Tax-Free Savings Accounts |
| What is it? |
Tax-Free Savings Accounts (TFSAs) are a registered personal savings vehicle designed to help Canadian save money and benefit from paying no tax on any interest earned. There are several TFSA product options, with varying degrees of risk and return potential. |
| Right for you? |
TFSAs are perfect for just about anyone, offering a number of benefits depending on how you use your TFSA to complement your savings plan. |
| Features |
Some features of this new registered product include:
- Available to Canadian residents age 18 and older
- Contributions will not be tax deductible
- Interest income, capital gains or dividends paid under a TFSA will be tax sheltered
- Withdrawal of contributions and/or income will not be subject to tax
- Maximum contribution limit for 2009 will be $5,000.
- Unused contribution room may be carried forward and contributed in a future year
- Withdrawals (capital and income) will increase the unused contribution room
- Unused contribution room will be reported on the annual CRA Notice of Assessment
|
| Types: |
We have several different TFSA products to choose from, including:
TFSA Savings Account Interest rates, while subject to change, apply to the entire balance and are calculated on the minimum daily balance, paid monthly.
TFSA Fixed Rate Term Deposit Term Deposits offer a solid and secure investment with guaranteed interest rates and varying term lengths. The terms offered are 1 to 5 years during which time the funds are non-redeemable. The interest is fixed for the length of the term and is calculated and paid annually. A $500 minimum deposit is required.
TFSA Index-Linked Term Deposit Take advantage of stock market gains without mutual fund administration or management fees. Returns on your deposits are based on the performance of the S&P/TSX 60 Index, and your principal is guaranteed. Available as a TFSA registered product. A $500 minimum deposit is required. The term is normally 3 of 5 years, during which time the funds are non-redeemable. |
RRSP Term Deposits |
| What is it? |
RRSPs are a tax-sheltered plan to help you save for your retirement. There are several RRSP options, with varying degrees of risk and return potential. |
| Right for you? |
You’re never too young for RRSPs. Start planning for your retirement now to ensure you maintain your current standard of living during retirement. |
| Features |
Term Deposits offer a solid and secure investment with guaranteed rates and varying term lengths of 1 to 5 years. We have several different term deposits to choose from, including: |
| Types: |
Accel-a-Rate RRSP Fixed interest increases once annually and applies to the entire balance. 5 year term.
Variable RRSP The funds from this deposit can be withdrawn at any time. The rate fluctuates with interest rate changes and is calculated daily and paid semi-annually.
Fixed Rate The term is normally 1 to 5 years during which time the funds are non-redeemable. The interest is fixed for the length of the term and is calculated and paid annually.
Index-Linked and Global Investments Take advantage of stock market gains without mutual fund administration or management fees. Returns on your deposits are based on the performance of the S&P/TSX 60 Index, and your principal is guaranteed. Available as a registered or non-registered product. |
Annual Contributions
You may choose to purchase your RRSPs in one lump sum, which is usually done at tax time. As long as your RRSPs are purchased on or before the annual RRSP deadline, and they are within your annual allowable RRSP limit, they will benefit your annual income taxes.
Monthly Contributions
Contributing to your RRSPs in smaller amounts monthly may be more attainable than contributing a big lump sum at the RRSP deadline. As little as $25 to $50 a month can be regularly withdrawn from your account through Pre-Authorized Contributions (PAC). It’s an easy way to save, and frequent contributions allow your money to work for you immediately. It also allows you to minimize volatility risk and maximize returns |
 |
Financing your RRSP Purchase
Peoples Credit Union makes it easy for you to set up or add to your RRSP’s even if you do not have cash on hand to make a contribution to an RRSP. We offer a variety of products with interest rates as low as prime +0% and with flexible payment schedules (OAC). Please ask your MSO for details and options.
RRIF—Registered Retirement Income Fund |
| What is it? |
A RRIF is the natural extension of an RRSP. While an RRSP exists for the purpose of accumulating tax-sheltered funds for retirement, an RRIF exists for the purpose of providing an income during retirement. |
| Right for you? |
If you have RRSPs and you’re in retirement, you’ll want to examine the RRIF options that will give you the level of risk and return that you’re comfortable with. |
| Features |
Term Deposits offer a solid and secure investment with guaranteed rates and varying term lengths of 1 to 5 years. We have several different term deposits to choose from, including: |
| Types: |
Fixed Term 1 to 5 years non-redeemable terms with a minimum deposit requirement of $500. Principal and interest are insured. Interest is fixed for length of term and is calculated and paid annually.
Variable Rate RRIF Fluctuates with interest rate changes. Principal and interest are insured. No minimum deposit required. Interest is calculated daily and paid semi-annually (February & August). |
RESP—Registered Education Savings Plan |
| What is it? |
A special savings account to help you fund your child’s post-secondary education. Although RESP contributions are not tax deductible, capital gains and income earned on your contributions grow tax-deferred until withdrawn to pay education expenses. At that point, accumulated earnings are taxed at the student’s typically lower tax rate. |
| Right for you? |
Post-secondary education is an expense that is increasingly beyond the reach of many families. You can make the financial burden easier by contributing monthly to reach your education savings goal when the child turns 17. |
| Features |
The federal government’s Canada Education Savings Grant program pays 20% of the first $2000 in annual RESP contributions to the plan, up to a lifetime limit of $7,200 per child. RESPs can hold cash, term deposits, mutual funds* or other securities, and there is no foreign content limit. RESP’s can also be transferred to other family members. Ask your MSO about which RESP best suits your needs. |
* Mutual Funds are offered through Credential Asset Management Inc. Unless otherwise stated, mutual fund securities and cash balances are not covered by the Canada Deposit Insurance Corporation or by any other government deposit insurer that insures deposits in credit unions.
Non-registered Term Deposits |
| What is it? |
A non-registered investment means there is no tax shelter benefit, however, it is still a safe and secure way to reach your savings and investment goals. |
| Right for you? |
Term deposits are perfect for the secure part of any portfolio. They also are backed by the Deposit Insurance Corporation of Ontario (DICO). They carry no fees and can be purchased for as little as $100. |
| Types: |
Escalator Plus Cashable once a year on the anniversary date and 30 days thereafter. The Escalator Plus features an interest rate that increases annually on the renewal date.
Quick Access Term Deposits Cashable at any time in $100 increments, however if cashed within the first 90 days, no interest will be paid. The Quick Access carries a guaranteed interest rate for the specified period
Fixed Rate The term is normally 1 to 5 years during which time the funds are non-redeemable. The principal and interest are insured. The interest is fixed for the length of the term and is calculated and paid annually.
Short Term Deposits Can be arranged for between 30 to 364 days, during which time the funds are locked in. The principal and interest are insured. The interest is fixed for the length of the term and is paid at maturity. |
Bonds |
| What is it? |
Savings Bonds are an investment option that allows you to help build our country or province and plan for the future. |
| Right for you? |
If you’re looking for a secure investment with an attractive rate, a Bond may be for you |
| Types: |
Canada Savings Bond* (CSB)s are cashable at any time, giving the holder easy access to the funds invested.
Canada Premium Bond* (CPB)s are only cashable on the anniversary of the issue date and during the 30 days thereafter.
Ontario Savings Bond (OSB)s have three different types: Step-Up, Variable Rate, and Fixed Rate. The provincial government backs these bonds. Ontario Bonds are available to purchase during a few weeks in June. |
* Both bonds offer two types of interest, regular and compounding and are backed by the Canadian Government so they are very secure. Canada Bonds offer several series each year, starting October 1st.
Our experienced and knowledgeable Member Service Officers would be happy to meet with you to discuss the types of investments offered and the options that are right for you. |
