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Countdown to Retirement – RRSPs…a Bright Idea!

January 16, 2020Living in Retirement

According to an H&R Block Canada Inc. 2019 study, only 26% of Canadians are planning on taking advantage of a Registered Retirement Savings Plan (RRSP) this year, a decrease from last year’s 33% that planned to contribute. If you are hoping to retire soon it is time to start planning to determine if depositing to an RRSP is right for you.The deadline is right around the corner to make your 2019 tax year RRSP contributions.

RRSP deadline tips to keep in mind:

  • March 2, 2020 at 11:59 p.m. is the deadline for 2019 tax year contributing to investments in your RRSP.
  • The maximum contribution room for 2020 will depend on your earned income in 2019 (minus your pension adjustment if applicable).  You will be able to find your personal maximum allowable contribution on your most recent notice of assessment from the Canada Revenue Agency (on line (A) of the RRSP Deduction Limit Statement).
  • You can carry forward unused contribution room from prior years.
  • You can fill your unused contribution room in a single year or over a number of years until the end of the year in which you reach age 71 (or the end of the year your spouse/common-law partner turns 71, if he or she is younger).The key is to understand your budget, taxation status and your financial planning goals. If one-time contributions into your RRSP are not easy to save for, consider setting up a monthly contribution. The monthly contributions can be adjusted at any time.

It’s never too late to start building a plan that will give you peace of mind as you look ahead to retirement.  For customized financial planning strategies contact your FaithLife Financial Representative who will help you to be wise with your money so you can feel confident about your finances.