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Tax planning

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RRSP period, the perfect time

Since the market downturn of the last few months, many investors may be reluctant to contribute to their RRSPs by investing in mutual funds or other financial products linked to the stock market. 


However, some should consider this decline as an opportunity to introduce additional funds at a lower cost. Others should take advantage of this opportunity to review their investment strategy to ensure that it still reflects their investor profile. A little introspection is therefore in order...

In accumulation mode, it is necessary to take advantage of it

Mutual fund advisors and representatives cannot repeat it often enough: when the markets go down, you must have the reflex to invest and not the opposite! This is even truer for people whose RRSPs will be used over the long term. As long as the investor's risk tolerance level is respected, you should go ahead with your plan. Just as the weather turns from bad to good, so too will the downturns be followed by upswings. Since the investor has several years to grow his or her savings, there will be plenty of time to recoup losses and make gains again.

Pre-authorized chequing and diversificatin:Allies of choice
During the RRSP season, it is not uncommon for investors to inject large lump sums or even take out an RRSP loan to cover their contribution room. In order to avoid making a hole in the family budget (in addition to the one caused by the holiday season that just passed) or getting further into debt, systematic savings become a valuable tool. First of all, it allows you to save gradually without necessarily realizing it and the amount saved fluctuates less significantly in times of uncertainty.

Sound portfolio diversification is one of the golden rules of investing. To achieve this, it is important to hold several types of investments that will generally have different returns over time, which will solidify the portfolio while mitigating risk. Rebalancing is also necessary to ensure that the asset classes remain within the weightings of your initial profile and maintain the same level of risk. A turnkey solution like FÉRIQUE Portfolios provides peace of mind through automatic rebalancing.

In retirement mode, a review is necessary

Investors who are approaching retirement and have accumulated significant amounts in their RRSPs may become fearful during this period of fluctuation, and with good reason. This time of year should be used to implement a disbursement strategy. In addition, if the volatility of the RRSP portfolio causes stress, it is imperative to gradually lower the level of risk and not drastically exit the markets. A panic will only result in losses and missed opportunities for growth when markets are positive. Remember that retirement is not the end of saving. Depending on your financial situation, savings can continue for many years, allowing the RRSP to continue to grow at a more moderate pace.

Whether you are at the beginning of your career or on the verge of retirement, the RRSP period is a good time to review your savings objectives and readjust your investment strategy. So it's time to take advantage of this perfect moment by conducting a thorough analysis of your financial situation with a Services d'investissement FÉRIQUE advisor and mutual fund representative.

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