How to Save a Million Dollars for Your Retirement

According to TD Canada Trust, if you start at age 25 and contribute monthly to an RRSP account that earns a 6.8 per cent annual rate of return, compounded monthly, you'll have a million dollars for your retirement.

Every month, you must save, depending on your age:

• 25-30: $100
• 30-35: $250
• 35-40: $500
• 50-65: $750 

Analysing this savings strategy, financial writer Alision Griffiths points out in today's Toronto Star "Me and My Money" column that saving this amount could be very difficult for many people.

Griffiths says that according to statistics, 22 to 34 year-olds have less income than in previous decades and higher debt due to the increased cost of education and higher cost of living.

She points out that middle-aged parents trying to help their young adult children with education costs are facing increased debt as many turn to using lines of credit.  In addition, "boomerang kids," who return to the home (and grown children who remain at home) deplete their parents' savings potential.

For adults in the 50 to 65 age group, Griffiths says saving $1000 a month might be possible "if you've got a good job, aren't still supporting children or looking after elderly parents and have little or no debt. That's a lot of ifs."

That's not to say you shouldn't try.  Griffiths and her colleagues offer lots of ways to keep within your budget and increase your savings on the http://www.moneyville.ca/ site.  Check it out.