The secret to making effective use of RRSP contributions revolves around compounding interest! Contact a financial planner at Walton Financial Group to book a consultation.
The Walton Financial Group in Barrie, Ontario has advice for making RRSP contributions
The secret to making effective use of RRSP contributions revolves around compounding interest. Your money earns on its money! When you’re young, taking advantage of compounding interest on contributions can be critical for reaching retirement goals 25 to 30 years down the road.
If you’re not in a position financially to contribute as much as you’d typically like this year, there are strategies to keep your retirement savings on track.
In the short term, try to put just enough money into your RRSP that will drop you into the next marginal tax bracket. This way, you’ll be paying a lower tax rate with a reduced taxable income.
But rather than trying to put in a large lump sum in the next three weeks to hit your savings goals, Walton Financial Group recommends taking whatever amount you’re short this year and breaking it up into digestible monthly payments over the next year or two.
What’s important is “flexing that savings muscle” and staying in the habit of monthly contributions — even if those deposits are smaller than you’d like in a tough economic time.
Call Walton Financial Group in Barrie, Ontario and speak with a retirement planner to get the best plan in place for your RRSP contributions.
