Here is the average RRSP balance at age 44 for Canadians

Data from 2024 gave us a pretty rough idea of ​​how Canadians are doing with their tax-free savings accounts (TFSAs). For the 40 to 44 age group, the average TFSA balance was about $17,000, which isn’t great for Gen X.

But the Registered Retirement Savings Plan (RRSP) looks better. According to Ratehub, Canadians aged 35 to 44 have an average RRSP balance of about $49,000. That’s still not surprising, but it is noticeably higher.

Employer matching helps, and for many people making more than $75,000, it makes sense to prioritize the RRSP because the tax deduction offers more value at higher marginal tax brackets. If you have a workplace plan, you’re locked into the mutual funds your provider offers, which can be hit and miss due to their high fees.

If you manage your own RRSP, the menu improves dramatically. This is why I prefer using an exchange-traded fund (ETF) over a mutual fund, and an all-in-one ETF that I think is a good fit for a typical 44-year-old investor.

Why use an ETF?

ETFs trade all day, just like stocks, giving you more control over when you buy or sell compared to mutual funds, which trade only once a day at closing net asset value. They also tend to have much lower costs. Many mutual funds still charge management expense ratios of over 1%, while comparable ETF strategies can be as low as 0.2%

And while taxes don’t matter within an RRSP, mutual funds often pay out large capital gains at the end of the year due to portfolio turnover. That can hurt if you ever keep them in a taxable account, even if you haven’t sold them. ETFs largely avoid this due to the creation and redemption process, which allows units to move in and out without triggering taxable events.

The ETF to Buy

At age 44, your risk tolerance and time horizon are still long enough to invest heavily in global equities, but not so long that bonds should be ignored. That’s why I like it BMO Growth ETF (TSX:ZGRO) for a set-it-and-forget-it RRSP pick.

The portfolio contains roughly 80% global equities and 20% global bonds, giving you diversified growth with some stability. The management expense ratio is only 0.2%, so a $10,000 investment only costs about $20 per year in fees. The fund will automatically rebalance and the quarterly distributions can be reinvested to get into your RRSP.