Registered Retirement Savings Plan (RRSP)
Build Your Retirement Wealth with Tax-Advantaged Savings
2025 Contribution Limit
18% of earned income (max $31,560)
Key Benefits of an RRSP
Tax-Deferred Growth
All investment earnings grow tax-free inside your RRSP until withdrawal, maximizing your compound growth potential.
Immediate Tax Deduction
Contributions reduce your taxable income for the year, providing immediate tax savings.
Investment Flexibility
Hold a wide range of investments including stocks, bonds, ETFs, mutual funds, and GICs.
Special Programs
Access funds for first home purchase (HBP) or education (LLP) without immediate tax implications.
How to Maximize Your RRSP
- Contribute in High-Income Years – Maximize tax benefits by contributing when your tax rate is higher.
- Plan Withdrawals Strategically – Time your withdrawals for lower-income years to minimize tax impact.
- Consider Income Splitting – Use spousal RRSPs to balance retirement income and reduce overall taxes.
Essential for Every Canadian's Retirement Plan
A Registered Retirement Savings Plan (RRSP) is a cornerstone of retirement planning in Canada. It offers unique tax advantages by allowing your investments to grow tax-deferred while providing immediate tax deductions on your contributions. This powerful combination can significantly boost your retirement savings over time.
Why an RRSP is Essential for Your Retirement
Tax-Deferred Investment Growth
All investment earnings compound tax-free inside your RRSP until withdrawal, maximizing your long-term growth potential.
Immediate Tax Benefits
Reduce your current taxable income with every contribution, potentially resulting in significant tax refunds.
Flexible Contribution Options
Unused contribution room carries forward indefinitely, allowing you to catch up when you have more income.
Special Withdrawal Programs
Access funds for first-time home purchase (HBP) or education (LLP) without immediate tax consequences.
Income Splitting Opportunities
Use spousal RRSPs to balance retirement income and potentially reduce your household's overall tax burden.
Compare Registered Accounts
| Feature | TFSA | RRSP | FHSA |
|---|---|---|---|
| 2025 Contribution Limit | $7,000 | $31,560 | $8,000 |
| Tax on Contributions | After-tax dollars (no deduction) | Tax-deductible | Tax-deductible |
| Tax on Withdrawals | Tax-free | Taxed as income | Tax-free for home purchase |
| Withdrawal Flexibility | Withdraw anytime, no penalties | Penalties unless for HBP or LLP | Must be for first home purchase |
| Contribution Room | Accumulates from Age 18+ or when becoming a Canadian resident | Based on earned income | 1-year carry-forward |
| Age Limits | No age limit | Must convert to RRIF by 71 | Must close after 15 years |
| Recontribution Rules | Next calendar year | Lost unless HBP repayment | No recontribution allowed |
| Best Used For | Flexible savings, investments, emergency fund | Retirement savings | First home purchase savings |
* FHSA = First Home Savings Account, HBP = Home Buyers' Plan, LLP = Lifelong Learning Plan
Optimize Your RRSP
Visualize your RRSP contributions and withdrawals
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