RRSP – Registered Retirement Savings Plan

Home RRSP – Registered Retirement Savings Plan

RRSP! The buzz word, especially starting from November every year because that is when you start thinking about saving taxes, albeit this plan is designed by the government for you to save for Retirement!

Having said that, if saving taxes takes precedence over saving for retirement, so be it, you are eventually saving this money for Retirement, because if you withdraw this amount before a specific age, you are taxed based on your existing tax bracket.

Oh, by the way, the full form of RRSP is Registered Retirement Savings Plan.

You can open the RRSP plan in form of investment/savings account, you can have a simple GIC, whose rate of return will not even beat the inflation.

Or you can open in a segregated fund, where your money is guaranteed to a certain percentage, and you can invest in safe investments.

Then, there are Mutual funds, but the returns or investments are not guaranteed!

Retirement is indisputably one of life’s major transitions, Besides the change in our daily routines, our income sources are entirely different from what they had been for years.

If you look at your expenses more closely, they tend to fall into 3 broad categories:

  1. Essential “need-to-have” expenses (housing, food, clothing, health care etc)
  2. Optional “nice-to-have” expenses (social activities, dining out, travel, recreation, gifts etc)
  3. Unforeseen expenses.