A Pop Quiz

By Tom Bradley

Quick. It’s February 28th, 2010. The Olympics are just ending and you have to make a last minute RRSP contribution. What would you do?

Five seconds.Four.Three.Two.One.

Time is up. OK. If you answered:

• Put it in the Money Market Fund and think about it later;

• Go with whatever your advisor is talking about;

• Look at what’s been doing well; or

• I don’t have a clue,

...then you’re not where you need to be. Forget about February 28th. You don’t know where you’re going now. You don’t have a plan...a framework...a road map.

The correct answer?

• Look at every investment, existing or new, in the context of my investment plan;

• Don’t let the RRSP deadline determine when I buy or what my mix will be;

• Add to my existing holdings in the proportions that I currently have; or

• If necessary, use the money to re-balance my portfolio so it’s back in line with my long-term asset mix.

Just testing.

Related reading:Tackling Uncertainty This RRSP SeasonUneasy About the Market Bounce? Just Stick to Your Plan