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» _ Mutual funds can provide a betâ€" "ter return than savings and term deposits, and they‘re fully liquid. Mutual funds â€" which are managed by professional money managers â€" allow people with relatively small . amounts of money to pool their ; cash with other investors and buy ‘units in a fund. Investments can range from stocks, bonds, treasury bills, mortâ€" gages, and even precious metals. Mutual funds are particularly appealing to people who don‘t have the time or interest to research the market and the many options availâ€" able. Most banks offer a variety of mutual funds. For example, Royal Bank offers 12 different funds, 10 Low interest rates make mutual funds attractive I ith interest rates hitting :Wthe low single digits, ‘ P some people may want to consider mutual funds as an alterâ€" native investment for the RSPs. | | What Do You Do Atfter You‘ve Given The Highest RRSP Rate® 4 Years In A Row? the OPENING NEAREST YOU! DISTRICT OFFICE 374 Brant Street Burlington, Ont. L7R 2E8 Tel: (416) 639â€"7625 WATCH FOR THE LOCATION Just ltke we did last year and the thre major financial institutions in Canada Just like Hongkong Bank of Canada Do It Again. Now, what can we do for you? Consistently higher rate B PERSONAL WEALTH CREATION, PRESERVATION & MANAGEMENT Ei?stf\lccr)e];tlesli:()e?sl\(l)nl{a?il;e?â€":gir:itgt! plan. Call for your complimentary consultation! Merntt H. Goddard, H.B.A, ER1, CE.P. Exeaitive Vice President, Senior Financial Advisor Direct Line 340â€"6068 "Bank mutual funds range from low to medium risk funds. As a general rule, the higher the risk, the greater the potential for maximum growth," says Jenny Gould, Royal Bank‘s Area Manager for Oakville/Milton. of which are RSP eligible lllllz""'"f'"lllllllllllllllll BEEesLtq 4 7y ~NERRRbEIEIZEEE 5 """"1’“ | flllllll"l 7 J yDe_â€"i.LAsmnc=me./ o | CIBC "Bank mutual funds range from low to medium risk funds. As a general rule, the higher the risk, the greater the potential for maximum growth," Jenny Gould, Royal Bank‘s Area Manager. Money market, mortgage and Pe me thin 710 Dorval Drive och PR ONISUOIL® B vears be M 845â€"7 164 M ne ns1ste net char 0 bette T T. n 11 Bond, balanced and equity funds are considered medium risk funds. Bond funds are primarily made up of bonds and are designed to seek safety of principal with as much income generation as possible. (See ‘Mutual page 15) B dividend funds are considered low risk funds. Money market funds consist of shortâ€"term debt investâ€" ments â€" such as treasury bills â€"â€" that generally mature in less than one year. The objective is to provide comparatively high yields with safety of capital. Mortgage funds consist of investments in commerâ€" cial and residential mortgages. They are designed to provide a steady rate of income while protecting the capital invested. Dividend funds consist of preferred or highâ€"yielding common stock. The objective is to provide a steady source of income while having a potential for moderâ€" ate growth. RRSP r we‘ll b eal iI ite zher T It‘s th: thal AKVILLE BEAVEFR pl Before you spend your RRSP contribution on something other than an RRSP, remember that the On a yearly basis, the increased limits are signifiâ€" cant. However, when compounding the increases, the results are staggering. For example, let‘s assume that you contribute the maximum to your RRSP for the next 25 years. If invested at 10% per year, the RRSP would be worth $1.8 million after 25 years. Not bad for a $460,000 investment made gradually over time. At the old $7,500 limit, the value would have been $800,000. You have the potential to gain an additionâ€" al $1 million with the new limits. These new limits are a potential windfall. In fact, over the next 25 years, you will be able to contribute $460,000 to your RRSP, assuming the annual wage index increases 2% per year. Keep in mind that these contributions will give you a tax deduction â€" so assuming a 50% tax rate â€" the afterâ€"tax cost is only $230,000. By PETER WATSON M.B.A., C.E.P., R.E.P. Special to the Beaver The new RRSP rules have taken effect. With these new rules come some new strategies. Some will make use of them and they will retire with financial security. Others will not, and they will just retire. INCREASED CONTRIBUTION LIMITS The most significant change is the generous increase in RRSP annual contribution limits. The maximum contribution in 1990 was $7,500; however, in 1991, it increased to $11,500 and in 1992 & 1993 to $12,500. The limit will increase by $1,000 per year until 1996 and, thereafter, it will be indexed to the annual wage index. New strategies needed to deal with changing RRSP rules Don‘t Just Read About Him You can read about Tony Massie‘s stock picks in the national media after he has made them or you can let him make the choices for you. GLOBAL STRATEGY Rothschild FISCAL AGENTS Important information about mutual funds referred to in this seminar is contained in that fund‘s simplified prospectus. Obtain a copy from Fiscal Agents and read it carefully before investing. Unit value and investment return will fluctuate I\.,A 648 Fiscal Agents Savings and Investment Centre, 466 Speers road, Oakville. L6J 6L6 (416) 844â€"7700 Tax Savings & Investment Seminar Kal.t . "F iTR amk :A }}so :4 ce U BB BsA mm l oi on wl h td WV Call Susan Tippett at Fiscal Agents now for reservations 844â€"7700 The seminar is free, but space is limited. Vice President Fiscal Agents, Investment Fund Services TIME PLACE Cordially Invite You To Hear The Case For THE EQUION GROUP J Global Bond Investing Low Risk Investment Strategies Doubling your afterâ€"tax monthly income RRSP and RRIF â€" The latest rules and options Tax Savings Tips Asset Allocation â€" What it means to you Townsend Haines FISCAL AGENTS Savings & Investment Centre GLoBaL STtRateEay Exectutive Director Global Strategy Wednesday, February 17th. 7.30 pm Holiday Inn â€" Oakville 360 Iroquois Shore Rd (North East corner QEW and Trafalgar Rd) William H. Shutt Meet and hear With the increased RRSP limits, it will often be easier to manage your cash flow with regular monthâ€" ly payments versus a large lump sum payment. This can be done with automatic deductions taken from your bank account. * After 1996, the maximum contribution will be indexed with the average wage index. Investing monthly on a regular basis â€" referred to as "Dollar Cost Averaging" â€" is a conservative way to invest. Prices fluctuate and there is a fair amount of luck involved in whether you buy at a low or high price. With Dollar Cost Averaging, you purchase the investment at 12 separate times during the year, therefore, you eliminate the risk of investing at the peak of the market. real advantage of an RRSP is its ability to compound taxâ€"free. If you fail to make your $12,500 contribuâ€" tion for 1993, you could lessen your nest egg by $135, * Members of a Registered Pension Plan must reduce their RRSP contribution by the amount of their Pension Adjustment for the preceding year. * Deferred Profit Sharing Plan (DPSP) benefits also reduce the RRSP contribution. Year 1993 1994 1995 1996 Investment Funds I a 4LPAW $12,500 13,500 14,500 15,500 100 in year 25 Maximum Contribution New RRSP vearly CONTRIBUTE MONTHLY l P i (See ‘Changes‘ page 15) Montfi]y | _ »Competitive Rates on Individual Retirement Annuities. »Guaranteed Lifetime Income. Waiver of Premium for Disability Option »"Good Neighbor" Service. $1041.61 1125.00 1208.33 1291.66 HRMPAGE 13 Check with State Farm Contribution Limits WAYNE McGILL 2345 Wyecroft Road Unit 21, Oakvilie 847â€"5671 : Earned Income from Previous Year for Maximum Contribution RRSP? $69,445. 75,000 80,556 86,112. @Uoe: Maximum Foreign _Content 18% 20% 20% 20%