Focus on RRSP Schedule

Good Money™ shows you how to make the most of your RRSP contributions.

1. Start early
   The more time your contribution has to compound, the bigger it will grow. By putting away some of your hard-earned money today, you could be securing thousands of extra dollars tomorrow.
2. Start small if you have to
   Even small contributions can make a big difference – to your retirement savings, and also to your annual tax return.
3. Pay yourself first – you deserve it!
   Set up a Pre-Authorized Contribution plan for your RRSP. Every month, you automatically withdraw a pre-set amount from your chequing account and contribute it to your RRSP. That way, your contributions have more time to compound, and you’ll avoid having to scramble for extra cash during RRSP season.
4. Estimate how much you’ll need
   It’s hard to plan if you don’t know what you’re planning for. We have an online retirement planner and other resources that can give you an idea of how much you’ll need to save to reach your retirement goals. Using them will help you create specific, concrete savings goals.
5. Maximize your contributions
   Doing so allows you to take advantage of one of the best tax sheltering opportunities available to Canadians. It also gives your savings more time to compound.
6. Short on cash? Lots of unused contribution room? A short-term RRSP loan can make sense
   Borrowing to make your RRSP contribution can make financial sense, particularly if the deduction will generate a sizeable tax deduction—you can use your refund to pay down your loan faster. Vancity offers competitive rates on short-term RRSP loans. Learn more here.
7. Diversify, diversify, diversify
   Your RRSP portfolio should be well-diversified among equity, fixed-income, cash and other investments, preferably from different geographic markets. What’s the right amount of diversification? That depends on your personal financial goals and risk tolerance. Talk to a Vancity Investment Professional to learn more. Call 1.888.Vancity (826.2489) to book an appointment.
8. Make sure to name a beneficiary
   Doing so could help your estate save thousands of dollars in probate fees. Also, if you name a “qualified beneficiary” (a spouse or common-law spouse; a dependent child or grandchild under 18; a dependent child or grandchild over 18 with a disability), you can transfer the full value of your RRSP without paying taxes. How good is that?
9. Two RRSPs may be better than one...
   Do you make significantly more income than your spouse? If so, consider a Spousal RRSP. By splitting retirement income among two people, you’ll reduce the total income tax you’ll pay as a couple. Depending on your individual circumstances, you may also retain eligibility for government retirement benefits as well. Learn more here.
10. What ELSE can your RRSP do?
    Good Money believes you can make investment decisions that deliver positive financial returns and positive social returns at the same time. By investing your RRSP in companies that are making a positive impact on the environment, social equality and corporate responsibility, you get performance without compromising your principles. It’s called Socially Responsible Investing, and you can learn more here.
11. Ask for professional help
    Your retirement plan is the roadmap to your financial future. As such, it shouldn’t be something you just do in haste. If you feel overwhelmed by the intricacies of retirement planning, ask for professional help and get the advice you need.