Calculators

RRSP or TFSA?

Where the next dollar goes comes down to one comparison: your marginal tax rate now vs in retirement.

The next dollar

Pre-tax amount this year ($)Marginal tax rate now (%)Expected marginal rate in retirement (%)Years until withdrawalAnnual return (%)

Fair-comparison assumptions: the RRSP contribution includes the reinvested tax refund (a full pre-tax dollar goes in), while the TFSA gets what's left after tax today. Same return, same years.

RRSP, after tax

$33,962.86

TFSA, after tax

$27,319.95

RRSP wins by

$6,642.91

Why

With the refund reinvested, the entire contest collapses to one question: is your marginal tax rate in retirement lower than it is today? Lower rate later → RRSP wins by exactly that rate gap. Higher rate later (pension income, OAS clawback territory) → TFSA wins. Same rate → identical outcome, to the cent. Growth rate and time change the size of the gap, never the winner.

Not financial, tax, or investment advice.