Immediate Tax Deductions
Reduce your current year's taxable income by the amount you contribute, potentially leading to a tax refund.
RRSP: Save for a Comfortable Retirement
Tax Deductions Now, Tax-Deferred Growth for Your Future
What is an RRSP (Registered Retirement Savings Plan)?
A Registered Retirement Savings Plan (RRSP) is a government-approved plan designed to help Canadians save for retirement. Contributions to an RRSP are tax-deductible, meaning they can reduce your taxable income in the year you make them. The investments within the RRSP grow tax-deferred, meaning you don't pay tax on the earnings until you withdraw funds, typically in retirement when your income may be lower.
Key Benefits of an RRSP:
Tax-Deferred Growth
Your investments grow without being taxed annually, allowing for potentially faster compounding.
Source of Retirement Income
Provides funds for your retirement years, supplementing CPP, OAS, and other pension income.
Investment Choices
Hold qualified investments like Segregated Funds and GICs within your RRSP through insurance companies.
Spousal RRSPs
Contribute to an RRSP in your spouse's or common-law partner's name to potentially split income in retirement and reduce overall family tax.
Home Buyers' Plan (HBP) & Lifelong Learning Plan (LLP)
Allows you to withdraw funds tax-free from your RRSP for a down payment on your first home or to finance education for yourself or your spouse (conditions apply, and funds must be repaid).
Understanding Your RRSP Contribution Limit:
Your RRSP deduction limit for a given year is generally calculated as:
- 18% of your previous year's "earned income",
- UP TO the annual maximum RRSP dollar limit set by the CRA for that year (e.g., $31,560 for 2024 - **this needs annual updating**),
- MINUS any Pension Adjustment (PA) from an employer pension plan,
- PLUS any unused RRSP deduction room carried forward from previous years.
Always refer to your latest Notice of Assessment from the Canada Revenue Agency (CRA) for your exact RRSP deduction limit.
Quick RRSP Contribution Room Estimator
Disclaimer: This calculator provides a very basic estimate based on general rules and the current year's maximum limit. It does NOT account for your unused carry-forward room or Pension Adjustments. Always consult your official CRA Notice of Assessment for your accurate RRSP deduction limit. This tool is for illustrative purposes only.
(Assumes the RRSP maximum dollar limit for contributions based on income, for the contribution year, is $. This limit changes annually.)
Investment Options within an RRSP:
As a licensed life insurance agent, we can help you invest your RRSP contributions in products offered by insurance companies. Through our partnerships with institutions like Industrial Alliance (IA), Manulife, Equitable Life, Ivari, and Canada Protection Plan, you can typically hold:
- Segregated Funds: These are investment funds similar to mutual funds but are insurance contracts. They offer potential for growth and often include guarantees, such as maturity and death benefit guarantees, which can protect your principal investment.
- Guaranteed Investment Certificates (GICs): GICs offered by insurance companies provide a fixed rate of return over a specific term, with your principal investment guaranteed.
We can help you choose investment options that align with your risk tolerance, time horizon, and retirement goals, focusing on the security and unique benefits offered by insurance-based investment products.
Start Building Your Retirement Savings Today
An RRSP is a cornerstone of retirement planning in Canada. Let us help you understand your options and make the most of this valuable savings tool.
Discuss Your RRSP StrategyCall us at 647-709-3400 or email info@oneprotection.ca.