An RRSP is a savings plan designed to help employees save for retirement after they stop working. Self-employed people can also participate in the program, and it can be used as an investment vehicle. The pre-tax funds are kept inside of an RRSP account, and it grows tax free until you withdraw the money. However, when you do this, you are taxed at a very marginal rate (usually less than 1%). This means that even if your entire balance is withdrawn at once, you’ll only end up paying taxes on a fraction of what was originally deposited into your account.