Section 8 – Retirement Assistance Programs
Section 8 Introduction
The purpose of retirement assistance programs is to provide individuals with financial independence based on their desired lifestyle when they retire, by complementing public retirement savings plans (see Section XII). Given today’s longer life expectancies, individuals must plan for and invest increasingly greater amounts to cover longer retirement periods.
Tax measures generally allow investment income to accrue in certain tax-sheltered plans. Accordingly, it accrues more quickly at very attractive rates. This becomes even more attractive if the taxpayer starts to save for retirement at a very early age as can be seen in the following table:
| Starting age | Total investment ($5,000/year until age 65) | Portfolio value at age 65 | |
| 4% return | 6% return | ||
| 25 years | $200,000 | $494,133 | $820,238 |
| 30 years | $175,000 | $382,992 | $590,604 |
| 40 years | $125,000 | $216,559 | $290,782 |
| 50 years | $75,000 | $104,123 | $123,363 |
Tax-assisted retirement saving measures are the same federally and provincially. The measures vary depending on whether it is an RRSP or an employer pension plan.
This document is up to date as of August 31, 2023 and reflects the status of legislation, including proposed amendments at this date.
