RRSP is a Canadian method of encouraging employees to save money for their retirement. Under this method, the employee is liable to pay the tax amount until the savings is withdrawn by him/her. RRSP may be an asset, investment, bond, stocks or even mutual funds.
A person have 14 years for his retirement. His current available savings in RRSP is $3,000 and he could borrow an extra $2,000 to make a $5,000 RRSP contribution and he is in 15% tax bracket. Find his registered retirement savings plan fund available at his retirement?
P=$3000 p=14 years i=15 / 100 C=$5000
RRSP Funds Available at Retirement
Substitute the given values in the formula, RRSP = (3000 * (1+0.15)14 ) + (5000 * (1+0.15)) * (((1+0.15)14 - 1) / 0.15 ) = 21227.12+232902.05 = 254129.17 = 254129.17 $