As we head into 2018, a plan for your RRSP contributions and investing should become top of mind – we can help ensure you maximize the allowable benefits.
Each year, the contribution limits for RRSP investing change. For instance, for the 2017 taxation year you need to know:
Deadline: March 1, 2018
Contribution Limit: 18% of your earned income in the preceding year to a maximum of $26,010
Although the deadlines and contribution limits are straightforward, RRSP investing requires a bit more planning that just these details.
What Factors Should Be Considered?
We believe strongly that you need to consider other factors, such as the length of time until your retirement, your risk tolerance, and how an investment in an RRSP account fits into your total investment picture.
Investment Choices For Your RRSP
The types of investments suitable for holding inside your RRSP are almost as varied as any non-registered investment account. There are a few exceptions which include very high risk investments, but for the most part, any combination of stocks, bonds and GICs that meet your risk tolerances and investment objectives can be held in an RRSP account.
All of the capital gains, dividends and interest accruing in these accounts is tax free until funds are withdrawn from them. Ask us about which investments would be right to hold in an RRSP account that may help you achieve your investment goals.
What About Planning Ahead to Next Year?
Planning ahead for the upcoming year, you may want to consider making monthly payments to your RRSP account. The compounding effect of making monthly payments over a longer period of time can have a significant impact on your rate of return. And ... it relieves some of the pain of pulling together a large contribution at the last minute.