Start early in life

When you start contributing to your RRSP earlier in life, you’ll allow more time for the income earned in your RRSP to compound. You may also find that you can make a smaller total investment in your RRSP, and still be further ahead.

One of our recent surveys indicates 87% of Canadian baby boomers wish they had started saving earlier for retirement, even in their teens.

For example:

Lakshmy, age 30 contributes $1,000 a year until age 65* earns 6% average annual compounded return total RRSP investment: $36,000 total worth of RRSP at age 65: $126,268   Shawn, age 45 contributes $2,000 a year until age 65* earns 6% average annual compounded return total RRSP investment: $42,000 total worth of RRSP at age 65: $84,785

At age 65, Lakshmy's RRSP is worth significantly more than Shawn's primarily because Lakshmy's RRSP had more time for a compounded return on his investment. * Assumes contributions made at the beginning of each year. The above example is for illustration only. While care is taken in the preparation of the calculations in the illustration and examples, no warranty is made to their complete accuracy.

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