Registered Retirement Savings Plan /
Registered Retiremtn Income Fund

What is an RRSP?

An RRSP (Registered Retirement Savings Plan) is a government approved registered savings plan through which you save money for your retirement years. Your contributions, within limits, are tax deductible and the income on your investment is tax sheltered during the time it remains in an RRSP.

Who Can Invest?

All taxpayers who have earned income, up to the end of the year they turn 71, may contribute to an RRSP. In some cases, taxpayers beyond age 71 may contribute to a spousal RRSP if the spouse is younger than 71.

Contribution Limit

Contribution limits are established from time to time by the Federal Government.

Foreign Content Rule

As of 2005, there is no longer a limit on the amount you may hold in foreign investments.

Spousal RRSP’s

Contributions may be made to a spousal plan within the contributor’s RRSP contribution limits. This strategy can potentially create income splitting between spouses in retirement.

What Is a RRIF?

A RRIF (Registered Retirement Income Fund) is one of the options available to RRSP holders that wish to start drawing income from their RRSP. An RRSP may be transferred into a RRIF at any time before the end of the year in which the RRSP holder turns 71 years of age. Once a RRIF is established, the RRIF holder must withdraw a minimum amount each year. This amount is established by the government of Canada and may be changed periodically.

 


 

 

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