RRSP

Most investments today are offered on a non-registered or “open” basis, or on a registered (RSP) basis. We offer a wide range of both types to our clients. If the funds are being transferred from a Pension Plan, they go into a special type of restricted RSP called a LIRA.

Once you have reached retirement age, by law you must begin to liquidate your RSPs by turning them into income. Basically, you have three options:

• 1. Cash them out – This is really not much of an option, as you would be taxed on the whole amount as income
• 2. Purchase an Annuity with all or part of your RSPs
• 3. Purchase a RRIF (or LIF) with all or part of your RSPs (or LIRA)

In planning your RSP portfolio it is important to have a written investment plan. We often meet with new clients and discover that they have no idea why they have a fund in their RSP portfolio, or they can't remember what motivated them to buy it. Often times they were told it was a “good buy” or a “hot fund”. The net result is that they end up chasing the marketplace. This invariably leads to poor decisions clouded by short-term reactionary thinking.

Unlike other firms our primary focus is on the planning process. We believe that this is the logical starting point. From there, we can create an effective RSP portfolio. It is notable is that all the financial planning books tell you to have a written investment plan; yet when we meet with new clients and ask them to bring their written investment statements created by their current advisors, we find that they rarely have one.

We make sure all our clients have a written investment statement. Our Portfolio Tune-up service provides you with a written investment plan that we can both refer to, when we have a review meeting.

We also offer online statements for all of our clients powered by CTV Bell Globemedia, so they can have instant and up to date information on their portfolios – including real time performance figures and fund information.

Do you sometimes find yourself looking for the money to make your contribution each year?

Here’s a suggestion – make your RSP deposit each month starting now. We can set up a regular monthly contribution to be transferred directly from your bank account. This method also allows you to take advantage of dollar cost averaging which ensures that you are buying your units at the lowest average cost.

Here’s another alternative – an RSP loan. Many of the carriers we deal with have loan programs at or around prime each year. Although the interest is not tax deductible, the advantage to you is that you get to make the RSP deposit now, and pay it off over the next few months, up to 2 years.