In my last article, I wrote about the benefits of a buy and hold strategy where an investor stayed in the market through the ups and downs of a particular investment.
A common piece of advice for investors is that long term success doesn’t hinge on timing the market. It’s time in the market that may make the bigger difference.
Provide a tax efficient income stream for your surviving spouse
Like many Canadian business owners, you may be holding money in your corporate account in GICs and other short-term investments to avoid market downside risk. Consider segregated funds as an option in your corporate account to maximize investment returns and get efficient tax and estate planning.
Bill and Rosalind are friends of Sam and Christine, whom you met in this article. They live in Halifax. Bill died of a stroke just before his 70th birthday. He had named his common law partner, Rosalind, as beneficiary of his Registered Retirement Income Fund (RRIF) via his will, which he had set up earlier in the year.
Sam and Christine live in Moncton, New Brunswick. Sam is celebrating his 71st birthday this year. He has held on to his Registered Retirement Savings Plan (RRSP), optimizing the tax sheltered benefits of doing so. He named his wife Christine as beneficiary of that plan. Sam wants to convert his RRSP to a Registered Retirement Income Fund (RRIF).
Tom and Sharon have been together for about 8 years. This is a second marriage for both of them. Tom is semi-retired; Sharon is a retired schoolteacher. The couple are both wary investors; they still feel the pain of the big market correction in 2008–09. They moved their investments to segregated funds for the insurance guarantees including the ability to reset the minimum guarantees based on the growth on their investments.
The next retirement myth is an example of an inter-generational issue. It also goes back to the issue of when to start making and funding plans for retirement.