💞 Spousal RRSP: The Secret Tax Strategy Every Canadian Couple Should Know
When it comes to building wealth as a couple, most people think of joint bank accounts or shared investments — but few realize that one of the best financial hacks in Canada is something called the Spousal RRSP.
It’s not just another retirement plan — it’s a smart tax-saving strategy that can put more money in your pocket now and reduce your tax bill later.
💡 What Exactly Is a Spousal RRSP?
A Spousal RRSP works just like a regular RRSP, but with one key difference:
👉 One partner contributes, and the other partner owns the account.
That means:
- The higher-income spouse contributes money.
- The lower-income spouse owns the RRSP and will eventually withdraw it in retirement.
- The contributor gets the tax deduction today, while the withdrawals in the future are taxed in the lower-income spouse’s hands.
It’s a win-win for couples who want to save more and pay less.
💰 Let’s Break It Down with an Example
Say:
- Raj earns $100,000/year
- Priya earns $40,000/year
Raj contributes $10,000 into a Spousal RRSP for Priya.
✅ Raj gets a $10,000 tax deduction this year — instantly reducing his taxable income.
✅ Priya owns the RRSP and will withdraw it later in retirement — when her income (and tax rate) will likely be much lower.
This simple move can save hundreds or even thousands of dollars in taxes every year.
🧾 The 3-Year Rule You Must Know
If your spouse withdraws the money within three years of your contribution, the withdrawal will be taxed back to you (the contributor).
So — treat this as a long-term wealth-building strategy, not a quick cash grab.
🔑 Why Couples Love the Spousal RRSP
1. Double the Tax Efficiency
You reduce your taxes today, and your spouse enjoys lower taxes tomorrow.
2. Balance Retirement Income
Keeps both partners’ income in lower brackets — meaning less tax overall when you retire.
3. Avoid OAS Clawbacks
Helps prevent one spouse from crossing the Old Age Security clawback threshold.
4. Stay Flexible
If your spouse is younger, you can keep contributing to their Spousal RRSP even after you turn 71, giving you extra years of tax deductions.
💎 Unity Financial Tip
At Unity Financial Services, we always remind couples — your relationship status is more than love; it’s a financial partnership.
By coordinating your RRSP, TFSA, and other investments strategically, you can build wealth together while keeping your taxes low and retirement strong.
🧮 Quick Comparison
| Feature | Spousal RRSP | Regular RRSP |
|---|---|---|
| Account Owner | Lower-income spouse | Contributor |
| Contributor | Higher-income spouse | Account holder |
| Tax Deduction | Contributor | Contributor |
| Taxed on Withdrawal | Lower-income spouse | Account holder |
| Ideal For | Couples with income imbalance | Individuals |
🏁 Final Thought
If you and your spouse have a big income gap, a Spousal RRSP can help you both retire richer — and with fewer taxes eating away at your savings.
💬 Ready to find out how much you could save with this strategy?
Reach out to Unity Financial Services for a personalized plan that maximizes your RRSP benefits and sets your family up for long-term success.
📞 438-701-3770
🌐 unityfs.ca