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Benefits of year-round RRSP Contributions
For many Canadians, an RRSP is a last-minute scramble. The result? Many people end up contributing only a fraction of what they should. Their investment decisions are hurried, and they pay more in taxes.

Why contribute year-round?
There are many reasons why you should make year-round contributions to your RRSP, rather than wait until January or February. By contributing regularly, many people find they end up putting more money aside. That significantly cuts their tax bill. As well, they are often able to file their tax forms earlier, because they haven't waited until the end of February to make important RRSP decisions. They get their tax refund cheques sooner.

Last-minute RRSP contributors end up making hasty decisions and investing in products that may not be right for them. In contrast, those who make regular contributions have the time to think about their investment goals, consult a financial advisor, and develop a financial plan. They are more likely to have properly diversified portfolios, and are probably better able to weather market volatility. A year-round strategy is a financially sound and less stressful way to get the most out of your retirement savings.

Making regular contributions
If you make regular contributions, your money goes to work sooner and can produce higher returns. For example, if you contribute $100 to your RRSP each month, you'll have a retirement nest egg of $207,929 after 30 years (based on an annual return of 10 per cent). But if you invest the same amount over the same time in yearly $1,200 lump sums, you'll have only $193,220.

By contributing regularly to the investments in your RRSP, you also avoid the pitfall that snares many small investors ... "buying high and selling low." Your costs are "averaged" across the year, and you are not as vulnerable to market downturns.

Be prepared
Finally, year-round contributors develop the right habits. They periodically review their portfolios, reassess their goals, and make adjustments as needed. As a result, they are often more prepared when new investment opportunities arise.

Start planning and making next year's RRSP contribution now. Your financial advisor can help you make the right decisions.




“If you aim at nothing, you will hit it with amazing accuracy.”



Raymond E. Jackson, CFP, CPCA
Retired

 

 



Simon J. Jackson, CFP, CPCA
Senior Financial Advisor, Manulife Wealth Inc.
Life Insurance Advisor, Manulife Wealth Insurance Services Inc.

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Simon Jackson, CFP, CPCA
Tel:  (289) 245-1003 ext. 221; Email: simon.jackson@manulifesecurities.ca

Geraldine Doupe, Administrative Assistant
Tel:  (289) 245-1003 ext. 241



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Jackson Financial Planning Group | Manulife Wealth

3310 South Service Rd. Suite 204, Burlington Ont. L7N 3M6

Phone: (289) 245-1003
Fax: (289) 245-1009

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Investment dealer dealing representatives (“investment advisors”) registered with Manulife Wealth Inc. offer stocks, bonds, and mutual funds.. Jackson Financial Planning Group is a trade name used for dealer business only. Insurance products and services are offered through Manulife Wealth Insurance Services Inc. Banking products and services are offered by referral arrangements through our related company Manulife Bank of Canada, additional disclosure information will be provided upon referral.

Simon Jackson and Manulife Wealth Inc. and/or Manulife Wealth Insurance Services Inc. (collectively, “Manulife Wealth”) do not make any representation that the information in any linked site is accurate and will not accept any responsibility or liability for any inaccuracies in the linked site. Any opinion or advice expressed in a linked site should not be construed as the opinion or advice of Simon Jackson or Manulife Wealth. The information in this communication is subject to change without notice.