RRSP contribution deadline approaching
Posted Feb 28, 2011 04:30:36 PM.
This article is more than 5 years old.
The deadline to make your RRSP contributions and get the tax deduction for the 2010 tax year is Tuesday.
Investment Sales Manager with BMO, Brian Wood, tells News 95.7 you shouldn’t be waiting until the last minute.
He says with technology, it’s something you should be setting up well in advance and monitoring throughout the year.
“You can set it up weekly, bi-weekly, same day as you get paid.” he says. “If the money goes from your bank account to your RRSP contribution the day you get paid, you learn very quickly how adjust and live with it.”
Wood adds that way you’re saving the money but you’re not really missing it because it’s going directly into the RRSP.
If you ever need access to the money, he says taking money out isn’t necessarily a bad thing but it really depends on what you need it for.
“You are allowed to take money out of an RRSP without paying tax under certain consideration, if you’re purchasing a first home, potentially education.” says Wood. “Beyond that you’re looking at anything you take out of an RRSP being 100 percent taxed to you as income.”
Wood reminds us, if you’re taking money out it in a year when you have other taxable income, you’ll pay a lot of taxes.
