Here is the average RRSP balance at age 34 for Canadians

The Registered Retirement Savings Plan (RRSP) it is a stepping stone for Canadians looking to secure their financial future. This tax-advantaged account allows individuals to contribute annually, reducing their taxable income during their working years. The goal is clear: until you retirementideally you’ll be in a lower tax bracket, allowing your savings to compound in a long-term deferred tax environment. But how does this play out for Canadians at the crucial age of 34?

What is the average RRSP balance?

Statistics Canada revealed that as of 2023, people under 35 had an average RRSP balance of about $57,500, including other retirement plans. Notably, this figure excludes other valuable assets such as those in Tax-Free Savings Accounts (TFSAs) or non-registered investment accounts, not to mention the equity that many have built through home ownership. When you compare this to the next 35 to 44 age bracket, which boasts an average balance of $88,600, the stakes become even clearer. For many 34-year-olds, these numbers can evoke feelings of urgency or inadequacy.

If your RRSP balance is below average, don’t despair. The key is to cultivate a consistent habit of saving and investing. Small, regular contributions can add up over time, and there are strategies to maximize your growth potential. Investing exclusively in low-risk options like savings accounts won’t cut it. Stocks have historically outperformed other asset classes over the long term, making them an essential component of any sound investment strategy.

Embracing stock market opportunities

Navigating the stock market can be intimidating, especially for first-time investors. The thought of choosing individual actions can seem daunting, but it is essential to understand that there are simpler and less risky paths. A popular solution is to invest in exchange traded funds (ETFs)which provides built-in diversification and mitigates the risks associated with individual stocks.

For 34-year-olds who want to invest wisely, consider adopting a monthly investment strategy using commission-free trading platforms. This approach, often called dollar cost averaging, allows you to buy more units when prices are low and fewer when prices are high. The objective? To build a robust portfolio that appreciates over time, ultimately leading to a more comfortable retirement.

iShares Core Equity ETF Portfolio

If you are looking for a simple investment option, iShares Core Equity ETF Portfolio (TSX: XEQT) deserves your attention. This fund is designed for those who want a simple, long-term investment solution. With a strategic asset allocation of 100% equity, XEQT provides diversified exposure to key global markets.

Breaking down its components, the ETF allocates 46% to iShares Core S&P Total US Stock Market ETFproviding significant exposure to the US market. In addition, invest 25% in iShares Core S&P/TSX Capped Composite Index ETF for Canadian market exposure, 23% in iShares Core MSCI EAFE IMI Index ETF for international investments in Europe, Asia and Australia and 5% in iShares Core MSCI Emerging Markets IMI Index ETF to access emerging markets.

With a low management expense ratio of just 0.20%, this ETF not only makes diversification easy, but also keeps costs to a minimum. While past performance — such as the fund’s five-year rate of return of 11.9% — isn’t indicative of future results, it does offer a glimpse of the growth potential ahead for disciplined investors.

The crazy investor in a package

As a 34-year-old Canadian, knowing your average RRSP balance can motivate you to work on your retirement savings and investments. By embracing the right investment strategies, including the potential of ETFs, you can take important steps toward achieving a secure financial future.