Currently you can only contribute up to 18% of EARNED INCOME to an RRSP, up to $12,500 annually.
For most people EARNED INCOME is employment income, and earned income does not include capital gains.
I have been living off capital gains for several years and have not been able to make any significant RRSP contributions during this period. That is a disadvantage to being an investor without a "real job", also I cannot make CPP contributions since that is based on earned income.
If you get an RRSP information booklet from TD Bank, it explains the basics.
ILG
PS I would actually like to make enough CPP contributions to max out my CPP. Although my stock investments are doing great right now, when I am 70 or so, I don't expect to own as many. The CPP income, say $600/month in today's currency, would be nice, especially when you calculate the amount of bonds you would need to get that income. If you have the CPP income, you do not spend a bundle to buy those bonds, and instead you can spend the money on a better house, boat, vacations, etc. |
