RRSP vs TFSA optimizer
Find which account maximizes your after-tax retirement wealth.
Your numbers
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Combined federal + provincial rate on your last dollar of income
Rate you'll pay on RRSP/RRIF withdrawals in retirement
TFSA comparison uses the after-tax equivalent ($6,700/yr)
TFSA and RRSP (pocket the refund) both cost $6,700/yr out-of-pocket — a fair apples-to-apples comparison. RRSP + reinvest requires saving your $3,300/yr refund too ($10,000/yr total), which is why it always leads. Actual results depend on contribution room. Not financial advice.
$246,463
20 yrs · $6,700/yr · tax-free
$286,928
20 yrs · $6,700/yr · 22% withdrawal tax
$408,320
20 yrs · $10,000/yr · saves refund too
RRSP + reinvest refund wins
Contributing $10,000/yr to RRSP and reinvesting the $3,300/yr refund into TFSA leaves you $161,857 ahead of TFSA-only after 20 years. Note: this strategy saves $3,300/yr more than the other two (total annual savings $10,000 vs $6,700).
Side-by-side breakdown
TFSA and RRSP (spend refund) are equal-cost comparisons. RRSP + reinvest saves more total.
| TFSA | RRSP | RRSP + Reinvest | |
|---|---|---|---|
| Annual out-of-pocket | $6,700 | $6,700 | $10,000(+refund) |
| Annual refund reinvested | — | — | $3,300 |
| Gross account value at retirement | $246,463 | $367,856 | $489,248 |
| After-tax value at retirement | $246,463 | $286,928 | $408,320 |
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