Retirement Planning
Start early
Invest now to maximize the benefits of tax-free growth, if in an RRSP, and compounding. Compounding is when you earn money on any gains your investments make over time.
Contribute early in the year
You can contribute to your RRSP from January 1st of any calendar year until 60 days into the following year. The best strategy is to make your RRSP contribution on January 1st for the current tax year. That way, your plan will benefit from up to 14 months of tax-free growth. Over time, these additional months can add extra dollars to your retirement nest egg. Consider putting your tax refund directly into your RRSP.
Make regular contributions
Play yourself first. Set up a convenient Pre-Authorized Contribution (PAC) Plan and make disciplined monthly contributions throughout the year. It will help avoid the last minute scramble to find the money for next year's contribution. And your money has the opportunity to compound and grow even more over the course of the year.
Maximize your contributions
Your RRSP contribution is your best opportunity to save for a worry-free retirement. Make your maximum allowable contribution and take advantage of unused room from previous years. RRSP contributions accumulate tax-free and reduce your overall tax burden.
Make spousal contributions to save even more taxes
Split your income and the impact of taxes at retirement by starting a Spousal RRSP for your spouse or common-law partner. As contributor you benefit from the immediate tax deduction but the contributions belong to your spouse.
Diversify for growth and to reduce risk
Diversify by spreading out your portfolio among a variety of asset classes. That way, you minimize your reliance on the performance of one particular asset class. The main asset classes are cash and cash equivalents, fixed income, stocks or equity mutual funds.