Registered Retirement Savings Plan (RRSP) FAQ 

When should I start investing in an RRSP?
The best time to start is the first year you get a job. The earlier you start, the less you have to save each year for your retirement.  

Who is eligible to contribute to an RRSP?
All Canadian taxpayers under the age of 71 with earned income in the previous tax year and a Social Insurance Number can contribute to an RRSP.

How old do you need to be to start contributing?
Anyone between the ages of 16 and 71 with qualified earned income from the previous year and a Social Insurance Number can contribute to an RRSP. Clients wanting to hold their RRSP in mutual funds must be at least 18 years old.

What is earned income?
For most people, their earned income is the amount of their salary, before deductions such as CPP (Canada Pension Plan), EI (Employment Insurance), and Federal and Provincial taxes.

How do I determine the amount I can contribute?
The easiest way to confirm your contribution limit is to look at your Notice of Assessment, which you'll receive after you file your income tax return with the Government of Canada.

Is there a minimum amount I need to invest in my RRSP?
No. You can start an RRSP with as little as $25.

What happens if I don’t invest my maximum contribution?
Extra deduction room can be carried forward indefinitely and used in any subsequent year.

Do I have to contribute every year to my RRSP?
You are not committed to making a contribution each year, but you are much better off if you do. If you start early and make regular contributions to your RRSP, your savings will grow at a much faster rate.

What is a spousal or common law partner RRSP and how does it work?
In a spousal or common law partner RRSP, you can contribute to an RRSP for the benefit of your spouse or common law partner. You get the deduction from taxable income, but your spouse or common law partner will receive the funds from the plan when they are withdrawn and your spouse or common law partner will report the income on those withdrawals on their own income tax. This type of RRSP is extremely effective if your spouse or common law partner has less income than you   and expects less income at retirement. This type of RRSP can balance out the couple’s income levels and reduce the overall tax burden. Use your RRSP contribution limit to contribute to your own plan, a spousal or common law partner plan or some combination of the two. You have one limit that must be allocated between your own plan and your spouse or common law partner’s. 

Can I withdraw funds from my RRSP before I retire?
Yes you can. When you do, however, the withdrawal becomes taxable income.

If you have more questions about RRSPs or other investment options, visit or call us at SASCU Wealth.