During this exciting RRSP season (where the main topic seems to be whether you can sex up the argument about TFSA or RRSP) there does not seem too much being mentioned about the Spousal RRSP and its uses in an Bimodal Savings system.
Can I use a Spousal RRSP ?
Let me be clear if you fit into any of the following groups then this advice is not for you:
- Not married, if you don’t have a spouse, you can’t have a spousal RRSP.
- If you are married but your spouse makes as much as you do
- You and your spouse have a good pension plan (which you are sure is going to exist when you retire)
- RRSPs are viewed as the devil’s own way to screw you into paying more taxes later in life.
In all those situations the Spousal RRSP really doesn’t do you too much good, however, if you are not one of the previous group, look into a spousal RRSP.
Why Spousal RRSP ?
The spousal RRSP was first introduced as the original income sharing mechanism. It can also be used for income sharing even before you retire (if you are careful, and you don’t care about your retirement funds).
On the retirement side of things, a spousal RRSP is relatively straight forward. It allows your spouse and you to split your moneys for your retirement years.
So let us give a cheer for the forgotten Spousal RRSP. It still can be an important part of your retirement plan!