We all know we have to start. It’s inevitable. But it’s hard – you hardly have the time, and you just can’t bring yourself to deal with the confusing (and possibly boring) world of retirement savings.
When it comes to planning for retirement, the truth is that the earlier you start saving, the better off you will be. Whether you just started working or you’re nearly done, you can still potentially grow your savings. Let this beginner’s guide to saving for retirement make it easy for you to boost your savings – no matter your current stage of life.
Focus on starting today
Especially if you’re just beginning to put money away for retirement, you should start saving as much as you can now, and let compound interest – the ability of your assets to generate earnings, which are reinvested to generate their own earnings, work in your favour.
Open a Registered Retirement Savings Plan (RRSP)
An RRSP comes with two key benefits that can help you meet your short- and long-term savings goals. For one, they provide tax-deferred growth – meaning money held inside your RRSP is tax-free until you withdraw it. And two, you can deduct RRSP contributions from your annual income when preparing your yearly tax return.
Rein in spending
Take some time to sit down and examine your budget. You might find a few key areas that you can improve savings on – perhaps you can start making more meals at home, rather than eating out. The goal is to find places to reduce spending so you have more money to save or invest.
Automate your savings
This is where the phrase “pay yourself first” comes in. Make your retirement contributions automatic each month and this will give you the opportunity to grow your savings without having to think about it.
If you have begun saving late or have yet to begin, it’s important to know you’re not alone. And there a several steps you can take to increase your retirement savings. Always remember it’s never too late to get started! Use the following tips to help you get a boost on your retirement savings – no matter where you are in life.