Whether your retirement dream involves sunny beaches, cross-country roadtrips or just relaxing at home, one thing remains constant: it takes money to make it happen. Regardless of where you currently stand in your career journey, taking steps to secure your retirement is crucial.

"But retirement? I've just begun my career!". While it may seem early, the ideal time to start saving for retirement is right now. Whether you're counting down the days or somewhere in between, here are some tips tailored to every stage of your retirement journey.

Start early and contribute often

The earlier you start saving, the more interest you will earn and the more money you will have when you’re ready to retire. Consider this scenario:

Although both people ended up with a similar amount, the crucial difference is that the person who started at 20 invested less than half their own money - most of the money came from interest, not their pocket.

The longer you wait, the more you may miss out on potential earnings. To understand just how much waiting could impact your retirement fund, check out our Cost of Waiting Calculator.

Choosing the right retirement account: TFSA or RRSP

Deciding on the ideal retirement account isn't a one-size-fits-all situation and depends on your individual circumstances and financial aspirations. There are two common investment account options - Tax Free Savings Accounts (TFSAs) and Registered Retirement Savings Plans (RRSPs).

When to consider a TFSA:

• If you're in the early stage of your career, and anticipate your income to increase over time.

• if you're in a lower tax rate, but expect it to be higher in the future

• If you want to withdraw this money without penalty before retirement. TFSAs are a great savings tool for emergencies and other financial goals you may have.

When to consider a RRSP:

• If you find yourself within a higher income bracket and can benefit from the tax deduction benefits.

• If you're looking for a long-range vision for retirement savings.

• If your employer offers a matching program for retirement contributions.

In some situations, utilizing both a TFSA and an RRSP can offer you a balanced approach. Remember, the right choice will be based on your unique financial situation. It's recommended to talk to a financial advisor to help you understand which account(s) may be best for you.

Understand your RRSP and TFSA contribution limits

Canada Revenue provides a Notice of Assessment after you've filed your taxes, showing your allowable RRSP contributions for the following year based on your income.

Your TFSA contribution room can be found by logging into your Canada Revenue Account or by contacting they directly.

Automate your savings 

Setting up automatic transfers to your retirement accounts ensures a consistent contribution. Your money will be seamlessly transferred from your bank account into your retirement savings without you having to worry about manual transfers or the risk of forgetting to make the regular contribution. This automated approach not only saves you time and effort, but also helps in building a more robust retirement fund over time.

Conduct annual retirement plan reviews

Just as regular check ups are vital for your health, annual financial check ups with your advisor are crucial. This ensures you're on track and allows for adjustments to your plan as needed.

-

Remember, there is no perfect time to start saving for retirement. Whether you're young with retirement still a long way off, or find retirement approaching sooner than anticipated, acting now not only lays the groundwork for a more comfortable retirement but also offers the potential to maximize your earnings over time.