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416 220 1010

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RRSP – The registered retirement savings plan

If you are wishing for a secured and relaxed retirement, Act now!!!

If you want to place yourself in a secured financial state after retirement, opt for a Registered Retirement Savings Plan (RRSP) that provides you a retirement income.

Your payments to a RRSP allow you to a tax deduction and generate investment income, which is shielded from income tax and makes it one of the most beneficial plan.

At retirement, when you withdraw your funds, they become taxable.

What is Registered Retirement Savings Plan (RRSP)?

A Registered Retirement Savings Plan (RRSP) is an individual savings plan registered with the Canadian federal government allowing you to save for the future on a tax-sheltered basis.

A Registered Retirement Savings Plan (RRSP) can contain a vivid investments including: RRSP savings deposits, treasury bills, guaranteed investment certificates (GICs), mutual funds, bonds, and even equities.

Who Should Have a RRSP?

Every individual looking forward to secure retirement should consider having a Registered Retirement Savings Plan (RRSP).

Why should one have a RRSP?

While saving for their future, individuals earning income can reduce their annual tax bill through a Registered Retirement Savings Plan (RRSP).

For people who don’t have company pension plans, Registered Retirement Savings Plan (RRSP) will be the foundation for funding their retirement. For those who are having a company pension plan, Registered Retirement Savings Plan (RRSP) add an extra comfort that their retirement needs are met.

Married couples, where one of them earns more income than the other can reduce their combined tax burden through a spousal Registered Retirement Savings Plan (RRSP). At retirement, one can reduce overall tax when the funds are withdrawn by applying an income-splitting strategy.

  • If you are planning on purchasing a house or continuing your education, you can contribute to your RRSP, then use these funds as a financial source.
  • If you’re expecting financial fluctuations because of various reasons, the Registered Retirement Savings Plan (RRSP) funds are always available to you.

On the basis of the income you earned last year, the amount you may invest in your RRSP in the present year will be determined.

To make the most of Registered Retirement Savings Plan (RRSP)

  • Be an early contributor.
  • Be regular in payments. Contribute monthly.
  • Diversify your investments and maximize your returns.

How to capitalize your RRSP?

  • Contributing to a RRSP will double the advantages – your payments give the right for tax deductions and your investment income will increase in a tax shield plan, until you withdraw the amount that has added up.
  • The earlier you begin to contribute; the chances of your RRSP being advantageous will be more. Your investment income will increase eventually to provide you additional capital at retirement.
  • Contribute consistently. It is simpler to make a minor contribution every month than to contribute a huge amount later, at once. Importantly, if you make your contributions at the beginning of the year, your money will be considered for manipulation and your RRSP will take- off in no time.
  • Contribute every year. If you fail to contribute for a year, your considerable investment income generated by income might be disposed.
  • Invest the maximum allowable amount to yield better and beneficial tax savings.

Pros of having a Registered Retirement Savings Plan (RRSP)

Though it is specifically designed to meet the requirement of retirement, Registered Retirement Savings Plan (RRSP) has benefits throughout its lifetime.

  • You will realize immediate tax benefits when your income is generally highest by contributing to a Registered Retirement Savings Plan (RRSP) throughout your working career. It reduces the amount of income tax by deducting the total amount of your annual contribution from your gross income.
  • Your investment in your Registered Retirement Savings Plan (RRSP) and its growth is tax sheltered and the total value may grow quickly. The income earned in your RRSP will be taxed, only during the time of withdrawal.
  • When you withdraw the amount at your retirement, the tax imposed will be lower than compared to your earning years.
  • Registered Retirement Savings Plan (RRSP) has some special features that allows you to fund specific life events.

Separation or Divorce

During divorce or separation, either your spouse or you can transfer existing Registered Retirement Savings Plan (RRSP) to the other without being tax-imposed, provided that:

  • You are living separately when assets and property are settled; and
  • You have a valid separation written agreement or a court order.

Death of a Plan Holder

In case of your death, the Registered Retirement Savings Plan (RRSP)’s earnings will be distributed to the beneficiary or to your estate, if no beneficiary has been nominated. This nomination can be specified in either your RRSP or in your will.

The earnings of the RRSP will remain tax-shielded if one of these situations applies:

  • The beneficiary is your spouse and the earnings are transferred into a Registered Retirement Savings Plan (RRSP) or a Registered Retirement Income Fund (RRIF) in his/her name;
  • The beneficiary is your children or grandchildren, who are minors. The proceeds will be transferred to a term annuity registered in their names; or
  • The beneficiary is your children or grandchildren, irrespective of age, who are dependent on your estate financially because of physical or mental infirmity. The RRSP grants will be transferred to a RRSP or RRIF registered in the names of beneficiaries or will be benefited to purchase an annuity

In other scenarios, the stability of the RRSP at the date of death is included as income on the plan holder’s final tax return.

Company Information

Zen+ Financial

10 Milner Business Crt, Suite 208
Scarborough, Ontario, M1B 3C6


Jelan Arumuganathan
Insurance & Financial Adviser

416 220 1010

E-mail address:
info@zenplus.ca