We are in our last week of “RRSP Season”, the time in which you are eligible to make contributions to your RRSP and have them counted towards your 2009 tax year. Most of our clients prefer to do regular, automatic, monthly deposits, and so do not have to concern themselves with finding “leftover” money to put in after the holiday season… if you don’t have a pre-authorized deposit plan set up, I highly recommend you take this opportunity to start one for 2010 (you can start with as little as $25 per month).

To give you an idea of the value of using an RRSP as part of your retirement plan, I encourage you to play around with Mackenzie’s RRSP Illustrator. You can also see just how much more can be saved by reinvesting the tax refund earned from RRSP deposits. If you have any questions, please give us a call!

As we move into the March tax season, it is the perfect time of year to give yourself a financial makeover. After the last couple years, are your investments still in line with your goals and risk tolerance? Do you have enough, or are you saving enough, to enjoy the kind of retirement you would like to have? Is your money protected from future economic downturns, from creditor’s claims or unnecessary probate costs, or from a personal emergency? We have options designed for people in all stages of life and business, please give us a call to talk about which ones are right for you.

If you are curious about the technical structures behind Canada’s RRSP program, here is a link to the Canada Revenue Agency’s Registered Retirement Savings Plan site.

Grant MacEwan University "Tilt-Shifted" Photo (Edmonton, Alberta)

Photo credit: “Grant MacEwan University Tilt-Shift” by pixelens photography (Flickr)

TFSA or RRSP: How to choose? – The Globe and Mail

As Canadian savings rates rise, a BMO report says older and wealthier Canadians are among those who should look at parking their money in a TFSA.

Piggy bank with coins iStockphoto

Happy New Year from our family "Down Under"

Many individuals ask us: “How much money will I need in retirement?”  The real answer is the amount of money you have saved is what you will have to live on, and your lifestyle will be determined by that. Sort of like the old ‘which came first: the chicken or the egg?’ puzzle.  Your lifestyle will be determined by your savings, but your savings are often determined by your lifestyle!

To answer the question in another way, it can be helpful to use something called the Rule of 20.  For the average Canadian, for every $1 of annual income you want to have in retirement you will need to have saved $20.  So, if you need $1,000 per month (i.e.: $12,000 per year) you must save $240,000 by the time you retire.  The numbers may seem intimidating, but working with a professional financial advisor to help you build and follow a plan, they are achievable.

For more information on the Rule of 20, please review the linked article and let us know if we should do a projection of where you are today and where you will likely be in the future. Our services include a breakdown of all your investments, projecting where you will be at and during retirement, and building a plan to get you the lifestyle you want to enjoy as simply and safely as possible.

Wishing you a great summer,

Harvey

CNW Group | Russell Investment Services Canada: Retirement Rule of $20 helps Canadians concerned about market volatility and longevity risk