Saving for Retirement

Saving for Retirement

Du sagst mir jeden tag du liebst mich – Fler

One often hears in the news that Canadians fail to save enough for retirement. In economics, saving is defined as future consumption, and also as spending less than income. However, many financial consultants, financial advisers or financial managers may offer important advice on saving for retirement and delayed consumption.

Another fundamental facet of this discussion, is a steady stream of consumption. Indeed, most people prefer a steady consumption stream. In other words, when a person goes from one job to another with a lesser income, or loses their job altogether, personal purchasing power diminishes and consumption becomes much lesser. Furthermore, depending on one’s income, aside from the purely psychological stress and distress that the problematic brings, there are intrinsically financial matters as well, matters to which professional marketers pay great attention.

The sad road for retirement. Photo by Elena

For instance, there are convenience goods and luxury goods. As your income goes up, you become able to afford luxury goods. Whether you are interested in consuming the luxury items and paying a prestige and status conveyance premium represents another matter altogether. Thus, to get back to the first paragraph of the present short essay, saving for retirement is crucial to avoid, or to at least mitigate, the loss of personal purchasing power and the reduced consumption stream.

Luckily, in Canada, there are several investment vehicles allowing individuals to save for retirement. To illustrate, there is the Registered Retirement Savings Plan (RRSP). The plan is registered with the Government of Canada and maximum yearly contributions are fixed. Other forms of saving for retirement involve private banking, and certified financial planners or other finance professionals may be able to advise persons wishing to save money for their retired years.

Alternatively, the Canadian Government also has plans concerning disability and education. Accountants, tax lawyers or other tax professionals are the best to consult on fiscal policies outlining contributions and collapsing of such plans, as well as how these affect one’s taxable income.