Regular RRSP contributions
A regular savings plan is one of the best moves you can make for your RRSP. It's much easier to come up with $100 per month, for instance, than waiting until January or February to come up with $1200. By contributing more frequently, your money will begin working sooner for you. And that means your retirement nest egg will grow faster.
Small steps to a big payoff
Monthly contributions put time on your side. Even though the amounts may be small, your RRSP earns income sooner and for longer periods in a tax-sheltered environment.
| Monthly saver | Yearly saver | |
|---|---|---|
| Amount contributed | $400 | $4,800 |
| Time period | 25 years | 25 years |
| Total contribution | $120,000 | $120,000 |
| Annual rate of return | 6% | 6% |
| Value after 25 years | $277,198 | $263,350 |
| Benefit to saving monthly | $13,848 | N/A |
Get your tax refund early
A regular contribution plan can get you one other advantage: you may be able to get your tax refund up front. Here's how.
The Canada Revenue Agency (CRA) allows your employer to take RRSP contributions into account when calculating the income tax withheld from your paycheque. So, if you contribute $100 each payday and your marginal tax rate is 40%, your take-home pay will be reduced by just $60.
To get your tax refund early, you need to file CRA Form T1213, "Request to reduce tax deductions at source" (available online at www.cra-arc.gc.ca). If your request is approved, the government will notify your employer to withhold less personal income tax from your paycheque.
Monthly RRSP investment options
There are many RRSP investment options. The ones that are right for you depend on your investment objectives and your risk tolerance.
Lower risk:
We offer a wide range of lower risk investment options such as variable rate , or .
Higher risk:
We have a wide range of investment options for investors with larger portfolios or longer term objectives. These include investment products and advice through Credential Asset Management and Vancity Investment Management.
A Vancity investment professional can help you determine which RRSP investment options are best for you. To speak with an investment professional, contact us at 604-877-7000, visit your local branch or in your neighborhood.
Credential Direct® is a division of Credential Securities Inc. and operates as a separate business unit. Credential Securities is a member of the Canadian Investor Protection Fund.
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