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.
Group Registered Retirement Saving Plans
A Group RRSP is much like a regular individual RRSP, but it is administered by an employer. It is a very flexible plan in that contributions can be made by the employer and/or the employee. Some employers offer to match the contribution by the employee up to certain limits, or in proportion to the employee’s contributions. The match could be 1:1, meaning for every dollar the employee contributes the employer will also contribute $1. Or it can be more or less than that ratio. The employee’s contribution is done by payroll deduction and contributed directly to the RRSP plan. Investments can be selected by the employee based on their own timeline and risk tolerance, from a selection of available investment options from the plan administrator. Contributions by the employee are tax deductible the same as individual RRSP contributions, and are limited by the individual RRSP limits. When an employer offers a Group RRSP, it is important to understand the plan details in order to take maximum advantage of it. Professional financial advice can help to accomplish this.
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.