Registered Disability Savings Plan

Registered Disability Savings Plan

As a person with a disability, have you worried about how to save for the future? One answer might be the Registered Disability Savings Plan, which is a long-term savings plan to help Canadians with disabilities to save for the future.

To be eligible for the RDSP, individuals must be under the age of 60, a Canadian resident with a social insurance number, and Eligible for the Disability Tax Credit (Disability Amount). There are two ways the RDSP can grow, the Canada Disability Savings Grant and the Canada Disability Savings Bond.

Canada Disability Savings Grant:

The Government will match your contributions by 300, 200 or 100 percent depending on the beneficiary’s family income and the amount of your annual contribution. A maximum of $3,500 will be paid each year, with a lifetime limit of $70,000. Contributions made to an RDSP on or before December 31 of the year in which the beneficiary turns 49 are eligible to receive matching grants

Canada Disability Savings Bond:

Depending on your beneficiaries family income you may receive, a Canada Disability Savings Bond (CDSB) of up to $1,000 per year.

You do not need to make any contributions to your RDSP in order to receive the bond. There is a lifetime limit of $20,000. Bonds will be paid into an RDSP on eligible requests made on or before December 31 of the year in which the beneficiary turns 49.

You can withdraw from your RDSP at any time however it is important to be aware of the 10 year rule - All grants or bonds received have a ten year waiting period. If you withdraw any of the grant or bond money received in the previous ten years, it must be paid back to the Government. So it makes sense to keep the savings in there for the 10 year waiting period.

One aspect that makes the RDSP unique, is the money in your RDSP can be used for any purpose. Even for people accessing Persons with Disabilities Designation through the Ministry of Social Development, money from an RDSP is not considered income, therefore will not affect the level of support you get.

For more information about this program, ask your financial institution, visit www.disabilitysavings.gc.ca or contact Crystal at IL Vernon at 250-545-9292.