(September 29 – 10:40 ET) –
Lobby efforts to get the federal
government to raise the $13,500
RRSP contribution limit have fallen
on deaf ears and left Canadians
looking for alternatives to expand
their retirement income, says Janet
Downing.

The feds say that raising the
contribution limit would result in
an estimated $200 million loss in
tax revenue, says Downing, a lawyer
with Watson Wyatt Worldwide
in Toronto. She made the remarks
yesterday at a session of the
annual conference of the Canadian
tax Foundation in Montreal.

“Recent research predicts the
average 40-year-old will live to
age 85,” she says. Since most
Canadians won’t want to rely on
Old Age Security and CPP for their
retirement, she says, employers
should be providing Supplementary
Employment Savings Plans.

The Canadian equity market
makes up only 2% or 3% of the
worldwide equity market, which is
why mutual fund companies are
using the derivative markets to
offer foreign-eligible RRSPs, says
Downing. These funds allow
Canadians to expand their
retirement income, outside the
20% foreign content restriction.

IE Staff