The economic recovery train has been revving up for over a year, including a couple of false starts, but has not created much forward momentum until recently. Finally, in the last six months, recovery has begun to take hold in North America and around the world, and financial markets have strengthened in anticipation of what we hope will be a long and sustained period of economic growth. For many of you, this has also meant recovery in your personal investment portfolios after consecutive years of market declines.

Recent headlines indicate that the economic recovery is broadening and deepening. The US economy grew at an annual rate of 8.2% in the third quarter of 2003, the fastest pace since 1984. While no one expects this blistering pace to continue, expectations are firming that growth will continue on a sustainable basis both in North America and abroad.

This situation offers an opportunity to get back on track with your financial and retirement plans, especially if you have held back on RRSP contributions and now have built up contribution room, or if you have parked money in secure but low-return areas.

For most people, investing in RRSPs still provides the best option for reducing current taxes, deferring taxes on investment growth far into the future, and reducing overall taxes at retirement through the magic of spousal RRSPs.

You have until March 1 to make your RRSP contributions this year … but don’t leave things to the last minute, as you may want to consider revamping your investment strategy in significant ways. Record low interest rates, currency movements, and increased global integration have made things a little more complex, and today’s environment requires some careful rethinking of your previous investment choices.

Our fall newsletter highlighted a variety of alternative strategies we have brought to our clients during the past two years to increase diversification and opportunity while at the same time reducing risk.

Now is the perfect time, just as we begin a new period of economic expansion, to undertake a full review of your financial situation and your investment holdings and adjust to the new market conditions. Don’t wait and be caught up in a last-minute rush to make RRSP deposits in February. Consider changed circumstances and new ideas and then discuss these with your advisor.