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THE HERALD Wednesday Novembers Page You must invest rather than save By PAUL J Fifty years ago when I was growing up anyone who became a millionaire or was a millionaire was looked up to In awe and held in the highest esteem Today I am told there are several new millionaires developed virtually every work day of the week I can also state that 50 years ago the average wage might have been per week and when I started working as an apprentice in 1942 I received 20 cents per hour but skilled workers were earning to cents per hour I remember a union winning a con tract giving their workers cents an hour a fantastic figure back then So a millionaire or years ago was really something Those workers who won that contract at 80 cents per hour years ago are probably earning to per hour plus benefits of as much as 5 per hour Thats an average of over times what they were earning years ago This also means that today you would have to have achieved more than the million dollar status to have the same power as million had back in 1942 What have the last years shown Inflation has averaged 7 per year thank goodness it has been much lower in the last seven years It means that today it costs to purchase the same amount of goods and ser vices that would have bought 20 years ago We need 3 88 to buy what 1 bought back then Frightening isnt if We still hear people say I want to become a millionaire but does it have the same mean ing as the millionaire status did when I was a boy What about the people who do achieve the millionaire status even today Can you name one yes just one who became a millionaire by saving and putting their savings into socalled guaranteed investment available from banks trust and insurance companies I dont believe there is such a soul because all people who do become wealthy do so by investing rather than loan ing money to an institution which is what we do when we make deposits Lets suppose years ago so meone had million and they loaned it out to a bank trust company insurance company or to the Government by buying Canada Savings Bonds andor Bills and achieved a return all the way through Someone else bought an apart ment building with their million years ago and receiv a rental profit of all through those years You can say they both earned the same in come True But the apartment owner saw Investment dealers can offer advice By BRIAN If you are a small business owner you may have wondered whether an investment dealer has any services to offer that could make your business more profitable and your investing more convenient One area where an investment dealer can be of assistance is in helping to manage shortterm cash needs Often in your business you will find yourself with large amounts of cash on deposit for a short period of time Any funds which are not current ly required for immediate needs are the basis for a short term portfolio These funds can be in vested temporarily in Money Market investments which are short term notes with maturities under one year earning a fixed rate of return A quick telephone call to your investment advisor is all it takes The Canadian Money Market is a wholesale billion marketplace ScotiaMcLeod is on a group of three Canadian dealers who are responsible for over 65 per cent of all money market trading The instruments which comprise the money market often have higher yields lhan those available with com instruments Some of these instruments are Canada and Provincial Treasury bills which are available in multiples of and 000 respective ly Canadian Chartered Bank Bearer Discount Notes and Ac multiples of and Commercial Paper which is the short term debt of investment grade Canadian corporations and government agencies multiples of 10 For large amounts funds can even be invested over night at an attraclive rate purchase a money market investment all you need to do is call your investment advisor The securities will be held for you in safe custody Maturity dates can be tailored to meet your re i md most invest minis cm be sold ii it i vailing Another v iv hi which an in vestment dealt i tan be of service is in providing vou research on vour own business routinely issue reports on various industries which can help you with strategic planning The demands of owning a small business often mean that owners lack the time to organize their own finances which can prove very costly in the long run An in vestment dealer can help you here too From assisting with cash management and portfolio planning to helping you plan for your retirement an investment dealer can be of significant assistance Likely the most important of these objectives is to begin ing early for your retirement As an independent entrepreneur you will not receive benefits from a company pension plan and what the government provides through Old Age Security and the CanadaQuebec Pension Plan is small and by no means certain therefore the onus is on you to make sure that your own needs at retirement will be met This can be done through an or if you employ several individuals you might want to give consideration to establishing a Group Either way an RSP is the best way to set aside funds for retire ment because contributions to an can be used to reduce tax able income and because earn on these contributions torn pound tax free until they are withdrawn from the RSP Because you are not a member of a company pension plan you are allowed to contribute the lesser of 7 or 20 per cent of earned income to an for 1990 Maximum limits are scheduled to begin increasing in until they reach 15 in 1994 These increases are very good news for independent business people because they mean it will be possible for you to invest enough in an over your working career lo generate cienl income for you and to have a comfortable retirement An in vestment advisor can help structure an RSP portfolio that will meet vour investment lives in I accumulate the vou i retirement Brian Slrssur is ail lnvt stun he directed ii Brian who in be at tailing from out tolled the value of his apartment grow to if it just kept pace with inflation whereas the per son with the money earning in terest still has only the million but its guaranteed One is richer than the other yet they both earned the same income per cent What if you had that million dollars 20 years from now If in flation equals what it was in the past 20 years a car will cost 58263 What will your savings buy years from now Will your increase in value to give you purchasing power that exceeds the ravages of inflation and taxes This writer believes that we must all become Investors I use mutual funds rather than loaners who earn interest When we earn interest we achieve the profit which is 100 subject to taxes and our prin cipal is eroded by inflation When we own something investors we receive profits in the form of dividends and capital gains both of which are taxed much less than interest and over time the value of the asset is likely to match or exceed inflation How do you save your money Or do you save for your future wellbeing Do you save 10 of what you earn Do you unders tand the concept of paying yourself first For more information at no charge contact Peter C Masson MBA Regal Capital Planners Ltd Drive Georgetown Ontario or phone Paul J Rockel the author of the best seller Why I Invest In Mutual Funds and President of Regal Capital Planners Ltd On almost every new car and truck in stock ZERO DOWN ZERO PAYMENTS ZERO INTEREST 91 CASH BACK Program applies to all new 1991 and prior model year Ford Mercury cars and light trucks excluding Crown Grand Marquis Continental Car Mark and Explorer Purchases must be made and taken from dealer inventory All 1990 models include dealer participation excluding Escort and Bronco II FordofCanada Limited will pay interest for the first 90 days Example month contract cost of money for first 90 days is nil financed over months at 15 A PR monthly payment is 439 Cost of borrowing Is 30 Offer available only to retail buyers their purchases through Ford Motor Credit On approved credit Additional cash back of350onFestiva 450onEscort Tracer 500 on Mustang Tempo Topaz Broncoll Ranger 700 on Taurus Sable Thunderbird Cougar Aerostar Econolme Bronco and F Series See Dealer for details DONT MISS THE MOST INCREDIBLE OFFER OF 1990 CAPITAL FORD SALES 8731626 Hwy at Delrex Blvd GEORGETOWN CAPITAL FORD SALES 8532370 Mam St ACTON PARK LINCOLN MERCURY SALES LTD 8772261 R 7 WEST GEORGETOWN