The Great RRSP Scam

I have argued at length with many friends and co-workers that saving in an RRSP is often counter-productive. This article should go a long way towards convincing them. Basically, if you save less than $100,000 in RRSPs, when you retire the only people you're helping are in government. For every dollar anyone takes out of their RRSP the government will claw back 50cents, and then tax you on what you took out. You may only get 25cents on the dollar of savings and the article shows that other income-based benefits may be denied you, effectively moving you into a net loss situation. The only way to get ahead is to have a large RRSP such that you don't need the government benefits you have already paid for!

As a conservative kinda guy I do believe it is your responsibility to plan for your future, and that it is the family's job, first, to care for each other, but if the government is going to tax us at a high rate and promise us secure retirement in return, then I have already paid. Why should I help the government while denying myself vacations, or faster mortgage repayment? Why should I pay now and then pay again later?