Start Saving Early
When you begin investing early in life, your money has more time to compound. This compounding effect adds to your accumulated savings. Therefore, the earlier you start building your RRSP, the smaller your total investment needs to be to fund your retirement years.
Diversify your assets
Studies show that proper diversification of investment assets helps increase overall returns, while at the same time reducing market risk.
Stay on course with contributions
A common rule of investing and saving is “Pay yourself first.” If you develop the habit of putting money every month towards your future, you’re more likely to achieve the retirement lifestyle that you want. Another important reason to make regular monthly contributions is that you can benefit from an effect known as dollar-cost averaging. Since asset prices rise and fall over time, a strategy of frequent, equal-sized investments means you’ll buy more investment units when prices are cheaper and fewer when prices are more expensive. This approach tends to produce more robust growth in your portfolio.
Use catch-up contributions to save more rapidly
If you have contribution room in your registered savings account, it can be financially advantageous to use extra money that you have on hand to make catch-up contributions. This will increase the size of your savings nest egg, while further reducing your taxable income.
Devise an income strategy to outlast your retirement reserves
If you are getting close to retiring, or are recently retired, now is the time to think about developing a strategy that seeks to generate income from your retirement portfolio.