 Deciding where to invest
your RRSP contributions can be a daunting task. With so many
choices, it's no wonder that some last minute investors panic.
DON"T PANIC! It's a difficult enough task making long term
investment plans when you're calm, never mind when you're harried!
- 2000 RRSP contribution limits are noted
on the 1999 personal income tax return assessment notices. Aim
to contribute as much as you can to your RRSP. You have until
February 28, 2001 to make tax-deductible contributions for the
2000 year.
- For people who recognize the wisdom of
making RRSP contributions but fear that managing their investments
will become a full time job, Financial Planners and/or advisors
can solve your dilemma. A financial advisor can assess your risk
profile and guide you into a portfolio strategy designed to meet
your particular risk tolerance characteristics.
- For the last minute investor who wants
to be involved in the investment of their RRSP contribution but
don't currently have the time, investing in an RRSP-eligible
Daily Interest Account or Money Market fund may be the answer.
Park your contributions temporarily - but don't forget to decide
on an investment strategy later!
- How can you entirely avoid the last-minute
rush to make RRSP contributions? Have your financial institution
set up monthly pre-authorized deposits to your RRSP investments.
Not only will you avoid the hassle of remembering and then making
your contributions, you will also reap the benefits of the effects
of dollar cost averaging!
- Here's a way to beat the RRSP rush next
year: as soon as you receive your tax-refund (if any), deposit
it into your RRSP investment to get a head start for next year.
- Rather than naming a charity as the beneficiary
of your RRSP or RRIF, name your estate as the beneficiary. This
way, you can take advantage of the tax credit available to offset
the income tax your estate would have to pay for the amount of
the bequest. Then leave instructions in your will explaining
that the money should be transferred to the charities you name
to ensure that your estate gets the benefit of the tax credit
for your donation.
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