RETIREMENT - SAVING AND INVESTING

As we age our challenges often increase juggling a salaried income with ever increasing costs of living. Life happens and we forget to research and study. Then turn over our savings or portfolio to someone to manage on our behalf. I know a few 80 year old widows that still research the stock market and invest aggressively. Even though the government says inflation is down, its only down on energy, technology, materials and commodities. 

Over the last 18 months the cost of grocery items specifically food doubled in price. If you have a family of six adults to feeds that can get very expensive. Any fees that you can save will help build up that nest egg much faster.  Your money may start to accumulate and want to know where to go what to do next? Do I work with a financial adviser or do it my self?  If you pay $200 per month in some form of management fees ($2400 per year) for 40 years compounded at 4% = $238,168.22. You could save this much more by learning to manage your investments your self. CAUTION: you will have to learn to manage your investing emotions and behaviour and only buy low and sell high. Easier said than done. Buying low then selling high is the hardest behaviour to master as you're wrestling with that beast called unconscious behaviour bias. We'll be talking a lot about unconscious behaviour bias as it causes much of the upset and irrational behaviours in our daily lives.

We were taught to save into a RRSP pension account as governments around the work are increasingly short of cash they are all eyeing our pension savings accounts. There are good and bad sides to RRSP pension accounts. I know for many folks its the only way to save. There will be a day of reckoning for RRSP account owners.

Money gets easily distracted, looses focus and needs managing

1. If you have an RRSP pension account the government will eventually become a beneficiary of your estate. (will permanent life insurance help?)
2. Save into a TFSA. No taxes here as your money passes tax free to your partner, family then estate
3. Save into an open investment account. For now capital gains in these are taxed at the lowest rates
4. Learn how dividend income is taxed at a much lower rate
5. Over paying your mortgage means you have less savings and your money has less time to compound and grow
6. You can become quite wealthy saving and investing larger amounts when you are young
7. Dealing with SIGNIFICANT debts when you are 40 to 60 can ruin your health
8. Delay lifestyle purchases to stay within your budget