Tip #1: Get a good financial planner. She or he will be your best investment. A good financial planner will be someone who is a Certified Financial Planner with several years experience working with a team of experts to help you with questions throughout your life. This is someone who can crunch numbers and find solutions. It is rarely black and white. There are many ways to get to your goals. Team up with someone who can highlight the advantages and disadvantages of several scenarios and help you make informed decisions.

Tip #2: When you save for the long-term like retirement, your return needs to at least beat inflation. If you thought that saving in a term deposit is safe. Think again. Term deposits will only pay about 2% currently while inflation is about 3%. Therefore, you are actually loosing 1% per year. Your money looses value overtime and so is your purchasing power. Saving in a GIC or Term deposit gives you a false impression of safety. Invest in good qualify investments to ensure that you beat and exceed inflation otherwise you may find yourself going broke too early in retirement.

Tip #3: Resist drawing from your RRSP even in an emergency situation. Keep your RRSP for long-term accumulation. It is meant to be for retirement and it needs to be there to compound. Keep your long-term money separate from your short-term money. Everyone needs two pots of funds. One to use later in life, the other to use for short-term emergencies or travel or other short-term goals. The long-term money should be invested to beat inflation, the short-term money should be in a high interest savings account away from market risks.

Tip #4: Save 10% of your income for long-term. I know, you have heard this a 100 times. Well, it’s because it is a good rule of thumb. But remember that the older you are, you will likely need to save more. It can vary substantially from one person to another. If you were already smart enough to save a lot or have a pension plan at work, you may not need to save as much. It also depends on your lifestyle and how much of it you want to keep during retirement. To be sure of what YOU need to save, you need to calculate it. Contact us. We can help. You can also go on our website and request an online calculation. But it is never as good as a full planning analysis of your situation.

Tip #5: Are you getting ahead?  Make a habit to update your net worth statement once a year.  December is a good time to do this.  A net worth statement outline your assets and your liability.  The difference equals what you are truly worth.  Did the numbers improved from last year?  Are you growing assets and reducing debts?  Where do you want to be next year?  Looking at the big picture helps the planning process.  It feels awesome and encouraging to confirm our progress.  Make a recurring event in your calendar to update your net worth every December!  If you need a template, contact us.  If you come in for a meeting every year, we will do one for you!

Tip#6: If it is too good to be true, it usually is. This person is going to jail for following a stupid “tax is unconstitutional” scheme”. Sorry, everyone needs to pay tax. That’s how we get to live in this great country with wonderful benefits. There are lots of legal ways to reduce taxes. Play smart and honest. That is the good old time tested way to get ahead.