Today’s seniors need to consider longevity, health care costs and low interest rates when investing their retirement nest egg. In recent years interest rates have steadily declined, and experts tell us we can expect them to remain low for some time.
Amidst the economic fall out of the Covid-19 pandemic, the Canadian government announced a 25% reduction in RRIF minimums as part of a multi-billion dollar relief package.When you are in a RRIF, you are mandated to withdraw the minimum amount required by law each year. In this scenario, when the market drops drastically the RRIF payment you receive equates to you selling that portion of your portfolio at a low.
Taking time off work to care for your child often means leaving the work force, or working fewer hours. If you do so, you will naturally have less contributions toward your Canada Pension plan than if you worked full time and contributed fully into CPP during those same years. For the stay at home parent, this may lead to a lower CPP pension payment in retirement.
It seems the comparison of the Tax Free Savings account (TFSA) versus Registered Retirement Savings Account (RRSP) is still often misunderstood.
Should I put money into my RRSP or not? Would my money be better off somewhere else, or is an RRSP my best option? These are questions many Canadians ask themselves as the RRSP season rolls around each year.
While some people prefer flexibility, it makes others nervous. What if I outlive my savings? Maybe you are the type of person who prefers guarantees. Maybe you are the type of person who wants to guarantee a flow of income for life.
The idea of a de-registration strategy is to draw registered funds from your RRSP or RRIF in a manner that is to your best benefit from a tax planning perspective.
After years of building RRSP savings, the next step is to think about how and when to draw on these savings for your retirement spending needs.
Budgeting, saving and money management are frequently procrastinated. And not by merely weeks and months; they are often procrastinated by years. It is one of the most popular New Year’s resolutions, yet also one of the most frequently abandoned.
An RRSP isn't for everyone. The basic building block is saving money. The next step is deciding where to put that money and an RRSP is only one of many options. For some it is the perfect choice, and not for others.