What is a RRSP?

A Registered Retirement Savings Plan (RRSP) is a personal savings account registered with the Canadian government to help individuals accumulate capital on a tax-deferred basis for their retirement. The objective is to help individuals grow their savings in a tax free environment to secure an income during retirement years.

Who is eligible? You are eligible to open a RRSP if you:

  • Are a Canadian resident
  • Have a valid Social Insurance Number (SIN)
  • Are 71 years of age or under
  • Have an income
  • Filed a Canadian tax return in the previous year


There are various types of RRSP including: individual, spousal, group, and pooled RRSP each with its own benefits.

Nevertheless, they all share one common advantage, and that is the tax benefits. Contributing to a RRSP account allows significant tax benefits when your income is at its highest. The total amount contributed to your RRSP in a given tax year is deducted from your taxable income for that year, reducing the amount of tax payable.

Consider two friends: Joanne and Alan who earn $35,000 a year and have a marginal tax rate of 26%. Alan ends up paying fewer taxes than Joanne because of his RRSP contributions.

Contact a 3i Financial Advisor today to see how an RRSP can help your retirement planning and reach your retirement goals.