It’s a Pivotal Time?

There are some financial decisions to consider when you turn 65 and 71—a financial planner can help remove the guesswork.

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What Financial Steps Do I Take at 71?

When you turn 71, there are certain steps you need to take with your RRSP. A financial planner can help with your options.

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5 Tips for Your 71st Year

1.Top Up Your RRSP

Before the end of the year, make your final Registered Retirement Savings Plan (RRSP) contribution—and make it as large as you can. Keep in mind, you don’t have until March of the following year—your contribution must be made by December 31.

2.Consider Over–contributing

If you earned income this year, you may want to over–contribute to your plan in December before you wind it down. The amount would be whatever you’re entitled to contribute based on your earned income.

While you will have to pay a 1% penalty for the month of December on the over–contribution, the tax savings will far outweigh the penalty.

3.Have Unused Contribution Room? This Is Your Last Chance

If you have unused contributions from previous years, now is the time to catch up and max out, if you can.

4.Continue Contributing To Your Spouse’s Rrsp

If your spouse is not yet 71, you can keep contributing to his/her RRSP until they turn 71, provided they have the contribution room.

5.Delay Withdrawing From Your Rrif

If you like, you can put off withdrawing from your Registered Retirement Income Fund (RRIF) until the end of the calendar year after it is set up. That means your savings will have more time to grow on a tax-deferred basis.

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RBC Financial Planning is a business name used by Royal Mutual Funds Inc. (RMFI). Financial planning services and investment advice are provided by RMFI. RMFI, RBC Global Asset Management Inc., Royal Bank of Canada, Royal Trust Corporation of Canada and The Royal Trust Company are separate corporate entities which are affiliated. RMFI is licensed as a financial services firm in the province of Quebec.