Consider Deposit Insurance When Weighing
RRSP Options: CDIC

List of Top Six RRSP Tips Consumers Need To Know

OTTAWA, February 12, 2007 – As Canadian consumers enter the peak of RRSP season, the Canada Deposit Insurance Corporation (CDIC) reminds them that they may want to find out what CDIC deposit insurance protects in terms of retirement savings products.

"With RRSP season in full swing and Canadians making critical financial decisions, it’s a very important time for everyone to ensure they have all the facts about deposit insurance so they can make informed financial decisions,” said CDIC President and Chief Executive Officer Guy Saint-Pierre. “That’s why we’re reminding all Canadians making RRSP decisions this season to ask questions about their investments if deposit insurance is important to them.”

CDIC’s Top Six RRSP Tips, released today, encourages Canadians to find out more about deposit insurance protection for RRSPs, which can hold more than one type of investment, some covered by CDIC and some not.

“What’s most important,” Mr. Saint-Pierre said, “is that Canadians ask for answers if they’re not sure whether or not their RRSPs are covered.” Consumers can ask where they bank or invest. They can call CDIC toll free at 1-800-461-CDIC (1-800-461-2342). They can also find answers on CDIC’s website, www.cdic.ca .

CDIC’s Top Six RRSP TIPS

1. WHAT IS COVERED: Deposits held in an RRSP that are eligible include savings accounts, GICs and term deposits of 5 years or less. To be eligible, a deposit must be held in Canadian money at a CDIC member institution. All eligible deposits are automatically insured. The maximum CDIC coverage for your RRSP deposits at one member institution is $100,000, including principal and interest.
   
   
2. SELF-DIRECTED RRSPs: If you have a self-directed RRSP, it must be administered by a trustee. The trustee could be a CDIC member or a non-member institution. CDIC does not distinguish between self-directed plans and other registered plans in terms of the maximum deposit insurance limit of $100,000 (principal and interest combined). But self-directed RRSPs administered by a trustee could have deposits in both CDIC member and non-member institutions. Eligible deposits in CDIC member institutions are protected but any deposits placed at financial institutions that are not members of CDIC are not insurable by CDIC. RRSP deposits with credit unions are insured by provincial deposit insurance agencies as long as those deposits are eligible for that coverage.
   
   
3. MULTIPLE RRSPS: For consumers with two or more RRSPs with different plan numbers at the same CDIC member institution, the $100,000 maximum applies to the total eligible RRSP deposits held in all the plans combined.
   
   
4. SPOUSAL RRSP PLANS: Unlike regular RRSPs, the contributor and the owner of the plan can be different individuals. For purposes of the $100,000 maximum, eligible deposits in a spousal or common-law partner RRSP will be added to other eligible deposits in RRSPs - up to the $100,000 limit - in the owner of the plan's name, and not with eligible deposits in the contributor's name.
   
   
5. RRIFS: Eligible deposits held in Registered Retirement Income Funds (RRIFs) with a CDIC member institution are insured separately from eligible deposits consumers may hold in RRSPs. The maximum protection for eligible RRIF deposits at each CDIC member is $100,000, including principal and interest. If a self-directed RRIF includes eligible deposits with CDIC members, deposit insurance applies in the same way it applies to deposits within a self-directed RRSP.
   
   
6. WHAT IS NOT INSURED: Like stocks, CDIC does not ensure mutual funds held in RRSPs; RRSP deposits in foreign currencies are not insured; nor are term deposits with a maturation date of more than 5 years.

About CDIC

CDIC is a federal Crown corporation that provides deposit insurance against the loss of deposits with its member institutions in the event of their failure. Eligible deposits are automatically insured for up to $100,000 per person at each member institution. As of April 30, 2006, CDIC insured $455 billion in deposits at its member institutions. CDIC members include banks, trust and loan companies, and federal retail cooperative credit associations. CDIC is funded by premiums assessed on its member institutions and does not receive federal tax dollars.

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For further information:

Sophie Roux,
Manager, Communications and Public Affairs

Tel.: 613-995-6548
Cell: 613-612-1068
E-mail: sroux@cdic.ca