Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
Please check if information is accurate. Please include stuff I have missed.
![HOW DOES IT WORK
Pre-tax money is placed by the investor into the RRSP account where the funds
until they are withdrawn. At the time of withdrawal, they will be taxed at a marginal rate. It
grow
tax-free
allows investors to compound without being taxed, as long as the funds are not withdrawn.
RRSP encourages Canadians to save for retirement which will help the population to be less
reliant on the Canadian Pension Plan for retirement needs.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ff4c617f2-91ad-4b3f-8379-ca1241aa79a8%2Fa6bb53fc-6997-445e-acde-5b4dc419752b%2Fn7kh6n_processed.jpeg&w=3840&q=75)
Transcribed Image Text:HOW DOES IT WORK
Pre-tax money is placed by the investor into the RRSP account where the funds
until they are withdrawn. At the time of withdrawal, they will be taxed at a marginal rate. It
grow
tax-free
allows investors to compound without being taxed, as long as the funds are not withdrawn.
RRSP encourages Canadians to save for retirement which will help the population to be less
reliant on the Canadian Pension Plan for retirement needs.
![WHAT IS IT
A Registered Retirement Savings Plan (RRSP) is a retirement savings plan that you establish, that
we register, and to which you or your spouse or common-law partner contribute. Deductible
RRSP contributions can be used to reduce your tax. Any income you earn in the RRSP is usually
exempt from tax as long as the funds remain in the plan; you generally have to pay tax when you
receive payments from the plan.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ff4c617f2-91ad-4b3f-8379-ca1241aa79a8%2Fa6bb53fc-6997-445e-acde-5b4dc419752b%2Fc8uthg_processed.jpeg&w=3840&q=75)
Transcribed Image Text:WHAT IS IT
A Registered Retirement Savings Plan (RRSP) is a retirement savings plan that you establish, that
we register, and to which you or your spouse or common-law partner contribute. Deductible
RRSP contributions can be used to reduce your tax. Any income you earn in the RRSP is usually
exempt from tax as long as the funds remain in the plan; you generally have to pay tax when you
receive payments from the plan.
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