What is a Registered Disability Savings Plan?
A Registered Disability Savings Plan (RDSP) is a long term savings plan for persons with disabilities that gives you access to funds in the form of Canada Disability Savings Bond (CDSB) and Canada Disability Savings Grant (CDSG) paid by the Canadian Government.
An eligible person can only have one RDSP but anyone can contribute to the person's RDSP.
Opening an RDSP can result in a minimum of $20,000 (no contributions) over 20 years to a maximum of $90,000 (with contributions) of funds from the Canadian government. This will help to establish long‐term financial security for the person with an RDSP.
What is the Canada Disability Savings Bond?
The Canada Disability Savings Bond is money the Government contributes to the Registered Disability Savings Plans (RDSPs) of low- and modest-income Canadians. If you qualify for the Bond, you can receive up to $1,000 a year, based on your household income. Over an individual’s lifetime, there is a limit of $20,000. You have until your 49th birthday to apply for an RDSP and receive these bond payments. You do not need to make any contributions to your RDSP to receive the Bond.
What is the Canada Disability Savings Grant?
RDSP’s have a contribution matching program called Canada Disability Savings Grant (CDSG), paid by the Canadian government.
For every $1 put in an RDSP account, the federal government can (if your household income is below $95,259) match with up to $3! The maximum Grant amount is $3,500 per year, with a limit of $70,000 over your lifetime. Matching grants are paid into the RDSP on contributions that are made up to December 31 of the year you turn 49 years of age.
- For the first $500 contributed each year to the RDSP, the Government will deposit $3 for every $1 contributed, up to $1,500 a year.
- For the next $1,000 contributed each year to the RDSP, the Government will deposit $2 for every $1 contributed, up to an additional $2,000 a year.
To be eligible for the RDSP, you must:
- You must be a Canadian resident, have a valid Social Insurance Number and be younger than 60 years old.
- You must be eligible for the Federal Disability Tax Credit (and receive Child Disability Benefits for minors under age 18)
- You must file your tax return every year to receive the annual Bond
- Choose the Holder (the person who makes the financial decisions)
RDSPs are a long term savings plan. Before you consider taking money out of your RDSP, you should talk to a financial advisor or other RDSP expert. Taking money out too early could mean repaying the government back some or all of the Bonds and Grants that are in your RDSP
Will the RDSP impact my government income assistance benefits?
The RDSP is an asset and does not affect your PWD benefits. For more information on RDSP asset and income exemptions, click here.
Endowment 150 Fund (E150)
The E150 grant helps individuals and families with low-incomes save for their future by providing a one-time $150 gift to help their RDSPs grow. The $150 is a contribution into the RDSP which allows the Federal government to deposit an additional RDSP Grant up to $450 into the RDSP account.
In partnership with the Disability Alliance of BC and the BC Aboriginal Network on Disability Society, Plan institute administers the Endowment 150 Program.