Last updated: December 1st, 2023 | Reviewed by Stuart Dollar

RPP vs RRSP

A registered pension plan (RPP)  and a registered retirement savings plan (RRSP) are both great ways to save money for retirement. However, these plans work in different ways. Here’s a breakdown of the similarities and differences between an RPP and an RRSP. 

Please note there are two types of RPPs: defined contribution pension plans (DCPP) and defined benefit pension plans (DB). At Sun Life, we offer only defined contribution pension plans. The information on this page refers only to DCPP. 

 

RPP

Individual RRSP

Group RRSP

 

What’s it for?

 

 

Retirement savings.

 

Designed for retirement savings, but you can use these funds for any purpose. You'll have to pay tax every time you make withdrawals from an RRSP.

 

 

Designed for retirement savings, but you can use these funds for any purpose. You'll have to pay tax every time you make withdrawals from an RRSP.

 

Who sets up the plan?

Your employer.

You.

Your employer, but you have the option to join in most cases.

 

Who contributes to this plan?

 

You and your employer.

 

Only you.

 

You and possibly your employer.

 

Are contributions tax-deferred? This means you won't pay taxes until you withdraw funds.

 

Yes.

 

Yes.

 

Yes.

 

Are contributions tax deductible?

 

Yes.

 

Yes.

 

Yes.

 

Is there a contribution limit?

 

Yes. It’s based on a percentage of your income. (See RPP contribution rules.)

 

 

Yes. (See RRSP contribution rules.)

 

Yes. (See RRSP contribution rules.)

 

Can I make withdrawals at any time?

 

Not until age 55. The only exception is if you qualify for a hardship withdrawal. Check with your pension plan administrator.

 

Yes.

 

Yes, but you should check your Group plans rules beforehand.Please note that some plans have specific withdrawal restrictions. Connect with an advisor for more detailed information. 

 

Do I have to pay tax on my withdrawals?

 

Yes.

 

Yes.

 

Yes.

Plan for your future

A Sun Life advisor can help you figure out how an RPP can impact your overall retirement plan. They can also answer any questions you have.

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