REER

REER, or régime enregistré d'épargne-retraite, is the French-language equivalent of the Canadian Registered Retirement Savings Plan (RRSP). It is a government-sponsored, tax-advantaged savings vehicle designed to help Canadians accumulate retirement funds. Contributions are generally deductible from taxable income for the year they are made, reducing current taxes, and the investments inside the plan grow on a tax-deferred basis. Withdrawals are taxed as ordinary income when taken in retirement. There is an annual contribution limit set by the federal government; any unused room can be carried forward. You can contribute as an individual or through a spousal REER to optimize retirement income, subject to certain rules. Investments within a REER can include mutual funds, GICs, bonds, and equities.

Withdrawals before retirement are allowed but may incur withholding taxes and penalties, and they reduce future contribution room. At age 71, a REER must be converted to a RRIF or an annuity, after which minimum annual withdrawals are required. A REER, like a RRSP, is portable across provinces and can be transferred or rolled over when changing jobs or moving, without triggering tax events, within the rules. The REER is mainly used in Quebec and other French-speaking contexts, though the term is widely understood across Canada.

Related savings vehicles include the RRSP in English, the TFSA, and the RESP for education savings.