There are many different investment, income and retirement options to choose from. Here’s a look at investment plans, accounts and products that can help you reach your financial goals.
Registered retirement savings plan (RRSP)
An RRSP helps you save for your retirement. Your contributions into this plan are tax-deductible. And, the income earned within your RRSP are tax-deferred until you make withdrawals.
Tax-free savings account (TFSA)
A TFSA helps you save money for any purpose. Although contributions aren’t tax-deductible, your investments can grow tax-free and you can make withdrawals at any time without paying tax.
First home savings account (FHSA)
A FHSA helps you save money to buy or build a qualifying first home tax-free. Your contributions into this plan are tax-deductible. You can make tax-free withdrawals for up to 15 years to buy a qualifying home. If you don’t buy a home, any unused funds may be transferred directly to an RRSP.
Locked-in retirement account (LIRA)
A LIRA is like an RRSP, but the funds in the plan come from a pension plan instead of RRSP contributions. But unlike an RRSP, LIRAs have withdrawal restrictions.
Registered education savings plan (RESP)
An RESP helps you save for a child’s post-secondary education or training. Your contributions into this plan aren’t tax-deductible, and any income earned within the plan is tax-deferred until withdrawals are made.
Registered retirement income fund (RRIF)
A RRIF is an investment account that pays you income during retirement. There’s a minimum amount that you must withdraw from a RRIF each year. Funds in this plan are tax-deferred until withdrawals are made.
Life income fund (LIF)
A LIF is like a RRIF. It pays you income during retirement. There’s a minimum amount you must withdraw from a LIF each year and there’s a maximum limit too. Funds in this plan are tax-deferred until withdrawals are made.
Restricted life income fund (RLIF) & locked-in retirement income fund (LRIF)
An RLIF or an LRIF turns your locked-in pension funds into retirement income. There’s a minimum amount you must withdraw from a LIF each year and there’s a maximum limit too.