The next section of the Action Financial Group Orientation Series will deal with Investment Account Types.
An account is not an investment; it is a container that holds one or more investments. Different containers have different features such as size, shape or colour, one hole in the bottom or none, a lid or no lid; different accounts have different features too, such as tax treatment, size limitations, or rules about contributions and withdrawals. Not all accounts are suitable at different life stages or circumstances and it’s always best to seek advice.
Deferred Profit-Sharing Plans
A Deferred Profit-Sharing Plan is another type of retirement plan offered by some employers. Contributions are only made by the employer (unlike pension plans or RRSPs where employees may also make contributions), and are made from the “profits” of the employer. The annual contribution limit is half of the usual RRSP contribution limit. Contributions reduce the amount of room available for other pension or RRSP contributions. The employer may allow the funds in the DPSP to be invested in various investments including the stock of the company, or other available options depending on the financial institution administering the plan. Withdrawals from the plan may be limited prior to retirement.
We hope you will find this information valuable and will increase your financial confidence. You can always find these articles on our website www.actionfinancialgroup.com.
Karin Rimnyak, Certified Financial Planner®
David Dryburgh, Certified Financial Planner®
Ian Barrie, Certified Financial Planner®
This information has been prepared by Karin Rimnyak who is an investment Advisor for iA Private Wealth. Opinions expressed in this email are those of the Investment Advisor only and do not necessarily reflect those of iA Private Wealth. iA private Wealth Inc. is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada. iA Private Wealth is a trademark and business name under which iA Private Wealth Inc. operates.