TFSA versus RRSP

Weigh the benefits of investing in a TFSA versus an RRSP.
Alberta
Taxable income when you contribute (maximum value $1,000,000)
100,000
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Taxable income when you withdraw (maximum value $1,000,000)
50,000
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Contribution amount (maximum value $50,000)
10,000
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Info
Years of growth (maximum 50 years)
25
Rate of return (maximum value 16%)
6.00%
X
Input Error: Rate of return
Enter a value between and %.
Net Amount in 18 Years
TFSA
RRSP

Contribution TFSA RRSP
Pre-tax dollars $10,000 $10,000
Tax at % $3,600 $0
After-tax dollars $6,400 $10,000
Investment value in years $27,648$42,919
Tax at % $27,648 $42,919
Net amount in years $27,648 $29,185



 
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Assumptions
Calculations use marginal tax rates as of . Rates take all federal and provincial taxes and surtaxes into account and the basic personal tax credit. The RRSP contribution limit is $ for . The TFSA contribution limit for is $. Calculations do not factor in the effect of RRSP withdrawals on Old Age Security and other government benefits and credits that are income tested.

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