The first 60 days of every year is known as RRSP season. March 1, 2011 is the RRSP deadline when Canadians can make contributions to an RRSP and have it eligible for a tax deduction for the previous year (2010). Before you make a RRSP contribution, here are some basics you need to know.
What is an RRSP?
The RRSP is a well-known account that has been around since 1957. RRSP is short for Registered Retirement Savings Plan. The plan is designed to help individuals save for retirement by giving them two tax benefits. The first is a tax deduction and the second is tax deferred growth. With these two benefits, RRSPs remain one of the best ways to save for retirement.
How much can you put into a RRSP?
There are two ways to figure out how much you can contribute to a RRSP. Let’s start with the harder way. Basically, there is a formula to determining your RRSP contribution limit, which goes like this:
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Tags: Rrsp, Rrsp Basics
Posted February 7, 2011 by Admin under Financial Guru