By Physicians, For Physicians
Like many physicians I’ve spoken with recently, I’ve been feeling the uncertainty in today’s economy. Costs are rising, the markets are unpredictable, and there’s a general sense of hesitation when it comes to long-term financial commitments.
When you’re unsure what the next few months will look like, the last thing that feels wise is adding new expenses or setting up new structures. I get it — I felt the same way.
So when I first heard about the Canadian Physicians’ Pension Plan (CPPP) and the option to set up my very own Registered Pension Plan (RPP), my first thought was: why would I do that right now if I’m not ready to contribute?
What I discovered, though, was that setting up the plan — even well before I contributed a single new dollar — gave me advantages I didn’t realize were possible. This article lists some of these key advantages.
1. I used my existing RRSPs to unlock new benefits
One of the biggest surprises for me was learning that I could transfer my existing RRSPs into my RPP without any tax consequences. This move alone created new tax deductions and investment opportunities.
Here’s how: when you hold investments in an RRSP, you can’t deduct the management fees. But once those same investments are inside a pension plan, those fees become a corporate tax deduction — real money saved, year after year.
On top of that, the RPP opened up a much broader range of investment options — including private real estate, mortgages, private equity, and farmland — asset classes that aren’t even RRSP-eligible. These are the same strategies used by large institutional pension funds, and they can offer stability that public markets sometimes can’t.
2. I gained creditor protection and peace of mind
As physicians, we’re always mindful of risk — not just clinical, but financial. What appealed to me about the RPP is that it immediately put my retirement savings under the strongest level of creditor protection in Canada. Pension assets are shielded by federal law, which means they can’t be touched by creditors or legal claims in bankruptcy.
And when it comes to estate planning, the difference between an RRSP and an RPP is striking.
Let’s take a simple example: if a physician passes away with $1 million in an RRSP and no spouse, that full amount is taxable in the estate — usually at the top personal rate (around 53% in Ontario). The family gets what’s left after tax is paid to the CRA.
If those same funds were in an RPP, the story changes dramatically. Pension assets can be split among multiple beneficiaries, and each beneficiary pays tax only on their portion. That same $1 million could be divided into ten $100,000 shares — significantly reducing the overall tax bill because that income is taxed in a lower tax bracket. If part of it goes to a charity, that portion can even be completely tax-free! When I say charity, i could have included my alma mater (med school) or a hospital as well.
For me, that level of control and protection gave real peace of mind — especially knowing I didn’t have to put in any new funds to benefit right away.
3. My contribution room started building — even before I contributed
Another benefit I hadn’t realized: the moment your RPP is set up, your contribution room starts accumulating, even if you’re not ready to contribute yet.
So while I’m holding cash a little tighter this year, my future contribution room is already growing. When things stabilize — or when I’m ready to make a commitment — I’ll be able to make up for lost time and claim a bigger tax deduction in one go than had I simply continued using an RRSP..
That’s a huge advantage over waiting, because it means my clock has already started ticking on those extra benefits.
4. I realized it’s not about timing — it’s about positioning
Setting up my RPP wasn’t about having spare cash. It was about positioning myself to take advantage of opportunities when they come.
Even if I decide not to contribute until next year, the structure is ready. I’m protected from risk, and my contribution room is quietly building in the background.
It’s one of the few financial steps that genuinely makes sense — even in uncertain times.
If you’ve been wondering whether it’s the right moment to start, I’d say this: don’t wait for perfect timing. The earlier you set up your RPP, the sooner those unseen benefits start working for you.