Meeting your retirement planning fears head-on


Set up a simple saving plan that is so automatic, you won't even notice it.
Sarah Twomey | Desjardins Group

If you could rate your retirement planning confidence on a scale of one to five, with one being the lowest, how would you rate? Maybe you're like the majority of Canadians who find it very confusing and a bit scary.

So, what would it take to overcome your fear and finally start investing in your future? Similar to starting a diet or quitting smoking, it usually takes a shock to your system to make critical behavioural changes. 

Instead of hitting your financial rock-bottom, why not decide to put your money where your emotion is? You can set up a plain and simple saving plan that is so automatic, you won't even notice you're saving. One easy option to consider is to contribute to your employer-sponsored retirement savings or pension plan:

The pay-yourself-first concept: Your contributions are made automatically through payroll deductions, so it's virtually painless. If you don't have it, you won't spend it.

Tax savings: Your contributions can be deducted before taxes. This means you're lowering your taxable income and your contributions can grow, tax-deferred.
 
Matching employer contributions: Depending on the features of your plan, your employer may also contribute to your plan. This means that you could double your savings.

Choice of investment options: You may have access to a variety of investment options that have been carefully selected by experts.

Lower investment/No transaction fees: Take advantage of group buying power, lower investment management fees and possibly no front-end, back-end or deferred sales charges.
 
Home buyer/life-long-learning possibility: Depending on your plan, you may be able to use some of your savings to purchase a house or return to school.
 
Portability: If you leave your employer, you should have the option of transferring your plan to another investment vehicle or savings plan.

There's so much information about retirement saving that it's easy to feel overwhelmed and avoid it all together. Instead, try this approach:  meet your fears head-on. Make regular retirement saving your goal and you'll end up changing your financial future for the better. 

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