I taught I had until the end of March to contribute to my RRSP but I have until February 29th.... the more I think about a RRSP contribution for the 2011 fiscal year, the more I dislike the idea.
One of my reader is a tax specialist so I bring in my numbers with what I had found as deposit amount in my banking account for the 12 months of 2011 and I found out that my 2011 net income exceed the 40k. I was surprised because it didn't give me the impression that I earn that much in 2011. I wasn't even working 30 hours per week at my main job. but even there, it's true I was also working full-time during the weekend. Anyhow, all that to say that yeah, once again, I pop up the 40k income, with multiple money maker streams. Nice, but ho headache, what about the income tax? I wasn't paying income tax on my part-time job, only the unemployment insurance and a few other mandatory things. Because of that, I could have a couple of hundreds $$$ to pay in taxes.
My mom is getting closer to 65 and at her age, she has to cash out her RRSP for a reason or another. I am really not into RRSP but I know that at a certain age, you need to transfer what you hold in an RRSP account into another type of account. but even there, while doing so, you have to pay taxes on each single withdraw.
For 2011, I taught of giving 4k on my RRSP contribution.
Now, I am going to tell you why I won't be doing so.
No matter what if I contribute or not to my RRSP, I won't have 4k to pay back on taxes. So can someone could explain to me why should I bother doing a 4k RRSP contribution?
While being in a RRSP account, I won't be able to take a full advantage to my 4k RRSP contribution.
Yes, I can use my RRSP money on the purchase of a house, or go back to studies (I think) but WAIT, its not as great at it seem, all withdraw made from a RRSP, all amount need to go back in the RRSP withing a certain time frame because I have to pay it back. I mean come on, those type of shitty solutions are really not made for me. I don't want to earn a house (unless I win 649 lotto) and I certainly don't want to enroll in a Canadian university program. You need to be a fool, a complete idiot to pay those extremely expensive tuition fee. If you know me by now, you know that the Dividend Girl is the kind of girl who is extremely smart. Canadian universities? WHAT THE F. They are made for dummies.
Now, another think, a 4k RRSP contribution will remain untouchable and not enjoyable until I retired. But even there, I will have to pay taxes on the withdraw and oh wait, since the money will remain in a RRSP account for like several decades, the initial amount deposit will grow grow grow... and when come time to withdraw, HELLO TAX PROBLEMS. Again.
So I mean, come on now RRSP account is all about bullshit. Its a government fantasy made as set up. There's no real benefit to a RRSP. Better just enjoy the money while being young, but it on the margin, trade, go with a TFSA with Questrade whatever. But a RRSP? NO THANK YOU. NEVER EVER AGAIN.
A RRSP account is for fools.