Where to Invest Your Retirement Money in Canada

Whether you have a plan to retire abroad in Canada or you already did, it’s obvious you’ve already given thought to investment options that could bring you good fortune. Living on the money you saved sounds great, but the idea of creating more income during your post-retirement years or as retirement looms isn’t something you will want to pass up.

Canada is among the few countries known to be pretty friendly to immigrants. You are guaranteed not just freedom, but plenty of opportunities that could help you grow your money.

What many may not know about Canada is that if you intend to apply for permanent resident status there as a retired person, the government will treat your application more favorably if your intention is to invest in Canada.

We understand that you may have specific retirement goals, so apart from what we may suggest, we also recommend that you meet up with a financial advisor or other relevant experts to assist you to make better choices.

Our intention today is to help you choose investment options that probably suit you well as a retired person and fit perfectly into your investor profile.

Check them out:

Mutual Funds

Canada has over $800 billion in assets invested in mutual funds, and for good reasons. Mutual funds remain a preferable option for retired persons and many other classes of people due to several factors.

Apart from the fact that they are good for diversification (options include global funds i.e. covering a huge geographical market and sector funds, i.e. funds from the same sector, etc.) the entire work of selecting stocks, bonds, and other investable assets is done by a team of professionals. Mutual funds also own several companies and this guarantees consistency.

With multiple types of mutual funds to choose from, you will have the opportunity to choose whichever fits your lifestyle.

However, mutual funds, just like most of the investment options in existence today, have their good and bad side. Buying a mutual fund is relatively expensive (as high as 2%), but on the contrary, it’s a lot cheaper having one compared to having to buy the fund’s stock on your own.

Canada has plenty of great mutual funds. You can talk to a bank or licensed advisor to find out more.

Bonds and dividend stocks

Even though they don’t pay as much as stocks do, bonds are a safer way to invest. Corporate bonds are known to yield better returns than government bonds, only they are a little riskier. Nonetheless, however bad the market gets, your bonds will always stay intact.

As for stocks, Canada has a good number of companies with stocks that pay pretty good dividends. For those who may not know, dividends are annual or quarterly payments given to shareholders when a company makes extra cash. Some companies, of course, pay higher than others.

It’s really up to you to decide whether to re-invest the cash back into the company by buying more stocks or putting it to other uses.

Exchange Traded Fund (ETF)

ETFs are a hybrid between stocks and mutual funds. Toronto Stock Exchange is credited with listing the world’s first ETF. That was in 1990. Many years later, ETFs now account for well over $100 billion in assets in the country.

ETFs have friendly management fees (as low as $0.05).  For that price, one can buy ETFs not just in the Canadian Stock Market but also in U.S. stock markets.

Just like mutual funds, ETFs are also great for diversification. They include bonds, stocks, and plenty of other securities cutting across multiple markets and sectors. And since they are highly liquid, you can buy and/or sell them pretty quickly and cheaply.

Still, there are plenty of other advantages ETFs have as an investment option over other investment types.

Visit ETF to learn about ETF investing in Canada.

Real Estate

Recently, there have been plenty of mixed reactions in relation to the bubbling real estate market in Canada, especially Toronto and Vancouver. What can’t be denied, however, is that growth in the real estate sector in both cities has been relatively faster and rewarding.

Over 250,000 immigrants move into Canada yearly and this creates a demand for housing. More people also move into towns, and this adds to the increasing demand. With a reliable and steady economy, cities like Toronto are an attractive place to invest in real estate for the retired person looking to generate extra cash.

The best thing about investing in real estate is that you have more control over your investments. But that depends on a couple of things, key amongst them being the acquisition of proper real estate property.

As an immigrant, you will certainly need expert guidance, not just in choosing an ideal property but also when it comes to legal and also tax-related aspects. Toronto’s finest real estate firms like Buttonwood have helped many in managing their property plus other related day-to-day hassles.

There are additional reasons to invest your retirement money in real estate, and talking to firms like Buttonwood is a sure way to go about it.

Obviously, there are plenty of other investment options out there, but the few we’ve mentioned present a great opportunity for you to put your retirement money to good use. Remember to seek expert help where necessary and, more importantly, invest your money where you feel more confident and comfortable.

Author Bio:

Sabine Ghali is Director at Buttonwood Property Management, a property management company in Canada. She is an entrepreneur at heart who endeavors to help investors create real estate wealth over time in the Greater Toronto Area. Sabine is published in a number of media outlets, including Toronto Sun and Gulf News, among many others.

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