How to Encourage Employees to Contribute to an RRSP

Saving for retirement can feel overwhelming - depending on where your employees are in their careers and life stage, they may feel like they’re already too late to start or they might put it off thinking they have plenty of time. In both cases, it’s easy to let the overwhelm prevent action.

However, contributing something is always better than waiting for the “perfect” time or amount. That’s why it’s important for employers not only to educate their employees about RRSPs, but also encourage them to contribute. It isn’t about applying pressure or guilt, it’s about providing timely clarity and support.

RRSP basics 

A Registered Retirement Savings Plan (RRSP) is a long-term savings tool designed to help Canadians set money aside for the future while reducing taxes today. When employees contribute to an RRSP, those contributions are deducted from their taxable income, which can result in a lower tax bill or a larger refund. Any money invested inside an RRSP grows on a tax-deferred basis, meaning employees don’t pay tax on what the investment earns until funds are withdrawn later in life, typically when income and tax rates may be lower.

In a workplace setting, RRSPs are often offered as a group RRSP, which works much like an individual RRSP but with added advantages. Contributions are usually made through payroll deductions, making saving automatic and consistent. In some plans, employers also contribute through matching programs, which effectively provides employees with additional compensation toward their retirement savings. Even when matching isn’t available, payroll contributions can make saving feel more manageable by spreading it out over time.

RRSP saving doesn’t have to be “all or nothing.” Each year, the federal government sets a maximum amount that Canadians can contribute to their RRSPs. For most people, RRSP contribution room is based on 18% of their earned income from the previous year, up to an annual dollar cap. Employees can find their personal RRSP contribution limit on their most recent Notice of Assessment from the CRA or by logging into their CRA My Account. This limit applies across any and all RRSPs they may have. Contribution room accumulates over time, so if someone doesn’t contribute in a given year, that unused room carries forward and can be used in the future. 

Employees don’t need to know the perfect amount to contribute or have a complete financial plan in place before getting started. For many people, contributing a small amount regularly is a more realistic and sustainable way to build long-term financial security than waiting for the “right” time to begin.

The RRSP contribution deadline: Why March 1, 2026 matters

The RRSP Deadline is the last day to contribute to your RRSP to claim a tax deduction for the previous tax year. This date typically falls 60 days after December 31st, which is March 1st this year. Meeting this deadline lets you lower your taxable income for last year. Any contributions made after the deadline will count towards next year's taxes.

Some common misconceptions around this deadline include: 

• RRSP Deadline day is always March 1st. Not true, the date shifts so that it doesn’t fall on a weekend or if it’s a leap year.

• Waiting until the last minute is best. It's actually better to contribute early. Contributing earlier lets compounding do more of the work. That means the money you earn on your savings can start earning money too – and the longer it has, the bigger the impact.

• People often wait because they think they need to know the “right” amount to contribute in order to maximize their refund before taking any action. In reality, any RRSP contribution made before the deadline reduces taxable income, which means it will have some positive tax impact. And waiting often results in no action taken at all. 

• Many also mistakenly believe they can't contribute if they don't have a lump sum. Smaller, easy automatic transfers can be a better, more sustainable way of contributing, while spreading the cost across the whole year.

How to encourage employees to contribute to an RRSP (without pressure or guilt)

Here are some practical ways employers can increase participation in Group RRSPs:

• Promote payroll deductions and automation

• Highlight employer matching (if available)

• Share examples of small, manageable contributions

• Illustrate the actual cost of a contribution after taking tax savings into account (a $1 contribution is typically only a $0.70 out of pocket cost)

• Make it easy for employees to enrol or increase contributions

• Educate employees about the power of compound interest

• Point employees to the right support (advisor, provider, EAP financial coaching) when needed

It’s really important to recognize that not all employees are in the same financial position. Acknowledge competing financial priorities by reinforcing that contribution levels can change over time. Encourage flexibility: small contributions, temporary contributions, adjusting contributions after bonuses or raises. Most importantly, emphasize that the employee has both choice and control. 

How to communicate about RRSPs so employees actually pay attention

Often, traditional benefits communication fails because it’s too complex, poorly timed or easy to ignore. The RRSP deadline is a natural engagement moment for employers. 

Here are some best practices for RRSP communication that can help make sure your employees actually pay attention:

• Shift your messaging from “you should” to “here’s how we can help”

• Keep messaging simple; use plain language and real examples

• Repeat key information; use frequent, short reminders rather than longer one-time explanations

• Focus on relevance, not rules

• Start communication early (January–February)

• Consider the communication channels that work best for your organization: email, payroll reminders, info sessions, provider tools, etc.

If it’s helpful, use Captivate Benefit’s RRSP Basics visual to help communicate with your employees about the benefits and fundamentals of investing in an RRSP. 

Participation in these kinds of saving opportunities matters beyond tax savings for employees. RRSPs can provide long-term financial confidence and reduce both current and future financial stress. When employers communicate effectively about the RRSP benefits offered by their plans, it results in better employee engagement.

The important thing to emphasize, when it comes to RRSP contributions, is ‘progress, not perfection’. The goal isn’t to max out your RRSP - if that’s not available to your employees - it’s to help your employees take one meaningful step towards a better financial future. Consistent, supportive communication around this topic will build trust and promote benefits usage.

With the deadline fast approaching, now is a good time to review how and when your organization talks about RRSPs. Remember, there are tools, resources and support available through your plan.

If you’d like to talk to Shannon about all things RRSP, reach out - she’s available and ready to help.