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RRSP Loans

The RRSP loan difference

Contributing to an RRSP is one of the most important strategies you can use to build your wealth for a worry-free retirement. If you don't have the money today, an RRSP loan can help you stay on track.

A $5,000 loan could mean a $21,459 difference in the value of your RRSP over 25 years*. And the interest costs on the loan would be only $264.57* over two years.

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The interest costs on the loan would be only $264.57* over two years.

* For illustration purposes only. Assumes $25,000 in your RRSP, earning a 6% average annual compound return over 25 years and a 2-year variable loan rate at 5%, compounded monthly. Variable loan rate calculated using the Empire Life RRSP Loan Calculator. Actual returns and loan rates may be higher or lower and are not guaranteed

Invest today, pay later

With Empire Life's lending partners, you can defer your first RRSP loan payment for up to 180 days. If you're expecting a tax refund, you can use all or part of the refund to pay down the loan even before your payments start.

Get an Empire Life RRSP loan working for you

To find out more about RRSP loans and the investment choices available from Empire Life, talk to your advisor.

Use our RRSP Loan Calculator to calculate the cost of an RRSP loan.

Leveraged Loans

The leveraging difference

Borrowing to invest, or leveraging, can be an effective wealth accumulation strategy. It can:

  • increase the potential returns on your investments, since a larger amount is invested and starts compounding right away 
  • create tax saving - the interest on leveraged loans is generally tax-deductible

Here is an example of how leveraging works:

If you borrow $50,000, at a rate of 7%, your after-tax annual borrowing cost would be $2,100. Let's compare that to an annual investment of $2,100 over 10 years for a total investment of $21,000.

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Source: Talbot Stevens, assumes Interest-only loan at 7% (historical average borrowing rate), 40% marginal tax rate, 100% of loan interest tax-deductible. For illustration purposes only, actual returns and loan rates may be higher or lower and are not guaranteed. 


Based on a 7% return, the net value of your investments without leveraging would be $28,465. If you used leveraging, it would be $40,920 – that's 44% higher.

It is important to remember that leveraging can also magnify your losses and increase your risk. At a 0% return, the net value of your investments after you paid down the loan would be $0, a 100% decrease compared to no leveraging.

Reducing the risk of leveraging

These simple steps can help you reduce the risk of leveraging:

  • Borrow less than you can afford. If interest rates go up or your circumstances change, you can still afford to pay your loan
  • Invest for the long term to reduce the effects of market volatility
  • Diversify your investments to help you achieve more consistent returns
  • And always work with a trusted, knowledgeable advisor who can help you understand and manage the risks

Get an Empire Life leveraged loan working for you

To find out more about leveraged loans and the investment choices available from Empire Life, talk to your advisor.