Well, the Christmas and New Year's indulgences are finished for another year, the office parties "incidents" have blown over and you are probably due for another visit with your family members...this coming Family Day long weekend. Of course, that means it is that time of year - RRSP season!
Soon, if not already, you will be bombarded with commercials, calls from your bank, or the annual "Hi [insert client name here] how are you?" from your non-existent financial advisor (yes the one that sends you statements four or 12 times a year and is full of excuses).
Among many of the decisions are RRSP versus TFSA contributions, tax reduction from RRSP versus none from other vehicles, RESPs, do I pay down my mortgage first, do I borrow, etc? So many questions, and yet Canadians only give a tiny amount of time to address these critical issues (due to our illnesses of Twitter diarrhea, Netflix over-consumption and Facebook-itis). Yup, Canadians would rather wake up everyday and know about the latest trending video of kittens on Youtube rather than take 30 seconds to "look into" their retirement savings accounts - even just to know the number was higher or lower than the day before.
I have my own information and opinions on the aforementioned, some of which I have shared in previous posts (ETFs being the biggest topic of discussion, while fees to another broker are a RETURNS KILLER!). As such, from the Financial Post yesterday, I never realized the following should be given a much higher priority!
One of the most important features of an RRSP (that is a Registered Retirement Savings Plan - a previous article that was posted compared this plan to a "toy box" and you put "toys" such as bonds, stocks, ETFs, etc into the toy box or plan) - "RRSPs are one place the creditors will never be able to grab your money".
There are many methods and outlooks of investing. I prefer to select stocks/shares with a "cautious optimism", while another method of investing includes complete pessimism and investing for a worst case scenario - that is, bankruptcy. In this case, if you are facing the "do I contribute to my RRSP or TFSA" decision that BNN will over inflate in the coming weeks, keep this very important point in mind. Again, it is not highlighted by our robotic mutual fund representatives at the banks and financial advisors that call clients once a year.
http://business.financialpost.com/personal-finance/retirement/rrsp/rrsps-are-one-place-the-creditors-will-never-be-able-to-grab-your-money
