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Investments

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Investments

Investing your money can be a daunting task, but it’s also an essential step towards securing your financial future. With so many investment options available, finding the right fit for you and your unique financial situation can be challenging. At SkyReach, we offer a range of investment services to help you make informed decisions and invest with confidence.

Whether you’re a seasoned investor or just starting out, our team of experienced investment professionals is here to guide you every step of the way. Our goal is to help you build a diversified investment portfolio that aligns with your financial goals, risk tolerance, and investment timeline.

At SkyReach, we take the time to understand your financial situation and work with you to create a personalized investment plan that fits your unique needs. We offer regular portfolio reviews and monitoring to ensure your investments continue to align with your goals and make adjustments as necessary. With SkyReach, you can feel confident knowing that your investments are in good hands.

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We Specialize in all kind of investments including:

 

RRSP

    • An RRSP, or Registered Retirement Savings Plan, is a type of investment account designed to help you save for retirement. Contributions to your RRSP are tax-deductible, and your investments grow tax-free until you withdraw the funds in retirement.

TFSA

    • A TFSA, or Tax-Free Savings Account, is a type of investment account that allows you to save and invest money tax-free. Unlike an RRSP, contributions to your TFSA are not tax-deductible, but you can withdraw your funds at any time without penalty.

RESP

    • An RESP, or Registered Education Savings Plan, is a type of investment account designed to help you save for your child’s education. Contributions to your RESP grow tax-free, and you can withdraw the funds to pay for your child’s education expenses.

LIRA

    • LIRA, or Locked-In Retirement Account, is a type of retirement savings account that holds money that was previously saved in a pension plan. LIRAs are typically created when an employee leaves a job where they were part of a registered pension plan, and they are not yet eligible to receive pension benefits.

Cash

    • Cash investments typically refer to short-term, low-risk investments that provide a predictable rate of return. While cash investments may not offer the same potential for high returns as other types of investments, they are a safe and reliable way to preserve your capital.

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An Introduction to RRSP Mortgages

Looking to diversify your RRSP investment portfolio? Consider investing in private mortgages backed by Canadian real estate. With a self-directed RRSP mortgage, you become the mortgage holder, and each monthly payment is a fixed income payment that goes directly back into your RRSP account tax-free. You can lend on single-family homes, multi-family properties, and commercial real estate, and even invest in mortgages through Registered Retirement Income Funds (RRIFs) and Locked-in Retirement Accounts (LIRAs).

CRA allows a wide range of investments to be held within registered retirement accounts, including bonds and debentures, term deposits and Guaranteed Income Certificates (GICs), equity-linked notes, rights and warrants, covered calls, long calls and puts, LEAPS, gold and silver certificates, and mortgages secured by real property.

BENEFITS OF INVESTING IN MORTGAGES

Investing in mortgages is a less risky alternative to mutual funds and stocks since you are secure in both the borrower and the property. With mortgages, you have the freedom to negotiate interest rates and terms with the borrower, and you can earn passive income while staying tax-sheltered. Additionally, investing in mortgages allows you to invest in real estate without becoming a landlord and running after tenants.

FREQUENTLY ASKED QUESTIONS

  • Must the entire mortgage fund be provided by one plan?

    • No, mortgages can be funded wholly or in part from the annuitant’s RRSP. Thus, if your RRSP is not large enough to fund the entire mortgage, the mortgage can be split between you and other RRSP fund holders.

  • Does only residential real estate apply?

    • No, you can lend on single-family homes, multi-family properties, and commercial real estate.

  • Can only RRSPs be invested in mortgages?

    • No, the same principles apply to Registered Retirement Income Funds (RRIFs) and Locked-in Retirement Accounts (LIRAs).

  • What does the CRA have to say about RRSP Mortgages?

    • The Canada Revenue Agency (CRA) allows a wide range of investments to be held within registered retirement accounts. Most people are familiar with holding stocks or mutual funds, but few realize that investments may also include bonds and debentures, term deposits and Guaranteed Income Certificates (GICs), equity-linked notes, rights and warrants, covered calls, long calls and puts, and LEAPS, gold and silver certificates, and mortgages secured by real property. For more information, see Income Tax Interpretation Bulletin No. IT-320R3 on the CRA website (www.cra-arc.gc.ca).

  • According to the CRA… “A mortgage, or an interest therein, in respect of real property situated in Canada is a qualified investment for a plan trust. There is no requirement that the mortgage be a first mortgage or a residential mortgage.”

  • What happens if the borrower is in default?

    • If the annuitant is unable to make their monthly mortgage payments, the financial institution administering the mortgage will place the mortgage in default. They will then attempt to collect the proceeds upon a power of sale of the property.

  • Can the borrower deduct the interest paid?

    • If the proceeds from the mortgage are being used on an investment property, the cost to set up the mortgage as well as the mortgage interest may be considered tax-deductible expenses. The CRA requires a clear audit trail of the investment and the mortgage.

A STEP-BY-STEP GUIDE

To invest in RRSP mortgages, follow these simple steps:

1. Open a self-administered RRSP account with us.

2. Transfer your RRSP, RRIF, or LIRA funds to your self-administered account.

3. Perform due diligence on the borrower and the property.

4. Negotiate the terms, conditions, and interest rate with the borrower.

5. Take the mortgage commitment to a lawyer to register the mortgage on title.

6. Complete and sign the mortgage commitment.

7. Fill out and sign an Arm’s Length Mortgage Package with your Trustee of choice.

8. Set up an automatic payment system with the borrower, and watch the monthly returns go into your account.

Investing in mortgages is not limited to RRSP money, and you can also use cash to invest in mortgages or invest with a partner via Joint Ventures. Contact us to learn more about investing in RRSP mortgages and diversifying your investment portfolio.

Experienced Financial Professionals

SkyReach is proud to have a team of experienced financial professionals with several decades of industry experience. With their expertise, our clients receive the highest level of service and guidance throughout the mortgage process. Our financial professionals provide a personalized approach and utilize their vast knowledge of the industry to find the best mortgage solutions for our clients. We understand that navigating the mortgage industry can be daunting, which is why we are dedicated to simplifying the process and providing exceptional service.

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