When should you start contributing to an RRSP?
It’s very important to save for your future and knowing whether an RRSP is the right savings vehicle for you depends on your personal financial situation. It’s best to talk to a financial planner and let them assess your needs.
With Canada’s tiered taxation rates, RRSPs allow for the development of strategies to reduce taxable income during high earning years (i.e. contributions while employed), while paying tax when you begin making withdrawals in lower earning years (i.e. retirement).
By investing early and contributing regularly, even if a small amount bi-weekly or monthly, returns will be compounded over time, which will maximize the benefit of this savings program for you.
They say a picture is worth a thousand words. Take a look at the graphs below to see how your investment could be worth hundreds of thousands of dollars by the time you reach the age of 65.
It’s never too late to begin investing. If you’re interested in learning more about RRSPs, contact Westoba today and make an appointment to speak with a financial planner!