Preparing for retirement is very similar to building any long-term investment strategy. You need to follow certain basics. Once you consider your time horizon, set your goals and evaluate the risk you want to take, you have to choose the investments that will help your plan succeed. Remember every investment has three key characteristics: Expected Return, Risk and Marketability.
York Financial Group will sit down with you to review your present financial situation and plan and recommend an action plan if necessary to meet your retirement objectives. Until then you might review our RRSP checklist below.
Use the following checklist to see if your RRSP is in shape:
- Contribute in Time.
The deadline for your contribution is within the first 60 days of the year. But don't wait until the last minute. Get a head start by making (or at least starting) next year's contribution when you top up this year's.
- Make Your Contributions as Early as You Can.
Over time, this is an effortless way to increase your nest egg. After 25 of years earning a 9% annual compound return, there's a $38,000 difference between investing $5,000 at the beginning of the year and investing it at the end.
- Contribute Regularly.
If you can't make contributions at the beginning of each year, pre-authorized contributions go automatically from your bank account to your RRSP.
- Maximize Your Foreign Content.
Under current rules, you may invest your RRSP holdings in foreign assets. Investing outside Canada can lower overall investment risk by improving diversification and by offering the potential for higher returns overall.
- Rebalance Regularly
Have you reviewed your portfolio in the past 12 months? It may be time to sell some of those fast-growing investments and to reinvest the money to bring your asset allocation back in line with your objectives.
For more detailed information on RRSPs and RRIFs please click here.