A lot of people have been making plans for their retirement for the longest time. However, it’s important to be able to do the research early on. Times had changed ever since the olden days when pensions were paid into by companies in order for their employees to comfortably retire at age 65. A key tip is to make sure that you have an active will.
There are several ways to start saving for your retirement. The Registered Retirement Savings Plan (RRSP) is the most traditional way available, but it’s not the only one out there. Here is what you need to know about retirement plans in Canada:
Guaranteed Income Supplement (GIS)
This one is specifically for people who are on the lower end of the income scale. OAS may be supplemented by this as needed. However, there is a criteria for qualifying for GIS. This is based on your tax declarations, specifically income. If you’re unsure, look into investment firms in Edmonton for assistance.
Old Age Security Pension (OAS)
As soon as you hit 65, you will be able to take advantage of this benefit, which is not too known about. This applies no matter if you have been employed in the first place or have present employment. Unlike CPP, this plan is not paid for. The basis for these payments comes from the duration of your Canadian residency.
Quebec Pension Plan (QPP)/Canadian Pension Plan (CPP)
For the entire duration of you earning income throughout your life, you have been making payments to the CPP. When you reach retirement age, you’ll be able to fully take advantage of these benefits. The moment you retire, the Canada Pension Plan Investment Board will be able to start giving you payments on a monthly basis. These are computed through how much you contributed and the entire duration of your contributions. As soon as you hit 70 years old, you’ll be able to cash in at any point.
It should be noted that the payments given monthly, no matter how much your contribution is and however long your period of earning was, will not be able to help you sustain life. It’s crucial to have another source of income during retirement aside from this.
Here are two vital tips when it comes to planning your retirement:
– Address Any Debts and Pay Them Off
Retirement will not be fun or enjoyable if you still have debts to worry about. Make sure you do your best to be able to entirely eliminate whatever debt you have beforehand. If that’s not possible, include concrete steps towards managing them in your retirement plan.
– Have a Realistic Budget
When you start to craft your budget, make sure it’s realistic for your present and future. Ideally, you will be able to live comfortably until retirement.
One of the best things anyone can do at any age is to start investing in their future. This includes learning more about the available retirement plans. Also, create a realistic budget and eliminate any debts.
Looking for help with retirement planning? Contact Alberta Wealth Management today! We are a one-stop financial services company that is fully independent, searching the market to find the best products and services for our clients.