Types of RRSPs

Types of RRSPs

There are two basic types of RRSPs: managed RRSPs and self-directed RRSPs. In a managed RRSP, the plan holder invests in any of a variety of segregated pooled funds or mutual funds which are held in trust under the plan and no further investment decisions are required to be made by the plan holder. Managed RRSPs are by far the more popular and the more suitable vehicle for the majority of investors.

Canadian mutual funds, trust companies, life insurance companies, chartered banks, credit unions and investment dealers offer a wide selection of plans whereby the RRSP holder purchases shares of mutual or equity funds. To qualify as acceptable investments for an RRSP, segregated pooled funds or mutual funds must be registered with Canada Revenue Agency and meet Canadian content requirements in their investment portfolios.