1 WOW WOULD YOU MANAGE FINAN- CIALLY IF YOUR PARTNER DIED ?

"Financ Mike Grenby

and sense

USE THE financial focus of dealing : with your tax return to review all your money mat- ters and get your questions

, answered.

QUESTION: |. “I’m. 32, with $100,000 insurance and three chil- dren under 11; my husband has no - insuraice. We have @ big mortgage and no savings. Should my husband - have life insurance or at least put money into an RRSP?” —- LL. | -ANSWER: If ‘your husband died today, how would you manage finan- cially? if your folks would welcome - you and the kids to live with them, for

+50 INSTEAD OF LIFE INSURANCE THE KIDS AND I COULD MOVE IN

WIT

A: If you have a $1,000 loan out- standing for one year at 12%, you will pay $120 interest, “Invest” that $1,000 in the loan and you will keep the $120 in your pocket.

But if you decide to invest the $1,000 elsewhere and your tax bracket is 50%, you must find a guaranteed deposit paying 24%, That would yield

. $240 interest, on which you would pay $120 tax, leaving the $120 in your pocket.

Q: ‘I’m 90 and when I die, my

"four children will divide my home,

my only estate. The capital gains tax rules for 1994 are confusing. Should I sell my home or transfer it to my children now to save estaie taxes?”

A: Because this is your principal residence, you don’t have to wory about the capital gains tax. And at the moment, we have no estate taxes. Adding your children’s names to the title could save probate fees — but might cause other problems. Get

example, and you could earn areason- - {

able living, perhaps -your husband ’ doesn’t need insurance.

. Otherwise, he should have cover- age to pay off all debts and leave you with enough money to enable you to

‘eam an income... Contributing to’ an RRSP wouldn't _ provide the “instant estate” you'd need if he died now — ‘especially with the kids still athome. . .°-

Q@: “Should I renew my $11,000 mortgage -— I could manage to increase the payment to $800 from my present $545 — or pay. it down” using all $4,000 of my personal sav- ings plus my RRSP?” — D.B.

Regular Price

’ Portfolios

‘

A: Use $2,000 of your savings to |

reduce the mortgage and increase your payments to $800 a month to pay off the balance within a year. Then contin-’ ; ue that payment to build up your sav-' ings. Don’t touch your RRSP.! | | - Q: “You once wrote paying off a 12% debt is like making up to 24% guaranteed, I try to impress that on all our kids but am unsure hew you . arrive at 24%?" — CM.

Come i in and apply at any Scotiabank branch. This rate is s available on, R month term. aI ne However,”

HERE |S YOUR INHER- WANCE-GET

& YOURSELVES A GooD

expert advice.

Q: “Can i name my daughter as the beneficiary of my RRSP or RRIF? I’m single.” — ML.

A: Yes, but unless your child qual- ifies as u dependent, any balance in your plan at your death will still be taxed. See page 34 of the tax guide, 1994 RRSP and Other Registered Plans for Retirement, available from er local tax office.

Q: “If I make my $30,000 catch- up contribution to my RRSP this year, do I deduct it from this year’s income or is it spread back over the years?” — D.C,

A: The. deduction will apply to your 1995 income.

Mike. Grenby is a North Shore- based columnist and independent Jinancial adviser who works with indi- viduals; he will answer your questions in this column as space allows (sorry, he cannot reply individually) —- write to him clo 2444 Haywood Avenue, West Vancouver, B.C. V7V 1Y1.

PERSONAL INJURY |

Free Initial Consultation

Douglas W. Lahay CLARK, WILSON

BARRISTERS & SOLICITORS 800-885 West Georgia Street, Van. 687-5700

24 HOUR MESSAGE 643-3161

§ ICBC's policies are not law. 1 will get

you a fair settlement or trial award.

.. THE RETIREMENT SPECIALISTS . Monthly income on $50,000 investment

Life Annulty 10 yr, Guarantee ARAL. Minimum

} Male | | Female | Joint | tst¥r. | 10th Yr. | toh Ye Fund Value | = ll alo 65_|eot

41927 [295.6 | 167.00 424.00 | $65.02 |

ARIF tilustration or a

copy of our Guide, call:

925-3101 Solguard Financial Ltd. 401-100 Park Royal S., West Vancouver . Building better retirement incomes since 1974

This is your enportuity to learn ~> New tax planning strategies |

> The myth of financial security in Canada in ' the 1990s and beyond fe _ => Implications of the budget for professionals a.

os New Retirement & Estate Pianning

| strategies .

samen

[ Reservations will be required as seating is limited

Date: Tuesday, ‘Apr tt 4

i Time: 7, ee

Place: The vancouver Trade & Convention centr e

| DOOR PRIZES |

_ Sponsored by:

some restrictions apply. As of March 16, 1995 Scotiabank Prime Rate was 9.75%, but is subject to change. 7 oo