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Facts and Questions about the Registered Disability Savings Plan

July 10, 2013

Fears about the future concern people with disabilities and those who care for them. Looming medical expenses and high costs of living make financial planning difficult. The government of Canada recognizes this burden and wants to provide a system of financial support to anyone living with a disability. This is why they offer the Registered Disability Savings Plan (RDSP) to those who qualify for the disability tax credit.


Ensuring a financial future for someone living with a disability is a huge relief. People with disabilities know that life offers no guarantees. However, the RDSP is a way of safeguarding money and letting it grow so funds can be accessed after maturing to a good amount.

Facts About the RDSP

As with all government support programs, it is necessary to qualify for the savings plan before making financial contributions. Criteria for eligibility includes:

– Resident of Canada
– Under the age of 60
– Qualify for the disability tax credit

In meeting these criteria, it is a great idea to apply for the RDSP. The savings plan is a government held savings account. It works like this: the government matches the amount put into the account each year. It is possible for the government to put in more than what is contributed – up to $4,500 per year and $200,000 in a lifetime. When this money becomes available it can be used for any purpose. Unlike the disability tax credit, however, this money will be taxed when it is withdrawn.

With programs like the RDSP available to people with disabilities, it is even more important to apply for the disability tax credit. Taking advantage of these benefits opens doors for financial freedom. This is a phenomenal option for anyone living with a disability to plan for a high quality future.

Questions About the RDSP

Many questions are raised regarding disability tax benefits and RDSP. Listed below are a few answers Disability Living can provide. Additional information about the RDSP and how to apply for this program are available here:

Is there a limit to how much money I will receive?

– Yes, there is a cap. The government will contribute up to $200,000 in a lifetime. This is not regulated yearly. Government contributions are made to match what an individual deposits into his or her savings account.

How long can I contribute to this savings plan?

– Contributions can be made to this fund every year until the age of 60. This is standard in other retirement and financial planning programs too. Funds are available to be accessed at this time. Ideally, this plan helps to guarantee financial support for your later years.

Can I establish this savings plan for my disabled child?

– Yes. The government of Canada defines third party holders as qualified persons. A qualified person can be “…an individual who is legally authorized to act for the beneficiary.” This may also be an agency or institution rather than an individual person. It is important to note this as a person caring for a loved one who may never act as manager of his or her financial accounts.

For more information about the RSDP, visit the source:

RDSP is an option for those who feel overwhelmed with planning for the future.

Worrying about the costs of living with a disability is burdensome. Secure financial relief ahead of time. The RDSP is a great program that safeguards funds, making money accessible down the road.

Image made available by Virtual Eric on Flickr through Creative Common Licenses.

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