Solutions I d e a s & s t r a t e g ies f o r f i n a n c i a l WINTER 2011 su c c ess How to build a better RSP Canadians are living longer and enjoying more years in retirement. It’s easier than you think. Start good RSP saving habits today. A registered Retirement Savings Plan monthly amounts, rather than making one large advantage of a wide range of investment (RSP) is an investment in your future: contribution each year. See the story, “Make it opportunities, both global and domestic, It can help provide the savings you automatic and boost your savings,” on Page 2 while at the same time, managing risk by to see how quickly your money can grow. not putting all of your money in one type of need to get the most from your retirement years. And your RSP also comes with other Diversify your RSP. How you invest your investment. It’s a good idea to review your benefits: Your contributions to your RSP RSP dollars can also make a difference in the investment mix at least once a year with your help reduce the taxes you pay today while retirement wealth you accumulate. One of Mutual Funds Representative and make any the money in your plan grows tax-free until the keys to RSP success is having a balanced necessary adjustments, as changing market you are ready to withdraw it down the road. mix of investments that suits your goals and conditions may alter the balance in your plan. At that point, you will probably be in a lower your tolerance for investment risk. tax bracket, saving you even more money. With Canadians living longer and enjoying Define your retirement dream. One Balancing your portfolio means spreading — or diversifying — your RSP across different more retirement years, getting the most out of types of investments and geographic regions. your RSP has become even more important. Typically, these include growth investments Here are a few easy ways to build a better RSP. such as equities or equity mutual funds, Make it a habit. Taking the simple step of bond mutual funds and “cash” investments best moves you can make. You may find it easier such as money market funds. Two ways to benefit with dividend funds 2 This balanced approach lets you take China, India and other emerging markets are powering ahead Continued on Page 2 TD Asset Management Inc. was named the Morningstar®© Fixed Income Fund Manager of the Year at the 2010 Canadian Investment Awards Gala. fixed-income investments such as bonds or contributing regularly to your RSP is one of the to set up an automatic savings plan with small of the fun parts of retirement planning is 3 What’s ahead for the economy in 2011? 4 Spotlight How to build a better RSP Continued from Page 1 Make it automatic and boost your savings thinking about how you want to spend your For the 2010 taxation year, you can “golden years.” This will influence how contribute up to 18% of your 2009 much money you’ll need for retirement and earned income to your RSP, to a maximum the amount you’ll need to save today to of $22,000, plus or minus any pension reach your goals. adjustments. Your Notice of Assessment For instance, if your dream retirement is gardening and spending time with your grandkids, you may not need as much $49,193 But don’t wait until the March 1, extensively. That’s why you should start contribution. By contributing sooner, thinking now about how you want to you’ll avoid the rush and your money spend your retirement. will have more time to grow. $94,870 Compound growth available contribution room. money as someone who wants to travel Get started. A TD Personal Your contributions from your 2009 tax return will show your 2011 deadline to make your RSP Assessment1 Watch your money grow $27,931 15 yrs That’s where an automatic savings 20 yrs 30 yrs can help you create a clear picture of plan — where you contribute a set your current financial situation and start amount each month — can help. As the your plan for a successful retirement chart shows, the sooner you start, the savings strategy. Arrange for a TD Personal better. You can try different senarios for Assessment with your local TD Canada Trust yourself using the RSP calculator at Plan for your RSP, visit your TD Canada Trust branch or visit www.tdretirement.com www.tdgetsaving.com branch or call 1-866-222-3456 to speak with for more information. n To set up a Pre-Authorized Purchase Assumes a $100 monthly investment in a balanced fund2, earning a 6% rate of return, compounding tax-free in an RSP. a Mutual Funds Representative. Mutual Funds Two ways to benefit with dividend funds These funds can help you invest with confidence paying shares — and the mutual W earned to unit holders through — have the potential to rise in receive regular dividend income from the regular dividend price, along with the market. So fund, and your original investment has the distributions. you have the potential not just hen you invest in dividend funds, you funds that hold these shares may benefit in two ways. You could potential to rise in price. Dividend funds could provide income and capital gains. for income, but also for capital Dividend funds explained The tax advantage These funds focus on shares of companies Dividend distributions also come with an dividend income and potential capital that pay dividends. Dividends are a portion of important tax advantage. Like eligible appreciation, a fund such as the company profits that are paid to shareholders, dividends from Canadian corporations, TD Dividend Growth Fund could be a good usually every quarter. Many established blue- eligible mutual fund dividend distributions choice for your portfolio. For more information, chip companies have a long track record of qualify for the dividend income tax credit, visit your TD Canada Trust branch or call regular dividend payments. which reduces the taxes you pay on those 1-866-222-3456 to speak with a Mutual earned dividends. Funds Representative. n Mutual funds pass along any dividends 2 Like all stocks, dividend- gains on your investment. If you’re looking for both solutio n s | Winter 2011 Investment Strategy Investment Planning China, India and other emerging markets are powering ahead Not sure how to invest? Start with a TD Personal Assessment How you can benefit from this growth L ately, the news has been full of stories It’s a big investment world, with lots about slowing economies — in the to consider. Financial markets are United States, Europe and Canada. But constantly changing, and there is a there’s a big part of the world where huge selection of investments to economies are growing rapidly. choose from. When it comes to investing, it’s easy to feel overwhelmed. Exciting growth ahead For example, should you invest in Economies are booming in what are known mutual funds? Or do you need the as emerging markets — such as China, security of Guaranteed Investment India, Brazil and many others. By investing Certificates? How can you earn investment in companies that profit from this growth, returns that will help you meet today’s you too could benefit from the opportunity financial needs and save for a to participate in some of the world’s comfortable retirement? fastest-growing economies. Where do you stand today? Businesses headquartered in emerging nations are increasing sales and profits by catering to a large and growing middle A growing middle class spells opportunity in emerging markets. We can help make sense of it all. Start the process with our complimentary class. Large multinational companies are TD Personal Assessment. It can show also tapping into this potential by selling you where your finances stand today goods and services to a growing number That’s because emerging economies, being and help you take control of your of middle-class consumers in emerging at an earlier stage of economic development, investment future. countries. are often subject to greater fluctuations than Other companies are benefiting from economies of developed countries. the huge investment in infrastructure — As part of your TD Personal Assessment, a branch representative will work with you to develop a clear picture of your current roads, airports, factories, water treatment A conservative option financial situation. You’ll also discover how plants, power grids — that is taking place Investing in a mutual fund, such as the much you should be saving for retirement. in emerging economies. TD Global Dividend Fund or TD Global And they will help you choose the right Multi-Cap Fund — which are also included investment solutions for your needs. Diversifying your investments in TD Comfort Portfolios — may be a good For all of these reasons, you might consider way to gain exposure to emerging markets, The advice you need to succeed adding some exposure to emerging markets but in a more conservative way, since At the end of your TD Personal Assessment, in your investment portfolio. they reflect a disciplined approach to you will receive advice, recommendations investing. and the next steps to help meet your By investing abroad, you’ll gain exposure to companies and even entire industries ® These funds hold many large, multinational unique financial and retirement needs. that may not be widely represented in companies that are selling their products to Canada. This can help diversify your emerging market consumers. So you can and ask for your TD Personal Assessment. investments and minimize the impact of take part in this exciting growth potential, You can also prepare for your TD Personal ups and downs in your portfolio. but gain a measure of safety from investing Assessment by completing the questionnaire in established companies that you are at www.tdretirement.com/ familiar with. n pictureyourdreams.aspx However, it’s a good idea to proceed carefully when it comes to emerging markets. solutio n s | Winter 2011 Visit a TD Canada Trust branch today 3 Economic Update What’s ahead for the economy in 2011? Craig Alexander, Senior Vice President & Chief Economist, TD Bank Group, gives his views. Canada’s economy should grow by 2% in 2011. Q What are the major economic U.S. growth over the next couple of years of themes for 2011? around 2%. Our forecast for Canada is similar, The dominant economic story is that the around 2% for 2011, which is in line with global economic recovery continues to long-term averages. unfold, but in an unusual way. Emerging markets are extremely strong. Meanwhile, it is a completely different Q Q What does all of this mean for investors? Modest economic growth in developed countries doesn’t mean there aren’t attractive investment opportunities. Some parts of the What are the greatest risks economy will do better than others. And some to the economy? parts of the developed world will do better. We worry about two things: the potential Many companies do much of their business developed countries are experiencing fragile for renewed fiscal problems in European outside the countries in which they are head- and tentative recoveries. Europe will be hard countries and the possibility that the quartered, so they aren’t necessarily levered to pressed to grow by more than 1.5% a year U.S. economic recovery will prove to be domestic economies. Those businesses benefit over the next couple of years. unsustainable. The biggest risk to Canada from growth elsewhere, including emerging is if the U.S. economy falters. However, we markets. (See the article “China, India and don’t expect a double-dip recession. other emerging markets,” on Page 3.) n story in the industrialized world. Many The U.S. is gradually recovering, but with emphasis on the word “gradual.” We expect Questions? Discover the solutions that you need Whether you have questions about your mutual fund investments or would like more advice on services or strategies described in Solutions, we’re here to help. Just visit your TD Canada Trust branch or contact a Mutual Funds Representative at 1-866-222-3456. For your convenience, you can also get up-to-date, secure information about your TD Mutual Funds® accounts online with EasyWeb® — 24 hours a day, seven days a week. Let’s figure it out! 1 The TD Personal Assessment is provided by TD Canada Trust. 2 A balanced fund will invest in both stocks and bonds, generally investing in a range between 40/60 and 60/40 within these asset classes, depending on the fund you select and your risk tolerance. The statements contained herein are based on material believed to be reliable. Where such statements are based in whole or in part on information provided by third parties, they are not guaranteed to be accurate or complete. The article does not provide individual financial, legal, tax or investment advice and is for information purposes only. Any graphs, charts, or graphics are used for illustrative purposes only and do not reflect any future event or future value or performance of any investment. 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