Your life is ever-evolving, and so are your financial goals. At Wiegers Financial & Benefits, we understand the importance of maximizing your RRSP to ensure your future stays on track. By taking a holistic approach to financial planning, we aim to ensure every base is covered as your circumstances and objectives change. In this blog, trusted financial planner Kim Chicoine shares valuable strategies to help you maximize your RRSP and secure your financial future.
Matching Each Saving Option to Your Financial Goals
Building savings can feel like a challenge. After all, there are countless other demands on your income. However, the long-term satisfaction of watching your savings grow far outweighs the fleeting thrill of a new purchase. To maximize your RRSP and other savings, consider incorporating options such as guaranteed investment certificates (GICs), mutual funds, segregated funds, stocks, and bonds into your registered retirement savings plan (RRSP) or tax-free savings account (TFSA).
Accelerating Your Savings with Smart Strategies
There are several ways to maximize your RRSP contributions and accelerate your savings growth. Here are some proven strategies:
Pay Yourself First with a Pre-Authorized Chequing Plan – A pre-authorized chequing (PAC) contribution plan allows you to make regular, automatic contributions to your investments. This “pay yourself first” approach treats saving as a recurring payment, just like your other bills. By contributing more frequently, you benefit from dollar-cost averaging, which can reduce the impact of market fluctuations over time. Additionally, you can talk with your advisor about setting up a plan that gradually increases your contributions annually. Think of it as giving your investments a well-deserved raise, which can significantly maximize your RRSP over the years.
Catch Up on Unused Contribution Room with an RRSP Loan[1] – An RRSP loan can help you maximize your RRSP by catching up on unused contribution room, allowing you to give your investments more time to grow. Borrowing for an RRSP contribution doesn’t have to be costly. You can use your tax refund to pay down the loan, letting you take advantage of tax benefits immediately. While RRSP loans aren’t suitable for everyone, they can be a powerful tool when used wisely.This strategy benefits you in several ways:
Provides additional funds earlier to boost your investment growth
Potentially creates a larger nest egg for retirement
Reduces your tax bill by enabling an income deduction equal to the amount contributed
Contribute to a Spousal RRSP – A spousal RRSP can be an excellent option for couples looking to maximize their RRSP contributions and equalize income during retirement. In this arrangement, the higher-income spouse contributes to the RRSP, claiming the tax deduction, while the lower-income spouse owns the plan. This strategy lowers the family’s overall tax rate in retirement. It’s important to note that withdrawals from a spousal RRSP may be taxed to the contributing spouse if contributions were made in the same calendar year or the two preceding years. Speak to your financial advisor to fully understand the implications of this plan.
Why Starting Early Matters
While RRSP season isn’t here yet, starting early always gives your investments more time to grow. The earlier you begin, the greater the potential for compounding returns to work in your favor. Maximizing your RRSP early not only boosts your retirement savings but also helps you develop disciplined saving habits. If you have questions about which strategies or savings options are right for you, reach out to your financial advisor for personalized guidance.
At Wiegers Financial & Benefits, we’re committed to helping you maximize your RRSP and navigate the complexities of financial planning. Take the first step today and set yourself up for a secure financial future. Contact us to learn more.
Insurance Representative, Wiegers Financial and Insurance Planning Services Ltd.
Financial Planner, Manulife Wealth Inc.
The opinions expressed are those of the author and may not necessarily reflect those of Manulife Wealth Inc.
[1] Using borrowed money to finance the purchase of securities involves greater risk than a purchase using cash resources only. If you borrow money to purchase securities, your responsibility to repay the loan and pay interest as required by its terms remains the same even if the value of the securities purchased declines.
(function() {
var file = ["https:\/\/wiegers.ca\/wp-content\/et-cache\/2184\/et-divi-dynamic-tb-3257-tb-8575-2184-late.css"];
var handle = document.getElementById('divi-style-parent-css');
var location = handle.parentNode;
if (0===document.querySelectorAll('link[href="' + file + '"]').length) {
var link = document.createElement('link');
link.rel = 'stylesheet';
link.id = 'et-dynamic-late-css';
link.href = file;
location.insertBefore(link, handle.nextSibling);
}
})();
var et_link_options_data = [{"class":"et_pb_text_0_tb_header","url":"mailto:wiegers@manulifewealth.ca","target":"_blank"},{"class":"et_pb_text_1_tb_header","url":"mailto:%20inquiries@wiegers.ca","target":"_blank"}];
jQuery(document).ready(() => {
let body = jQuery('body');
let header = jQuery('.header-floater');
let observer = new IntersectionObserver(
(entries, observer) => {
entries.forEach(entry => {
/* Here's where we deal with every intersection */
if(entry.isIntersecting) {
header.removeClass('header-floating');
body.removeClass('header-is-floating');
}
else {
header.addClass('header-floating');
body.addClass('header-is-floating');
}
});
},
{rootMargin: "0px 0px -200px 0px"}
);
let observed = jQuery('.header-placeholder-observation')[0];
observer.observe(observed);
})
document.addEventListener('DOMContentLoaded', function() {
var currentYear = new Date().getFullYear(); // Get the current year
var yearElement = document.getElementById('copyright-year'); // Get the year element by id
if (yearElement) { // Check if the element exists
yearElement.textContent = currentYear; // Update the year
}
});
var DIVI = {"item_count":"%d Item","items_count":"%d Items"};
var et_builder_utils_params = {"condition":{"diviTheme":true,"extraTheme":false},"scrollLocations":["app","top"],"builderScrollLocations":{"desktop":"app","tablet":"app","phone":"app"},"onloadScrollLocation":"app","builderType":"fe"};
var et_frontend_scripts = {"builderCssContainerPrefix":"#et-boc","builderCssLayoutPrefix":"#et-boc .et-l"};
var et_pb_custom = {"ajaxurl":"https:\/\/wiegers.ca\/wp-admin\/admin-ajax.php","images_uri":"https:\/\/wiegers.ca\/wp-content\/themes\/Divi\/images","builder_images_uri":"https:\/\/wiegers.ca\/wp-content\/themes\/Divi\/includes\/builder\/images","et_frontend_nonce":"4da144ed90","subscription_failed":"Please, check the fields below to make sure you entered the correct information.","et_ab_log_nonce":"251a5e6237","fill_message":"Please, fill in the following fields:","contact_error_message":"Please, fix the following errors:","invalid":"Invalid email","captcha":"Captcha","prev":"Prev","previous":"Previous","next":"Next","wrong_captcha":"You entered the wrong number in captcha.","wrong_checkbox":"Checkbox","ignore_waypoints":"no","is_divi_theme_used":"1","widget_search_selector":".widget_search","ab_tests":[],"is_ab_testing_active":"","page_id":"2184","unique_test_id":"","ab_bounce_rate":"5","is_cache_plugin_active":"yes","is_shortcode_tracking":"","tinymce_uri":"https:\/\/wiegers.ca\/wp-content\/themes\/Divi\/includes\/builder\/frontend-builder\/assets\/vendors","accent_color":"#a6192e","waypoints_options":[]};
var et_pb_box_shadow_elements = [];
