I am an immigrant in canada and works full time here. I dont have an RRSP account yet. I am 28 years. I have a savings account. Is RRSP a wise decision?
If you set up an RRSP, that is for what I call the sheep. First of all, you hand over your money to the banks so they can use it to make money by paying professional fund managers and investors to invest your money, or enslave someone in debt, and then they give you an unexciting interest rate...Inflation on average is 2-3% a year...For example $1000 in 1990 (24 years ago) would be worth only $607.51 in 2014...in other words you'd need $1,607.51 in 2014 to match $1000.00 in 1990. (Source: Inflation calculator - Bank of Canada)
You have to ask yourself are you making that much in interest? and then you have to factor in tax when you take it out later in life. Not to mention if you have enough in the account the government can reduce how much you get for your pension when you go to retire...even though you paid into the Canada Pension Plan (CPP), you don't get the full amount if you were responsible and saved for retirement...and then you have to factor in the loss of opportunity if you had put your money else where such as in stocks, bonds, real estate, gold, silver... For example Gold was around $380-$400 in 1990...it is now worth roughly $1300 in 2014 a 325% Return on Investment (ROI), divided by 24 years would be an annual rate of return of roughly 13.5%...far ahead of inflation.
It is a very good idea to have such an account and start it as early as you can. At age 28 I would recommend you have the majority or all of the assets in you account in corporate shares and mutual funds.
It's a good idea to have it. For one thing, you can defer your income tax and invest the money yourself for your retirement. You might be able to get $B's out from it.
hi,
I am an immigrant in canada and works full time here. I dont have an RRSP account yet. I am 28 years. I have a savings account. Is RRSP a wise decision?
