- So what is the point of RRSPs anyway?
- The best strategies for your RRSP and TFSA when money’s tight
- Will Malcolm (66) and Catherine (64) run out of RRSP gas?
- Borrowing for your RRSP: Here’s how to calculate how much you’ll need
- Slap your hand if it dips into the RRSP jar
- How RRSPs are like social media (Jan 29, 2014)
- For young people, debt might come before RRSPs (Jan 28, 2014)
- Should you raid your RRSP to pay debt? (Jan 13, 2014)
What’s Missing?The sheer volume of RRSP information quickly overwhelms. The contradictions don’t help. For instance, The Globe and Mail tells you how to borrow for your RRSP and the Toronto Star says don’t borrow. How do you decide?
Consider a unified voice, especially if you want to learn well. A book helps. Bruce Sellery’s Moolala Guide to Rockin' Your RRSP: Start Rockin' in Five Easy Steps (Amazon link) makes an excellent choice.
I first met Bruce at the 2013 Canadian Personal Finance Conference organized by Preet Banerjee and Krystal Yee and then at the 2014 Art of Sales. We’ve exchanged numerous emails in between. Bruce has an engaging personality, high energy and breezy way of communicating the complex. You’ll see that in his book.
Why write a book?Writing a book takes time and too few read regularly. Since RRSPs are most discussed during January and February, the market seems small. Why not write a book with broader appeal which includes RRSPs as a component?
That seems like a wiser strategy. Bruce already wrote a general book called Moolala: Why Smart People Do Dumb Things with Their Money - and What You Can Do About It. Maybe that's why he decided to specialize this time. This video lets him explain.
Why read it?A book that’s only about RRSPs would be shorter and (probably) boring. Bruce’s book is about much more.
Bruce asks a simple but powerful question: why are you saving for retirement.
He’s saving for adventure, which includes travel. Unless you know your why, how motivated are you to save? A distant goal must be compelling to move us. Saying you want financial security during retirement may not be enough. That’s vague. A vacation or new car or home renovation is often much more tempting.
You ParticipateBruce includes many quotes from real people. That's unusual and effective. The book feels interactive and engaging — a workshop, rather than a lecture. Bruce encourages you to write in the book, which makes it more like a workbook (see write a workbook instead of a book). You’re then more likely to act and less likely to lend your copy — more sales!
Myths About Retirement IncomeBruce starts by tackling beliefs about retirement income, which you might share:
- “The government will cover the basics”
- “I can’t afford to save for retirement right now”
- “I’ll just work longer”
- “My family will provide for me”
- “My retirement plan is simple: I won’t need much”
- “My house is my retirement plan”
He only leaves out lotteries, which 34% hope to win. How likely is that? There’s a much greater chance of getting disabled before age 65. The likelihood for a 30 year old nonsmoker is 36% for males and 41% for females. Too few worry about this (use the risk calculator from Manulife yourself).
It’s easy to be optimistic ways that cause financial harm.
Five StepsBruce gives five solid steps for retirement financial planning.
- Lay the foundation
- Determine how much you need
- Develop the plan
- Take action
- Stay engaged
ActUnless you’re one of the few with a secure defined benefit pension plan, you need to take steps to prepare for retirement on your own.
A secure tomorrow requires sacrifices today. We know that but don't always take the steps. Bruce helps you build good habits that can help you for the rest of your lives — even if you win the lottery (and don’t get disabled).
- Bruce Sellery: moolala.ca, @brucesellery, MoneySense
- How to rock your RRSP (Cityline video)
- Secret 7: The best tax sheltering in Canada
- Will you have financial freedom at 35, 55 or 75?
- The four steps in wealth management
- The first rule for financial success