RRSPs

By Jason Heath, CFP on October 8, 2025
Estimated reading time: 4 minutes

By Jason Heath, CFP on October 8, 2025
Estimated reading time: 4 minutes

While most Canadians will benefit from continuing to contribute until the day they retire, some will be better off calling a halt sooner.

When you are in your career’s home stretch and approaching retirement, whether you do or do not contribute to your registered retirement savings plan (RRSP) becomes particularly important. Contributing to your RRSP—for most of your working life a wonderful tool for building wealth—can, in some cases, be detrimental to your financial security.

If you have a group RRSP with matching contributions from your employer, this provides a significant boost to your savings. Many group plans offer matching contributions of 25%, 50%, or even 100% on contributions up to a certain dollar amount or percentage of income. To get your hands on this free money, you have to keep contributing. Defined contribution (DC) pension plans fall into this same category, with employer contributions making maximum participation a compelling opportunity.

If you do not have much retirement savings or pension income, RRSP contributions are also generally advantageous. The reason is that you are likely to be in a lower tax bracket in retirement. Paying a lower tax rate in the future than today makes RRSP contributions even more compelling.

Anyone in a high tax bracket today—especially near or at the top tax bracket in their province—will........

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