Choosing the right investment products starts with understanding your financial goals, timeline, and comfort level with risk. Whether you’re saving for a short-term purchase or planning for the far future, there are options available to help your money grow in a way that aligns with your needs. Take a look at this breakdown of non-registered and registered investment options to help guide your decision-making. 

NON-REGISTERED INVESTMENTS 

Non-registered investments are flexible options that are not held within a tax-sheltered account. While earnings are taxable, they offer fewer contribution restrictions in comparison to registered investments. 

Term Deposit 

A term deposit is a low-risk investment that offers a guaranteed rate of return over a fixed period. Because funds are locked in for the duration of the term, term deposits typically provide more stability than market-based investments such as stocks or bonds. You can choose your term deposit period, which often ranges from one to five-year terms.  

Term deposits are ideal for short- to medium-term financial goals such as saving for a vehicle, a home renovation, or other upcoming expenses. Term deposits are also a strong option during periods of market uncertainty or when you want predictable, reliable growth. 

Mutual Funds 

Mutual funds collect money from multiple investors to invest in a diversified portfolio of assets such as stocks, bonds, and other securities. This diversification helps spread risk while providing exposure to a broad range of markets and sectors. 

These are generally better suited for longer-term investment goals, as they have the potential to generate higher returns over time compared to fixed-rate products like term deposits. Mutual funds can be tailored to different risk tolerances, which makes them a good option for building wealth over the long term. 

Provincial Credit Union partners with CU Financial Management to provide a full suite of mutual fund solutions tailored to fit your unique needs. 

REGISTERED INVESTMENTS 

Registered investment accounts offer tax advantages that can help your savings grow more efficiently in Canada. These accounts can hold a variety of investment types such as term deposits, mutual funds, stocks, and bonds. For example, holding a term deposit within a Tax-Free Savings Account allows you to earn interest without paying tax on those interest earnings. 

Registered Retirement Savings Plan (RRSP) 

An RRSP is designed to support long-term retirement planning. Contributions are tax-deductible, which can reduce your taxable income in the year you contribute. Investments within an RRSP grow tax-deferred, meaning you won’t pay tax on earnings until funds are withdrawn. When the money is withdrawn in retirement, most people’s income and tax rate are lower. To find your RRSP contribution room, check your latest Notice of Assessment. 

Tax Free Savings Account (TFSA) 

A TFSA is a flexible, tax-efficient way to grow savings. Contributions are not tax-deductible, but any income earned is completely tax-free, even when withdrawn. 

Because you can withdraw money from a TFSA at any time, it is an excellent option for short or long term goals such as an emergency fund, travel savings, or supplementing retirement income. You can view your current TFSA contribution room by checking your latest Notice of Assessment. 

Registered Education Savings Plan (RESP) 

An RESP is designed to help families save for a child or grandchild’s post-secondary education. Contributions grow tax-deferred, and when funds are withdrawn for educational purposes, the student is taxed for the withdrawal. Students usually have a much lower tax rate than those who work full time. The Canada Education Savings Grant can also help families save for a child’s education by paying a grant based on the contribution to the RESP.   

First Home Savings Account (FHSA) 

The FHSA is a registered account that combines some of the benefits of an RRSP and TFSA. Contributions are tax-deductible, and withdrawals used toward the purchase of a first home are tax-free. This account is specifically designed to help first-time homebuyers save more efficiently and offers great tax advantages. 

Registered Disabilities Savings Plan (RDSP) 

An RDSP is a long-term savings plan that’s purpose is to help people with disabilities and their families build financial security for the future. Contributions to an RDSP are not tax deductible, but the investment that grows within an RDSP is not taxed. A key benefit of an RDSP is that the government matches contributions through the Canada Disability Savings Grant, and lower income families may be eligible for the Canada Disabilities Savings Bond.  

We would love to chat with you about what investment products will work best for your financial goals and situation. Contact us if you have questions or would like to book an appointment with one of our Financial Service Officers.