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WEALTH MANAGEMENT
|Segregated Funds|
|Labour - Sponsored Funds|
|Annuities|
|Guaranteed Investments (GIC)|
|RESP's (Registered Educational Saving Plan)|
|RRIF's/LIF's Registered Retirement Income Funds|
|RRSP's Registered Retirement Savings Plan|
REGISTERED RETIREMENT SAVINGS PLAN (RRSP)
Why buy an RRSP?
There are three compelling reasons for contributing to an RRSP – Registered Retirement Savings Plan.
- First, your contribution is tax deductible – the higher your marginal tax rate, the greater your tax savings.
- Second, the income generated by the plan is only taxed on withdrawal from the plan (usually when you are retired and possibly in a lower tax bracket). As a result, you can build up significant earnings inside your plan on a pre-tax basis.
- Finally, all or a portion of your annual eligible contribution may be contributed to a plan set up for your spouse.
Spousal plans
Setting up a spousal RRSP is a good idea if you expect your spouse to be in a lower tax bracket than
you on retirement. When funds are withdrawn from the spousal RRSP, they are taxed in your spouse’s
hands at his or her lower tax rate (this arrangement is subject to special rules to prevent abuse).
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