For most investors, 2008 was one of the most difficult years in memory.

Global stock markets posted a significant decline in the second half of the year. But from a long-term perspective, history teaches us that economies and stock markets are resilient and inevitably recover from such downturns.

A diversified portfolio, with a variety of investments, can carry less risk. It's less likely that the whole portfolio will decrease in value. With proper asset allocation and disciplined investment plans, short-term events often have a minimal effect on long-term goals or a well-balanced financial plan.

The beginning of the year is hectic enough without having to worry about making a large contribution to your Registered Retirement Savings Plans (RRSP) before the deadline. Make a new year's resolution that's easy to keep this year by committing to make regular monthly contributions to your RRSP throughout the year. You can make monthly contributions easily and conveniently with pre-authorized deductions that can be set up for as little as $50 a month.

Also, regular contributions to your RRSP throughout the year alleviates much of the pressure of making last-minute decisions during the hectic frenzy of RRSP season. Spreading your contributions throughout the year gives you the benefit of time, allowing more time for your money to grow. The earlier you begin to save during the year, the longer your money is working for you.

Here are some tips to think about as you make decisions about your RRSP contributions:

1. Take advantage of dollar cost averaging What this means is investing a set amount of money on a regular schedule, whether it's weekly, biweekly or monthly, to take advantage of lower share prices. Because the purchases are made automatically and for a set dollar amount, you will be purchasing more units of a fund when prices are low and fewer units when prices rise. Dollar cost averaging takes the guesswork out of predicting the "best" time to buy.

2. Make sure you have the right asset allocation Asset allocation is the process of figuring out which investments you should choose (cash, fixed income and equities) based on your risk tolerance and your financial goals.

Successful investors know an investment's performance is unpredictable, and the best plans involve a long-term strategy. Asset allocation first identifies your tolerance for market volatility, and then selects an appropriate mix of funds and interest accounts from the three basic asset classes to help minimize risk and maximize potential return. Asset allocation should be a part of an overall investment plan customized to reflect your personal investment style and goals.

3. Create a financial plan
There are so many choices available, sometimes it's hard to know where to start. A financial plan can help you figure out how to save for tomorrow while still enjoying today. By understanding where you are today and what your goals are for the future, you can start making decisions that fit into your long-term strategy.

"Taking the time to develop a financial plan now will give you more time to make investment decisions that are right for you," said Rocco Taglioni, Vice-President, Individual Wealth, Sun Life Financial Canada. "Working with a financial advisor can help you investigate all your options and answer such questions as how much you need to save now to reach your retirement goals, which investments are best suited to your goals and what’s your risk tolerance as an investor?"

For more information about RRSPs and financial and/or retirement planning or to find a financial advisor, visit www.sunlife.ca/MyRetirement.

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Nadine Ricketts
t: 416.979.6273 / 15-331-6273
nadine.ricketts@sunlife.com