4 Things to Look for in an RRSP

Pitch Financial Group |

After reading Gordon Pape’s article, “What to look for when investing in an RRSP” I wanted to share 4 key takeaways because it is the season to think about retirement savings.

  1. Long- Term Performance: performance is the first factor you should consider when investing in an RRSP. While past results are not a guarantee of future performance, it can be a good indication of how the fund will perform. As Pape recommends, consider these good indicators:

– Equity based security – return of 8% or more over the past 10 years

– Balanced mutual fund or exchange-traded fund – 6% average annual growth

– Fixed income investment – 4-5% is a good benchmark

  1. Consistency: consistency is key. While you can’t expect the same return every year, it is possible to pick investments that are stable. Balanced mutual funds and ETFs are options that have lower volatility.
  2. Fees: While high fees can affect returns over time, an actively managed mutual fund can outperform a passive ETF. Is that worth it long term? Fees come with service and advice. It can end up making you more money over time.
  3. Risk: Money lost within an RRSP cannot be replaced. Investing in high-risk funds should be done in a non-registered investment – you can write off the loss against capital gains. Investing in your retirement should be well planned and strategized since you will be relying on this money as income when you are no longer working and want the same quality of life.

For more information please contact:

Raymond Pitch CLU LLB
Pitch Financial Group