Last month federal Finance Minster Jim Flaherty revealed the "Economic Action Plan 2012", the budget will see the eligibility age for Old Age Security (OAS) raised from 65 to 67. OAS payments can also be deferred by eligible Canadians for a maximum of five years beginning in 2013 in exchange for higher benefits. These changes will affect Canadians under the age of 54. If this is you, now is a good time to revisit your retirement plans. There are 3 sources of retirement income that are available to Canadians when they retire. Some people refer to them as the 3 pillars or the 3 legged stool. 1.      Government programs : (CPP & OAS) 2.      Employer sponsored plans: (Defined benefit pension plans (DB), Defined contribution pension plans (DC), Structured RRSP’s (STRP), Deferred profit sharing plans (DPSP’s), stock plans) 3.      Individual Accounts: (Individual RRSP’s, TFSA’s non-registered plans) Generally speaking there are 3 variables that Canadians have control over that would impact the final retirement income they receive from their employer sponsored plans and individual accounts. These are; 1.      Time 2.      Investment return 3.      Contributions In regards to time the earlier the participant sets up the plan and starts contributing the more they will have at retirement due to the magic of compound interest & longer exposure to market growth. For investment return the participant who holds more aggressive … [Read more...]