In Canada, retired individuals and senior citizens are well-looked after. There are many programs, facilities and services that cater exclusively to this demographic.
What is RRSP?
A Registered Retirement Savings Plan (RRSP) allows individuals to save for retirement while lowering taxes through their banking institution. Putting money into this account means that you can deduct the amount from the taxable income for that year.
This type of account should be opened as quickly as possible to start saving for retirement, however, in some cases you can use the money for other essential items like the purchase of your home.
You will, however, need to decide what you would like to do with your RRSP when you turn 71 years old. Most Canadians opt for a Registered Retirement Income Fund (RRIF).
You are eligible to open an RRSP if you:
|Are a Canadian resident for tax purposes and file income taxes in Canada|
|No age limit (you or your guardian may set one up)|
|Have an income|
When you retire you may be eligible for government pension assistance, though you will need to assess whether you are eligible for the specific programs.
Will I receive financial assistance from the Government when I retire?
|Canada Pension Plan (CPP) Retirement Pension|
|Old Age Security (OAS) Pension|
|Guaranteed Income Supplement (GIS)|
|Allowance and Allowance for the Survivor|
Will I get a pension from my employer?
While working, you may receive a pension plan from your employer which will help you save for retirement. There are usually two types of pension plans; the Defined Benefit Plan, which gives you a specific percentage of your salary when you retire, and the Defined Contribution Plan, which allows you to benefit based on the amount you and your employer contributed, including interest.