RRSP vs TFSA Decision Tool

The RRSP vs TFSA decision depends on your current income, your expected retirement income, your tax bracket, and your financial goals. This tool walks you through the key factors and gives you a recommendation based on your answers. It covers Ontario-specific tax brackets and considerations that matter for people in London and Southwestern Ontario.

RRSP wins15 years · 6% return

RRSP advantage

+$2,771

On $15,000 of pre-tax income, in your pocket after all tax is paid, 15 years from now.

RRSP — after tax

$25,519

$35,948 grown, minus $10,430 tax

TFSA — after tax

$22,748

$9,492 in, grown tax-free, no tax out

Why, in one sentence

The deduction shelters this money at 36.7% today and you pay only 29.0% when you take it out, so the RRSP wins by the difference.

What to do

Put this $15,000 in the RRSP. Then actually invest the $5,508 refund — spending it is what turns a winning move into a losing one.

Your numbers

The whole decision turns on one comparison: your tax rate now versus your tax rate when you take the money out.

Your income today

Marginal rate now: 43.4%

$120,000

$30,000$400,000

Your other income in retirement

Pension + CPP + OAS + other RRIF income, before this withdrawal

$55,000

$0$250,000

Amount you're deciding on

Pre-tax dollars

$15,000

$1,000$100,000

Years until you withdraw

15 yrs

1 yrs40 yrs

Annual return assumption

Applied identically to both accounts — the growth rate never decides this question, the tax rates do.

Rate today

36.7%

What the deduction shelters

Rate when you withdraw

29.0%

On the whole RRSP withdrawal

Tax refund on the RRSP

$5,508

Invest it, or the RRSP loses

Growth multiple

2.40x

6% over 15 years

The full breakdown

The verdict above is the answer. This is the working behind it — the dollar-by-dollar path of both accounts, and the retirement income level where the answer flips.

Unlock the full breakdown

See the dollar-by-dollar path of both accounts, the year-by-year comparison, and the exact retirement income level where the answer flips from RRSP to TFSA. Marc will follow up with a personal read on your numbers.

three of the 57 Checks

with your numbers, Marc would look at these next

Holding each investment where it is taxed least
the same investments, less tax, just by where they sit.
Timing spousal contributions correctly
a precise rule that, done right, keeps the tax with the right spouse.
Finding your low-tax years
we map your future income to spot the years you can move money at a discount.

the RRSP wins because your rate today is high. i would look at a spousal RRSP so the withdrawal lands on the lower-taxed spouse, and at where each holding sits.

book a fit call

thirty minutes, no pressure. if you are already on track, Marc will tell you.

or start with a Plan Check ($497, credited toward your plan)

those are three of the 57 Checks. the other 54 are what the plan runs.

Assumptions & simplifications

The comparison starts from the same PRE-TAX dollars. The full amount goes into the RRSP because the deduction cancels the tax; only the after-tax amount fits into the TFSA. That is the apples-to-apples version of this question.
Rates come from 2026 combined Ontario + federal marginal brackets on ordinary income.
The rate today is the real blended rate your deduction shelters — tax on your income minus tax on your income less the contribution — not a single headline bracket.
The rate later is the blended rate the whole RRSP withdrawal is taxed at when it stacks on top of the other retirement income you entered. A large withdrawal crossing brackets is reflected here.
The RRSP is modelled as withdrawn in a single year. Spreading withdrawals over many years usually lowers the rate later and improves the RRSP result.
Returns are steady and identical in both accounts. No fees, no contribution-room limits, and no RRSP over-contribution rules are applied.
The TFSA result ignores two real advantages that do not show up in this math: TFSA withdrawals never count as income for OAS clawback or GIS, and the room comes back the following year.
The RRSP result ignores the pension income credit, income splitting after 65, and any employer match — all of which favour the RRSP.
Provincial and federal credits, the age credit, and the OAS recovery tax are not modelled here. Use the Ontario Retirement Calculator for the full after-tax picture.

This is an educational tool, not financial advice. Real plans depend on investment performance, tax rule changes, government benefit changes, and your own circumstances. For a personalized plan, book a fit call with Marc.

Quick RRSP vs TFSA Guide

RRSP is often better when:

- Your income is over $55,000
- You expect lower income in retirement
- You want to reduce this year's tax bill
- Your employer offers RRSP matching

TFSA is often better when:

- Your income is under $55,000
- You might need the money before retirement
- You want flexibility with withdrawals
- You're already in a low tax bracket

Tax Planning

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Retirement

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