Does the term “income splitting” mean anything to you? It’s a tax strategy that can allow a couple, under certain circumstances, to optimize their net income during retirement. There are two main ways of putting this strategy into effect: one that can be adopted upon your retirement, and one that works best when set up years in advance: the spousal registered retirement savings plan (spousal RRSP).
A five-point explanation.
The following sources were used to prepare this article.
Desjardins, “Contributing to your spouse's RRSP.”
EY, “2022 Personal tax calculator.”
Intuit TurboTax, “Spousal RRSP: Contribution & Withdrawal Rules.”
Les Affaires, “Un REER de conjoint aide les couples à économiser.”
MoneySense, “A guide to spousal RRSPs for married and common-law partners.”
Retire Happy, “The proper use of spousal RRSPs.”
Vancity, “Spousal RRSPs: still useful?”