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BlogNewsConvincing millennials to invest in an RRSP

Convincing millennials to invest in an RRSP

Friday, February 26, 2016

Convincing young people to invest in a long-term strategy like an RRSP is hard. But if they do, they have everything to gain! Here are a few tips to help them see the light:

1- Their retirement will be as long as their working lives!

The life expectancy for Quebecers born in the 1990s is 79 years for men and 84 years for women. Retirement for members of generation Y could last for 20, 30 or even 40 years. Young people have to enough money put aside in savings to maintain a reasonable standard of living for what could be decades.

2- Inflation, something you have to think about!

According to the Bank of Canada, $1,000 invested in 2016 will be worth $782.16 in 2066. To maintain the same lifestyle in retirement as we enjoyed during your working years, everyone will have to save more.

3- Interest on interest

An optimal investment strategy can help investments grow, big time! By investing an additional amount each year just for retirement, an investment advisor can invest this amount, based on the client’s preferences, in stocks and funds that can grow with time.

4- RRSPs are not just for retirement!

RRSPs can be used to jump-start two types of projects:

  • Going back to school, using the Lifelong Learning Plan
  • Buying a first home, using the Homebuyers’ Plan.

Contributing to an RRSP has many benefits, and this has to be drilled to the younger generation, who tend to skim over this entirely. RRSPs also help you pay less in taxes!

Sources:
http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/health26-eng.htm
http://www.bankofcanada.ca/rates/related/investment-calculator/?
www.conseiller.ca/nouvelles/retraite-la-generation-y-nepargne-pas-assez-56292

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