We found this article on the Investment Executive website, and thought it would be interesting to share with our readers.
Only one in 10 Canadians with a disability, or those with a family member with a disability, are knowledgeable about the Registered Disability Savings Plan (RDSP) and its benefits, with 44% having never heard of it, according to survey results released Tuesday by Bank of Montreal.
Introduced by Finance Minister Jim Flaherty in the 2007 federal budget, RDSPs are designed to provide financial security for individuals with disabilities and combine the advantages of tax deferred investment growth with the opportunity to receive government subsidies.
Despite the benefits that RDSPs provide, only 5% of those surveyed actually hold an RDSP. While the majority of survey respondents shared a lack of awareness of RDSPs, once given a brief description, more than half (55%) were interested in opening up an RDSP account.
“The financial costs associated with having, or caring for someone, with a disability can often be overwhelming and challenging, making it critical that work be done to raise awareness of this program which is designed to provide critical financial support,” says David Sharone, product manager, registered plans and solutions, BMO Financial Group. “When you consider the significant savings a beneficiary can accumulate through the Canada Disability Savings Grant (CDSG) and the Canada Disability Savings Bond (CDSB), along with tax-deferred investment growth, RDSPs are a powerful investment tool that can offer long-term financial security.”
Other key findings from the survey include:
> of those who have heard of RDSPs, only 6% know that contributions are tax sheltered;
> 44% of respondents feel that RDSPs are “too good to be true” and there is probably a catch involved, despite the benefits they provide; and
> 75% of respondents indicated that they would like to know more about the RDSP program.
“As the first bank to introduce RDSPs, we feel a special responsibility to educate Canadians about the advantages they provide,” says Sharone. “The survey results clearly demonstrate that Canadians with disabilities are not aware of the assistance and financial relief available through RDSPs. We want to let them know that this program can be extremely helpful in providing critical financial support for those with disabilities.”
The survey was completed with 501 Canadian adults who have a disability or have a family member with a disability, and was conducted using Leger Marketing’s Web panel between September 10 and 19.