From tax advantages to generous government incentives, an RDSP can bring greater financial stability and peace of mind for individuals, their families and their caregivers. –Tanya Postlewaite
Introduced in 2008, by the federal government, an RDSP is a powerful tool for individuals and families with all income levels. Offering generous financial incentives, RDSPs are designed to help children and adults with a disability to save money for their future needs.
Are you missing out?
Awareness around the RDSPs is low compared to other registered accounts, according to research by Concentra Trust, an Equitable Bank company providing services to Canada’s credit unions. This results in many missing out on the opportunity to receive federal incentives such as the Canada Disability Savings Grant (CDSG) and Canada Disability Savings Bond (CDSB) that make the account a particularly powerful savings tool, says Tanya Postlewaite, Vice President and head of credit union services at Equitable Bank.
“For the people that open an RDSP, the benefits are clear and compelling. Having a nest egg in an RDSP can help reduce financial worry, offer long-term financial security and manage unforeseen expenses more confidently. That can be life changing,” Postlewaite says.
The CDSG provides up to $3,500 annually (lifetime limit of $70,000) based on personal contributions, while the CDSB can support individuals in low to modest income families with up to $1,000 annually (lifetime limit of $20,000) based on adjusted family net income.
Designed for long-term tax-deferred growth, a plan opened with Concentra Trust or at your local credit union can grow quickly if the holder makes full use of available grant and bond, which could be as much as $90,000. Funds can be used for any purpose when the time comes.
To be eligible to open an RDSP, the plan’s beneficiary must:
• Be a Canadian resident
• Qualify for Disability Tax Credit
• Have a valid social insurance number
• Be under 60 years of age.
According to the guidelines, the beneficiary can manage the funds inside the plan if they are an adult and legally able to enter a contract. Otherwise, a parent, spouse, common-law partner, sibling or legal guardian can be the holder. When they’re ready, the beneficiary of the plan can receive funds in a lump sum or regularly scheduled payments.
For questions, or if you wish to get started, call 1-800-788-6311 or visit Concentra’s website. If you would like to learn more about RDSPs in-person, visit your local credit union. Concentra Trust proudly partners with most credit unions across Canada, head to your nearest one to open an RDSP. Visit your local Credit Union.
