BCU Product Knowledge Quiz #4

1. Does unused contribution room carry forward to future years for RRSPs?

YES

NO

YES, but Contribution Room is not restored after withdrawals from the RRSP ( but it is for a TFSA.)

Explanation

YES, but Contribution Room is not restored after withdrawals from the RRSP ( but it is for a TFSA.)

2. Where can a member find their RRSP contribution room?

A member can find their RRSP contribution room on their Notice of Assessment (NOA). The NOA is a document sent by the Canada Revenue Agency (CRA) after an individual files their income tax return. It provides a summary of the individual's tax situation, including their RRSP contribution room for the year. By referring to their NOA, individuals can determine how much they are eligible to contribute to their RRSP and maximize their tax savings.

Explanation

A member can find their RRSP contribution room on their Notice of Assessment (NOA). The NOA is a document sent by the Canada Revenue Agency (CRA) after an individual files their income tax return. It provides a summary of the individual's tax situation, including their RRSP contribution room for the year. By referring to their NOA, individuals can determine how much they are eligible to contribute to their RRSP and maximize their tax savings.

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3. True or False: The YOUR Everything Account has all of the same features regardless of whether you are 18 and younger or 19 to 24 - except that: the $3 monthly fee starts at 19 and you can not get a master card until you are 19 (but you can get a global payments card before that with your parents permission).

True

False

it is all true!
see Your Everything Account on the BCU website.

Explanation

it is all true!
see Your Everything Account on the BCU website.

4. Your ___________ account builds as you make annual deposits based on a percentage of your Allowable Net Sales (ANS) and receive matching contributions from the government.

The given correct answer is "AgriInvest, agriinvest, agri invest". AgriInvest is an account that allows individuals to make annual deposits based on a percentage of their Allowable Net Sales (ANS) and receive matching contributions from the government. This account helps individuals in the agricultural sector to build their savings and receive additional support from the government.

Explanation

The given correct answer is "AgriInvest, agriinvest, agri invest". AgriInvest is an account that allows individuals to make annual deposits based on a percentage of their Allowable Net Sales (ANS) and receive matching contributions from the government. This account helps individuals in the agricultural sector to build their savings and receive additional support from the government.

Submit

5. For Term Deposits, a minimum deposit of $________ is required (except for students).

With flexible interest rates, investment terms, and automatic renewal options, term deposits provide a great way to save and earn money with a guarantee of principal and interest.
A minimum deposit of $1,000 is required except for students where a minimum of $500 is accepted.

Explanation

With flexible interest rates, investment terms, and automatic renewal options, term deposits provide a great way to save and earn money with a guarantee of principal and interest.
A minimum deposit of $1,000 is required except for students where a minimum of $500 is accepted.

Submit

6. How old do our members need to be to have a TFSA

The Tax-Free Savings Account (TFSA) is available to Canadian Residents age 18 and older. TFSA allows taxpayers to set money aside in eligible investment vehicles and watch those savings grow tax-free throughout their lifetime.

There are no restrictions on the way TFSA funds (contributions and earnings) may be used (i.e. purchase a car, renovate a home, start a small business, take a family vacation, or just save for a rainy day). All income levels and all walks of life can benefit from a TFSA. But only a careful review of each person's financial situation will determine how to optimize use of RRSP's, RESP's, RRIF's and TFSAs.

Explanation

The Tax-Free Savings Account (TFSA) is available to Canadian Residents age 18 and older. TFSA allows taxpayers to set money aside in eligible investment vehicles and watch those savings grow tax-free throughout their lifetime.

There are no restrictions on the way TFSA funds (contributions and earnings) may be used (i.e. purchase a car, renovate a home, start a small business, take a family vacation, or just save for a rainy day). All income levels and all walks of life can benefit from a TFSA. But only a careful review of each person's financial situation will determine how to optimize use of RRSP's, RESP's, RRIF's and TFSAs.

Submit

7. True or False: All of the following are types of RRSPs: Individual RRSP (registered to contributor), Spousal RRSP (registered to your spouse, but your contributions do not affect the contribution limits of the spouse), Group RRSP (collection of individual RRSPs offered to employees by an employer), Self-Directed RRSP (self-managed RRSP portfolio).

True

False

True - they are all types of RRSPs and those are ALL the types there are.

Explanation

True - they are all types of RRSPs and those are ALL the types there are.

8. This savings account: pays interst at tiered rates, calculates interest daily but pays it monthly, provides free online and telephone transfers, is perfect for people who want to park their money while they decide if they will lock it in and or decide on a new purchase. (Which one of the acounts listed below is it?)

Tax Free Savings Account

Youth Savings

Your Savings

Your HISA

YOUR HISA is a Non-registered High Interest Savings Account for those that want to earn a higher rate of interest, however higher service charges apply if the account is accessed at the branch.
There is a $5.00 service charge to make in branch withdrawals.

Explanation

YOUR HISA is a Non-registered High Interest Savings Account for those that want to earn a higher rate of interest, however higher service charges apply if the account is accessed at the branch.
There is a $5.00 service charge to make in branch withdrawals.

9. This savings account: pays interst at tiered rates, calculates interest daily but pays it monthly, provides two free transacations per month without a monthly fee and charges 75 cents for any transaction therafter. (Which one of the acounts listed below is it?)

Tax Free Savings Account

Youth Savings

Your Savings

Your HISA

YOUR Savings account is flexible, allowing you to maximize the interest calculated on every dollar you deposit. Even with a fluctuating balance, our competitive tiered interest rates will ensure you reach your savings goals at your own pace, one deposit at a time.

Your interest rate is based on the rate for the highest tier attained

Pricing

· No monthly maintenance fee

· Transactions are charged on a per item basis, so you only pay for the transactions you use

Explanation

YOUR Savings account is flexible, allowing you to maximize the interest calculated on every dollar you deposit. Even with a fluctuating balance, our competitive tiered interest rates will ensure you reach your savings goals at your own pace, one deposit at a time.

Your interest rate is based on the rate for the highest tier attained

Pricing

· No monthly maintenance fee

· Transactions are charged on a per item basis, so you only pay for the transactions you use

10. The difference between a TFSA and an RRSP is that (select all that apply).

The have different contribution limits

They have different maturity limits (RRSP matures at age 71)

RRSP reduces your taxable income (TFSA does not)

RRSP will impact your eligabiltiy for government benefits (TFSA does not) such as child tax, old age security, and GIS

Amount withdrawn from TFSA is not added to your taxable income, but is with RRSP

They are all differences!
see a chart with more differences here

https://www.edwardjones.com/en_CA/products/taxfree_savings_account/tfsa_differences/index.html

Explanation

They are all differences!
see a chart with more differences here

https://www.edwardjones.com/en_CA/products/taxfree_savings_account/tfsa_differences/index.html

Submit

11. True or False: none of the following savings accounts are covered by CUDIC'S deposit insurance: equity shares issued by a credit union, self-administered RRSPs that are mutual funds, securities held for safekeeping, and accounts in foreign currency.

True

False

Every registered RRSP, RRIF and RESP investment contract is insured separately to $250,000, including principal and interest. This means you can have unlimited coverage of your RRSP portfolio by maintaining multiple contracts of $250,000 or less.

What accounts are not covered?
•Equity shares issued by a credit union
•Self-administered RRSPs that are not deposits (e.g. real estate or mutual funds)
•Securities held for safekeeping
•Mutual funds
•Accounts in foreign currency

Explanation

Every registered RRSP, RRIF and RESP investment contract is insured separately to $250,000, including principal and interest. This means you can have unlimited coverage of your RRSP portfolio by maintaining multiple contracts of $250,000 or less.

What accounts are not covered?
•Equity shares issued by a credit union
•Self-administered RRSPs that are not deposits (e.g. real estate or mutual funds)
•Securities held for safekeeping
•Mutual funds
•Accounts in foreign currency

12. True or False: Your TFSA contribution room is found on your notice of assessment.

True

False

False, contribution room for a TFSA is the same for everyone and is increased each year. The contribution room for 2009-2012 was $5000 and $550o for 2013/2014

Explanation

False, contribution room for a TFSA is the same for everyone and is increased each year. The contribution room for 2009-2012 was $5000 and $550o for 2013/2014

13. True or False: Your allowable RRSP contribution for the current year is the lower of: 1) 12% of your earned income from the previous year OR 2) the maximum contribution limit for the taxation year.

True

False

False, it is 18% of your earned income

(The maximum 2013 RRSP deduction limit is $23,820)

Explanation

False, it is 18% of your earned income

(The maximum 2013 RRSP deduction limit is $23,820)

Bcu Product Knowledge Quiz #4