Rethinking your RRSP in the new normal
Everyone’s retirement vision and plan to get there is different – especially now – and TD Financial has some advice for how to adjust in these unprecedented times.
Some Canadians have the option of participating in an employer-led retirement savings plan, while others may not have access to this option or prefer to choose an alternate way of saving for the future.
Regardless of your personal situation, the economic fallout of the COVID-19 public health emergency has caused many Canadians to rethink their retirement plans and assess if they’re still on track to meet their goals.
TD Financial Advisor Mohamad Hannouf offers some tips for those who may be rethinking their retirement plans:
It’s important to truly understand your current situation, current needs and concerns for the future. Many consumers want to know they are on the right track, and they are wondering whether they should be buying or selling.
One of the first things to consider is how financial markets perform long-term. Review your financial plan on a regular basis, such as once a year or whenever you have a major life event, such as buying a home or losing your job. But if your long-term goals – such as saving for retirement – haven’t changed, be careful with adjusting your plans.
Avoid common mistakes
If you attempt to predict the ups and downs of the market, and you find yourself buying and selling at the wrong times, you could find yourself missing out on long-term growth.
A pre-authorized payment plan allows you to make regular contributions towards your RSP, so you don’t need to think about the best time to buy.
Staying focused on long-term investment goals is critical, as the best times for investment growth come after a downturn. Those who sell during a down market could miss out on returns during the recovery.