Important Facts about Registered Retirement Savings Plans

The constant need for financial security in today’s world encourages us to be on the look-out for savings plans that could benefit us the most. A popular choice among investment-savvy Canadians is the Registered Retirement Savings Plan, otherwise known as an RRSP. Here are some important facts you need to know about this plan to help you out:

1. Savings on tax – The contributions you make to your Registered Retirement Savings Plan is tax deductible. This means that this plan allows you to make a significant amount of savings on taxes. For example, if you make a contribution of $5000 from your taxable income of $60,000, you should be able to save approximately $1,500 depending on the province in which you’re residing.
   
   
2. Varieties of plans – One of the best features of the RRSP is that you’re not just limited to contributing to your own account. You have options to set up an account wherein contributions are made by your employer and deducted from your paycheck. You can even go for the spousal RRSP, which lets a spouse with higher income make contributions to the account of the other spouse.
   
   
3. Self-directed RRSP – You can opt to set up a self-directed RRSP that can bundle up a wide variety of plans together. Through this option, you get to make investments such as mutual funds, guaranteed investment certificates, stocks, gold and/or silver bullions, and many more.
   
   
4. Starting early – Since RRSPs do not have a minimum age limit, it is recommended that you start early for higher returns. You can continue making contributions up to the age of 71 if you’re still earning then. After you’ve reached the age limit, you have the option to buy annuity, switch to a different kind of savings plan, or withdraw the amount in cash. 

Whether or not you wish to start a Registered Retirement Savings Plan, make sure you do a thorough research about the plan. This can guide you in reaching a decision that will benefit you in the future.

Important Facts about Registered Retirement Savings Plans

The constant need for financial security in today’s world encourages us to be on the look-out for savings plans that could benefit us the most. A popular choice among investment-savvy Canadians is the Registered Retirement Savings Plan, otherwise known as an RRSP. Here are some important facts you need to know about this plan to help you out:

1. Savings on tax – The contributions you make to your Registered Retirement Savings Plan is tax deductible. This means that this plan allows you to make a significant amount of savings on taxes. For example, if you make a contribution of $5000 from your taxable income of $60,000, you should be able to save approximately $1,500 depending on the province in which you’re residing.
   
   
2. Varieties of plans – One of the best features of the RRSP is that you’re not just limited to contributing to your own account. You have options to set up an account wherein contributions are made by your employer and deducted from your paycheck. You can even go for the spousal RRSP, which lets a spouse with higher income make contributions to the account of the other spouse.
   
   
3. Self-directed RRSP – You can opt to set up a self-directed RRSP that can bundle up a wide variety of plans together. Through this option, you get to make investments such as mutual funds, guaranteed investment certificates, stocks, gold and/or silver bullions, and many more.
   
   
4. Starting early – Since RRSPs do not have a minimum age limit, it is recommended that you start early for higher returns. You can continue making contributions up to the age of 71 if you’re still earning then. After you’ve reached the age limit, you have the option to buy annuity, switch to a different kind of savings plan, or withdraw the amount in cash.

Whether or not you wish to start a Registered Retirement Savings Plan, make sure you do a thorough research about the plan. This can guide you in reaching a decision that will benefit you in the future.

What You Need to Know about Registered Education Savings Plan (RESP)

The Registered Education Savings Plan or RESP can be defined as a contract or an agreement between two parties in which an individual (subscriber) can declare one or more beneficiaries, agreeing to make financial contributions for them. The agreement requires the other party (promoter) to pay EAPs or educational assistance payments to the beneficiaries. Let's take a quick look at some important facts you need to know about this savings plan:

• Normally, you can make contributions to family plans in the case of beneficiaries who are below the age of 31 at the time of contribution. You can, however, make transfers from one family plan to the other even for beneficiaries over the age of 31.

• Since 2007, there has been no limit on the annual contributions you make to RESP and the lifetime limit of contributions that can be made for one beneficiary is $50,000. 

• However, any payment you make under a designated provincial program or the Canada Education Savings Act will not be considered when determining whether or not the lifetime limit has been exceeded.

• When excess contributions are made, subscribers have to pay taxes of 1% per month on their share if the excess has not been withdrawn by a certain deadline. So, you can easily cut down on the liable tax amount by withdrawing any excess contribution.

• If, for some reason, the promoter does not pay out the contributions you have made to the beneficiary, you will receive the accumulated sum by the end of the contract. You would not need to declare this amount as your income.

These are just some of the basic facts you need to know about the Registered Education Savings Plan, so you can get a rough idea of the agreement before making your contributions. Whether you wish to contribute to the RESP for your children, spouse, or any other beneficiary, you can learn more about the plan to help you make the right decision.

                                                                                                 

                                                                                                                                            

Enjoy Your Holidays to the Fullest

The schools are off and families are in the midst of summer holidays. It is travel time for most families. An estimated 29 million Canadians are likely to travel within and outside Canada this summer, making travel insurance an important subject that needs to be tackled right away. Here are some essential travel insurance tips to help you enjoy your holidays to the fullest.

Go for coverage not the price

When it comes to travel or any other form of insurance, it is always a good idea to go for a plan that provides greater coverage even if it means a higher premium. It is okay to compare policies and ask your insurance provider to match the rates a competitor may be providing. However, always remember that coverage is what you need most and make it your first priority

Learn as much as possible

It is not just enough to simply go through the insurance documents before signing them. You must first try to learn from your insurance provider about the exact details covered by your policy, ask about anything you don't understand and sign only after you are satisfied in every possible way.

Disclose your travel plans

It is very important to disclose your travel plans in full detail to your insurance provider. You can get a better service and the best insurance package only if you disclose all of your travel plans to your insurance provider. Insurance may not be covered for certain activities or in certain places under certain circumstances. An insurer can only guide you if he is fully aware of your plans.

Get referrals

Finally, you must know that no one can guide you better than someone you are familiar with. So, if you know anyone who travels frequently because of business or any other reason, ask them about their travel insurance arrangements. These travelers will often be familiar with insurance policies, who provides the best service and so on.

Every person may need a unique insurance coverage depending on their travel needs and we have something for everybody. From business travelers to backpackers, rest assured that you are insured when you go outside Canada.