REGISTERED DISABILITY SAVINGS PLAN
Have you opened a Registered Disability Savings Plan (RDSP) for yourself or your disabled family member? You should—today! This tax-deferred savings plan offered by the federal government is an invaluable resource available to the disabled population of Canada since 2008. With 100,000 RDSP’s opened to date, an estimated 500,000 Canadian citizens will benefit from this groundbreaking initiative. Your investment, coupled with an outstanding government match program, will assure your loved one a worry-free financial future. If you have never done so yet, sit down with a financial planner today!
Here are some questions you may be asking about an RDSP:
Who is Eligible?
Your Disability Tax Credit Certificate (DTCC) is your ticket for eligibility! If you have a DTCC, you can open an RDSP.
Where is the money invested?
You choose! Any major Canadian bank can open an RDSP for you, and your choices are as endless as your bank’s account options.
Who can contribute?
Anyone—you, your relatives, your friends. Besides a lifetime maximum of $200,000, the only limit on individual contributions is that they must stop when the beneficiary/account holder turns 59.
Will I have to pay taxes on money I’m putting away for the future?
No! And not only that, the government will contribute up additional bonds and grants to your account, depending on your contributions and your income level. The additional income you earn, whether from interest or the government grants and bonds, is taxable.
What benefits can I expect to receive from the government match program?
You may receive up to $3 for every dollar you contribute! Government grants are available for up to $3500/year ($70,000 lifetime max), and for lower income families, bonds are available for up to $1000/year ($20,000 lifetime max). Definitely speak to a financial advisor to maximize your contributions. Make the most of the benefits available!
How do I withdraw money from an RDSP?
RDSP’s are designed to care for you or your disabled loved one after the age of 59. The time to plan is today! Talk to your financial advisor about the best way to start using your savings, without paying taxes or penalties. There are different payment options depending on your life situation.
Where can I find more information?
Try these links!
Employment and Social Development Canada