Hello Marcel, You asked:

"I have three more years of investing before I retire.What are the equivalent canadian forms for..401k and all that, that
they use in the states. There is something that I'm not getting."

As noted by other Fools, the closest thing in Canada to a 401K is the RRSP - Registered Retirement Savings Plan. I can share some information about the similarities and differences between the plans but am not an expert.

The year 2000 limit for pre-tax contributions to a 401k are $10,500 with an upper limit of 25% of income that can be directed into the plan assuming your plan permits this. There are some other fine points regarding the after tax contributions that I am not fully conversant with, but I expect there are many expert Fools who can fill you in. The maximum contribution to a RRSP for 2000 is the lesser of CAD $13,500 or 18% of earned income. The contribution limit rises to CAD $14,000 in 2002 and then CAD $15,500 in 2004. Percentage stays at 18%.

Contributions to a 401k plan are made via direct payroll deduction, with the contribution amount being reported by the employer to the IRS. RRSP contributions are made directly by the investor into a plan administred by a licensed dealer (bank, broker, etc) who provides a contribution receipt that is filed with your tax return. The advantage of this approach is that you can dump windfalls into your RRSP at year end to top it up if you are unable to fill it using a regular monthly savings program. In addition, most banks in Canada will loan money for topping-up RRSPs at preferred interest rates since the tax advantage of filling one's RRSP is approx. $0.45 per contribution dollar for someone with enough income to hit the maximum contribution. The downside of the Canadian system is that all money put into the plan are post-tax dollars until you file your tax return the following April and get your refund.

RRSPs can be self-administered or have a "Wise" administrator. There are varying fees for having a self-directed RRSP, mine costs CAD $145.00 per account per year. Clearly, one minimizes the number of accounts. Investments in the RRSP must not exceed the 20% Foreign Content rule, but there are some new investment options available this year that skirt this rule. I have some limited info on them.

At age 69, an RRSP must be rolled over into either a life annutiy or a Registered Income Fund with government regulated payout schedules. Bummer. You must begin taking payments from the rolled balance no later than age 70 and I believe that a 20% first year payout may still be required. You see, The Beaver wants his tax dollars from that tax deferred income and does not want you to die and give it your heirs tax free (remember, Canada still has no death duties).

I suppose I have rambled on too long, but I hope it is helpful.

- A refugee from the North -
RDG99