One way to save for your retirement is contributing to your IBEW Local 353 Group Registered Retirement Savings Plan (RRSP). Your Group RRSP is a “self-directed” plan, which means that when you enroll in the plan, you select where you would like your money to be invested. If you don’t make a choice, your money will automatically be invested in the Continuum Target Date Fund closest to the year you reach age 65. You can change this selection at any time.
Your IBEW Local 353 Group RRSP
For most members, for every hour you work, your employer contributes 3% of your wages to the IBEW Local 353 Group RRSP, administered by Canada Life. Once you join, you’ll receive quarterly updates showing how the investments you’ve selected are performing, along with the amount of contributions made or withdrawn during that quarter.
You can also monitor your contributions online at My Canada Life at Work or by reviewing your Quarterly Contribution Statements from TEIBAS. For questions regarding contributing to your spouse’s RRSP or questions regarding transferring to another RRSP, please call Canada Life directly at 1-800-724-3402. Saving for your future doesn’t need to be stressful. It can be easy.
RRSP Tax Savings
You’ll receive a tax receipt annually from Canada Life. Here are three ways RRSPs can reduce your taxes:
- Contributions are deducted from income before calculating income tax.
- Income earned within your RRSP account (interest or investment returns) isn’t taxed until money is withdrawn from the plan.
- Money may be withdrawn from an RRSP in tax years when you have less income (due to retirement, unemployment, etc.) placing you in a lower tax bracket and reducing your tax obligations.
What to Know About RRSP Contribution Room
Remember to take the time to review your RRSP contributions prior to December 31st of each year and to monitor how much you and your employer have contributed over the year. Your RRSP “contribution room” for the year is the maximum amount that can be contributed to RRSPs on your behalf during that year. This amount is generally determined by the following calculation: 18% of your previous year’s income minus any contributions to a registered pension plan (such as the IBEW 353 pension plan) in the previous year plus any RRSP room carried forward from prior years. If your employer’s total annual contributions to the pension plan and Group RRSP are more than your annual “contribution room” this may result in an overcontribution. It’s your responsibility to monitor your contribution room to make sure your don’t overcontribute.
Overcontributing can result in a penalty of 1% per month on your contributions that exceed your contribution room by more than $2,000. To avoid over contributing, make sure you monitor your contributions online at My Canada Life at Work or visit myteibas.com to review your quarterly contribution statements from TEIBAS.
For more information on RRSP contribution limits visit the Canada Revenue Agency’s website at https://www.canada.ca/en/revenue-agency.html or call
1-800-959-8281 to answer your questions.