Most professionals assume that as long as they diligently contribute to an RRSP, they’re doing everything they can to prepare for retirement. But what if the structure of your retirement plan (not your income, not your savings discipline) was what made the real difference in the size of your nest egg?
The Personal Pension Plan (PPP®) was designed for professionals and individuals to have an option for higher allowable contributions, past service buybacks, and tax deductions for their retirement savings. The PPP® consistently builds more retirement wealth than an RRSP.
Here are four real-world scenarios based on actual professionals and standardized CRA assumptions:
- 3% annual salary growth
- 5% annual investment return
- Contributions based on a percentage of T4 income (18% for RRSP, 30% for PPP)
A Lawyer’s Leap: Nearly Double the Wealth
At 50, a lawyer with 20 years of incorporated service and an annual salary of $140,000 had already accumulated $228,445 in an RRSP vs $440,521 in PPP®. With 21 years left until retirement, her savings had time to grow, but the vehicle she used would determine just how far they could go.
By age 71, her RRSP grew to approximately $1.75 million, but her PPP®, thanks to larger tax-deductible contributions, past service buybacks, soared to $3.02 million.
That’s an additional $1.27 million simply by using the right structure.
Nothing else changed. Her income, investment returns, and risk profile stayed the same.
Same Salary. Same Growth. Bigger Future.
This isn’t hypothetical. It’s a real calculation based on CRA rules and the very structure of how a Personal Pension Plan works.
The key difference?
- RRSPs: contribution room stays flat every year (18% of earned income, up to CRA’s max).
- PPP®: contribution room increases with age, often exceeding RRSP limits significantly.
This structural gap is why two professionals with the same income, savings discipline, and investment returns can end up with very different retirement outcomes.
The PPP® allows more capital to be put to work, earlier and faster. It’s tax-efficient, corporate-deductible, and age-sensitive, meaning your ability to contribute increases as you near retirement.
And it doesn’t end the day you retire. Even at 71, you can still put in contributions and use the Personal Pension Plan to create a legacy that can be passed on to generations after you.
What would your numbers look like with a PPP®?
Let us run the projection for you, side by side with your current RRSP strategy, so you can see the difference for yourself. Contact us today and find out how much more you could retire with.
