8 thoughts on “Are RRSPs Really Beneficial?

  1. I have always been taught to invest in an RRSP as soon as I started working fulltime. Thanks for opening my eyes up! When did you first know that RRSPs was not good?

    1. Your both incredibly incompetant, due to the fact that the limit is 5000 for TFSA now in 2013 its 5500. So what your saying is put your money in a BANK, where they can leverage your money, or put your hard earned cash under your mattress because inflation will not get at that. It all depends on the clients risk tolerance. Every Canadian has 2 options PAY the government or Pay for your retirement. Because with the economy being what it is, what are the chances that CPP, OAS etc will still be available, i hope you all take his advice and in the end when your 65+ you are all broke and need government help. KUDOS to you.

      1. If I read correctly, your advice is to put money under a mattress.

        “Inflation” will get at your mattress stash whether you put it in a bank or not. Inflation can be increase of prices and also the decrease in value of your money through increase money supply. So, if your mattress money has absolutely no returns then you’re actually losing even more to “inflation”. Ok, there are probably pro’s and con’s in terms of safety with keeping your money or other assets under a mattress, but that’s a different point.

        Regardless of whether you put money in a registered account (TFSA, RRSP, RESP, etc) … who’s to say the FI isn’t leveraging it anyways?

        I think you forgot, the post was in 2011. You responded in 2013… so somehow you expected the poster in 2011 to know it would be 5,500 in 2013?

  2. I first got the notion that RRSPs and 401ks were not beneficial from a book called Rich Dad Poor Dad, by Robert Kiyosaki. I read it back in 2002 shortly after I landed my first job. It’s a beginners personal finance & general investing book. The author mentioned that RRSPs/401ks were retirement plans if you plan on being poor, and were not for becoming wealthy. It explained the reasons for that in general manner.

    I then thought about it and researched for more information regarding how RRSPs actually worked, or how it would work against me if I did not plan on becoming poor. At the time, not contributing to RRSPs was considered very unconventional and financial lunacy!

    Its funny because many DIY investors say that Rich Dad Poor Dad was a waste of time. But that one little part regarding RRSPs made a huge impact years later. Its not an amazing book, and is geared towards beginners (more of a personal finance book). But it is a good stepping stone and contains some good general principles for shaping the mindset & attitude for investing. It was the first investing book I actually read, so I can’t say it was a waste of time.

  3. I too have RRSP income from tryst Units. It’s doing Ok for our retired living here in Nicaragua. But what I’m wondering is what I have to do about RRSP to RRIF. I think I’m reading above that I should put RRSP to RRIF each year…but do i have to pay tax upon withdrawing RRSP to move it to RRIF? I sure hope not!!!

  4. I appreciate all the info, I think the more educated we become the better it is for us. I was just wondering what your background is Investment Blogger? That will solidify my believe in what you are saying. Which again I do appreciate.

    1. Definitely the more knowledge you have the more successful you can become. Backgrounds can be misleading. I have an educational background in business, namely strategy, finance, economics, accounting and marketing. University is a starting point for learning, and degree means very little if you can’t add more knowledge afterwards or apply it. I’ve been investing for more than 13 years now, and have held a multitude of different asset types including real estate, stocks, bonds, warrants, rights, etc. The majority of my assets come directly as a result of profitable investing through the application of investment and financial knowledge.

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