Inside The Markets:- RRSPs
Source: Manulife Financial, October 25,2000
Using RRSP overcontributions to your Advantage

RRSP Investors who turn 69 this year may be able to contribute more to their RRSPs

than they thought. Here's how.

As you know, clients who turn 69 in 2000 must collapse their RRSPs and turn

them into some form of retirement income by December 31. But are you aware

that contribution room for 2001, created by earned income in 2000, can be

used this year too?

As long as the contribution is made prior to the end of the year - before

the RRSPs must be collapsed - the client can use this year's RRSP

overcontribution as a tax deduction in 2001. If the contribution is made in

December, the client will be charged with only a 1% penalty on the

overcontribution for one month.