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Are you expecting a tax refund for this tax year? If so, what do you plan to do with the funds? While it is very tempting to spend the funds on a holiday, an e-bike or the latest phone, you may wish to consider other options.


The first priority should be to reduce or pay off your debt. Carrying credit card balances, for example, is paying unnecessary high monthly interest charges. Give us a call and ask about a loan to pay off or consolidate your debt.

Reinvesting some of the refund to your retirement savings is a great option. Contributing now to your RRSP is giving you a jump start on a potential tax refund next year. When you reinvest your refund, you start earning interest on your RRSP contribution right away versus only earning interest when you make a tax time contribution. Also consider paying yourself first by contributing monthly, of even a small amount, to your RRSP.  


Make your money work for you. At CCEC, we can help. Investing your tax refund in an RRSP at CCEC is also an investment in your neighbours and local businesses. We have kept our members' money working in the community since we opened in 1976. 


Give us a call first for your lending, borrowing and investment needs.


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The deadline for RRSP contributions for the 2021 tax year is March 1, 2022. Apply at CCEC for an RRSP loan by February 18, 2022.

Do you have March 1 marked on your calendar? If you do, then there’s a good chance you’re already on top of your registered retirement savings plan (RRSP) contributions for this year. The 1st is the last day you can put money into your RRSP and get a tax deduction against your 2021 earnings. If you haven’t decided whether to contribute this year — or if you haven’t set up a RRSP yet — then the answers to these questions might help with your decision.

How much can I contribute to my RRSP? 

You’re allowed to contribute up to 18% of your income to a maximum amount set annually by the Federal Government. You can carry forward any contribution room from previous years, so be sure to review your notice of assessment from the CRA to find out how much. 

Do I need an RRSP if I have a pension? 

Yes, even if you have a good pension at work, an RRSP can help boost your retirement savings. However, having a pension might reduce the amount you’re allowed to contribute in order to reflect the fact that you’re already saving through your workplace pension. 

What happens when I retire?  

You can continue to contribute to your RRSP up until age 71 at which point you need to wind it up. Many choose to convert their RRSP savings into a registered retirement income fund (RRIF) that allows them to take a monthly retirement income. You can convert your RRSP to a RRIF at any age and the amount you are able to withdraw increases as you get older. Learn more about converting your RRSP to a RRIF here.

Is the money I take out of my RRSP tax free? 

No. You get a tax deduction on money that you contribute, so you are delaying paying income tax. When you withdraw money out of the RRSP during retirement or any other time, that income will be taxed just like any other income you earn. 

What happens if I withdraw from my RRSP early? 

If you withdraw money early from an RRSP, you pay withholding tax and income tax. However, there are exceptions. The Home Buyers’ Plan allows you to withdraw up to $35,000 without paying withholding tax in order to buy your first home. Repayments begin two years after and you have 15 years to pay it all back. The Lifelong Learning Plan lets you withdraw up to $10,000 annually to a maximum of $20,000 to pay for full-time education or training for you or your spouse or common-law partner. You’ll find more information about early withdrawal here
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The CCEC Board of Directors would like to invite all members to attend a virtual information session on February 3rd, 2022 for an update on the proposed merger conversations with Community Savings Credit Union. 


The Board would also like our members to know that they have applied to defer the 2022 AGM for up to 6 months, as we work on the proposed merger application.  Click here to view or download the 2021 financial statement .


Please register by 12pm on February 3, 2022, if you would like to attend the virtual meeting. 


Date:    Thurs., February 3, 2022

Time:    7:00pm – 8:30pm 

Where: Via Zoom 


RSVP to Joanne by 12pm February 3, 2022 by email or phone.


Email:   jmackinnon@ccec.bc.ca  

Phone: 604.254.4100 ext 227


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At CCEC, RSP loans are available until February 23, 2021!  The deadline to contribute to an RRSP for the 2020 tax year is March 1, 2021. 

We know that we are in unprecedented times and finances may be tight this year. Saving for your future may not be top of mind. However, even contributing a small amount to your RRSP today will go a long way in the future.  It’s not just about long-term growth but also benefits, like lowering this year’s taxes.  More important, your funds at CCEC are invested in your community, your neighbours and local businesses.

Are RRSPs worth it in the long run? Even though you have to pay the tax back when you withdraw the funds, yes, they are worth it. They are a valuable tool to reduce your tax burden and save for the future. We encourage our members to include an RRSP as an investment option in your financial plan. And, be sure to review your plan each year.  


If you would like to contribute, ask us about an RRSP loan so that you can maximize or top-up your RRSP contribution. Consider starting a monthly contribution plan, you can earn compound interest making more than if you contribute a lump sum. 

Call us today and ask how you can contribute to, top up or start an RRSP. Be sure to also ask about our other investment options including TFSA’s.


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A Tax-Free Savings Account (TFSA) is designed to help you save for your short and long-term goals. This is different from an  RRSP that is considered a longer-term strategy to save for retirement.  A TFSA may be a good option for you to consider if you have shorter-term goals where you want to access and more easily withdraw funds.

TFSA contributions are not tax deductible as they are with an RRSP.  However, the contributions and the gains made can be withdrawn tax-free at any time.  They are flexible in that you are allowed to ‘refill’ your account with no penalty.  For example, If you do make a withdrawal, that amount of room is added back the following year.  As the amount you can contribute is adjusted annually, you can top up from unused room you have carried forward and the value of the withdrawals.

At CCEC, we are pleased to offer this new savings option to our members. It is considered a retirement savings option by  CRA and has terms and conditions.  We ask our members to contact or look at your MY CRA account to find out how much room you have available. In addition to the rules governed by CRA, at CCEC we’ve also set a minimum contribution at $500. 

Contact us to learn more and to open a TFSA account.  We can review your needs and suggest what might work best for you from the range of investment strategies we are now able to offer. 

For more information visit the CRA website 

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2020 was an unprecedented year.  It did not go as we were expecting as Covid impacted all of us.  We have seen loss of lives and changes in our communities and local businesses. As we are set to enter a new year, let’s pause, reflect and identify what is important to us.  

The CCEC Board is inviting members to join us to  discuss the future of the credit union and the upcoming Annual General Meeting. We hosted a Virtual Town Hall on December 10th and our second Town Hall is on: 

As you know, the credit union sector in British Columbia is facing enormous pressure with ever increasing regulatory requirements, rising costs and low margins resulting from historically low interest rates.  While our financial position is strong and we will be reporting healthy earnings in the year ending September 2020, our long term financial planning indicates we will face challenges. Across the province, over 25% of credit unions are currently considering a merger or acquisition.

 

CCEC’s Board has initiated some informal discussions with other credit union boards about what they are experiencing and what, if any, opportunities there may be to collaborate and/or join forces.

 

This is also a great opportunity to learn more about CCEC if you are interested in running for the Board at the AGM on February 4, 2021. Nominations are being accepted for 6 positions on the  Board and 4 positions on the Credit Committee. Click here for more information and to download the Nominations Form. 

 

We look forward to seeing you at a virtual town hall meeting and the upcoming virtual AGM on Thursday, February 4, 2021. 

 

RSVP Joanne  jmackinnon@ccec.bc.ca to attend the Town Hall and the AGM.  A zoom link will be sent closer to the time. 

 

Thank you and be safe and healthy in 2021.


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Managing your money, debt and investments, planning for retirement and protecting yourself from consumer fraud -  November is the 10th Anniversary of Financial Literacy Month  and a good time to review how you are doing. 


It is important that we all know how to protect ourselves, our identity and our money from frauds and scams.  Did you know that each year Canadians lose an estimated $100 million dollars to a variety of scams? In the past six months, loss to Covid-19 fraud was $6.2million. Lean more in the webinar hosted by the Vancouver Public Library taking place on November 24. 


The Canadian Government has many online tips and tools to help you better manage your finances in challenging times.  These include making a budget to keep track of your money, minimizing debt, and understanding financial products and services.  You can also learn how your credit score is calculated and how to make it better.  


If you have any questions about your financial well-being, we ask you to give us a call. We can provide complimentary advice. 


Financial Literacy Month is online in November. Follow them at @FCACan  and #FLM220


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November is Financial Literacy Month and the theme is “Understanding Your Finances”. Check the Government of Canada website for practical tips and tools on budgeting, savings, investing, fraud prevention, avoiding debt and building a strong credit history. Learn the 10 things you should know during times of financial uncertainty. 

They are also offering webinars: 

Financial Literacy Month is online in November. Follow them at @FCACan  and #FLM220.

If you have questions or concerns about your financial wellbeing, please give us a call. 

 

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A Registered Retirement Income Fund (RRIF) provides a source of retirement income. It can be set up anytime and withdrawals must start one year after it is opened. CCEC is now offering this service to our members and we want you to better understand them. 


There are various retirement investment options and we can provide you with complimentary financial advice and guidance.  While you must convert your RRSPs to a RRIF by the end of the year you turn 71, you can transfer your existing RRSP into an RRIF at any time.  To open an account, we can help you transfer your RRIF from another financial institution. 


A RRIF, like an RRSP, is tax-sheltered for deposits. As you need to withdraw a minimum amount in the calendar year after it was first funded, those members who are thinking of taking an early retirement may want to talk with us about opening an account.


Investing at CCEC means that you keep money working in the community to benefit you, your neighbours and local businesses.  CCEC has always been highly localized in how we invest your money since we opened in 1976. Our values have not changed. 


We are pleased to offer our members the option to invest in an RRIF. 


Call us to learn more. 


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Invest in you and your future with an RRSP.  RRSP’s continue to be a good investment fit for many of our member-owners’ financial plans and lifestyles.


There are two main reasons our members invest in an RRSP:  to reduce taxable income (paying less tax in that year); and to be saving tax-free as (taxes are payable later on withdrawal in what would be a lower income year).  At this time, you can contribute up to 18% of your 2019 earned income, to a maximum of $27,230 plus any carry-forward contribution room that you may have until the year you are 71 years of age. 


If you would like to contribute, ask us about an RRSP loan so that you can maximize or top-up your RRSP contribution (before March 2, 2020).  You may be able to save tax dollars by investing the funds from the loan into your RRSP. By starting a monthly contribution plan, you can earn compound interest making more than if you contribute a lump sum. 


RRSP’s are considered longer-term retirement investments. However, you can withdraw funds,  for use towards the Home Buyers’ Plan or the Lifelong Learning Plan; which must be repaid within a specified time.  A word of caution before you resort to withdrawing from your RRSP - look for alternatives and talk to us. 


Are RRSPs worth it in the long run? Even though you have to pay the tax back when you withdraw the funds, yes, they are worth it. They are a valuable tool to reduce your tax burden and save for the future. Be sure to include an RRSP as an investment option in your financial plan. And, be sure to review your plan each year.  


Need a plan?  We can help you with that.


Call us today to speak with one of our investment specialists. 

Pick up the leaflet, Your Guide to Understanding RRSP’s in the branch or visit the CRA website for more information. 


A Registered Retirement Savings Plan (RRSP) is a retirement savings and investing vehicle for employees and the self-employed in Canada. Pre-tax money is placed into an RRSP and grows tax free until withdrawal, at which time it is taxed at the marginal rate.

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