At some point, a family member, or even you, may consider the Lifelong Learning Plan or Home Buyers’ Plan. Both allow Registered Retirement Savings Plan (RRSP) withdrawals on a tax-free basis, provided funds are repaid according to plan rules. An individual can withdraw up to $20,000 under the Lifelong Learning Plan to help cover their own or their spouse’s education costs. Those who qualify as first-time buyers can use the Home Buyers’ Plan to withdraw up to $35,000 to apply toward a home purchase.


As of 2020, Home Buyers’ Plan eligibility was extended beyond first-time buyers to Canadians who recently had a breakdown of their marriage or common-law partnership. This provision recognizes that one or both individuals may need a new home at a time they face financial challenges. Also, it can help one person buy out the other’s interest in the home they had shared.


Making a significant RRSP withdrawal means losing years of potential tax-deferred compound growth while funds are repaid. So other funding sources should be explored. But if an RRSP is the best or only choice, either of these plans can still offer financial benefits. Someone can use the Lifelong Learning Plan to enroll in an educational program that leads to a higher-paying career – and larger RRSP contributions. The Home Buyers’ Plan can pay off if it makes the difference between owning versus renting, or avoiding the cost of mortgage insurance.

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