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Special Accounts

There are a number of less common accounts that might be relevant to you depending on your personal situation. If you have need of any of the following accounts, you may want to consider the support of a Financial Advisor. Let us recommend a great one here.

Company account: Separate legal entity managed by a board of directors and officers. A company can invest just like an individual.

Sole proprietorship: A business with a sole proprietor who personally owns all the assets, manages the business, collects all the income, and assumes all the financial and administrative responsibilities. Often sole proprietor businesses also make investments.

Individual Pension Plan (IPP): 

Although company-wide pension plans are in decline, the use of an Individual Pension Plan (IPP) is on the rise, particularly for older, senior executives at larger companies.  Essentially, the IPP is a defined benefit plan established for only one person (or sometimes two). For older workers (typically at least 40), the IPP allows contributions beyond the maximum permitted by the RRSP by over 50% at age 60. In many cases, the company makes the contributions to the IPP.

If you own your own company, you can set up an IPP and contribute to it as long as you have qualified earnings (you’ll need to take a paycheck). This can be complicated so you may want to contact your financial advisor for more information.

For most people an IPP is a very valuable investment vehicle and if offered by your company, you should take advantage of the opportunity to improve your financial situation at retirement.

Succession: An estate bequeathed by a deceased person and administered by an executor. The investments in a succession account need special management since they will normally be dispersed to the inheritors within a relatively short period of time.

Trust: An entity administered by a trustee to which assets have been transferred to achieve a specific purpose. Often that purpose is to leave assets to children or other family members.

Partnership: A legal entity created by an agreement between two or more people (natural or legal): a limited partnership (L.P.), a general partnership (G.P.) or a limited liability partnership (L.L.P). All of these partnership types can hold investment assets.

Investment Club: A group of individuals who agree to pool their expertise and funds for the purpose of jointly managing investments, under the terms of an agreement. Investment Clubs are often formed for educational purposes or to allow for better diversification by pooling funds to buy a diverse group of assets.

Association: A group of persons who agree to pursue a common goal other than profit making. (e.g., hockey association). These groups might have assets to invest.

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