Understanding Different Types of Investment Accounts

You have many account options to choose from when saving for your future, with each offering plenty of advantages … as well as some restrictions.

Know your options

Everyone knows when they walk into a bank to open an account that they’ll be asked to choose between a chequing and a savings account. Both come with distinct advantages, as well as certain restrictions.

Similarly, when working with your advisor to create a plan for your financial future, you’ll be able to choose between a few different types of accounts, each with their own features.

Some of these features are very important for you to know, including tax deferral and withdrawal restrictions, and can impact your ability to grow your savings over longer periods of time.

Your two main account options are non-registered and registered accounts.

1. Non-Registered Accounts

Non-registered accounts don’t offer the same tax-deferral or tax-reduction benefits as registered accounts, but have few or no restrictions in terms of how much you can deposit or how often you can access your savings.

2. Registered Accounts

Registered accounts such as Registered Retirement Savings Plans (RRSPs), Registered Retirement Income Funds (RRIFs) and Registered Education Savings Plans (RESPs) usually have some restrictions in terms of the amounts you can contribute each year and how much you can withdraw, but tend to offer attractive tax deferral or savings incentives that are important to consider.

Registered accounts also have a number of additional features you should be aware of. For instance, with RRSPs you have the ability to take money out (tax free) under certain conditions, including programs related to buying your first home or funding an education. RRSPs also allow you to defer paying tax on the amount you contribute, as well as on any income payments or investment growth achieved within your RRSP, until withdrawal.

Tax-Free Savings Accounts (TFSAs), which can be used to help meet any financial goal, are different from RRSPs or RESPs because they are funded using after-tax dollars. So when you withdraw funds from this account, the amount is not taxable.

A financial advisor can help you understand all of the rules and features of these accounts to determine which type is best for you. Don’t have a financial advisor? Before you start your search, read about working with a financial advisor.


The commentaries contained herein are provided as a general source of information and should not be considered personal investment or tax advice. Every effort has been made to ensure accuracy in these commentaries at the time of publication; however, accuracy cannot be guaranteed. Market conditions may change investment decisions arising from the use or reliance on the information contained here.
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AGF Management Limited (“AGF”), a Canadian reporting issuer, is an independent firm composed of wholly owned globally diverse asset management firms. AGF’s investment management subsidiaries include AGF Investments Inc. (“AGFI”), AGF Investments America Inc. (“AGFA”), Highstreet Asset Management Inc. (“Highstreet”), AGF Investments LLC (formerly FFCM LLC) (“AGFUS”), AGF International Advisors Company Limited (“AGFIA”), Doherty & Associates Ltd. (“Doherty”) and Cypress Capital Management Ltd. (“CCM”). AGFI, Highstreet, Doherty and Cypress are registered as portfolio managers across various Canadian securities commissions, in addition to other Canadian registrations. AGFA and AGFUS are U.S. registered investment advisers. AGFIA is regulated by the Central Bank of Ireland and registered with the Australian Securities & Investments Commission. AGF investment management subsidiaries manage a variety of mandates composed of equity, fixed income and balanced assets.

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