Registered Retirement Savings Plans, ( RRSP's)
RRSPs are a way to save for retirement. Are a government approved program that is designed to encourage Canadians to save for their retirement by providing powerful tax reduction options. The tax breaks come in two forms. The first is that once you set up an RRSP, the financial contributions you make are deductible from your taxable income.
The second tax advantage consists in the sheltering of the income and capital gains that are generated by the investments in your RRSP. That is, your money is allowed to grow tax free, where as, funds invested for example in a GIC (outside of an RRSP) render the interest earned heavily taxed. Likewise, a capital gains tax is levied on investments like stocks and mutual funds. But all investments within an RRSP are effectively "sheltered" from tax and allowed to compound.
Once you've determined the amount of money you can afford to put into your plan (within the Government limits), the next decision must be where to invest. There is a plethora of options. Like, mutual funds, Treasury Bills, bonds, or GICs.
Why not explore your options with us by letting us help you identify the options that are best for you..
