Are You Going to Outlive Your Money?

Live longer, save smarter: a few tips for lasting retirement income

Life expectancies have never been higher. People are living longer than ever these days. In the 1920s, men and women could expect to live until 59 and 61, respectively. By 2020, those numbers had jumped to 80 and 84.

That’s great news for seniors who want to enjoy their golden years, but not so great for their bank accounts. How can you make sure you don’t run out of money before you run out of time?

Here are some tips to help you stretch your retirement assets:

Estimate how long you’ll live. This is not an exact science, but you can look at your health, family history, and lifestyle. If you’re fit as a fiddle and your grandparents lived past 100, you might want to plan for a long haul. If you’re a couch potato with a heart condition and a fondness for bacon, maybe not so much.
Take inventory of your assets and debts. List everything you own and owe, from your home and pension to your credit card and car loan. Subtract your debts from your assets to get your net worth. This is how much money you have to work with.
Review your pension plan. If you have a defined benefit plan that pays you a fixed amount for life, lucky you! You can skip this step. If you have a defined contribution plan that depends on how much you save and invest, pay attention. You need to make sure your savings will last as long as you do. You might want to consider buying an annuity that guarantees income for life.
Delay starting your government benefits. If you can afford to wait until age 70 to collect your Canada Pension Plan and Old Age Security, do it. You’ll get 42% more money every month. That’s a lot of extra doughnuts.
Draw down your assets wisely. Don’t withdraw more than 4% of your total assets per year, or better yet, 3%. And don’t forget about inflation and taxes. Some investments are taxed more favourably than others, and some benefits are clawed back if your income is too high. Talk to your financial advisor about the best strategy for you.
Plan for health care costs. Health care is expensive, especially if you need special equipment, surgery, or long-term care. Make sure you have enough money set aside for these expenses, or buy insurance to cover them.
Plan your estate. Don’t leave a mess for your loved ones when you die. Make a will that spells out how you want your assets distributed. Use charitable donations or trusts to reduce taxes on death. Buy life insurance to cover any remaining taxes or debts.

We know someone learned these tips the hard way when her father passed away. He had no will, no insurance, and no savings. He left behind a mountain of bills and debt. It was a nightmare that she thought she would never wake up from.

Don’t be like this father. Plan ahead and enjoy your retirement!

Canadians projected to live longer, but can they afford it? | CBC News

*Information provided here is based on material provided by Industrial Alliance. Insurance Kit and those associated with the information on this website are not professional accountants, unless specified otherwise. Please always seek the advice of a professional accountant prior to making any tax or pension related decisions.

What’s next?

An important note if you are between 50-70 of age

You are in a crucial stage of your life, we are here to help you achieve your financial goals, so that you can have the retirement of your dreams!

It is never too early to think of your retirement. The best way to predict the future is to create it.

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A Smarter Way to Save

THE RATE OF A GIC, THE FLEXIBILITY OF A SAVINGS ACCOUNT!

(This content is based on an article from Industrial Alliance)

There could be Better Returns with GIFs and HISAs

Life is full of uncertainty. Recent global events, current and possible wars, inflation trends, and high interest rates are the hot topics of the day. Like it or not, we are all at the mercy of our economy and our government's fiscal policies. Not only are people looking for some certainty, they are also looking for guarantees - "I don't care if it makes money, I just don't want to lose any!” Sound familiar? However, there is a silver lining in all this.

Rising interest rates have multiple impacts. Beyond the various declines observed in some asset classes, they tend to have a positive effect on the returns of savings and short term bonds. One of the insurance companies in the market make it even more attractive for you to "stay-put" with your money in these uncertain times.

High Interest Savings Accounts (HISA)

High interest savings accounts provide more security against volatility. The return offered by Industrial Alliance (iA) is among the most competitive on the market: their rate has increased from 0.40% to 1.10%* since the beginning of the year.

In addition, unlike other financial institutions that may offer temporary promotional rates, iA provides a steady, competitive rate. More predictable and always attractive, it allows your investment to remain profitable, regardless of its duration.

Guaranteed Interest Funds (GIF)

Guaranteed interest funds are among the first to benefit from rising interest rates since they offer higher returns than in the past few years.

For new investments, GIFs represent an interesting complement to bonds for investors looking for more financial stability. The portion of your portfolio invested in GIFs allows you, among others, to:

reduce the risks associated with volatility;
benefit from a fixed interest rate, as opposed to bonds or equity funds that are prone to fluctuation;
improve their portfolio diversification.

*Rates as of October 19, 2022, and are subject to change without notice.

Common benefits

Their GIFs and HISAs also share many common interesting benefits:

Can be redeemed at any time, unlike a bank GIC
Provide protection against creditors
Allow beneficiaries to receive a fast payment in the event of death
Have no management fees

These two products offer an enviable security in times of market volatility, but it is important to maintain a diversified portfolio to benefit from opportunities related to different asset classes. Also, there might be other offerings that fit your investor profiles better.

At Insurance Kit, we find the right solutions for you. Discuss your options and needs with us now!

FHSA will be here on Apr 1, no joke!

First-time Home Buyers get more incentives than ever

What is the First Home Savings Account (FHSA)

A First Home Savings Account (FHSA) is a savings account from the Federal Government that is set to be available for Canadians on April 1s, 2023. It allows individuals to save money for their first home purchase, providing tax benefits and other incentives to help them afford a home.

The Tax-Free First Home Savings Account is a new type of account that works much like an RRSP or TFSA because it combines the features of both. For example, when you contribute to your FHSA, your taxable income will decrease by the same amount for that year. Additionally, when you withdraw from your FHSA to purchase a qualified property, that money will be tax-free.

Eligibility for the First Home Savings Account

Must be Canadian residents, at least 18 years old.
You cannot own a home in the calendar year that the account is opened nor in the 4 years preceding that. That means you are considered a new home buyer if you and your spouse have not owned a home for up to 5 years.
The FHSA account is meant for primary residences and not investment or leisure properties.
You can have more than one FHSA, but you cannot exceed your yearly or total contribution limit.

Contribution rules for the First Home Savings Account

The FHSA works very similarly to an RRSP or TFSA, with a few key differences. You will need to open an account with any Canadian financial institution or bank that offers these accounts. Once you open an FHSA, some of the contribution rules will include:

A contribution limit of $8,000 per year with a maximum lifetime contribution limit of $40,000.
The unused contribution room in this account cannot be carried forward.
Any contributions you make to these accounts can also lower your taxable income by an equal amount.
If you open an account this year, even if you don't have money to put in yet, in 2024, you’ll have $16,000 of contribution room available.

How can you withdraw funds from your First Home Savings Account?

Some of the withdrawal requirements and applicable tax consequences include:

No tax consequences if the withdrawal is for the purchase of a first home. The FHSA must also be closed within 1 calendar year of the first withdrawal, and the holder of the account will no longer be eligible to open another FHSA.
Withdrawals that are not related to a first-time home purchase will be considered taxable income.
Different than RRSP, FHSA withdrawals do NOT need to be paid back.
You CANNOT use both the Home Buyer's Plan from an RRSP and FHSA for the same home purchase.

What happens if you don't use the FHSA to purchase a first home?

When you contribute to your FHSA, you can invest your money in allowable investment assets like stocks, bonds Segregated funds mutual funds, ETFs, and GICs.

If the funds in your FHSA are not used within 15 years of opening the account, you will need to close the account or the funds within can be transferred to a Registered Retirement Savings Plan (RRSP)
As the account holder, you can transfer the funds from within to an RRSP or a RRIF. When you withdraw the amount from these other accounts, the taxes will be paid as normal.
If you transfer funds from your FHSA to an RRSP or RRIF, you will not be limited by the RRSP contribution room.

Other plans and programs for home buyers in Canada

If you're looking for some additional home-buying support, there are a few other programs and plans available to you.

The Home Buyers' Plan (HBP) - a program that allows home buyers to borrow up to $35,000 from their RRSPs towards the purchase of your first home under certain conditions.
The First Time Home Buyer Incentive (FTHBI) provides eligible buyers with 5% or 10% off the price of the home they're buying. To qualify for this program, you must have purchased or plan on purchasing a resale or new build home that is less than $500,000.
The Home Buyer's Tax Credit (HBTC) is a non-refundable tax credit that provides buyers with $10,000 for the purchase of an existing home, which would provide up to $1,500 in tax relief to eligible home buyers.

If you're thinking about purchasing your first home or are in the process of doing so, a First Home Savings Account can be an excellent way to help you achieve this goal while enjoying all the benefits it offers. Some of the advantages of the FHSA include tax-deductible contributions, tax-free earnings, and the ability to use funds from your account at any time for anything related to your home purchase.

There’s almost no downside to opening the FHSA and contributing earlier. Whether you're ready now or in the future, consider opening a First Home Savings Account to help you on your journey to homeownership. Book a coffee chat with us to learn more.

*Information provided here is based on material provided by Canada Life. Insurance Kit and those associated with the information on this website are not professional accountants, unless specified otherwise. Please always seek the advice of a professional accountant prior to making any tax related decisions.

What’s next?

📷If you want to know if you are eligible for the First Home Savings Account (FHSA), learn more about the proper criteria you must meet.

📷Make sure you are looking into all the home buyer plans and programs that are available to you..

Find out more

The Good & Bad of the Rising Interest Rates

Central banks likely to continue lifting rates

That is despite a drop in headline inflation of U.S. from 9.1% to 8.5% in July that make some wonder why the interest rate keeps going up. Especially in Canada, something called the "Core inflation",.. a broad-based price growth may force the Bank of Canada (BoC) to remain aggressive in its policy stance.

So, as expected, the Bank of Canada increased its policy interest rate to 3.25%, which means the Royal Bank of Canada Prime Rate has also increased to 5.45%. However, the next Bank of Canada announcement will be on October 26, 2022, so we should brace ourselves for another hike.

Bad News First - Impact on all sorts of loans

As stipulated in most loan agreements, this increase will automatically impact the payments to be made by those who are with previously issued loans (RRSPs, RESPs, investment loan, mortgage, line of credit, student loan etc.) as these loans are established according to the prime rate. In addition, most insurance companies also use this rate to establish policy loans on certain individual life insurance policies, these loans could be affected as well.

The Good news is...

Rising interest rates also mean higher rate for savings accounts. Other than Manulife's promotional offer at 3.25% on their Advantage Savings Account (with checking privilege and interest!), Industrial Alliance's High Interest Savings Account (HISA) has increased the interest rate to 2.85%. Consider the offers from other financial institutions are either lower interest rates, with monthly fees, or a locked-in period, the less well-known offers from insurance companies are worth taking a look.

More Good News for those looking for a simple, accessible and risk-free alternative for income

With medical advances and healthier lifestyle choices, people are living longer.

If you are worried about market volatility or outliving your money, consider an annuity as part of your retirement strategy. With the high interest rate environment, clients today have an opportunity to secure guaranteed lifetime income at some of the highest payout rates offered in recent years.

An annuity provides a series of periodic income payments for a worry-free, dependable source of retirement income. A typical annuity product could provide:

Guaranteed income for life
No exposure to market risks
Inflation protection
Tax-efficient income

With annuities, there is no worry and stress about managing complicated investment portfolios, no fear of stock market crashes! You could choose either guaranteed income payments for a chosen period, or for your life. You could own it individually or with a spouse registered or non-registered.

If you want to taking advantage of the upside of a high interest rate environment, please contact us for more details.

How Do You Weather the Market Volatility?

Stay Invested & Invest Regularly - Apply the Dollar-Cost-Averaging Strategy

Over the last few years, there have been many uncertainties and fluctuations in the financial markets. The fear of losing money is an understandably strong emotion and it’s normal to have questions on the financial perspective ahead.

However, history shows us that on average, markets generally return to their previous levels after only 19 months.* Imagine the ups and downs are like a yo-yo moving in the hand of someone riding an escalator. Look at the bigger picture and you will find stability despite the volatility. In such periods of volatility, it is best to stay the course on your savings plan.

One way to stay focused and on course is to apply the Dollar-Cost-Averaging strategy. Instead of trying to time the markets, use dollar cost averaging as a simple strategy that helps you build your investment portfolio while averaging out the cost of your purchases. It helps take the guess work out of investing.

How does dollar cost averaging work?

You invest the same amount on a regular basis. Since market prices fluctuate, you will purchase more units when markets are low and buy less units when markets are high. Dollar cost averaging usually lowers the average cost of your investments over time. Think of it as paying a bill—pay yourself to invest. Set up a Pre-Authorized Contribution (or PAC) and have a pre-set amount of money from your bank account transferred into one of our suppliers' Segregated funds** investments, which could provide you another layer of principal protection. You then determine how much you want to invest and how often.

An example for if you started investing regularly:

Month Investment Amount Price/Unit # of Units Purchased

1 $200 $5 40

2 $200 $4 50

3 $200 $2 100

4 $200 $4 50

5 $200 $5 40

Total $1,000 $3.57(average) 280

Dollar cost averaging can lower your average price and increase the number of units you can purchase. But if you invest the $1,000 in the first month, you would have only purchased 200 units at the highest price.

Why dollar cost averaging makes sense

No guessing when to “get into the market” or time the market, plus emotion and stress are eliminated from your investing strategy. You don’t have to invest large amounts (as few as $25 a month) and it helps you maintain consistency in your long-term financial plans.

Insurance Kit can help guide you towards achieving your financial goals. If you would like to learn more about it, please don’t hesitate to contact us today.

(This content is derived from the following sources: Industrial Alliance and

Equitable Life)

*Source: S&P 500 Bear Markets since 1950, iA Investment Management

** See our post below titled: To Insure Your Investment?

Market Volatility moves like a yo-yo in the short t; the long-term market moves like an escalator.

What in Our (Financial) World is Going on?

Keep Calm and March On

There have been some major events in the news recently. The situation in Ukraine, and the continuation of Covid are what we seem to hear about most. However, the one recent event that will impact Canadians financial futures that might not have caught your attention is the Bank of Canada's recent raising of interest rates.

The Bank of Canada announced on March 2nd, an increase of 0.25% to the policy interest rate, which now stands at 0.50%.

This increase is not surprising, according to iA's Interim Chief Economist Sébastien McMahon, since the Bank of Canada had previously announced its intentions. This increase will automatically impact the payments to be made by you with previously issued loans (RRSPs, RESPs, investment loans, mortgage, car and student loans etc.) as these loans are established according to the Royal Bank of Canada's prime rate which now stands at 2.70%. This is believed to be only the beginning of more increases to come this year.

According to a Toronto Star article, for a home in the GTA priced at $1,240,000 (with a minimum down payment of 20 per cent amortized over 25 years), a 25 basis point rate increase sees the estimated payment rise to $3,942, an increase of $114 per month or $1,368 per year. Similar situation would apply to the lower Mainland of the Vancouver area as well. With gas prices and grocery bills going up, even if you don't have a mortgage or any loans, this also means you will have to review your budget and make adjustments accordingly. Yes, we all feel the pinch!

The silver lining is that while loan interest goes up, so does interest rates for savings accounts. Though there is no insurance to protect one from inflation and world events such as this, Insurance Kit could provide you some helpful tips on how to use an insurance product to protect your savings and investment from market volatility.

We cannot protect you from getting sick or injured, but protecting your assets due to such events is our mission.

Learn A Little More...

Watch the video of Sébastien McMahon at Industrial Alliance (iA) talking about the market reaction to the Ukraine situation.

WATCH IT NOW

Is Getting a Tax Refund Good or Bad?

The Government is saying: "Gotcha!"

(Revised and expanded from our 2020 posting)

Unless you are self-employed, chances are you have filed your tax return. If you were entitled to a refund, I'm sure many of you were looking forward to that payment. If you qualified for a refund, did you put it back into your savings account? Spent it as if it was a windfall? Or invest it so it can grow for you?

Before you got too excited about the "tax refund" idea, let's consider this: did you know that when a tax refund is issued, it means you had given the government an interest-free loan over the previous year? Or your employer is withholding too much tax from your take-home pay to begin with? So, it is NOT gift-money from the government - it is your OWN hard-earned cash overdrawn! Don't worry, Insurance Kit will show you how you can stop that from happening. *

Firstly, you could submit Form T1213 (Request to Reduce Tax Deductions at Source) to tell the government to reduce the amount of deductions on things like RRSP contributions, childcare expenses, etc. Once approved by the CRA, voila! You could start seeing more money on every pay. You could also do this if a large bonus or vacation pay is coming up.

Secondly, if you have a personal RRSP outside of work, you could inform your HR department about that. They might be able to coordinate and adjust their deduction accordingly.

You should use the additional cash flow to increase monthly contributions, support a Retirement Savings Plan or Tax-Free Savings Account or repay an investment loan. Increasing savings each year – even by a small amount – can have a substantial impact on your retirement savings.

Note: If you are not good at saving money at the end of the month, an Automatic Payment Increase Option is a disciplined approach to make sure you set aside money for your future self before you spend any of it. Some say you should just pretend you have never earned it and let it sit in your retirement/savings account waiting for you.

In addition, here are the deductions and credits you can claim to optimize your tax situation.

Deductions**

RRSP contributions

Moving expenses

Childcare expenses

Pension income splitting tax credits

Medical expenses

Charitable donations

Tuition fees

House purchase costs

Possible tax deductions due to telework during the COVID-19 pandemic

The much-anticipated tax refund

Once you receive your refund, use it wisely on things that have longer impact and value. i.e. not on a shopping spree for new action figures, purses or kitchen gadgets. In 2021, the federal government paid out an average of $2,800 in tax refunds to those who qualified. Imagine if you had that money in your own savings at the beginning of the year!

Please feel free to contact us if you have any questions.

DOWNSIDE OF THE TAX REFUND

A real life story from a 72-year-old retiree:

With his survivor pension, CPP and OAS, side income on part-time woodworking projects, his annual income is about 80K. He has about $100K RRSP from enjoying the tax refunds over the years, which has turned into an RRIF this year and is subject to a minimum annual withdrawal of 5.4% per year. (This rate increases yearly) That equals $5,400, which pushes his income to the next tax bracket from 19.80% to 23.02%.

If not planned right, your tax refund savings could cost you more at your retirement years.

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RRSP season or Hockey season?

Sorry, hockey fans, RRSP season comes first in January! Now the verdict is out, so why RRSP gets its own season? A Retirement Savings Plan or RSP as they say, (or RRSP, if it is registered, as we are referring in this article) is one of the best ways to help ensure your financial security. The back story is that they were introduced by the Canadian Government to promote savings for retirement by employees and self-employed people. (Please see our first post below). Read on to learn just how relevant this RSP opportunity can be for you today.

Tax savings

You can reduce your taxable income by the amount of the RSP deposit, which grows and compounds in a tax-sheltered environment until you withdraw the money. Since many of us will have a lower tax rate in retirement than during our working years, this can result in you and I paying significantly less tax overall.

Tax refund

Since most of us get income deducted from our paycheque, most of us will receive a tax refund if we make an RSP deposit and file our income tax. The more you contribute, the greater the refund.

Income splitting

When you retire, your RSP can be changed to a Retirement Income Fund (RIF). This is a retirement income vehicle that is designed to provide you with regular income payments from your savings. If your spouse has a higher income during retirement, up to 50% of the RIF income can be allocated to you.

Be your own bank

The Home Buyers' Plan allows a first-time home buyer to withdraw up to $35,000 tax-free in a calendar year to buy or build your first home. You have up to 15 years to pay the money back. With home prices on the rise, why not tap into additional resources to increase your down payment.

The Lifelong Learning Plan allows you or your spouse to withdraw up to $20,000 tax-free to cover tuition and education expenses. The repayment period gives you 10 years to repay the money you borrowed.

Convert your RSP

You can transfer your RSP into a RIF or Payout Annuity when you retire. You will pay tax on the regular payments you receive each year but if you are in a lower tax bracket in retirement, you will pay less tax.

So, you only just turned 30; why should you start now? Many of us know we should start early so our money has a longer time to grow. With the costs of buying a home, raising kids (and paying for their education), it would be wise to start early. Here are four steps that will help you get started.

1. Visualize your dream retirement.

Before you dive into how you’ll save enough money for retirement, take some time to think about what you want to be doing. Think about the lifestyle you’d like and where you want to be living. Are you dreaming of living on a body of water, in a downtown condo or travelling the world?

2. Calculate how much you will need.

After you've thought about your dream retirement, the next step is to consider how much money you’ll need to fund it. Once you know how much you’ll need, you can work backwards to determine how much you should be saving each month. By starting early, you have time on your side.

For example, if you start by saving $100 per month at age 25, by the time you retire, your savings will have grown to $199,149 assuming 6% rate of return compounded annually to age 65. There are plenty of investment solutions available to you if you’re starting to save later in life, too.

3. Determine your tolerance for risk.

When you’re making decisions about investments for retirement, it’s important to understand your personal tolerance for risk. This is impacted by a number of things including the number of years until retirement, age, investment knowledge and your personal financial situation.

Once you’ve solidified your plan, you're ready to start putting it into action. This will mean saving money, living within your means and regularly checking with your advisor (a.k.a Insurance Kit!) to ensure you’re on track. If you’re not, we can help you re-assess your plan and make adjustments.

Now you know the steps to planning a comfortable retirement. These steps do require time and thought. There are many options and variables to consider. Working with the right financial advisor – someone who can help you navigate any uncertainty – may be the most important step you’ll take.

Source: https://www.equitable.ca/en/who-we-are/equitable-blog

*Insurance Kit and those associated with the information on this website are not professional accountants, unless specified otherwise. This information does not constitute legal, tax or other professional advice. Information is believed to be accurate, but accuracy is not guaranteed. Please always seek the advice of a professional accountant prior to making any tax related decisions.

Click to Get your chance to win $5,000 by contributing towards your future!

To Insure Your Investment?

Do you have all your investments in one "Mutual Fund" basket?

Are you one of the many Canadians who use the banks for their savings, investment and/or retirement planning needs? Why not? You have likely known them since the day you broke your piggy bank, and your parents brought you to open your first bank account. They are the people that know about money. Their branches are there if you need to talk to someone in person. There are many reasons why people stay with the bank. And yes, some or all of your savings account balance is protected by the Canadian Deposit Insurance Corp. except mutual funds and other types of investments.

Therefore, when you choose a bank to put your registered (RRSP, TFSA, RESP, RDSP, RRIF....) and non-registered investments into mutual funds, you are exposed to many risks that you may or may not have thought of. For example, negative returns (i,e. losing money!), higher taxation rates, complicated and expensive estate asset transfer fees, to name a few. This is where an insurance advisor comes in.

Segregated Funds / Guaranteed Investment Funds

All markets are volatile. And all can offer lucrative earning opportunities. With Segregated Funds products that are offered only through insurance companies, you can tap into their unlimited potential without any of the inherent risks mentioned earlier. Through careful diversification of your portfolio across a variety of assets, bonds and stocks, you are guaranteed full capital protection at your chosen level while you could be enjoying a consistent return annually.

Another one of the biggest advantages of Segregated Funds is the Estate Benefit they offer. This makes looking after your loved ones even in the event of death or injury easier than ever. Naming beneficiaries becomes quick and convenient within the structure of the Segregated Fund, so in the event of an accident or death, they can inherit all proceeds privately and without incurring any of the associated legal, probate and estate fees, or facing administrative difficulties or timely processing.

If you wonder why your bank or financial advisor have not mentioned these to you, that is probably because they are not licensed to handle insurance products such as segregated funds.

If you are interested in learning more about Segregated Funds, contact us for a personal consultation session, or join one of our education webinars.

Disclaimer: *Insurance Kit and those associated with the information on this website are not professional accountants, unless specified otherwise. This information does not constitute legal, tax or other professional advice. Information is believed to be accurate, but accuracy is not guaranteed. Please always seek the advice of a professional accountant prior to making any tax related decisions.

Learn More

We will update this page and add more content in the future. We may even post a summary of our online webinar so that those who missed the sessions can still learn with us.
Make sure you come back to visit. Have a question you want to ask now? Email us and we will answer that as soon as we can.

Find out more

RRSP - Savings or Investment?

Why Does One Save?

If you live in a world where you need to use money to exchange for food, shelter or any other worldly possession you so desire, you will need money. That means we need to make money so that we can hopefully save some at the end of the month. Well, that is only your short-term goal.

Your long-term goal should be to ensure there are enough savings so that when you are not working anymore, that dream of sipping margaritas on a sunny beach does not end up being just a dream. So, as Canadians, we need to learn the very first thing that should be in your Economics 101 textbook, or if you are an immigrant, in your Welcome to Canada handbook. Yes, there are some communities that have readily available resources regarding that as well. However, since you are here already, let's learn about the most important 4-letter-word in your newly acquired vocabulary: RRSP.

(Below is part of a brief summary of our earlier webinars)

RRSP stands for Registered Retirement Savings Plan. Well, to be honest, this is quite misleading. It is because you can do so much more than just saving your money in a low interest bank account. Here are the 5Ws of RRSP

WHY?

Canadians are not saving enough for retirement
Average life span has increased over the years
Decrease of ways to save on taxes
Aging population, a smaller working group

WHAT?

Established in 1957
Tax deductible and Tax-deferred until withdrawn
Must collapse at the end of calendar year at 71 (otherwise considered as single withdrawal)
Tax rate based on marginal tax rate of last penny earned
Flexible investment options in savings, cash, GICs, Mutual funds, fixed income securities. stocks etc.

WHO?

Whoever has earned income in Canada and has a Social Insurance Number
Spouse that has a higher income could contribute to a lower income-earning spouse
Based on 18% of gross earned income of the previous year but with a yearly maximum
Life time over contribution limit is 2K

WHEN?

Anytime - deadline is important only if tax deduction is needed for the year.
Monthly contribution or annual contribution, where monthly contribution could be more advantageous
Unused room can be carried forward indefinitely
Could be withdrawn to finance a first home or back to school. But has to be paid back within a time limit
Once matured, can be transferred to RRIF - Registered Retirement Income Fund

WHERE?

Banks; Credit Unions; Mutual fund companies; Most financial institutions
Insurance advisors - we can submit your application after bank hours on the day of the deadline before it hits midnight! However, we do not encourage anyone to be a last minute dasher on this.

Note:

1) If your income is low and tax deduction is not necessary for the year, there is no rush to meet the deadline.

2) Whether you need to do it or not should be reviewed before Christmas. Again, no last minute mad dash, please!

3) Pre authorized account for RRSP could be better for you because monthly contribution lessen the pressure of a lumpsum payment before the deadline

Learn More

We will update this page and add more content in the future. We may even post a summary of our online webinar so that those who missed the sessions can still learn with us.

Make sure you come back to visit. Have a question you want to ask now? Email us and we will answer that as soon as we can.

Find out more

Are You Going to Outlive Your Money?

Live longer, save smarter: a few tips for lasting retirement income

What’s next?

A Smarter Way to Save

THE RATE OF A GIC, THE FLEXIBILITY OF A SAVINGS ACCOUNT!

There could be Better Returns with GIFs and HISAs

High Interest Savings Accounts (HISA)

Guaranteed Interest Funds (GIF)

Common benefits

FHSA will be here on Apr 1, no joke!

First-time Home Buyers get more incentives than ever

What is the First Home Savings Account (FHSA)

Eligibility for the First Home Savings Account

Contribution rules for the First Home Savings Account

How can you withdraw funds from your First Home Savings Account?

What happens if you don't use the FHSA to purchase a first home?

Other plans and programs for home buyers in Canada

What’s next?

The Good & Bad of the Rising Interest Rates

Central banks likely to continue lifting rates

How Do You Weather the Market Volatility?

Stay Invested & Invest Regularly - Apply the Dollar-Cost-Averaging Strategy

What in Our (Financial) World is Going on?

Keep Calm and March On

Learn A Little More...

Is Getting a Tax Refund Good or Bad?

The Government is saying: "Gotcha!"

The much-anticipated tax refund

DOWNSIDE OF THE TAX REFUND

RRSP season or Hockey season?

Tax savings

Tax refund

Income splitting

Be your own bank

Convert your RSP

1. Visualize your dream retirement.

2. Calculate how much you will need.

3. Determine your tolerance for risk.

To Insure Your Investment?

Do you have all your investments in one "Mutual Fund" basket?

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RRSP - Savings or Investment?

Why Does One Save?

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