Registered Disability Savings Plan (RDSP) - what is it, and why someone who qualifies, should have it

Dawn Luhning |

Many families worry about how a loved one with a disability will be cared for in future years. Thanks to the Registered Disability Savings Plan (RDSP) and generous federal grants and bonds, now it is easier for people with disabilities to save for their long-term financial security.

Why RDSPS are the best way to save

  1. Anyone can contribute to an RDSP with the written consent of the account holder.
  2. The total lifetime contribution for each beneficiary is $200000, with no annual contribution limits.
  3. Contributions can be matched, based on family net income, with up to $3500 a year in Canada Disability Savings Grants and up to $1000 a year in Canada Disability Savings Bonds.
  4. The money you contribute grows tax free.
  5. Savings and withdrawals do not affect federal and provincial income-tested benefits.
  6. Carry forward on Canada Disability Savings Grants and Bonds is available back 10 years or to the date of diagnosis. Since RDSP was launched in 2008 carry forward can go back to then. Maximum grant someone can receive in a year is $10500 and maximum bond is $11000.

Who qualifies for an RDSP?

Your qualify to be an RDSP beneficiary if you are a recipient of the Disability Tax Credit, a resident of Canada, less than ago 60 and have a valid Social Insurance Number.

How to open an RDSP account

Take advantage of Government help

  • Canada Disability Savings Grant (CDSG) - Through the CDSG, the Government deposits money into your RDSP to help you save, providing matching grants of 300%, 200%, or 100%, depending on the amount contributed and the beneficiary's family net income. The maximum is $3500 each year, with a lifetime limit of $70000.
  • Canada Disability Savings Bond (CDSB) - Through the CDSB, the Government deposits money into the RDSPs of low-income and modest-income Canadians. If you qualify for the bond, you could receive up to $1000 a year, with a lifetime limit of $20000.

Withdrawing your money

RDSP withdrawals must begin by the end of the year you turn age 60. You may withdraw funds earlier, but be sure to note that once a withdrawal of any amount is made, $3 worth of federal grants and bonds paid into the RDSP in the previous 10 years have to be repaid for every $1 withdrawn.

Withdrawals will consist of non-taxable contributions, taxable Government monies and taxable growth.


If you know someone who might qualify for this type of account, I would recommend you forward this link to them to investigate an RDSP account further. Many Canadians do not know this account is available to them and ultimately, it is leaving quite a bit of money on the table. If you have questions, please let me know by contacting me by email or telephone.