Ontario residents with registered savings plans are seeking enhanced benefits from their investments in these plans as the global economic downturn takes its toll, according to a VentureLink Funds survey conducted this week.

Specifically, as Ontarians prepare to make RRSP contributions, they want increased tax benefits and more faith that their investments will grow.

Of the 800 RRSP-holders surveyed by Angus Reid, 70% said they would contribute the same or less to their RSPs than they did last year, while almost three in 10 won’t contribute this year.

“I’m happy to hear that people are still very much motivated to do so,” said John Varghese, VentureLink’s managing partner.

In terms of choosing specific funds, 60% of Ontarians site additional tax incentives as a key determinant. Almost half of respondents said they would look to funds that performed well in 2008.

Roughly half of respondents were more inclined to invest in funds with high growth potential, such as those invested in companies focusing on biotechnology, environmental technology and energy management.

“This is the year that people are looking to find all sources to generate cash in their accounts, especially if they’ve lost quite a bit in the past year,” Varghese said.

He encourages investors to seek products with additional benefits. Purchases of retail venture capital funds, for instance—funds which invest in private companies in the startup or expansion phase—are eligible for federal and provincial tax credits of up to 30%.

According to VentureLink, an investor who makes $75,000 and contributes $7,500 worth of retail venture capital funds could have total tax savings of $4,831.

“People should be taking advantage of these,” Varghese said.

IE