RRSP — when (and when not) to use it
Lesson 3 of 8 in Investing Basics — TFSA, RRSP, FHSA & RESP · 22 minutes
The Registered Retirement Savings Plan. Powerful tax tool for the right person at the right time — and a costly mistake at the wrong time. Here's how to know which is which.
What you'll learn
- Distinguish RRSP from TFSA — and pick the right one for your situation
- Calculate your RRSP contribution room from your CRA My Account
- Use the Home Buyers' Plan and Lifelong Learning Plan correctly
From the lesson
Content note
General information, not financial advice. Rules and limits change — check canada.ca. For advice about your own situation, talk to a qualified, registered professional.
RRSPs are powerful — but they require thinking about your future income. For the right person, they're a 30 % rebate on retirement savings. For the wrong person, they're a tax trap. Here's how to know.
How RRSPs actually work
What an RRSP is
The Registered Retirement Savings Plan is a tax-deferred investment account. You contribute BEFORE-tax money — you get a tax DEDUCTION when you contribute, reducing your income tax for that year. Inside, the money grows tax-free. When you WITHDRAW (usually in retirement), it's…