AMP 2 FINANCIAL STRATEGIES WEEK TWO Cohl so

` AMP 2 FINANCIAL STRATEGIES WEEK TWO

Cohl so far… • Started strip club ‘Pandora’s Box’ – Police, legal fights • Tough first few years – Early bombs: Buck Owens, Procol Harum • Some early coups – Maple Leaf Gardens, Donald K Donald • Scandals: ‘Ticket Traumas’, CNE tax • “He can Adapt, Improvise, & Overcome” –Keith Richards

White Man At The Door Iggy Pop has called Fat Possum Records “the most uncorrupted label in America”-would you agree or disagree? In the event of running a record label, how comfortable would you be with having 2 convicted killers on your roster? What are the qualities in Matthew Johnson that have allowed him to survive in the music industry?

(Your) Personal Finances • It helps your business to have your personal finances in order • As an Entrepreneur, the stakes are much higher • Life savings, assets, and retirement could all be on the line • Don’t count on the government either for retirement • Canada Pension Max = $960/month Average = $504. 88 • Old Age Security: Max = $526. 85/month Average = $493. 34 • Music industry also faces specific challenges & uncertainty • Pensions & benefits rare • Traditionally only larger companies have them

(Your) Personal Finances • Luckily, there are quite a few solutions • Investment portfolio can be built over a number of years, and can include: • Guaranteed Investment Certificates (GICS) • Stocks • Mutual Funds • Bonds • Real Estate

(Your) Personal Finances • Registered Retirement Savings Plans (RRSPs) also worth consideration • Any amount you can contribute is deducted from your tax year Net Income • Can contribute up to 18% of income or $22, 450 per year • You can carry over unused contributions into the future • Can help you move to a lower current tax rate • 15% up to $40 K, 22% on next $40 K, 26% on next $45 K • Are only taxed on withdrawals later on • Most people would be in a lower tax bracket once retiredremember Canadian Pension Average around $500/month • First Time Home Buyer’s Plan • Can withdraw up to $25, 000 tax free for first home, pay back over 15 years

The Power of RRSPs • Daryl and John are taking different approaches to their RRSPs • Daryl invests $1000/year from age 20 30 • John invests $1000/year from age 30 64 • At the age of 65, who’s better off? • Daryl! He’s made approx. $138, 000. 00 more.

TFSAs • In 2008, Tax-Free Savings Accounts (TFSAs) became available • Any interest income/gains on deposit are not taxed • Can withdraw amounts at any time without penalty • $5, 000/year deposit limit, unused deposits carry over indefinitely • Deposits can also be transferred to spouse’s account • Drawback: Interest Rates are (currently) very low • Alternative: Self-directed accounts