The Registered Disability Savings Plan (RDSP): You may be eligible for up to $90,000 towards your retirement—ARC

Why should I open an RDSP?

It’s about your future quality of life. The RDSP is a long-term savings plan that became available in 2008 to help Canadians with disabilities save for their financial futures. This method of saving is ideal for those with arthritis and other autoimmune disorders, those who are earning low incomes and those who are not able to make adequate investments to their RRSP. The RDSP is also beneficial for low-income earners receiving GIS benefits. The RDSP will not affect CPP (Canada Pension Plan), GIS (Guaranteed Income Supplement), or OAS (Old Age Security) benefits. The RDSP has incentives to encourage individuals and families to save money.  The incentives include generous grants and bonds from the federal government.

A few facts:

  • Contributions may be eligible for the Canada Disability Savings Grant (CDSG), which provides matching contributions of up to $3,500 annually until the end of the year that the beneficiary turns 49 ($70,000 lifetime limit).
  • Additionally, the plan may also be eligible for the Canadian Disability Savings Bonds of up to $1000 per year for those with low incomes, up until the age of 49, with a lifetime maximum amount of $20,000.
  • There is no annual contribution limit, but there is a lifetime limit of $200,000 for total contributions. Tax is deferred and income earned is tax-sheltered; ideal conditions if you receive a substantial inheritance or settlement.
  • Additionally, the plan holder can give permission for friends and/or family to deposit money to contribute to the plan.


  • Depending on the income level, a person who starts an RDSP at the age of 29, contributing $125 per month for 20 years, could receive full grants and bonds totaling $90,000. Depending on their investment choices, at the age of 60, when mandatory withdrawals begin, they would have over $800,000. This certainly can be used to enhance their quality of life.

To Qualify:

You must:

  • Be a Canadian resident
  • Have a Social Insurance Number
  • Be 59 years of age or younger
  • Be eligible for the Disability Tax Credit.  The Disability Tax Credit is a credit that a person gets if they are disabled. To apply for the Disability Tax Credit you need to get your doctor to fill out a special form and send it to Canada Revenue Agency (see link below).

So just think about it – can you really afford not to do it? To apply for the DTC, download the application form T2201 from the CRA website:  Disability Tax Credit Certificate

Laura MackenrotLaura Mackenrot

*Laura Mackenrot is a financial expert for people with disabilities. Born with arthritis, she went on to receive her Bachelor of Commerce degree from UBC. After experiencing total vision loss since 2007, she has become the first blind woman to be licensed in both life insurance and mutual funds in BC.




“Depending on their investment choices”

what investment choices would I need to make to earn $800,000 when i turn 60?

February 25, 2012
2:08 am
Reply |

In my 50th year, the investment horizon for my CDSP is limited. It would be foolish for someone with my limited investment skills to attempt growth using aggressive equities investment, and most of my CDSP is held in mutual funds. The banks representatives tell me this is the only way I can invest my CDSP. They also tell me an investment advisor is not assigned to handle my money.

My modest investment is in mutual funds being depleted by an MER (management expense ratio) of 2%. I would like this investment to be in index funds or ETFs with much a smaller MER. There is little I can do to improve market gains, but I can reduce the management expense, if allowed to.

Can anyone tell me if these are government policies, or that they can be determined by the bank I deal with? How can I get this information?


February 29, 2012
6:51 pm
Reply |

Can the PWD allowance be reduced because there is money saved in a RSDP?

Linda Rosner
March 9, 2012
11:21 pm
Reply |

Wondering if a CDSP can be invested in either of these two rrsp eligible vehicles

shares of a company

April 7, 2012
7:18 pm
Reply |

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