A pension plan is a registered savings vehicle and is commonly referred to as an RPP and provides mandatory tax-sheltered growth for employees and is dedicated to providing a retirement income for them. Unlike a Group RRSP an employee cannot cash in a pension plan, rather it must be used to provide a retirement income at the earliest of age 55 and the latest at age 71. As with any group savings plan the employer may choose to match deposits that an employee makes up to a specified maximum.
As an integral part of the employee’s compensation package the addition of a Pension Plan can build moral within a company and attract and retain quality employees.