Saving for a comfortable retirement \u2014 there\u2019s nothing particularly exciting or glamorous about it, but it\u2019s something that should be on every Canadian\u2019s to-do list. That\u2019s where a registered retirement savings plan (RRSP) is a wise choice. This article covers everything you need to know, including how the savings plan works, what its limits and rules are and its benefits so you can start saving for your retirement today.<\/p>
An RRSP is a savings plan that\u2019s registered with the Canadian federal government. It provides tax benefits to help you save for your retirement.<\/p>
There\u2019s no minimum age requirement to open an RRSP, and you can make contributions to an RRSP up until the age of 71. The contributions are tax-deductible, so they can be used to reduce your annual income at tax time.<\/p>
You also won\u2019t pay any tax on the income you earn from the investments and savings in your RRSP until you make a withdrawal. And when you withdraw funds once you\u2019ve retired, you\u2019ll likely be in a lower income bracket at that time \u2014 which will again reduce your tax bill.<\/p>