Retirement Planning – It’s never too early

A young, fresh recruit you are, then why start planning for something four decades down the line? Well, the earlier you start planning and eventually, saving, the better your sixties and further decades become. It’s good to not worry about old age and the present to the fullest, but it should not be confused with ignorance and a mere plan should be put into motion.

Suppose you started saving now and by the time your future grandson graduates, you could be congratulating him via video call from a vacation resort in Hawaii. Imagine another scenario where you start saving fifteen-twenty years later. Your future grandson graduates and you receive the news on your landline (if that exists in that era) while watching some reality show on your obsolete television set. It’s your call to make.

You need to save. The question is – how much?

That solely depends on how you want to spend your retirement days. The above examples can be taken into account to elucidate the answer to this query. But, the exact figure calculation may prove tougher in practicality. No worries! You can go online and make use of certain retirement calculators that help you plan your savings and your intended retirement.

Another way of raising more funds would be to work post retirement age, although that depends on whether you willingly wish to labor and stay in the condition to do so. Employers don’t usually hire elderly masses, but that orthodox belief is changing gradually. You could continue working for someone or could run your own business or firm if you manage to accumulate enough money to be invested. These methods can help you grow your retirement funds and live a peaceful life ahead. For more details on retirement savings funds and other relevant details, check out icash.

Okay! Savings sound relaxing, but how to save?

There are several options to save money, such as the most common Savings accounts and GICs. These are optimum for regular savings, but retirement funds need a different approach to saving. The pioneers in saving for retirement are Registered Retirement Savings Plan (RRSP) and Tax Free Savings Account (TFSA).

Now, which one to opt for?

Again, the choice depends solely upon your discretion and the income you generate over the years. RRSP, as the name suggests, is optimal for exactly retirement purposes as for early withdrawals count as taxable income, while you can withdraw from the TFSA for miscellaneous purposes. RRSP requires you to be disciplined and calm. Withdrawals from TFSA aren’t penalized but the returns are also not at par with the returns via RRSP. So, to be put in a shell – RRSP is right for the long run, a choice that requires discipline and patience while TFSA is an option for the cautious minded, who expects risks and gambles in the years to come. A higher income can support the choice of RRSP while a relatively low income emphasizes upon the importance and existence of TFSA. If you face problems while making a choice, then consult an expert.

Leave a Reply

Your email address will not be published. Required fields are marked *

+ sixty six = seventy