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Friday February MONEY MANAGEMENT Wednesday February IB Pager SENSE Make sure savings suit your vacation planning If your body By Diana Chant mind are American style hotel coiling creaming vacation and your bank US a night Instead of the balance 11 crying for mercy you bargain country perhaps a more just discovered the first expensive country with higher rule of vacation planning budget hotel standards where you can find suitable middle of the road Budgeting puis many people off but without it they find they never seem to have the necessary money when vacation time arrives Yet even with a simple budget you can plan to put a little away American travellers over the weeks and so you slop for a rr mule before you do will have money you will need Should you be buying American when all you can think about and paying the commission and a getting way hefty exchange penally or would Canadian or local currency travel Dollar Sena of fere general lera cheques be just as good financial advice by members Neil consider whether travel of The Institute of Chartered ten cheques or a credit card is anight would be belter For many Canadians the first thing they do after deciding on go is plan on buying Accountants of Ontario Diana Chant with Price Waterbouse Chartered Ac countant Toronto best way to pay for your Travellers cheques do offer safety they will be replaced if lost or stolen and they lend to keep you from overspending but you do have to lock in your exchange rate at lime of pur chase which may or may not be in your favor With a credit card on the hand the exchange rate isnt set until you use or ihe lime the charge reaches the credit card company this could work in your favor or against you But re member to wary its just as easy to get caught up in the A budget is primarily cial planning tool that will identify essential expenditures and those which may be postponed A little bit of budgeting now makes pay for your vacation a lot easier Once you are assured the money will be there when you want to escape il is time to plan your trip Start with the obvious destination Many people choose their next escape on basis of vacation spirit and which country has a favorable exchange rale or devalued currency the typical cheap country vacation Important considerations What is the accommodation like Are the middle of the road hotels up Canadian standards Will you be content to May in the hotel you can rent for the equivalent of a night Canadian or do you prefer one of the luxury North up an horrendous bill using credit cards And if all this figuring seems to loo much you could simply vacation in Canada Advice from chartered ac countants la also available on Watch for Your Wealth on broadcast chan nels and Money in the Bank on most cable channels Early action pays The old adage about not putting off until tomorrow you can do to day is particularly true when il comes to contributions Yet though most Canadians have long been sold on he merits of saving for their retirement while sheltering in come from tax at same time many delay inking action until It becomes a haphazard last minute scramble There are definite advantages to making your i960 tion well in advance or the deadline Firstly mil only will you avoid get ting caught up in the fury of eleventh hour purchasing you will also allow yourself more lime to make quality investment decisions The range of ItltSP options available in marketplace is so extensive that it simply I make sense not to shop around And with some products offering more rales and features I nan others you could be doing yourself a disservice by simply decision to chant Ensure you demote time and attention to your Hits I planning that it deserves Terry Meln tyro of the liraLCily Trust branch in Brampton Too many think only of tax deferral aspect of They don put any rial thought into their and just snap up whntcvir Is easily available They ignore fact ltiit on is first and foremost an In vestment which musi be suited to I heir needs To achieve the maximum benefit from your HUM investment Mr Mclnlyrc advises establishing a per action plan To begin with review your existing in vest minis so that you arc aware of terms conditions and the maturity dates that are attached to them At this lime of year financial institutions provide their customers with an annual that contains this information Next calculate maximum amount you arc eligible to con tribute your for It will be the lessor of per of your earned income for the year or if you ore not a member of a pension plan If you arc limit is S3 less any personal contributions you have made to the pension plan during FINANCIAL FREEDOM To be rich would be great be would be great but highly unlikely for most of us To be financially free would be great also But unless plan for again it is In Canada today 50 per cent of all Canadians retiring qualify for Guaranteed Income Supplement I S Is program which was by Trudcau govern merit in ihc mid GO and is designed to the Income of retired tana from the starvation level lo the poverty evil In Ontario per of nil those reliring today qualify for G I That means that almost half the people who read will someday recede Guaranteed Income Supplement Which half will you be In These statistics arc shocking com from second country in Ihe world The problem is most of us simply keep putting it off until tomorrow and the lime tomorrow arrives it is loo laic The solution to this problem is simple can be summed up in these three rules 1 Pay yourself first Let magic of compounding work for you Get advice from professional financial planner The first rule pay yourself first simply means thai out of every dollar you cam you must keep lit tie for yourself When pot jour family budget together each month nut yourself on lop of Ihc list then pay your other pjymcnls next The second rule let the of compounding work for you is simp ly letting the amount you pay grow and compound lo pro vide the financial freedom pot that will let you rcllre in dignity To illustrate the magic of com pounding assume fnvestnr A begins an HUM or open investment pro gram at 19 eight he The vest grows the rale of 10 per year eight years no more investments arc made A second investor Investor I makes no contributions until the age which the first person stopped investing and then each year until Assume the same per growth per year As you can see by the chart the in credible result is that the person who contributed earlier only eight contributions totalling inds up more money than Iht person who mode 3D totalling a later dnte This demonstrates the of compounding lime Thi fcruicc in the Iwo investors result Big obstacle easy to solve The biggest obstacle most of us face when il comes lime mike our annual ItllP contribu tion is a lack of ready cash In fact miny people miss out altogether on the benefits of In retirement savings products because they have no funds aside make contribution before deadline Yet there ore several ways you can Invest in an without having to put any money out front SAME DAY TAX RETURNS is the first had eight more of compounding early years wire worth per cent or more than Ihe entire later contributed by second Investor The third rule get advice from a professional financial planner is in order lo develop a plan that will satisfy you and your family financial goals Your work and family lives are so busy here lime to analyze and Implement a Financial plan that will your results and jour A profes sional financial planner will provide you with ongoing advice and alter natives that can select from and can be comfortable You make Ihe final decision and stay in control of your finoncial plan Your financial planner works with you he dots not sell you The complexities of financial world and the changing lax laws arc such lhat is impossible for any in dividual to be aware of all the op portunities pitfalls and tax exist A professional pi inner is knowledgeable in these matters and has sources from which detailed information can be obtained A planner lias bein educated and trained to assist individuals and families achieve Ihe maximum results from their present financial position Select a professional as you would doctor lawyer or any other pro fessional I- ind someone who you reel comfortable with has proper credentials relating lo financial planning and ask for references you find person you want to work with be prepared for a rtlo- that will las for many years Your Individual and family goals will change and your financial tanner will help you keep your plan tunc with your goals No mailer what you earn how old you are or how much money you have financial planning Is available for all who want It A little can go a long way The main point is get started and give your plan the lime to grow But it never too late to start tUITIIItb Mr a certified general accountant and financial planner with Sutherland Investment torpors Hon Comments about this article are appreciated and can be made bj colling or IH4JHI8 The Basics Everything you need know about and retirement income options is yours free in The Basics A complete up Ihe minute booklet explains everything in ample every day language Please send mo a copy of The Basics Name Address City 273 QUEEN ST ACTON HALTON CREDIT UNION 187GUELPHST GEORGETOWN 8776926