Your Friend With Benefits®

Group Savings Information


A group savings plan is a benefit that you may want to consider offering to your employees. Group savings plans can be created in a variety of forms.

Group Registered Retirement Savings Plan (RRSP): helps plan members save for retirement by deferring income tax on their contributions and savings growth.
Deferred Profit Sharing Plans (DPSP): is an employer-sponsored profit sharing plan that gives an employer the option of linking plan contributions to the profitability of the business.
Registered Pension Plan (RPP): is a tax-deferred savings vehicle that allows contributions to accumulate tax free for use as retirement income at a later date.
Group Tax-Free Savings Account (TFSA): is a flexible, registered general-purpose savings vehicle that allows Canadians to earn tax-free investment income to help meet their savings goals.
Group Non-Registered Savings Plan (NRSP): is designed to help individuals save for short-term and/or long-term goals.

A great broker can help you determine if one of these options is right for your business.

Group Registered Retirement Savings Plan (RRSP)


A Group Registered Retirement Savings Plan (RRSP) helps plan members save for retirement by deferring income tax on their contributions and savings growth. Employees’ contributions are deducted from their taxable income, reducing the income tax they pay. Income earned within a RRSP, including interest, dividends and capital gains, is not taxed until the money is withdrawn.

A group RRSP is not subject to pension standards legislation; however, the plan must be registered with CRA.

A group RRSP may offer lower investment management fees (IMFs) than those of individual savings products. As well, a group RRSP offers access to leading fund managers not generally available to individual investors, plus a diversified fund line-up.

A plan like this offers you complete freedom. It may be voluntary where the employer doesn’t even have to invest a dime and the plan is completely employee funded. It can be created where the employer matches a percentage of the employee’s contribution. Or even created as 100% employer funded.

Regardless of the structure, the employees will benefit from all of the advantages a group RRSP has to offer.

Deferred Profit Sharing Plans (DPSP)


A Deferred Profit Sharing Plan (DPSP) is an employer-sponsored profit sharing plan that gives an employer the option of linking plan contributions to the profitability of the business and, on a periodic basis, sharing business profits with employees by contributing to the DPSP on each employee’s behalf. Employees do not contribute to DPSPs.

This plan type is only available as a group arrangement and is usually offered in conjunction with a group Registered Retirement Savings Plan (RRSP).

A DPSP offers lower investment management fees (IMFs) than those of individual savings products. As well, a DPSP offers access to leading fund managers not generally available to individual investors, plus a diversified fund line–up.

Registered Pension Plan (RPP)


A Registered Pension Plan (RPP) is a tax-deferred savings vehicle that allows contributions to accumulate tax free for use as retirement income at a later date. It is a plan designed to attract and retain employees by encouraging long-term retirement saving and loyalty through a variable vesting schedule and a locking-in feature.

Group Tax-Free Savings Account (TFSA)


A Tax-Free Savings Account is a flexible, registered general-purpose savings vehicle that allows Canadians to earn tax-free investment income to help meet their savings goals. A TFSA complements existing registered plans such as a Registered Pension Plan (RPP) or a Registered Retirement Savings Plan (RRSP).

Non-Registered Savings Plan (NRSP)


Non-Registered Savings Plans are designed to help individuals save for short-term and/or long-term goals (such as education, vacation or purchasing a home) or to supplement retirement income.