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Canada Premium Bonds come off the presses at the Canada Bank Note Company in Ottawa.
Canada Premium Bonds come off the presses at the Canada Bank Note Company in Ottawa.

How do savings bonds work?

How to buy savings bonds for RRSPs and RRIFs Add to ...

Canada Savings Bonds (CSBs) and Canada Premium Bonds (CPBs) are lower-risk investments you can buy for your retirement savings. The interest rate may go up while you own these bonds, but it will not go down. And, there are no fees to buy or sell a savings bond. 

How it works

  1. You can buy savings bonds for a self-directed RRSP or RRIF. Ask your financial institution or investment firm for details.

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  2. You can also contribute the interest you earn on savings bonds to your RRSP. To set this up, call the Canada Savings Bonds Customer Service Centre toll-free at 1-800-575-5151.

  3. You can cash in CSBs and CPBs at any time. However, when you cash in a CPB, you earn interest only up to the last anniversary date of the bond. Since CSBs earn interest to date, if you want more flexibility with your RRIF, you may be better off buying CSBs.

Visit the Canada Savings Bond website for more information on buying savings bonds for RRSPs and RRIFs.

Canada RSPs and Canada RIFs: These government-sponsored plans are no longer available to new customers. If you already hold a Canada RSP or Canada RIF, your plan won’t be affected. Learn more about the rules for these plans.

2 tax advantages

Holding your savings bonds in a registered account will give you certain tax advantages:

  1. Shelters the interest earned – For bonds held in RRSPs and RRIFs, you will not be taxed on the interest earned until you take the money out.

  2. Defers tax – Like any RRSP contribution, you'll get a tax deduction if you buy bonds for your RRSP.


Content in this section is provided in partnership with Investor Education Fund, a non-profit organization founded and supported by the Ontario Securities Commission that provides unbiased and independent financial tools to help Canadians make better money decisions. To find out more, go to: GetSmarterAboutMoney.ca


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