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OT: New Canadian Savings Plan.

For Canadians only. I thought this sounded too good to be true, but it isn't. Starting 1 January 2009, anyone over the age of 18 can deposit

5000 dollars per year into an account where you dont have to pay income tax on the interest. Further, if you dont have enough money this year, you can contribute up to the maximum of 5000 dollars in future years. So if you could only put 2000 dollars this year, you can deposit 8000 dollars next. I know this has been on the news extensively, but some people may not have heard. Jim.
Reply to
F.James Cripwell
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I'd like to see what the interest rates are on those accounts - are the interest rates significantly lower or about the same as other vehicles? Dora

Reply to
bungadora

I can only speak from what I have with my bank. A savings type account, with no priveleges whatsoever, the bank pays 2.25% per year. For the no tax account of the same type, I get 3.25%. My guess is that the bank realizes that if I decide to spend funds, I am going to wait until I have exahusted the lower interest rate funds first, and so I am likely to leave my money with them in the tax free account for a longer time. HTH. Jim.

Reply to
F.James Cripwell

I didn't investigate, I figured there is some trick in it, just like St Harpers 'I am being generous to seniors' trick - it's only generous if you can pension share with a spouse, so if you are a widow/widower you are shit out of luck. Why is it that one portion of seniors should benefit but not the others based purely on whether your partner lives ? I can safely say, it costs me very little less to live as a single person than it did for two of us, in fact, a good case could be made that he should have favoured the single pensioners! What a turkey!

Reply to
lucretia borgia

I haven't found out how much my bank pays on the interest free account yet so I was curious if the interest rates were comparable to regular savings. I have a way to go until retirement, thank goodness. I wouldn't want to be retiring now, withmy RSP tanking. Dora

Reply to
bungadora

I did investigate. It looks too good to be true, but in this instance it isn't. I happen to have enough money that I can transfer 5000 dollars from one account to another, with no risk, and instead of earning 2.25% interest, taxed at 50%, I can earn 3.25% with no tax. I would be stupid not to do it.

Reply to
F.James Cripwell

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