Encompass Credit Union - Hardisty

An RRSP is a tax-sheltered savings plan that allows you to save money for retirement. At PlanWright, we can help you to grow your money through the use of mutual† or segregated funds. As the growth is sheltered, you will not pay taxes on it. When you contribute to an RRSP, the contributions are tax deductible and your taxable income will be reduced for that year. This will generate a refund for the taxes you had paid on the amount contributed. If you have been working and haven’t made use of RRSPs yet, you can use up previous years’ contribution room. Your annual contributions are based on your annual income, 18% of last year’s income or $25,370 (2016), whichever is greater.

Using these plans will deter you from using these funds when you are in a higher tax bracket. The purpose of these plans is to save for retirement and start to generate income from them when you are in a lower tax bracket, as the funds will be taxed when you withdraw them from the plan. The RRSP must be terminated by the end of the year that the individual turns 71. These individuals must change the plans over to a Registered Retirement Income Fund (RRIF), which has a minimum amount that you must withdraw each year. This may supplement other retirement funds, such as funds from a pension plan, Old Age Security, or CPP. Taxes will be paid on the withdrawn money from the RRIF, however, people are usually in a lower tax bracket at this age and will have to pay minimal taxes.

We offer RRSPs as well as Spousal RRSPs, in which the higher income earning spouse can contribute to their spouse’s plan.