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TORONTO, ONTARIO--(Marketwire - Nov. 7, 2012) - To mark Financial Literacy Month, BMO Financial Group is releasing a series of financial tips throughout November. As part of BMO's commitment to 'Making Money Make Sense', the tips are designed to help individuals and families save and manage their day-to-day finances more effectively.

BMO's Tip of the Day: Consider investing in a Registered Retirement Savings Plan (RRSP) and taking advantage of tax incentives when saving for retirement.

What is an RRSP?

An RRSP is a registered plan that allows you to save for retirement in a tax-efficient manner.

• Within an RRSP, portfolio investors can hold a variety of investments including guaranteed investment certificates (GICs), mutual funds, exchanged traded funds (ETFs), bonds and equities.
• The money you invest within an RRSP grows tax free. Since you pay no tax on investment growth while your money remains invested in an RRSP, your investments compound far more quickly than they would if invested outside of an RRSP.
• Additionally, annual contributions (up to a maximum of $22,970 for the 2012 tax year) made into an RRSP are tax deductible based on your unused deduction room. This can result in a lower income tax bill.

"Investing in an RRSP should be a staple in any retirement savings plan, as it's the most tax-effective way to generate the funds you need to become financially secure in your retirement," said Marlena Pospiech, Senior Retirement Strategist, BMO Financial Group. "Whether you've been contributing to an RRSP for years or are just getting started, make sure you invest on a consistent basis, regardless of the amount."

Here is how an RRSP can work to your advantage:

The example below illustrates the difference in savings between a fixed annual RRSP and non-RRSP investment, assuming a 5 to 6 per cent average annual rate of return on a $10,000 annual investment over a 30 year period. With tax-deferred compound growth in an RRSP and investing regularly this can amount to a substantial difference in accumulated savings over time.

	RRSP	Non-RRSP
Amount Invested Annually	$10,000	$10,000
Years Invested	30 years	30 years
Marginal Tax Rate	N/A	46%
Average Annual Return	6%	6%
Total Savings After 30 Years	$838,016.77	$510,717.60

BMO Financial Group's RRSP Savings Calculator can help take the guesswork out of contributing to your RRSP by taking you through a few simple steps that will put you on the path to retirement success. Access it at http://www.bmoinvesting.com/calc/amisaving_index.asp.

"CFEE commends BMO's ongoing efforts to support Financial Literacy in Canada and promote ways in which Canadians can increase their competence and confidence when managing their personal finances on a day-to-day basis," said Gary Rabbior, President, Canadian Foundation for Economic Education (CFEE).

BMO Financial Literacy Month Tips

November 1: Maximizing TFSA investments annually over 20 years can save nearly $30,000 in taxes.

November 2: Utilize rewards to squeeze the most value out of every dollar you spend this holiday season.

November 3: Choose an investment advisor who is right for you and will help you meet your financial goals.

November 4: Use your RRSP to help make the down payment on your first home.

November 5: Space out payments to avoid cash-flow problems.

November 6: Take advantage of the benefits of preferred shares.

For more on financial literacy, Canadians can visit the Government of Canada's Financial Literacy Month website, as well as BMO's Financial Literacy online resource.

About BMO Financial Group

Established in 1817 as Bank of Montreal, BMO Financial Group is a highly diversified North American financial services organization. With total assets of $542 billion as at July 31, 2012, and more than 46,000 employees, BMO Financial Group provides a broad range of retail banking, wealth management and investment banking products and solutions.