What Investments Are Allowed?
For the average person, most investments can be held in an RRSP. However, the government doesn't let every investment sit under the tax-sheltered, tax-deferred umbrella of an RRSP.
The following are eligible for your RRSP account:
|Stocks||Debt Obligations (Bonds)||Unit Trusts
|Rights, Warrants, Options||Investment Grade Gold & Silver Bullion
|Funds of Stocks (i.e. mutual funds)||Mortgages||Royalty Units||Depository Receipts||Investment Grade Gold & Silver Coins|
|Shares of Small Business Corporations||Installment Receipts||Partnership Units||Annuity Contracts|
What Investments Are Not Allowed?
Although RRSPs allow Canadians to hold a wide variety of investments, you can't hold everything under the sun in your RRSP. Here are items that are not eligible as investments for your RRSP account:
Ineligible RRSP Investments
|Employee options to purchase stock|
|Gold, silver and other precious metals|
|Commodity futures or contracts|
|Listed personal property such as works of art & antiques|
|Gems and other precious stones|
|Bonds where the issuer is a wholly-owned subsidiary and the shares of its parent are not listed on a Canadian stock exchange|
|Mortgages on commercial properties owned by you or a family member|
|Small business investments|
|Puts and uncovered call options|
|Bonds or debentures of a company whose shares are listed only on a prescribed foreign stock exchange, even though the company\'s shares may be qualified|
|Source: Canada Revenue Agency|
Foreign Content Rule
In addition to the above, RRSP holders were previously not able to hold more than 30% foreign property in their RRSP account. However, this restrictions was eliminated for the 2006 tax year.
Financial AdvisorIncreasing your savings will provide tax benefits - and peace of mind.
Financial AdvisorFor Canadian RRSP accounts, washing same-day trades and using money market funds to bridge the gap over a multi-day trading period saves investors the exchange fee and will help their bottom ...
RetirementAmerican and Canadian governments provide many of the same types of services, but the subtle differences between the two countries are worth noting.