First home savings account: A Gen Z guide to achieving home ownership + MORE Mar 29th
3 sectors to consider investing in when the stock market is volatile May 3rd
How annuities work in Canada + MORE Apr 18th
Where should working retirees put extra income: A TFSA or an RRSP? Jan 11th
Contribute to RRSP or pay off mortgage? Oct 12th
How much to take out of your RRSP in your 60s
– moneysense.ca
Locked-in RRSPs, defined contributions (DC) pensions, and deferred profit sharing plans (DPSPs) all have the same rule requiring conversion at age 71.
The two big questions for a retiree prior to age 71 are: When should I start withdrawals? And how much should I take out each year?
If we take a simplistic approach to the RRSP drawdown, a sustainable withdrawal rate may be 2% to 5% of the account value. That is, between 2% and 5% of the starting account value may be withdrawn each year with subsequent withdrawals increased each year with inflation for life. There are many asterisks depending on age, life expectancy, investment risk tolerance, investment fees and other factors…
Why GICs are a good addition to an RRSP or a TFSA
– moneysense.ca
How GICs work
When you purchase a GIC, you agree to leave a deposit with the bank for a certain amount of time—the term—and in return, the bank agrees to pay you a guaranteed interest rate. The key word here is “guaranteed,” meaning that you aren’t at the mercy of market fluctuations, and 100% of your principal is protected.
As long as you don’t withdraw your money during the term, you’ll earn that rate when the GIC reaches its “maturity date,” or the end of its term. The exception is redeemable (or cashable) GICs, which you can cash in earlier—more on that below…