Did you know that you should try to put 10% of your gross income a year into your RSP? RSP is your retirement savings plan, which in the U.S. is commonly referred to as your 401k.
You will see your RSP contributions on your paystub because they are deducted from your net pay. Keep reading, and we will guide you to answer the question, “What is RSP on your pay stub?”
What Is RSP?
A retirement savings plan is how the government encourages people to save for retirement. The plan lets you grow your retirement savings, and you have a tax advantage.
You don’t pay taxes on the growth until you take the money out. There are different types of investments you can make, such as mutual funds, bonds, stocks, and ETFs.
There are limits on how much you can put in your retirement savings plan; essentially, you can’t just put as much money as you want. Your employer and the third-party system they use will make you aware of this limitation.
Typically, you can set it up where every month, a certain amount of your paycheck automatically goes to your RSP. That way, you don’t need to worry about keeping track every month of your contribution.
You should consult with your company’s third-party system to track your retirement savings plan or your payroll team if you have any questions about updating or changing your contribution.
Gather Pay Stub Information
If you’re trying to figure out “What is RSP on pay stub?” you now know that it stands for your retirement savings plan. Check out these sample pay stubs to get a feel for where your retirement savings plan information lives.
You should see the amount and the percentage taken out per month from your paycheck. This should be listed under employee contributions, and it’s vital to understand where to find it.
If you get a raise or switch jobs and are making more money and want to contribute more, you can up the percentage that’s being taken out per month. You can also see your employer contributions.
Some employers will match the amount that you put into your retirement savings plan after a year or if you’re contributing a certain amount. This is very helpful in growing it because they doubled what you contributed.
Pay stubs are a great way to keep track of everything coming out of your monthly paycheck, and your retirement savings plan is a valuable deduction. It helps you save for your future.
Start Saving For Retirement Today
Now that you can answer the question “What is RSP?” you can start contributing to your retirement savings plan and track everything through your pay stub.
Typically, you can have a percentage of your paycheck go into your retirement savings plan automatically every month. You can up your contributions, and sometimes your employer will match you, and you can save double.