Real advice for investing: your questions answered

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One of the best ways to increase your income and achieve your financial goals is through investing, but taking the first step in any investment journey can be daunting. That is why Capital of the Coast, Canada’s largest credit union by membership, is here to answer the investing questions that keep you up at night and provide the real advice you need to make sure you’re on the right track. .

With Canada’s inflation rate at an all time high, how can I save enough money to start investing and protect my portfolio from the ups and downs of the market?

Capital Savings Coast

While inflation drives up the price of almost everything around us, more than half of Canadians feel they cannot afford the cost of living. If your household budget is tight from all angles, starting to invest can be difficult. But it’s never too late to start and no amount is too small. So where to start ?

You can start by considering short-term or medium-term investments such as a guaranteed investment certificate (GIC) or a Tax-Free Savings Account (TFSA). GICs are term investments, which means that you deposit your money for a certain period of time, ranging from one month to 10 years or more, in exchange for a higher interest rate, payable when the GIC matures at the end of the selected term. period.

If you’re looking for more flexibility, you can also explore a TFSA, a savings account where any interest you earn is tax-free. Although contributions are not tax deductible, earnings and withdrawals are not subject to tax, which can help you increase your income and prepare for a better financial future.

It’s also important to keep in mind that your income and risk tolerance will change over time, as will your goals. Making adjustments based on your position and market behavior is part of the process.

I’m finally ready to invest, but I’m pretty risk averse. How can I start risk-free?

All investments carry some degree of risk, so determining your financial risk tolerance is critical to your success. Consider factors such as your age, timeline, goals, life stage, and existing savings, as these can help you think about the level of risk you can comfortably handle. Generally, the longer the timeframe, the more you can handle market fluctuations and risk.

Your risk tolerance will determine your asset allocation – the process of allocating the money you have in your investment portfolio between equities (high risk investments), fixed income securities (low risk investments) and cash needed for your day-to-day business. day life. Addressing a Financial Advisor is a great way to start the process. They can also help you navigate the ups and downs of the markets, provide you with real advice, and find the investments that match your risk profile and goals. There are also great free online tools like Coast Capital’s Money talkthat can help you understand your current financial health, where you want to go and how to get there.

What percentage of my income should I invest in my RRSP each year?

Coast Capital Investment Advisory

Capital Savings Coast

Aiming to contribute at least 10% of your gross income to retirement savings each year is a good rule of thumb. However, your contribution will depend on several factors, including the age at which you wish to retire and the rate at which you are able to save. There are tools to help you figure out how much savings you’ll need for a comfortable retirement, like Coast Capital. Retirement Planner Calculator. From there, you can go back to indicate your savings goals.

While many Canadians focus solely on RRSPs, it’s a good idea to also consider using a TFSA to build a well-rounded retirement plan. The main advantages of this approach are that contributions to a TFSA are tax-free and withdrawals can be made at any time. Additionally, the TFSA contribution limit is $6,000 per year for each person over 18 and unused contribution room is carried over (unlike RRSPs), providing additional flexibility and room for growth.

I am a new resident of Canada at 35 years old. How can I start saving for my retirement to prepare for a better financial future?

It’s never too late to invest. From stocks and bonds to mutual funds and ETFs, there is a variety of options choose which can help you achieve your medium and long-term goals. Start by determining the type of investment account that’s right for you. With a TFSA, you can grow your investments and have the flexibility to withdraw your money at any time. An RRSP allows you to grow your nest egg and reduce your tax bill until you withdraw.

Your income might not get you far, but your financial goals – whether it’s an emergency or contingency fund or savings for your retirement – can be achieved when you use the tools at your disposal to save and invest effectively. And remember, you don’t have to do this alone. Tools and expert advisors are available to help you understand how to get started.

Still have questions ? Submit them anonymously via the form below and they will be answered in pragmatic articles published on Daily Hive in the weeks to come.

This is an estimate based on guidelines at the time of publication.
This article is provided for general information only. It should not be considered as advice or a financial, tax or investment guarantee on the future, nor be considered as a recommendation to buy or sell. The information in this article, including information relating to interest rates, market conditions, tax rules, fees and other investment factors is subject to change without notice, and Coast Capital Savings Federal Credit Union is not responsible for updating this information. All third-party sources are believed to be accurate and reliable as of the date of publication, and Coast Capital Savings Federal Credit Union does not warrant the accuracy or reliability of any such sources. Readers should consult their own professional adviser for specific financial, investment and/or tax advice tailored to their needs to ensure that individual circumstances are properly considered and action is taken based on the latest information available.
Coast Capital Savings Federal Credit Union provides advice and services related to deposit, loan and mortgage products. Coast Capital Wealth Management Ltd provides investment and financial planning services. Coast Capital Financial Management Ltd. provides advice and services related to segregated funds, annuities and life insurance products. Worldsource Financial Management Inc. provides mutual fund advice and services. Mutual funds are not guaranteed or insured by any financial institution, government or other deposit insurer. Mutual fund values ​​change frequently and past performance may not be repeated. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Important information about mutual funds can be found in the relevant Fund Facts and Simplified Prospectus. Please read the Fund Facts carefully before investing.
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