Need a financial well-being boost?
Check out these common concerns and five financial fixes that can help you start saving for your future with the Target
Canada Group Retirement Savings Program.
This program includes a Registered Retirement Savings Plan (RRSP) for your contributions and a Deferred Profit Sharing
Plan (DPSP) for Target matching contributions.
Click on a concern to learn more.
1 I already have my own personal RRSP.
2 I can’t afford to save 5% of my pay cheque.
3 I don’t understand the tax advantages of an RRSP.
4 Retirement is so far away – I have other goals.
5 I need to sort out my finances first.
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1 I already have my own personal RRSP.
It’s great that you’re already saving, but did you know that when you save in the Target RRSP, you receive a 100% match
(for contributions up to 5%) from Target into the DPSP? That doubles your savings immediately.
Also, with the competitive fees Target has negotiated in the group program, you’ll pay lower investment fees than in most
individual retail plans, putting even more savings aside for your future.
See the power of
Target matching
contributions
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See how lower
fees increase
your savings
Contribution of
5% per pay
cheque –
Target match
adds over
$32,000 to
your savings
after 10 years!
The power of
Target matching
contributions
$70,000
$60,000
$50,000
$40,000
$30,000
$20,000
$10,000
Target
contribution
to the DPSP
$32,238
Team member
contribution to
the RRSP
$32,238
The company contributions
belong to you after two years
of service. Your contributions
always belong to you.
Target match
Team member
$0
5% – After 10 years
*Figures approximate, for illustrative purposes only
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Assumptions:
$50,000 annual income,
5.5% gross return, 0.5% fees
With a
contribution
of just 5% per
pay cheque,
lower fees add
over $3,000 to
your savings!
How lower fees
increase your
savings
$70,000
$60,000
Target DPSP
$32,238
$50,000
$40,000
$30,000
$20,000
$10,000
Your retail
RRSP $29,077
Your Group
RRSP $32,238
After 10 years in an
individual retail plan
After 10 years in the
Target program
Your savings in a
retail investment –
2.5% fees
Target match in a
group investment –
0.5% fees
Your savings in a
group investment –
0.5% fees
$0
*Figures approximate, for illustrative purposes only
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Assumptions:
$50,000 annual income, 5% contribution,
5.5% gross return
2 I can’t afford to save 5% of my pay cheque.
It can be easier than you think. If 5% of your pay cheque feels like too much, try saving 1% or 2% and just get in the habit
of saving. You can easily change your payroll deduction online with Manulife later.
The following example is based on an annual salary of $50,000 and monthly contributions.
Your Contribution
1%
2%
3%
4%
5%
Target Match
1%
2%
3%
4%
5%
Your Contribution
$42
$83
$125
$167
$208
Target Match
$42
$83
$125
$167
$208
Total contributions per month
$84
$166
$250
$334
$416
$1,000
$2,000
$3,000
$4,000
$5,000
Total Annual Contributions
*Figures approximate, for illustrative purposes only
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3 I don’t understand the tax advantages of an RRSP.
RRSP contributions made from your pay cheque reduce your taxable income each pay period. It doesn’t cost as much as you
think to save now!
In the example below, with the Target match, you’ll see that a 5% contribution gives you $416/month in total
savings for just $131 less in pay.
No RRSP contribution
5% RRSP contribution
Pay Differential
$4,166
$4,166
–
$0
$208
$208
Taxable Income
$4,166
$3,958
$(208)
Income Tax Withheld
$712
$634
$(78)
Net Income After Tax
$3,454
$3,323
$(131)
Monthly Pay
(based on $50,000 salary)
RRSP contributions
(based on 5% contribution)
*Figures approximate, Ontario 2013 tax rates, for illustrative purposes only
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Your $208 contribution reduces
your take home pay by only $131
4 Retirement is so far away – I have other goals.
While we encourage you to save for the long-term, you should know that your RRSP savings aren’t just for retirement.
You can access your RRSP savings to purchase your first home or go back to school under the government Home Buyers’
and Lifelong Learning Plans.
Start the habit of saving and give yourself options for the future!
Learn about the
Home Buyers’ Plan
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Learn about
the Lifelong
Learning Plan
Home Buyers’ Plan (HBP)
About the Home
Buyers’ Plan
• Allows withdrawal of funds from RRSPs to purchase or build a qualifying home
• Eligibility:
• Any individuals who have not owned a principal residence during four-year period prior to
withdrawal of funds
• Disabled persons acquiring a more accessible home
• Persons acquiring or providing funds to make an accessible home for a disabled person related
to applicant by blood, marriage, common-law partnership or adoption
• Maximum withdrawal is $25,000
• Important Dates and Deadlines:
• Participants must start repaying their HBP two years after withdrawing.
• Withdrawal must be completely repaid within 15 years.
Visit www.servicecanada.gc.ca for more details
Source: www.servicecanada.gc.ca
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Lifelong Learning Plan (LLP)
About the Lifelong
Learning Plan
• Allows withdrawals from RRSPs to finance personal or spousal training/education.
• Eligibility:
• Enrolled in a qualifying educational program or
• Person with a disability enrolled in part-time training or education
• Must complete income tax return every year until all LLP withdrawals are repaid
• Maximum:
• Up to $10,000 per calendar year
• $20,000 in total until January of the fourth year since first withdrawal
• Important Dates and Deadlines:
• Repayments must start two years after last eligible withdrawal or five years after first eligible
withdrawal (whichever date comes first).
• Amounts withdrawn must be repaid within 10 years.
Visit www.servicecanada.gc.ca for more details
Source: www.servicecanada.gc.ca
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5 I need to sort out my finances first.
Juggling your finances can be a challenge, but Target and Manulife have resources available to you to help you build your
financial well-being and look to the future.
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Team Member
Well-being Resources
Manulife Financial – our
Group Savings Retirement
Program provider
( 1-855-447-5416
8 www.guidanceresources.com
(Company ID: targetcanada)
( 1-888-727-7766
8 www.manulife.ca/Target
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05892
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