amount. When you have spent several. thousand dollars to purchase an annuity,it is sometimes difficult to accept the relatively small income it provides. However, it cannot be stressed too much that annuity plans vary widely between companies. Some annuities now provide some infla- tion protection. ‘ As well, annuities have the strong advantage of security: you can count on that monthly income. While it is true that you cannot manipulate the capital yourself, you are also protected against any mistakes you might make. At retirement, protecting your capital should be a primary consideration. The final option is also the most interesting one. This is called the Registered Retirement Income Fund, and it would appeal to a person who has adequate resources for a‘comfortable retirement in the early years, but who wishes to en- sure that as living costs rise, in- come will as well. By deferring income, the RRIF also defers taxes. The RRIF also permits*considerable hands-on control, Basically, an RRIF is a special account,.much like an RRSP. You can hold'an RRIF with a bank, a trust company, or a broker. You can hold in your RRIF ac- count ‘investment certificates, a savings. account, or securities, much as you can foran RRSP. ° In effect, you maintain control of your capital. One major dif- ference is that, while you can hold several RRSPs, you can hold only one RRIF at a time. However, you can close or transfer the RRIF at your discretion. RRIF income starts small and living costs, and provides the satisfaction of controlling your funds. Whatever RRSP maturity option you select, you owe it to your @ 3WAY SWITCH. "6 SOLID BRASS ARN e ANTIQUE LISHED” - BRASS’. WHITER BALET? . “OF COLOURS: peace of mind to investigate your own needs thoroughly, and to find an annuity broker and/or RRIF account that satisfies your re- quirements. ws a. telecourse called “STARTING A BUSINESS" a » NORBURN LIGHTING has a reputation of experienced service and is the place to see Western Canada’s largest display o! lighting fixtures if you are building or remodelling — or just out fo brighten up a dark corner — you'll find the right fight at Norburn. - Wholesale and Retait — Free catalogues available. HOURS. MONDAY THRU SATURDAY 8 30-5.00, FRIDAY 8 40-9 00 4600 EAST HASTINGS, BURNABY. TEL. 299-0666 | Can’t see the forest for the trees? 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