What are all the possible retirement and savings plans or accounts in Canada? A list of them.

In summary, this is a list of all of the possible retirement and savings plans available to Canadians:

• RRSP: Registered Retirement Savings Plan
• TFSA: Tax-Free Savings Account
• FHSA: First Home Savings Plan
• CPP: Canadian Pension Plan
• OAS: Old Age Security
• GIS: Guaranteed Income Supplement
• RESP: Registered Education Savings Plan
• Company Pension Plan
• Margin accounts

They are all taxed differently, and have different requirements, and in brief here they are:

RRSP: Registered Retirement Savings Plan

A misnomer. ‘Savings plan’ leads you to think you save into it and everything is fine, when in fact you should be INVESTING in that account instead.

There is no age limit, so even children can have RRSP room if they start working early, like if they are hired as employees in your company, or work as child actors for instance, or start a business.

You can contribute to it if you have an earned income (like with a T4 payslip), and they take a percentage of your income and create the contribution room based off it.

You only get taxed in the year you take out the money.

Read:

• Canada Basic 101: Registered Retirement Savings Plan (RRSP)
• All my posts on RRSPs and their benefits versus other plans

TFSA: Tax-Free Savings Account

Another misnomer. ‘Savings account’ *groan* You INVEST the savings in this account, you do not simply SAVE into the account.

The age limit is 18 (meaning you must be 18 to contribute to it), and there is a maximum you can put into it every year that increases over time. It started at $5000 annually, in 2009.

You only get taxed in the year you put in the money.

Read:

• Canada Basic 101: Tax-Free Savings Account (TFSA)
• All my posts on TFSAs and their benefits versus other plans

FHSA: First home savings plan

This is my favourite plan out of all of them. I am sad I do not qualify (it came a few years too late for me), but it is like if an RRSP and a TFSA had a baby and it took the best features of both of them.

There is an age limit of 18 years old, a contribution cap limit each year (to a maximum total amount you can put in there of $40K), and it is meant to help Canadians save for a down payment on a home.

If you pass a decade or so, and still did not use the money, it automatically becomes part of your RRSP. You even get a tax credit on it, like in an RRSP.

You can withdraw the money at any time as well and not get taxed. It is a thing of beauty and regardless of your feelings on home ownership, EVERYONE should contribute to this plan instead of their RRSP or TFSA.

Read:

• All my posts on FHSA

CPP: Canadian Pension Plan

If you are a Canadian employee, who gets a T4 slip, you automatically pay into this out of your paycheques every month. Look for it on your payslip.

No age limit to contribute, and you get it when you turn 60 (early withdrawal), but typically it should be at 65. If you wait until you are 70 to take it, they give you more money (an incentive to wait).

Read:

• All my posts on CPP

OAS: Old Age Security

This is automatically given to any Canadian who has lived in Canada for 40 years or longer. Basically, you have to be pretty young to have started in Canada to even hope to collect anything.

If you immigrated when you were 30 and started working immediately, then you will get it at 70.

If you immigrated at 10 but only started working at 25, you will be eligible for it when you turn 40, and will receive it at 65.

There is an income cap on this, meaning if you make more than a certain amount at 65, you could receive less or nothing at all. It is truly meant to help the poorer seniors, not the ones who have saved and invested enough to secure themselves.

Read:

• All my posts on OAS

GIS: Guaranteed Income Supplement

You do not want to have to qualify for this one if you can, because it is for the poorest of the poor. There is an income cap that is much lower than the GIS, and it is meant for Canadians living on the poverty line. If you qualify for this, you have absolutely nothing or near nothing to do so.

Read:

• All my posts on GIS

RESP: Registered Education Savings Plan

This is for your children, and again, the misnomer of it being a ‘savings plan’ drives me nuts.

Anyway, you treat it like an investment plan for your kids, and you can contribute up to $50K per child.

If you hold back contributions and put in $2500 a year, you will get a 20% match from the government (an incentive!), but you can also put in the full $50K if you are so inclined (and able to do so), and reap the rewards of the compounding interest over a longer period of time (18 years or so), until your child is ready to withdraw the money for school.

Read:

• All my posts on RESP

Company Pension Plan

This is whatever your company has for you as an employee. If you have one, congratulations! You will receive an extra amount each year once you retire. If you do not have one, you better open up a FHSA, RRSP or TFSA.

Margin accounts

This is whatever you have saved above and beyond what is in your FHSA, RRSP, TFSA, Company pension plans or in your RESP for your kids.

This is extra money lying around that could not be maxed out anywhere else, and it is just your money growing on its own, getting taxed every year for the dividends it brings in, or if you sell, its capital gains.

No tax benefits to be gained here.

And there you have it, a short overview of every single savings plan available in Canada.