Registered Disability Savings Plan

The Registered Disability Savings Plan (RDSP) is a federally regulated registered savings plan that helps to ensure long-term financial security for individuals and families of individuals with disabilities. Individuals who qualify for the Canada Revenue Agency (CRA) Disability Tax Credit qualify for this program. One RDSP per qualified person and one beneficiary per RDSP are allowed.

Benefits of a RDSP

Generous government grants and bonds, combined with tax deferred growth, make RDSPs a powerful investment tool. This savings plan is intended to provide lifetime financial income for people with disabilities. Furthermore, any income from these plans is not means tested against any other federal or provincial programs.

• Although not tax deductible, deposits and grants grow on a tax-deferred basis
• Deposits may be eligible for the Canada Disability Savings Grant (CDSG) and may qualify for additional payment under this program
• Up to $200,000 may be contributed to a RDSP over the life of the plan per beneficiary
• There is a wide selection of investments to choose from, including a principal guaranteed mutual fund

Canada Disability Savings Grant

To encourage long-term savings through a RDSP, the Government of Canada created the Canada Disability Savings Grant (CDSG). Contributions to a RDSP may qualify for payments from the CDSG, up to a lifetime maximum of $70,000 per beneficiary depending on family income or the individual’s income. Once the individual is 19, government contributions will be based on their income. Therefore, it is often beneficial to wait until the beneficiary is an adult to start the plan.

Funds must remain invested for a period of 10 years, so contributions matched by government grants have to be made by the time the individual turns 49. Twenty years of contributions will produce the maximum amount of grant contribution; therefore, the best age to start this savings plan is between the ages of 19 and 29.

Canada Disability Savings Bond

Lower-income families may qualify for additional payments in the form of the Canada Disability Savings Bond (CDSB), up to a lifetime maximum of $20,000. Individuals that cannot afford to make any contributions may qualify for a $1,000 CDSB just by opening an account.

More Information

To learn more about the RDSP, contact us at 306-842-6641. We offer a full suite of investment products and financial planning.