TFSA vs RRSP
Canadians have never had so many rewarding ways to help their hard-earned money go the distance!
What is a RRSP?
A Registered Retirement Savings Plan (RRSP) is an investment account that allows you to save money for your retirement while lowering your income tax. RRSPs build your wealth over time, and will put more money in your pocket through tax savings today.
Where saving for the future is concerned, a Registered Retirement Savings Plan (RRSP) is one of your wisest options—and we’re happy to help you set one up so that you can be ready to Retire Your Way!
What is a TFSA?
The Tax-Free Savings Account (TFSA) is a flexible, registered general-purpose savings vehicle that allows Canadians over the age of 18 to set money aside, which grows tax-free, throughout their lifetime. Each calendar year, you can contribute up to the set TFSA dollar limit of that given year, plus any unused TFSA contribution room from the previous year—as well the amount you withdrew the year before. The annual The annual TFSA dollar limit for 2023 is $6,500. The cumulative contribution limit in 2023 is $88,000.
The biggest determining factor for TFSA vs. RRSP is your income now vs. at retirement.
If your income now is higher than it will be at retirement, then the RRSP is the most effective option for tax efficiency. If your income now is lower than it will be in retirement, then the TFSA is the most effective option for tax efficiency.
With this in mind, our strategies will usually include both components, just weighted differently depending on your unique situation and financial goals.
|Why Choose a TFSA?
· Grow your savings tax free
· Withdraw with ease
· Keep your benefits
|Why Choose a RRSP?
· For retirement and more
· Lower your tax bill today
· Tax-deferred growth
Get started on the right path by booking an appointment today!