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10- PORT PERRY STAR - Tuesday, February 13, 1996 "Scugog's Community Newspaper of Choice" So you think GIC's are a no risk investment? tached to GIC ments. The first is inflation - the hidden tax - a drain year over year on one's Many people, apprehen- sive about investing in "risky" securities, have traditionally opted for what ostensibly appears to be a "no risk" employ- ment of their savings - guaranteed investment certificates, or certificates of deposit as they are sometimes called. While it's true that these instru- ments promise the safety of one's capital along with a pre-established rate of return throughout the term of investment, pru- dent investors know there are other factors which af- fect the growth of their savings. It is among these factors that we find the less obvious risks at- your retirement. ervices providing the security of a fixed rate Monthly Deposits: Maximize the tirementS interest earned by easy monthly deposits Re Let us help your RRSP grow rapidly over the years. For a Smarter Tomorrow: take aco yourself now with a Credit Union RRSP and we ll take care of the rest. A guarantee of a solid return to provide a secure life sale for A Credit Union RRSP offers Investment Options: Variable Rate Plans, giving you the current competitive rates, or a fived Rate Plan, Mariposa Community Credit Union 2 King StS. LITTLE BRITAIN (705)786-3534 invest- savings. Inflation eats away at the purchasing power of our money and as aresult, asks our money to work harder for us. As a point of illustration, for every percentage point your investment dollar grows, it must be adjusted downward to account for the erosion of buying pow- er caused by inflation. For example, assuming an ar- bitrary annual 4 per cent rate of inflation, if you earn $40,000 per year, in 10 years you would have to earn $59,210 to retain the HOW & WHEN TO GET SMART MaripoSer RRSPs Se. Credit Union same level of income you have today. In 25 years, that amount would rise to $106,663. How to combat this? To stay ahead of the game, many Canadians, with the help of their financial ad- visor, have adopted an in- vestment strategy which attempts to achieve high- er rates of return with cal- culated minimal risk usu- ally through investment diversification. Diversifi- cation may be achieved through a number of means: types of invest- ment products (treasury bills, stocks, bonds); by term of investment (three months to 10 years); and by place of investment (country, region). The absence of diversifi- cation is another risk in- herent with the practice of exclusively investing In GICs and the like. By in- vesting in a single vehicle in a single currency, one limits the opportunities, for growth and in the case of the currency, potential- ly sabotages the buying power of that investment dollar and as a result caus- es the value of the invest- ment return to shrink in real terms. Most economists and in- dustry watchers agree the Canadian dollar is in for a rough ride this next year as the country struggles to "determine its political fu- ture and control its fiscal direction. When the value PENNY ¢~ASSOC. ACCOUNTING SERVICES Betty Penny, Principal Accountant Patrick Fortune, Assoc. Accountant 180 Mary St., Port Perry Ontario LIL 1C4 Phone (905) 985+0712 Toll Free 1280026996190 Fax (905) 9859461 - Computerized Accounting Training, (Accpac Plus, Simply Business Visions, Quickbooks & Lotus) Management Consulting Part-time Controllership Personal & Corporate Taxes Temporary Bookkeepers New Business Set-Ups 'Mobile Service - Competitive Rates Robert J. Gow JL Van Camp Chartered A -THINK- -PLAN- ROBERT J. GOW -800-267-1522 RICHARDSON GREENSHIELDS Investment advisors to Canadian enterprise and enterprising Canadians 111 Simcoe St. N., Oshawa, Ont. L1G 454 & Keller | ccountants -ACT- 434-7156 or Financial, Income tax planning and return preparation. Personal tax returns electronically filed. estate and retirement planning. Personal Tax Returns are being processed now. OFFICE HOURS UNTIL APRIL 30. Monday to Friday 8 - 6, Saturday 9 - 1 204 Casimir St. Telephone: (905) 985-9725 Port Perry Toll Free: 1-800-215-3852 of our dollar declines so does our purchasing pow- er. One means of counter- balancing this effect is by diversifying investments internationally. Many Ca- nadians have the mistak- en notion that investing in foreign securities is risky. Sure it can be. But it doesn't have to be. In fact, international diversifica- tion in a portfolio actually has the effect of reducing risk by taking advantage of participation in mar- kets and economic cycles which move differently from our own and by re- ducing exposure to a de- valuation of the Canadian dollar. If, for example, over the past six months one had held a portfolio of U.S. stocks that moved neither up nor down, one would still see a tidy little profit due to the slide in the Canadian dollar. I believe that for most Canadians, mutual funds are one of the best ways to capitalize on opportuni- ties for growth and income and still maintain a level of risk that may be tail- ored to the comfort of the individual. So obviously do the thousands of Cana- dians who are currently invested in the more than 500 mutual funds availa- ble in Canada today. With this much choice, you're certain to find a mutual fund that meets your in- vestment objectives and helps you reach your fi- nancial goals. Courtesy of, Richardson Greenshields, Oshawa COURIER SERVICE CANPAR DEPOT 188 Mary St, Port Perry 985-7383 SHEPHERD & POWELL CHARTERED ACCOUNTANTS Accounting, Income Tax, Financial Planning and Consulting Services Corporations, Small Business, Farms and Individuals Consultation or Start-up Regarding the Purchase New Businesses Preparation of Business Plans and Cash Flows Supp ort in. md De scome Tas and Eta including Inter Computer Services, ou ing Set in Tins ing Lenders nancial Institutions Estate Planni ational Ty. ort and P Services and Assistance overnment Forms and Returns Including GST, PST, WCB, EHT and NISA FREE INITIAL CONSULATION Personal, Confidential Service Evening and Weekend Appointments Available DAVID R. POWELL coum. mp a,c 250 Queen Street, Port Perr (Next to the IA, (905) 085. 979] "V7 »