RRSPs

General RRSP Options at KCU

A Registered Retirement Savings Plan is a government-approved plan through which you may save money for your retirement years. Your contributions, within limits, are tax deductible, and the income earned is tax sheltered.

  • To be eligible to contribute you must have "earned income" subject to Canadian taxation.
  • You can make part or all of any contribution to a plan in your name or that of a spouse.

Spousal RRSPs

If one spouse will be in a higher tax bracket in retirement as much of the RRSP funds as possible should be accumulated in the name of the spouse who will be in the lower bracket. The income eventually created from the funds will then be taxed at that spouse's lower tax rate.

To set up a spousal RRSP, your spouse applies for a plan in his or her name, even though your spouse may not have any earned income. You make the contributions to the plan and receive the tax benefit. Although you make the contributions the assets of the plan belong to your spouse.

RRSP Deduction Limits

Your Notice of Assessment from Canada Revenue Agency, received after filing your tax return, will state your RRSP deduction limit for the following year. Any time after receiving this notice, you can also phone the Canada Revenue Agency TIPS line listed in your telephone directory to confirm your deduction limit.

Carry Forward Unused Deduction Room

If you don't claim your maximum RRSP deduction, or make a contribution, you can carry forward any unused deduction room indefinitely. If you don't have the cash to contribute now, you can make a larger catch-up contribution in future years.

What Types Of RRSPs Are Available?

Deposit-type RRSP's are the most common plans.

  • Variable Rate
  • Tiered daily interest calculated daily on closing balance and
    paid quarterly
  • Minimum $100 to open a Variable Rate RRSP unless subscribing to an Automatic Investment Plan

Automatic Investment Plan:

  • Allows you to contribute to your RRSP through payroll deduction or transfer from account on a weekly, bi-weekly, or monthly basis
  • Once funds have accumulated to $1000, your funds will be automatically invested into a fixed term deposit at a preselected term length