When you live pay cheque to pay cheque, saving money could be a chore. With rising living cost and inflation, it is worrying to think about retirement. Thankfully, the government has retirement savings plans for your old age.
There are three types of retirement savings plan.
While each program differs, the goal is to make keep more money for your retirement. We at Life 100 are right with you for that purpose. Let’s check out various savings plans that’s right for you.
At life 100, we ensure a smooth transfer of wealth, with minimum taxes and delays, to maximize the benefit you leave to your loved ones or charities of your choice. With our extensive experience in retirement plan management, we can help you find the right solution for your estate and your loved ones.
Registered Retirement Savings Plan, known as RRSP, helps you save money for retirement. As long as you are below the age of 71, you are eligible. With special tax advantages, your contributions to this plan are tax deductible and any taxes on investment growth will be deferred till you withdraw those funds. What more? The earlier you invest, the more money you make. Compounding interest helps a lot in RRSP. You’ll always have more income for your current needs.
Tax Free Savings Account (TFSA) allows you to save money without paying taxes on the growth. As long as you are above the age of 18, you could save up to $5500 every year in TFSA. All contributions will not be tax deductible even when withdrawn. In short, TFSA is a tax-efficient way to increase your savings way beyond what you have in RRSP.
What happens after you turn 71? This is where Registered Retirement Income Fund (RRIF) comes in. You can convert your RRSP savings into RRIF without tax liability to establish a source of retirement income. With many RRIFs you can vary your annual payments above the minimum required amount to meet all your needs. Moreover RRIFs can continue for the lifetime of the holder. RRIF is a excellent savings vehicle where you can keep your savings tax-sheltered and generate a stream of stable income. Our advisors at Life 100 could guide you through this process.