Hi All,
I'm interested in investing in RRSP and as far as I know the deadline is 29th Feb 2008. I need the following info related to RRSP as well as tax return:
1) Should I go to the bank to invest in RRSP or there are other agents who can do it for me? Any difference between those two ways ? Would my money be locked for a specific time ?
2) Can I & my wife file a joint tax return or it should be separate & we can still transfer credit from each other ?
3) Are there any other investments, like RRSP, which can reduce my tax ?
4)Any Tax consultant in Markham ?
Location: carl sagan's universe
Posted on: 21-01-08 07:43:55
Hi Meagainme,
Re RRSP- you can either invest vide a bank or thru a financial advisor.
Depending on the investment you choose, it might be locked in like a specified time GIC (1 yr, 2yr, 3yr) or a labour sponsored fund. However one can always redeem such investments by paying a penalty.
Regarding mutual funds, there are no lock in periods, but you might be hit with an exit load. Make sure when you make the investment that you specify that you won't be hit with an exit load nor be made to pay an entry load.
Right now with the markets as volatile as they are, it's best to put your money in a GIC - 3 month or 6 month or 1 year and when the markets stabilize you may switch them into equity funds, if you can stomach the ups and downs.
The other alternative I suggest is bond funds. As the scenario is that interest rates are going south, that means bond funds will go north, so you catch an upside.You can switch to equity funds later on.
It all depends on your risk ratio. I do not have a Know Your Client form on you, so I don't know your risk appetite.I am suggesting plans sans info on you. If you wish further info please send me a pm.
There are also stocks and mortgages you can invest in for RRSP.
Re tax returns, best to consult a tax guy, though with my basic knowledge of tax, I'd say a separate filing for each.
For reducing tax there are several other methods as well.
Hi there,
I have got my RRSP done through a Financial Advisor from Primerica (CitiGroup).. and can PM you the details, if interested. Send me a PM
- Hem
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Like you - a Canadian .. but still DESI 
Hi All,
I'm interested in investing in RRSP and as far as I know the deadline is 29th Feb 2008. I need the following info related to RRSP as well as tax return:
1) Should I go to the bank to invest in RRSP or there are other agents who can do it for me? Any difference between those two ways ? Would my money be locked for a specific time ?
-- You can go to any bank of do it online at ING. ING pays 5 percent etc on cash accounts and more on CD's
2) Can I & my wife file a joint tax return or it should be separate & we can still transfer credit from each other ?
-- There is no joint tax return in Canada like US. You could however do spousal RRSP where you get the tax benefit and your wife is the beneficiary
3) Are there any other investments, like RRSP, which can reduce my tax ?
-- Not that I know of
4)Any Tax consultant in Markham ?
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We will find a way or we will make one
Quote:
Originally posted by MeagainMe
Hi All,
I'm interested in investing in RRSP and as far as I know the deadline is 29th Feb 2008. I need the following info related to RRSP as well as tax return:
1) Should I go to the bank to invest in RRSP or there are other agents who can do it for me? Any difference between those two ways ? Would my money be locked for a specific time ?
2) Can I & my wife file a joint tax return or it should be separate & we can still transfer credit from each other ?
3) Are there any other investments, like RRSP, which can reduce my tax ?
4)Any Tax consultant in Markham ?
Investpro is bang on the money. Thats good advise.
There is so much RRSP in the air now, you can catch a good book called KPMG's Income Tax for family in any Chapter or book store. Its a great book I normally gift it to all my RRSP and non registered investment clients. It will has answer to all your questions including spousal income splits. I know Financial Advisors in Markham if you like you can send me a PM, I can send you his name.
I have a question wrt to my wife is not under high tax bracket. Can i make contributions of RRSP under her name to take advantage of reaching 20000 maximum limit that we could withdraw under Home buyers plan. I have already reached 20000$ limit in my RRSP contributions towards previous years. This year i am eliglibe to invest about 10000$ under RRSP my question can i invest under my wifes name and cliam the deduction from my income.
Thanks
Quote:
Originally posted by MeagainMe
1) Should I go to the bank to invest in RRSP or there are other agents who can do it for me?
I believe you need to understand your own financial needs first before you go to either a bank or an "agent".
Two factors are most important - (a) What is your investment horizon i.e. how long till you retire and (b) what is your risk tolerance level i.e. how much sleep would you lose if you investment lost 50% of its value overnight.
Both are related to some degree i.e. the longer your horizon the more risk tolerance you may have, although that's not true for everybody.
You need to first understand your own needs and be very clear about the two factors above.
Then you can decide your investment strategy and your portfolio asset allocation.
Quote:
Any difference between those two ways ?
Yes, there is.
A bank usually offers their own products i.e, GIC or mutual funds.
Whereas an agent may offer you slightly more variety.
However, both the bank and the agent are driven to some degree by their own personal margins and their commissions, trailer fees, etc.
You need to understand clearly your own objectives and the reasons for investing in certain funds.
In particular, if you are using an "agent" you need to understand the reasons why he/she is recommending certain investment products and how much benefit you get vis-a-vis how much benefit he/she gets.
It'll be foolish for anyone to ignore the agent's vested interest.
Quote:That depends entirely on the type of investment product chosen.
Would my money be locked for a specific time ?
Please look up terms like front-end load, back end load, DSC, etc.
Yes, it is entirely possible that your $$ may be locked in for extended periods like 5 - 10 years.
Also, any investments that offer additional tax rebates like labour-sponsored funds are locked in for very extended periods of time.
Quote:No, you may file together if you are using a tax software, but the returns are separate.
2) Can I & my wife file a joint tax return or it should be separate & we can still transfer credit from each other ?
There are no joint returns like USA's IRS.
Quote:RRSP is the most common and the most used.
3) Are there any other investments, like RRSP, which can reduce my tax ?
There are a few other avenues like writing off interest paid on borrowed money used for investing and additional tax rebates for labour-sponsored funds, etc.
I have noted that several financial advisors push for these so-called labour sponsored funds.
You need to understand carefully what those are, how they work, and the risks/returns of those.
Historically, these labour sponsored investments have been nothing but disaster - period.
So, buyer beware.
Also, be wary of "agents" pushing certain proprietary funds like Primerica, etc.
From your post, it appears that you are not very well up-to-speed with financial decision making.
I suggest the following -
1. Park your money in safe and secure GIC, Canada Savings Bonds, etc. investments (within RRSP if you wish) for the next little time, while you figure out the best course of action.
2. Don't believe that bond fund provide any more security than equity funds.
They may be slighly less volatile, but it's pretty common for bond funds to decline in value significantly.
Short term bonds are very sensitive to interest rate changes and long term bonds vary by several factors.
How volatile your bond fund is depends on the type of bonds it is holding.
You may hold direct bonds (like federal or provincial bonds) directly within an RRSP, which is much more safer than bond funds.
3. Educate yourself on your financial goals and financial plan.
Until then, use strategy (1).
Once you have a better understanding, start getting your feet wet.
There are several good books thata you can borrow from your local library to begin educating yourself.
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