Before deciding the ideal investment solution for you, it is important to consider your personal and professional situation, including your income and your dependents. Your short-, medium- or long-term projects and your goals will also have an impact on the best options for you.
Your life projects
Do you dream of travelling the globe, buying the sports car of your dreams or having a dream wedding? Investing in a tax-free savings account (TFSA) is an interesting option for short- and medium-term projects. This savings option allows you to generate returns tax-free and to withdraw the money saved without penalty.
Investing for your retirement
When you enter the workforce, investing for retirement may seem like a futile exercise. Your objectives are unclear, your salary is lower because you’re just starting out, and retirement is years away. You may be likely to put off investing in an registered retirement savings plan (RRSP) because your priorities are elsewhere. An RRSP can provide you with a tax deduction and possibly a tax refund, or lower taxes in the year in which the investment is made.
Good savings habits start by investing early and regularly. Opting for automatic debits can be a good way to reach your savings goals without having to worry too much. Your money will grow over the years and you won’t have to worry about investing at the last minute.
Buying your first home
Do you need access to liquidity to buy your first home? Did you know that you can use the money in your RRSP without being subject to unfavourable tax impacts? Thanks to the Canadian Government’s Home Buyers' Plan (HBP), you can withdraw up to $35,000 from your RRSP to buy your first home without this amount being added to your annual taxable income. You will then have 15 years to pay this money back and you must meet certain eligibility criteria to be approved under this plan. This can be an advantageous option to help you begin this new step in your life on the right foot.
To guide you
A financial security advisor can help you evaluate the best investment option for your situation based on the timeframe for your projects, your investor profile and your risk tolerance. Don’t have an advisor? Find an advisor near you today!