The RRSP deadline is just around the corner and many Canadians are thinking about putting money into their RRSPs and this is a good thing, because like it or not, all of us will, at some point in the future, retire (as in stop working) and will need income that will hopefully last until we depart this earth.

The question you should be asking yourself when you make your RRSP contribution this year is not how much money will you be getting back when you get your taxes done (although getting money back from the government is great); but rather how much income will you have when you retire.

If you participate in your employer’s pension plan (including a government pension) you may have a good idea of what your income (for the rest of your life) might look like when you retire.

Whether or not your retirement savings plan includes pension funds RRSPs, CPP and OAS, there are two questions you should be asking yourself with respect to what is likely to happen whenever you decide to retire:

1. What will my income be on a monthly basis when I retire?
2. Will that income continue monthly for the rest of my life?

With respect to RRSP contributions, many Canadians simply go to their bank and make a deposit, or they do it by monthly contributions, or they speak to their financial advisor who advises them to place their money in some form of investment vehicle, whether it be mutual funds, segregated funds etc.

Typically your bank, financial advisor or investment broker can’t tell you today how much income your RRSP will provide in the future, and as such, you really have no idea how much income you will have when you retire, and no idea if that income will be sufficient to support you for the rest of your life.

There is a product that can tell you TODAY and also GUARANTEE what your minimum income from the day you retire until you pass away will be, regardless of what the markets do.

It is called Guaranteed Minimum Withdrawal Benefit (GMWB) and it is only offered by a few insurance companies in Canada (not available from banks, mutual fund or trust companies) , and can be held in RRSPs, TFSAs, and Non-registered investments.

Your financial future is too important to leave to chance, implement your plan today

Karl Marshall
Marmac Financial Services Limited
Tel: 416-554-0892