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Planning key for next year

Even if you’re going to miss the March 2, 10:30 p.m. deadline tocontribute to your RRSP, experts say you shouldn’t let yourself getdiscouraged.

Even if you’re going to miss the March 2, 10:30 p.m. deadline to contribute to your RRSP, experts say you shouldn’t let yourself get discouraged.

Whether because of procrastination, a tough financial situation or another factor, missing the RRSP deadline can feel like a painful setback.

Scott Ward, a financial adviser with Edward Jones, says the most important thing after missing an RRSP contribution deadline is to make sure you don’t do it again by analyzing why you weren’t able to put away the necessary money.

“Make a budget. Take a real close look at what expenses you’ve got going out every month and what’s preventing you from saving for your retirement,” Ward said.

Even making a small adjustment, like eating out less, can have a profound effect on saving you enough money to put towards your RRSP.

Mark Coutts, a certified financial planner with Sun Life Financial, says saving a little money on a monthly basis is a better strategy than trying to dump a large sum of money all at once into your RRSP when the deadline looms. If you dropped the ball this year, plan to make your RRSP contribution a monthly commitment next year — after all, you’re in this for the long term.

“If you miss the deadline, you’ve got the entire year of 2009 to look to the future,” Coutts said.

Ward suggests that even if no new money is coming into your RRSP this year, now is a good time to review your portfolio and ensure your money is working for you. Speak to your adviser to figure out if you should make adjustments to your investments.

Coutts says that while missing the contribution deadline can hurt, remember that there are other investment alternatives like the Tax-Free Savings Account, a Registered Education Savings Plan for your kids, or putting money towards your mortgage.

If you’re feeling pessimistic about your savings, Ward says the best thing is to keep your chin up and continue to plan your RRSP strategically.

“Everything’s a cycle. Things will recover and you want to be positioned to take advantage of the eventual recovery,” Ward said.

 
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