Toronto Electrical Utilities Credit Union

For our members who are looking for a better rate without a great deal of risk on their investment TEUCU offers Index Linked Term Deposits. Index Linked Term Deposits allow you to invest in the stock market while keeping your principle deposit protected. Another great benefit of our Index linked term Deposits is the fact that there is no cap on the amount of interest you can earn. If the market does well, so do you!

Income
Index-Linked Term Deposit will pay 50% of the percentage difference between the Starting Value and the Average of Sets Value of the Index on the final Valuation Date, multiplied by the Participation Rate, multiplied by the Principal Amount.

Terms
Three-year

Minimum Investment
$1000.00

Commissions, Management and Administration Fees
None.

Redemptions
Not redeemable prior to maturity.

Retirement Planning
The term deposit is RRSP eligible.

Deposit Insurance
The principal and any return on Index-Linked Term Deposits are insured subject to prescribed insurance limits in accordance with the terms and conditions of the Credit Union’s deposit insurance coverage. Please ask your Credit Union for a brochure issued by the deposit insurer for the details.

Income Tax
Tax will be deferred on Index-Linked Term Deposits held inside registered plans. However, the income tax consequences of holding an Index-Linked Term Deposit outside a registered plan will depend upon a holder’s particular circumstances, and holders should consult their tax advisors before considering the investment outside a registered plan.

Calculating the Interest
The investment return on the deposit will be based upon the participation rate multiplied by the average return of the S&P/TSX 60 Index over the term of the deposit. The average is calculated by adding the monthly averaging date closing values for the S&P/TSX 60 Index between the start date and the maturity date and dividing that total by the months in the term (36 for the three-year deposit). The investor will receive the percentage difference between the average and the starting value, multiplied by the participation rate.

Risks
Unlike other term deposit, there is no guaranteed return on this product. Depending on the performance of the stocks comprising the S&P/TSX 60 Index over the term, it is possible that, at maturity, the investor will receive only their principal back.

TEUCU’s Daily Interest Savings Account offers premium interest rates paid monthly to your account. As your balance increases, so does your interest rate! You can access this account with your ATM/ Debit MemberCard, Online Banking, and TelephoneTeller.

This account allows you to save funds in a separate account for something special like a vacation or something simple like your Taxes! Interest is calculated daily and increases with an increased balance in the account.

Flip & Save

For those members who get good use out of their Debit Card, the Flip & Save Account will round your POS (Point-of-Sale) Transactions up to the nearest One, Five or Ten dollar amount, and direct those funds into your Flip & Save Account. This is a great way to save money for a rainy day. To sign-up for a Flip & Save Account, click here.

On June 18, 2008, the Government of Canada approved legislation to introduce a ground-breaking Tax-Free Savings Account (TFSA) in 2009.

The Tax-Free Savings Account also known as TFSA will allow you to save or invest money without paying tax on the income its earns and you can also withdraw it tax free.

· Maximum contribution limit for 2009 will be $5,000. The amount will increase in the future to take inflation into account

· The $5,000 per year limit is in addition to any RRSP contribution limit you may have

· The amount withdrawn from a TFSA (capital and income), can be put back at a later date, without reducing your contribution room

· Unused contribution room will be reported to you on your annual CRA Notice of Assessment

· Members may hold more than one registered TFSA account provided that contribution limits per owner are not exceeded

· Over-contributions will be subject to tax of 1% per month under the date of withdrawal

· TFSA will not affect your eligibility for federal income-related benefits, such as the Canada Child Tax Credit and the Guaranteed Income Supplement

· You will have the option to transfer your TFSA assets to your spouse or common-law partner upon death without any impact on the survivors existing contribution room.

There is also a link to a calculator built by the government if you want to estimate how much money you could save click here.

At TEUCU, you can choose from our High Interest TFSA Daily Interest Account, our TFSA Term Deposit or our TFSA Index-Linked Term Deposit. Please note that these rates are subject to change without notice. If you have any questions please give our offices a call at 416-542-2522.

Although a TFSA is very different from an RRSP, each of these accounts holds an after tax advantage in returns over a non-registered account. Everyone who is 18 years old and over will be able to contribute to a TFSA, and if you are eligible to make RRSP contributions it will generally be to your advantage to contribute to both.

That, of course, depends on having the money available. According to a national BMO Financial Group/Leger poll released on February 27, more than half of Canadians are not making an RRS contribution this year.

Realistically, for a large number of Canadians who won't be able to contribute to both a TFSA and an RRSP, the question becomes: Which one of the two will leave me further ahead?
To illustrate the differences between the TFSA, RRSP and non-registered savings, the Finance Department created a table (See below) comparing the three according to one scenario. The example used a $1000 one-time contribution, held for 20 years by an individual with a $40% marginal tax rate. The assumed returned, implying a very conservatively managed portfolio, was a compound annual 5.5%.

This RRSP investor jumps out to an early lead, since there is a tax deduction that leaves this account with the full $1000 to invest. The TFSA and non-registered accounts, by contrast, start out with only $600, since they must make their contributions with after-tax dollars.

Both TFSA and the RRSP accounts enable income to accumulate tax-free, while the holder of the non-registered account gets hit with income tax each year. The RRSP extends its lead, since it started out with a larger amount, while the TFSA ranks second and the non-registered account lags.

By the end of 20 years, the value of the net contribution plus investment income has reached $1751 for the TFSA, 2918 for the RRSP, and only $1307 for the non-registered account. (The governments' example for the non-registered account assumes a tax rate of 28% on investment income, based on portfolio returns that are assumed to be composed of %30 capital gains, 30% Canadian dividends and 40% interest).

The great equalizer between the TFSA and the RRSP accounts occurs at the time of withdrawal, which works out to a tax hit of $1167. This leaves the RRSP holder with after=tax proceeds of $1751, thereby finishing in a dead heat with the TFSA holder. (The non-registered account finished last with $1307).

The key variable is how the tax rate at the time of withdrawal compares to the tax rate at the time of the contribution. Here are the three scenarios, and how they may affect your choice of account:

-If the two rates are identical, as in the hypothetical example cited here, the TFSA and the RRSP are equally effective tax-savings alternatives.

-If the tax rate at the time of withdrawal is lower than at the time of contribution, the RRSP is the better choice.

-If the tax rate at the time of withdrawal is higher than at the time of contribution, the advantage goes to the TFSA.

RRSP vs. TFSA vs. Mortgage Pay down

A lot of people will fall into the category where their tax rates in the accumulation phase are higher because they are in their peak earning years and are paying the highest tax rates of their working life. Presumably, when they are retired they will be paying much lower taxes. Since their contribution tax rate is much higher than the withdrawal tax rate, a RRSP contribution is likely the better option. For the few Canadians who pay a higher rate in their withdrawal years than in their contribution years, a TFSA is probably the superior option.

The RRSP/TFSA versus mortgage pay down is a much harder debate because the right answer depends on so many assumptions made about the future. At first glance, it seems like a no-brainer because investments within a RRSP or TFSA need to earn higher after-tax returns than the low interest rate n mortgages today. However this is easier said than done. Many experts believe we are in an era of low returns for all asset classes (say &5 for stocks and 4% for bonds) that a 5% guaranteed after-tax return can be obtained by paying down the mortgage starts to sound very good. Also, while markets have provided generous returns in the past, the average investor has lagged the market returns badly due to chasing performance and not controlling expenses.

Unfortunately, if you have X amount of dollars, it is hard to say which option would be the most profitable pick. But, picking any of the three options would be a good move because the bottom line is you are saving money. In an era where the national savings rate is close to zero, that's a wise move.

The law in the province where you live may allow you to designate a successor holder and/or other beneficiary to your TFSA in the event of your death, by means of a separate designation outside of your will.

A successor holder is someone who takes over your TFSA when you die. The name on the account is changed to the name of the successor holder and that person can continue to hold and operate the tax-free savings account as their own after your death. By law, only your spouse or common-law partner, as recognized by the Income Tax Act (Canada), can be a valid successor holder. If the person who you have designated as successor holder is no longer your current spouse or common-law partner at the time of your death, they cannot become the successor holder of your TFSA.

You can also designate a beneficiary to your TFSA who will receive the funds in your tax free savings account after your death. This person cannot continue to operate your TFSA like a successor holder. The funds in your account are distributed to your beneficiary and your tax-free savings account is closed.

On each TFSA you have with TEUCU, you can designate a successor holder or a beneficiary or both. If you have designated both a successor holder and a beneficiary, at your death the person designated as your successor holder will become the holder of your TFSA except if that person has either a) died before you; or b) is no longer your current spouse or common-law partner at the time of your death. In either of these situations, the proceeds of the TFSA will be distributed to the person named as your beneficiary.

For advice regarding the tax implications of designating a successor holder and/or a beneficiary to your TFSA, consult your personal tax advisor.

A: A Tax-Free Savings Account (TFSA) is a new kind of registered account recently announced by the federal government. Through a TFSA, you can put your savings into eligible investments and not pay tax on the investment income you earn.

A: The idea behind TFSAs is to make the benefits of tax-free savings available to as many Canadians as possible. For that reason, TFSAs are available to every Canadian resident who is 18 years of age or older and has a Social Insurance Number (SIN).

The age of majority is 19 for residents of Newfoundland and Labrador, New Brunswick, Nova Scotia, British Columbia, Northwest Territories, Yukon and Nunavut, which may delay the opening of a TFSA. However, the accumulation of contribution room will start at age 18.

A: Withdrawals from a TFSA are tax-free and are added to unused contribution room starting the following year.

With a TFSA you don't need earned income to accumulate contribution room. Everyone has the same contribution room.

There is no requirement to convert the TFSA to an income payment option (i.e. RRIF) at any age.

You can give money to your spouse to open a TFSA without being subject to Canada Revenue Agency's (CRA) attribution rule.

A: No. Similar to registered retirement accounts, such as RRSPs, government rules only permit individual accounts.

Q: Will the TFSA have any impact on my government guaranteed income supplements?

A: Investment income and withdrawals from a TFSA will have no impact on Federal benefits.

A: No. While the TFSA is flexible, withdrawals made during the year can not be re-contributed until at least the following year. Please keep in mind that there is no access to TFSAs from Automated Banking Machines.

A: As investment income and capital gains within the TFSA are not taxed, any losses generated in the account can't be used against other taxable gains.

A: Generally, earnings that accrue in the account holder’s death will be taxable, while those that accrued before death would remain exempt. However, it would be possible to maintain the tax free status of the earnings if the account holder names his or her spouse or common-law partner as the successor account holder. Alternatively, the assets of the deceased’s TFSA could be transferred to the TFSA of the surviving spouse or common-law partner without any impact on the survivor’s existing contribution room.

Q: Could I still contribute to a TFSA If I become a non-resident of Canada?

A: If you become a non-resident, you would be allowed to maintain your TFSA and you would not be taxed on any earnings in the account or on withdrawals; however, you would not be allowed to contribute and no contribution room would accrue for any year throughout which you are a non-resident. In addition, any withdrawals made while you were a non-resident would not be added back to your contribution room.

A: As of January 2, 2009, you can contribute up to $5,000 a year to your TFSA. However, that contribution limit is indexed to inflation, which means that it will rise with the cost of living.

A: You can carry forward any un-contributed amounts into future years indefinitely. So, for example, if you contributed only $2,000 in 2009, in 2010, you could contribute up to $8,000 (the $5,000 limit for 2010, plus the $3,000 you had left over from 2009).

If, in 2010, you had only $5,000 to contribute, you could carry the $3,000 left over from 2009 to 2011 and on through the years until you use it.

A: Every year, the government will calculate how much TFSA contribution room you have available. You will be informed of your contribution limit when you receive your T1 Notice of Assessment.

A: There is no minimum or maximum income level. Every eligible person will accumulate contribution room each year starting in 2009.

A: If you contribute more than your contribution limit, you will pay a penalty of 1% per month on the excess amount.

A: There will be no lifetime limit on the amount of your contributions. If you are eligible, you will accumulate $5,000 every year, which will increase with inflation, in $500 increments.

A: No, you can’t contribute directly to your spouse’s TFSA as you can with a spousal RSP. However, you can give your spouse money, which they can then contribute to their own TFSA.

Q: If I give funds to my spouse to contribute to his or her TFSA, who will get the income, me or my spouse?

A: Your spouse owns the TFSA and will earn any investment income and capital gains in the account.

Q: If there is a breakdown of a marriage or common-law partnership, what will happen to my TFSA?

A: TFSA assets may be transferred between spouses or common-law partners upon marriage or relationship breakdown. However, it's important to understand the implications of transferring TFSA funds; the spouse who gives some or all of their TFSA funds (due to the divorce/separation agreement) will lose his or her TFSA accumulation room that they've acquired since the launch of TFSA because the transferred amount will not be added back to contribution room.

On the other hand, if a plan holder withdraws assets from the TFSA before giving the funds (due to the divorce/separation agreement), then the amount of the withdrawal will be added back to the contribution room of the transferring spouse for the following year, allowing the plan holder to continue to benefit from tax-free investing. The receiving spouse will be able to contribute to their TFSA, but only to the extent that they have their own contribution room.

A: You can withdraw funds from your TFSA any time you want – you don’t have to reach a certain age before you withdraw your money.

Because TFSA withdrawals don’t count as taxable income, they don’t affect Federal income-tested benefits or tax credits you may receive, including the Canada Child Tax Benefit, the Working Income Tax Benefit, the Goods and Services Tax Credit and the Age Credit. TFSA withdrawals also won’t reduce benefits based on your income level, such as Old Age Security, the Guaranteed Income Supplement and Employment Insurance benefits.

A: Anything you want. You could wait until you retire and use it to supplement retirement income you have from pensions, RRSPs or other sources, but you can also use it for short-term savings goals like a new car or a vacation, or for needs that arise suddenly like repairs to your home.

A: No, you never lose your contribution room – in fact, you can re-contribute amounts you have withdrawn. You have to wait until the next year to re-contribute, but you can carry forward the re-contribution room indefinitely.

For example, say you contribute $5,000 to your TFSA in January 2009 and another $5,000 in January 2010. Then, in the summer of 2010, you withdraw $3,000 to pay for some repairs to your home. You can’t re-contribute that $3,000 in 2010, but in 2011 it will be added to your contribution room again, meaning you could contribute up to $8,000 in 2011.

A: No, you can take out as much of your money as you want, whenever you want, and use it for anything you choose.

A: At TEUCU, you can choose from our TFSA Daily Interest Account, Our TFSA Term Deposit or our TFSA Index-Linked Term Deposit. For full investment information, please visit the TFSA information page on the Canada Revenue Agency’s Website.

Q: I have a lot of RRSP contribution room left over. Can I carry some of it over to my Tax-Free Savings Account (TFSA) so I can make a larger TFSA contribution?

A: You cannot carry-over your RRSP contribution room to your Tax-Free Savings Account (TFSA). Similarly, TFSA contribution room cannot be carried over to your RRSP.

Q: Can I borrow to invest in my Tax-Free Savings Account (TFSA)? Is interest paid on money borrowed to invest in my TFSA tax-deductible?

A: You can borrow to invest in your Tax-Free Savings Account (TFSA); however, interest paid on the money borrowed is not deductible for tax purposes.

Q: Will I get a contribution receipt for tax purposes for contributing to my Tax-Free Savings Account (TFSA)?

A: You will not get a contribution receipt for tax purposes because contributions to your Tax-Free Savings Account (TFSA) are not tax-deductible. You will get a confirmation of your contribution either through a transaction confirmation or your account statement, depending on the type of TFSA or type of investments you have in your account.

A: There is no limit to the number of Tax-Free Savings Accounts (TFSAs) you may own – although the annual TFSA dollar limit per person is still $5,000 per person, per year. Your TFSA contribution room is the same regardless of the number of TFSAs you hold.

Please note: Information about the Tax-Free Savings Account is based on what is currently available from the Canadian government and can be subject to change.

To learn more or to check for updates, visit the TFSA information page on the Canada Revenue Agency website.

TEUCU offers our members the advantages of a NO FEE Chequing account. There is no per cheque fee, you can also enjoy free unlimited automated AFTs and EFTs and Direct Deposit. All without the usual minimum balance required or any monthly fees or service charges and therefore no other interest is paid.

TEUCU offers both a variety of Term Deposits. These Term Deposits earn you a higher interest rate than a regular savings account. The rate is competitive and guaranteed. Bonus interest rates are available on amounts greater than $25,000.00. TEUCU Term Deposits are also eligible for registered plan investments. TEUCU certificates range from 90 days to 3 years. Five year terms are also available through Concentra Financial.

RRSPs are a great way to save for your future while allowing you to lower your income tax right away! TEUCU offer index linked, variable and fixed term RRSPs and RRIFs. You can have regular deposits to your RRSP account on a weekly, bi-weekly or monthly basis or lump sum deposits. We offer RRSP Loans and lines of credit to help you catch up on your RRSP contribution room before you lose the available space and help you lessen the cash crunch at tax time! Learn more

When you turn 71 years of age, transferring your funds into a TEUCU RRIF is quick and easy whether the funds are with us or another Institution. This allows you to spread out your payments and taxes over a number of years, reducing the amount of income tax you will pay!

You can also try our new online brokerage through Qtrade Investors. Canada's leading independent online brokerage provides online brokerage solutions to members. Qtrade Investor is a division of Qtrade Securities Inc., member IIROC and CIPF. CIPF coverage protects the holdings in customer accounts of its members up to $1,000,000 per qualifying account.

In order to comply with the Government of Canada Requirements, a RRIF is an investment plan into which you can transfer registered funds (like RRSPs) without tax liability. This RRIF then becomes an established income stream.

With a RRIF, starting the year after the plan is opened; an annual minimum payment must be taken each year and is considered taxable income. The year the plan is opened a payment does not have to be made, but you are free to withdraw any amount (however, in this case, withholding tax will apply to the full withdrawal amount).

The annual minimum payment that must be taken from a RRIF each year is determined by the Income Tax Act and is based on age. Your own age or your spouse’s can be used to calculate the annual minimum payment. Using the younger of the ages will result in a lower annual minimum payment. This means less money will have to be withdrawn and taken into a taxable income for the year and more remains in the RRIF earning tax-sheltered income.

Prior to 1993 RRIFs could only last until age 90. Now that RRIFs can last for a lifetime, there are to methods used for calculating the annual minimum payment.

For Qualifying RRIFs (this is a RRIF opened before December 31, 1992), this method is used up to and including age 77. 90 minus age formula.

Age	Percent
69	4.76
70	5.00
71	7.38
72	7.48
73	7.59
74	7.71
75	7.85
76	7.99
77	8.15
78	8.33
79	8.53
80	8.75
81	8.99
82	9.27
83	9.58
84	9.93
85	10.33
86	10.79
87	11.33
88	11.96
89	12.71
90	13.62
91	14.73
92	16.12
93	17.92
94+	20.00

Like your RRSPs, RRIFs grow tax-deferred. The only real difference is that you’ll have to withdraw at least the annual minimum payment required under the Income Tax Act, which is taxable as income.

All payments from a RRIF must be declared as income for the year they are received. Tax must be withheld on amounts withdrawn in excess of the annual minimum amount that is required to be paid under the Income Tax Act (Canada).

The government requires that everyone with a Registered Retirement Savings Plan (RRSP), including any locked-in savings plans ( LRSPs/LIRAs), must convert their RSP to one or more retirement income sources by December 31^st of the year you turn age 71. Otherwise, the plan will become “deregistered” and the proceeds will be paid out as cash and fully taxed as income.

However, you may choose to convert your RRSP earlier (subject to the minimum age restriction for lock-in plans). The decision depends on the income you need from your RRSPs to meet your personal retirement expenses.

A Registered Retirement Income Fund gives you the flexibility to choose different types of investment and payments schedules. You are required to take a minimum annual payment based on age, starting the year after the plan is opened. Whatever assets remain in your RRIF after death can be passed on to your spouse or beneficiaries. Other beneficiaries can receive your RRIF assets once the taxes have been paid.

In return for a one-time lump sum purchase, you receive regular fixed payments. You can either purchase a Registered Fixed Term annuity that allows you to pass on any remaining funds to your beneficiaries on death, or a Life annuity that pays you as long as your are alive. However, in either case, you are locked in to whatever interest rate is available at that time of purchase.

You can take your RRSP as cash, but it will be fully taxable in the year of withdrawal and a large percentage will go Canada Customs and Revenue Agency.

Some investors choose a combination of a RRIF and annuity. The RRIF give you both investment and payment flexibility and an annuity gives a guaranteed income stream.

If you have any questions about RRIFs or RRSPs conversions, annuities, Locked-In Funds and many other issues that can affect your retirement enjoyment please give us a call at 416-542-2522.

Canada’s retirement income system has three levels: Old Age Security ( OAS), the Canada Pension Plan (CPP) and private pensions and savings.

The CPP, which was established in 1966, provides basic benefits when a contributor to the Plan becomes disabled or retires. At the contributor’s death, the Plan provides benefits to his or her survivors.

What is a CPP retirement pension?
A CPP retirement pension is a monthly benefit paid to people who have contributed to the Canada Pension Plan.
The pension is designed to replace about 25 percent of the earnings on which a
person’s contributions were based.

How do I qualify?
You qualify for a CPP retirement pension if you have made at least one valid contribution (payment) to the Plan and if:
- you are at least 65; or
- you are 60 and 64, and meet the earning requirements set out in the legislation.

Your retirement pension does not start automatically. You must apply for it (unless you already receive a CPP disability benefit and turn 65, at which point your disability benefit automatically changes to a retirement pension).

If I am between 60 and 64, how do I qualify for a retirement pension?
To qualify for a retirement pension between the ages of 60 and 64, you need to do one of the following:

Stop working - This means that you are not working by the end of the month
before the CPP retirement pension begins and during the month in which it begins.
For example, if you want your pension to begin in April, you have to stop working
by the end of March and you cannot work during the month of April.

OR

Earn less than a specified amount -This means you earn less than the current monthly maximum CPP retirement pension payment ($884.58 in 2008) in the month before your pension begins and in the month it begins. For example, if you want your pension to begin in April 2008, you need to earn less than $884.58 in both March and April. Once you start receiving your CPP pension, you can work as much as you want without affecting your pension amount. However, you cannot contribute to the CPP on any future earnings from employment.

How does the CPP calculate my retirement pension?
Your CPP retirement pension is based on how much, and for how long, you
contributed to the Plan [or to both the CPP and the Quebec Pension Plan (QPP)]. The age at which you choose to retire also affects the amount you receive. The CPP protects your pension by making certain adjustments before calculating 25 percent of the earnings on which you contributed over your working life. For example, some low-earning periods during your career are “dropped out”, so they do not reduce the amount of your pension. The CPP retirement pension is indexed to the Consumer Price Index annually. The average monthly retirement pension (at age 65) in October, 2007 was $481.46.

How does my age affect the amount of my pension?
Your retirement pension normally starts the month after your 65th birthday. Your monthly payment is smaller if you begin receiving it before then, and larger if you take it after. This “flexible” pension can start as early as at the age of 60 or any time up to the age of 70. The CPP adjusts the amount of your pension by 0.5 percent for each month before or after your 65th birthday from the time you begin to receive your pension. The adjustment is permanent. This means that if you choose to start your pension early, the payment does not increase when you reach 65.

For example, if you start your pension at 60, your monthly payment is 30 percent lower than if you wait until you’re 65. However, by starting it sooner, you will likely receive it for a longer time. If you start your pension at 70, your monthly payment is 30 percent higher than if you had taken it at 65. There is no financial benefit in delaying receiving your pension after the age of 70.

Can I get an estimate of my retirement pension before I decide to apply?
Yes. For an estimate of your CPP retirement pension, check your CPP Statement of Contributions, or contact Service Canada. The closer you are to the date you want your pension to begin, the more accurate the estimate will be.

Can my payments be deposited directly to my bank account?
Yes. Your payment can go into your TEUCU account automatically.

Direct deposit offers several advantages over payment by cheque:
- your deposit will always be on time and you can immediately start using the money earning interest;
- your payment is never lost, stolen or damaged;
- your payment is automatically deposited into your account even if you are ill or are away.

If you live in Canada, you may sign up for the direct deposit service over the telephone.

When will I receive my payments each month?
If your payment comes by cheque, it usually arrives during the last three banking
days of each month. If you have direct deposit, the money will be deposited in your account during the third last banking day of each month.

1. What is a will?

A will is a legal document that allows you to divide and distribute your assets according to your wishes. If you die without a will (intestate), the courts will appoint an administrator to dispose of your assets according to a rigid legal formula. In other words, the law decides how and who will receive your assets regardless of your wishes or the needs of your family. That is why a will is so important.

2. Who needs a will?

Of course, you may have other reasons for requiring a will and your personal situation will determine this decision.

3. What is an executor?

The executor is the person(s) or trust company you appoint to carry out your wishes and settle your estate. Duties may include making funeral arrangements, managing investments, paying any taxes and debts owing, filing tax returns and making distributions to beneficiaries. The duties of an executor are not to be taken lightly.

4. What is a guardian?

A guardian is the person you appoint in your will to raise your minor children. If no guardian is named in your will, the courts will select a guardian on your behalf.

5. What is a Power of Attorney and why would I require one?

It is now becoming common practice to have a Power of Attorney for Property prepared at the same time you have a will prepared. This means that you can appoint someone to manage your financial affairs in the event that you are unable to. You may also appoint someone to make decisions on your behalf respecting your personal care and consent to treatment if you are unable to do so. This is known as the Power of Attorney for Personal Care. Both Powers of Attorneys may be revoked at any time as long as you have the requisite mental capacity.

6. What is a "living will"?

A "living will" is a term commonly used to describe a document which expresses an individual's desires and directives regarding medical treatment when that individual is in a terminal state. Often the living will prohibits life support systems that may prolong life artificially.

Note: The content herein is not intended to provide specific tax advice and should not be relied upon in this regard. Please consult your tax advisor to find out which strategies best suit your tax situation. The Toronto Electrical Utilities Credit Union Limited makes no guarantee, representation, or warranty and accepts no responsibility or liability as to the tax treatment of those services.