How To Contribute To RRSP

Learning how to contribute to RRSP can help you save taxes, build your nest egg, and avoid unnecessary penalties.
How To Contribute To RRSP
Article Overview

Welcome to our comprehensive guide to how to contribute to RRSP. The Registered Retirement Savings Plan (RRSP) is an important financial tool that allows Canadians to prepare for retirement while benefiting from tax breaks. In this article, we’ll walk you through the process of contributing to your RRSP, emphasize the benefits of maximizing your contributions, and provide practical advice to help you make the most of this excellent financial vehicle. Let’s get started!

How To Contribute To RRSP

Contributing to your RRSP is an important step toward a comfortable retirement. You may establish a sizable retirement fund while enjoying immediate tax benefits if you grasp the ins and outs of RRSP contributions, maximize your contributions, and make prudent investment selections. Remember to assess and adjust your contributions on a regular basis based on your financial situation and long-term goals. You can maximize your financial future with careful planning and smart decision-making.

RRSP Contributions

Contributing to your RRSP is a critical step toward accumulating a substantial retirement nest egg. Here’s what you should know:

1. What are RRSP contributions?

The money you place into your Registered Retirement Savings Plan account is referred to as RRSP contributions. These contributions are tax-deductible, which means they can reduce your taxable income and provide immediate tax savings.

2. Contribution limit

The annual contribution limit for RRSPs are determined by the Canada Revenue Agency (CRA) based on your annual earned income. The ceiling for the 2024 tax year is 18% of your previous year’s earned income, up to a maximum of CAD $31,560. To find out your own contribution room, you can check your most recent Notice of Assessment or login to your online account with CRA.

Increasing Your RRSP Contributions

Consider the following techniques to make the most of your RRSP and prepare for a comfortable retirement:

1. Establish a contribution budget

Determine how much you can contribute to your RRSP without jeopardizing your immediate financial needs by assessing your financial situation. While it is advantageous to maximize your contributions, it is also necessary to establish a balance that is compatible with your existing lifestyle and aspirations. You can choose to contribute a fixed amount biweekly, monthly or annually, whichever fits your situation better. 

2. Participate in employer matching programs

If your workplace has an RRSP or pension matching program, take full advantage of this to get the maximum match. This matching usually comes in percentage of your income; it can range anywhere from 2%-7%. This helps you to double down the money added to your retirement savings, and it can greatly boost your long-term financial capital for retirement purpose.

3. Make use of the carry-forward room

If you were unable to maximize your contributions in past years, your RRSP contribution room carries forward, allowing you to contribute in future years. Check your unused contribution room and consider topping up to save more taxes during high-income earning years.

Contributing Wisely For Optimal Returns

Strategic planning and wise investment selections can help your RRSP grow faster. Consider the following suggestions:

1. Diversify your investments

2. Review and adjust regularly

Review the performance of your RRSP investments on a regular basis and make any necessary adjustments based on your risk tolerance, financial goals, and market changes. Consulting with a financial advisor can provide useful insights and advice.

3. Think long-term

RRSPs are intended for long-term retirement savings, so while making investing decisions, keep the long term in mind. Stay focused on your overall retirement goals rather than making rash decisions based on short-term market swings.

How to contribute to RRSP: Tips

Here are a few more tips to help you optimize your RRSP contributions:

1. Automatic contributions

Set up automatic contributions to your RRSP to ensure a consistent and disciplined approach to retirement savings. You can get the financial institution you have your RRSP with to set up a pre-authorized withdrawal periodically from your bank account. The withdrawal amount is also set at the time, so you can achieve automatic savings and see your account balance grow over time.

2. Tax refunds and reinvestment

If you received a tax refund as a result of your RRSP contributions, consider reinvesting it back into your RRSP to recycle the tax refund for additional growth.

3. Contribute to spousal RRSPs

Consider making spousal RRSP contributions if your spouse has a lower income or is in a lower tax bracket. Spousal RRSP contributions allow a tax deduction against your income, but future growth is taxed at your spouse’s income. This can help to equalize retirement income while also lowering overall taxes paid in retirement.


To deposit money into your RRSP, you can typically do so through your financial institution or financial advisor by making a contribution either in person, online, or by phone. They will guide you through the process and provide you with the necessary forms and information to complete the deposit.

Yes, you can contribute to your RRSP yourself. As the account holder, you have the flexibility to make contributions based on your financial goals and available funds. However, it’s important to consider the contribution limits set by the government to ensure you don’t exceed the allowed amount.

Yes, many financial institutions offer online platforms that allow you to make RRSP contributions. These platforms are secure and convenient, allowing you to transfer funds from your bank account directly into your RRSP. Check with your specific financial institution to determine the online options available to you.

You can contribute to your RRSP at any time, but there are specific deadlines to consider. The deadline for making RRSP contributions and applying them to the previous tax year is usually around the end of February or early March. It’s generally advisable to contribute earlier in the year to maximize the potential growth of your investments within the RRSP.

Article Overview

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Written by:

Jim Pan, CFP, MFA-P

Jim is a dedicated, fee and advice only independent Certified Financial Planner with a focus on supporting healthcare business owners during their crucial growth phase. His expertise lies in offering comprehensive solutions to minimize taxes while embracing a holistic approach. With a career spanning back to 2010, Jim has established a strong presence in the financial industry. He proudly holds a range of designations, including Certified Financial Planner (CFP), and Master Financial Advisor - Philanthropy (MFA-P). He is currently pursuing additional designations and qualifications to better serve his clients and community. Beyond his qualifications, Jim is a member and an esteemed participant in the Million Dollar Round Table (MDRT), an exclusive global association comprising the top 1% of financial advisors. Jim's commitment extends to the community, where he spearheads numerous charitable fundraising events and plays an active role in enhancing the well-being of others. Additionally, he has contributed significantly by serving on the board of the Canadian Mental Health Association in Vancouver. Currently, he volunteers with Junior Achievement of British Columbia (JABC) to present personal finance topics to youths.

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