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10- PORT PERRY STAR - Tuesday, January 28, 1997 WHAT IS A MUTUAL FUND? Investing in a mutual fund is like taking a packaged vacation. You decide where you want to go, and in return for a fee, the travel company arranges to take you and everyone else who signed up to the destination of your mutual choice. You have your privacy, and you may or may not know anyone else in the tour group. In fact, the only ching you may have in common with anyone else on the trip is that you want to go to the same place. The benefits of going on a packaged vacation are that you don't have the stress and worry of getting there. It's all arranged. All you have to do is decide where you want to go. The travel company has people who are trained and have the contacts to get you to your destination safely. It's up to them to negotiate the details, give good service and respond to any needs you may have while you're in their care. It's the same with mutual funds. You choose a fund that's headed in a specific direction, and the fund company charges you a fee to take you there. Other investors in the fund have the same destination, but you may not know who they are, and their money and goals are totally independent of yours. It's the fund company's job to research, analyze and choose the investments that will take you where you want to go. It's also the fund company's job to make sure your account is accurate and up-to-date, and that you're kept aware of how your | investment is performing. Now you may be thinking that you don't like "packaged deals" and would rather explore or set up your own vacation -- and investment -- plans. In both cases, there's a sense of adventure associated with "doing it yourself." But if you are inexperienced; you can make mistakes and mistakes can be costly -- especially when your hard-earned money is at stake. So you should consider taking advantage of package deals and guides before you head out on your own. Member CIPF Talk with BC Investment Advisor DOMINION Robert J. Gow SECURITIES 434-7156 or Personal Wealth Management™ 1-800-267-1522 111 Simcoe St. N, Oshawa, ON LIG 454 Call the Port Perry Star to be a part of this regular Tax Talk Feature 985-7383 | | | I WELCOME YOUR CALL. PETER A. CADEAU 1-800-382-4964 [DJ SAVA SN @] 54 = S\N WEALTH MANAGEMENT | - T.D. Securities Inc. is a subsidiary of the Toronto Dominion Bank. | Member of the CIPF "Scugog's Community Newspaper of Choice' What to put in your RRSP People are constantly asking me the kind of investments they should be putting inside ~ their RRSPs. In today's low interest rate environment, it really doesn't make a difference. The exact same invest- ment you have outside your RRSP can be put inside your RRSP. That was not always the case. Investment strategies in the 1960s called for putting interest- bearing investments inside your RRSP-- because outside the inter- est would be fully tax- able--and dividend-pay- ing investments outside in order to take full advan- tage of the dividend tax credit or capital gains deduction. This theory worked well as long as interest rates were high. Today these yields are no longer there--so compare the yield on your fixed-income investments with the divi- dend tax credit and capi- tal gains available on equity investments. Term deposits that return 6 percent a year will double your money every 12 years. A quality mutual fund should double in value every four or five years. A 40-year-old, for example, who has $10,000 in interest-bearing invest- ments inside his/her RRSP will have $20,000 at age 52 and $40,000 by age 64. The same person who invests $10,000 in a mutual fund which dou- bles every five years will have $20,000 by age 45; $40,000 by age 50; $80,000 by age 55; $160,000 by age 60; and $320,000 by age 65. What about Revenue Canada? The Department's Mandate Revenue Canada's respon- sibilities include: ¢ Revenue collection; ¢ Border services; ¢ Trade policy administration; and ¢ Income redistribution. Revenue Canada works on behalf of the federal, provincial, and territorial governments as well as individuals and business- es to support Canada's social and economic progress. The Department over- sees various tax credit programs and collects fed- eral and provincial income taxes, the goods and ser- vices tax (GST), Canada Pension Plan contribu- tions, unemployment insurance premiums, and customs and excise duties. As well, it collects excise taxes and, for provinces with agreements with the federal government, IT'S YOUR MONEY WOULD YOU LIKE TO TALK PRIVATELY ABOUT GIC'S PORTFOLIOS RRSP'S, RRIF'S OR FINANCIAL PLANS? J) IT'S WHAT I'VE BEEN DOING WITH CLIENTS FOR OVER 20 YEARS. Revenue Canada collects provincial sales tax, tobac- co taxes and liquor markups and levies on non-commercial imports. The department also administers the border and trade aspects of the North American Free Trade Agreement (NAFTA), the General Agreement of Tariffs and Trade (GATT), the World Trade Organization Agreement (WTO), Canada's trade laws, and Canada's international tax agreements with other countries. Finally, Revenue Canada works in partner- ship with law enforcement agencies and other federal departments to protect Canadians and society as a whole by preventing ille- gal and dangerous goods and inadmissible people from entering Canada, and monitoring the move- ment of controlled and regulated goods. Revenue Canada con- tinually strives to deliver its programs and services effectively, fairly, and at the lowest possible cost. The department's goal is to: * Treat all its clients fairly and equally; * Protect the confidentiality of clients' information; ¢ Provide its services as efficiently and effectively as possible; e Maintain a level playing field for all its clients by ensuring maximum compliance through audits and responsible enforcement; Minimize the burden and cost of compliance with laws the Department administers; and ¢ Provide an impartial redress process. Note: Revenue Canada administers tariff and tax legislation. The Department of Finance is responsible for developing tax policy and for the wording of legislation. Fiscal Responsibility Revenue Canada advances the governments broader economic and social agenda, by helping to maintain the integrity of the government's resource base and ensur- ing that all Canadians pay their fair share of tax. One such initiative the department administers is the Refund Set-Off Program, which ensures that individuals or corpo- rations do no receive income tax refunds until they have fully paid their debts to the Crown. ROWETT & NE ROWETT | ACCOUNTING SERVICES Computerized Bookkeeping; Payroll OTHER SERVICES WE PROVIDE: Office Setup: Computers, Accounting Software & Training Phone: (905) 985-9901 EMAIL: rowett@cysys.com Le ee ee mer me es sm ma FIND GRAD CRED GENS GIS GAIN GEES GENS GIS GEES GEN GEES : Service; T4's; Gov't filings ]