Amoung the many Canadians who have displayed the foresight to contribute to an RRSP, there is a growing segment of even more fortunate individuals: those who are enjoys several additional valuable benefits because they have chosen to participate in a Group RRSP through their employer.
A Group RRSP is simply a collection of individual RRSPs where the employer arranges for employees to make contributions through regular payroll deductions on a pre-tax basis and forwards it to the investment manager for the group plan to have the contribution deposited into an individual RRSP and invested as specified.
Because the Group RRSP contributions are made on a pre-tax basis by payroll deduction, the amount of tax the employer is required to deduct at source is calculated after the Group RRSP contibution is deducted, resulting in an instant tax saving.
In addition to the instant tax saving, a Group RRSP also offers the following benefits:
- Payroll deduction offers the ultimate convenience; It is the easiest way to save.
- Acquire all the benefits of investing regularly
- Investment options based on fund performance and investor profile.
- The service of a qualified financial advisor.
Without a doubt the real advantage of a group plan is in the matching contribution made by the employer ensuring that the employee’s contribution requirement remains affordabel, while maximizinf investment return.
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