A plan for saving money registered with Revenue Canada that encourages Canadians to save for retirement by providing tax deductibility on contributions and tax deferral on earnings. It is one of the major tools people can use to secure their financial future.

RRIF Registered Retirement Income Fund(RRIF)

A fund set up with proceeds from an RRSP to provide income during retirement or any time that you might require a systematic and periodic income. Like an RRSP it may have any of a number of investments inside it. Payments from a RRIF are fully taxable as income in the year received.

DPSP Deferred Profit Sharing Plan

A plan registered with Revenue Canada that an employer contributes to for the benefit of employees. It is deductible to the employer but not included as income for the employee in the year received. When withdrawn by the employee either directly from the plan or after transfer to a RRIF, it is fully taxable as income to the employee. Tax is fully deferred while the funds are in the plan.

GIC Guaranteed Investment Certificates(GICs)

Securities issued by financial institutions, such as banks and trust companies, for a specified term. GICs of up to five years issued by members of the CDIC are covered by deposit insurance up to $60,000.

Mutual Funds

Pools of investment money, managed by professionals, and invested in a wide range of securities. A management company establishes, promotes, and manages a fund or group of funds, each of which is a separate entity with its own board of directors or trustee(s). The funds can include all or any of the following asset classes, Canadian stocks, international stocks, bonds, mortgages, real estate, treasury bills and/or derivatives. Mutual funds allow investors to purchase a basket of equities, bonds, or other securities, in amounts they might not be able to get as an individual. As a result, they are excellent for obtaining diversity that is otherwise available only to those investors with a substantial portfolio.

Segregated Fund

Similar to mutual funds but offered as an investment through an insurance company as the trustee of the funds. Since they then fall under the jurisdiction of the Insurance Act, they are covered by special deposit, death benefit and creditor-protection provisions.

Registered Education Savings Plan (RESP)

A registered educations savings plan (RESP) is set up for the benefit of your children's education (or in fact, any beneficiary including yourself, who may be attending college or university). The contributions are not deductible from your income. However, the investment income earned thereon is not taxed in the RESP; instead, the income is deferred and included in the beneficiary's income when withdrawn and used by them for the purposes of pursuing college or university. The RESP can participate in the CESG (Canada Education Savings Grant). The CESG is a grant from the Government of Canada paid directly into a beneficiary's Registered Education Savings Plan (RESP). It adds 20 percent to the first $2,000 in contributions made into an RESP on behalf of an eligible beneficiary each year. This means the Grant can be as much as $400 each year per beneficiary and over the years could amount to a total of $7,200.