Registered Retirement Savings Plan
Registered Retirement Savings Plans – RRSP’s are personally managed savings plans with tax assistance, contributions are tax deductible and investment growth is not taxed as it is earned. Tax is paid when funds are withdrawn from these plans. Anyone with an earned income is eligible to contribute to an RRSP, prior to their 72nd year.
Segregated Funds – sold by life insurance companies, a segregated fund is similar to a mutual fund but has unique feature, such as the guarantee of all or part of the principal. If the fund loses value because of poor market performance, you get part or all of your original capital back but only if you keep the fund for a specific period of time, typically ten years. Segregated funds offer the possibility of protection from creditors. They are held separately from the insurance company's other assets.
Individual Pension Plan
Individual Pension Plan: A defined benefit pension plan for one person. An IPP is typically most appropriate for key executives of an organization, self-employed professionals or owner-managers. It provides all the benefits permitted under the Income Tax Act of Canada in order to maximize tax-sheltered retirement savings.