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It's deadline day! Last-minute RRSP tips

Last Updated Mar 1, 2017 at 11:20 am PST

(iStock Photo)

Time is running out to contribute to your RRSP

One expert suggests questioning whether you need to pour money into a retirement plan

VANCOUVER (NEWS 1130) – Okay procrastinators, if you’ve been avoiding that RRSP contribution, there is little time to squeeze it in before the deadline for the 2016 tax year.

NEWS 1130 Business Reporter Richard Southern offers some last minute tips. “First off, figure out if you really need to be contributing to an RRSP. For Canadians making less than $40,000 a year, investing in a Tax Free Savings Account may make more sense. RRSPs work best for those in higher tax brackets,” explains Southern.

He also recommends unsure investors park their money in a registered GIC so it qualifies for the 2016 tax year. “Basically you just want to get that cash in an RRSP and you can figure out at a later date exactly how you want to invest it.”

If you are married, Southern suggests contributing to a spousal RRSP. “They let higher income earners contribute more cash to a retirement account. It’s basically a form of income splitting.”

Finally, he says it’s never too early to start thinking about retirement. “If you have a child under the age of 18, he or she may want to file a tax return to free up some RRSP contribution space.”

The deadline for RRSP contributions for the 2016 tax year is midnight.