RRSP vs TFSA Calculator
See which account likely leaves you with more after tax — modelled the way an advisor would, using your province’s tax rate and the tax refund most calculators quietly ignore.
The short answer
An RRSP usually wins if your marginal tax rate today is higher than it will be in retirement and you invest the tax refund. A TFSA usually wins if your rate is similar or higher later, if you want flexible tax-free access, or if you want to protect income-tested benefits like OAS. Enter your details below to see your own numbers.
Want this pressure-tested against your full tax picture, benefits and employer plan?
Get a personalized answer from a licensed advisorHow this calculator is different
- It models the refund honestly. The RRSP’s edge comes from investing the tax refund. Toggle “spend it” and watch the advantage disappear — most tools never show this.
- It uses your province’s rate. Marginal rates are estimated from your province and income, not a single national number, and you can override them.
- It shows the break-even. The exact retirement tax rate below which the RRSP wins, including any employer match.
- It flags the OAS clawback. Where a TFSA’s non-taxable withdrawals quietly beat an RRSP for retirees near the threshold.
The math behind it (for the curious)
We compare the same out-of-pocket amount today. The TFSA is funded with after-tax dollars and grows and is withdrawn tax-free, so its value is simply your contribution compounded at your expected return. The RRSP is funded with the same amount (plus any employer match), grows tax-deferred, and is taxed at your retirement marginal rate on withdrawal; the tax refund on your contribution is added back — invested tax-free if you choose “invest it,” or dropped if you choose “spend it.”
The break-even retirement rate is 1 − (1 − rate now) ÷ (1 + employer match).
Tax figures use 2025 federal and provincial brackets, exclude provincial surtaxes and
credits, and apply Quebec’s federal abatement approximately. They are estimates you can
override — always confirm your real marginal rate with the CRA or an advisor.
RRSP vs TFSA — Frequently Asked Questions
Neither is universally better. An RRSP wins when your marginal tax rate today is higher than it will be when you withdraw in retirement, and you invest the tax refund. A TFSA wins when your rate is similar or higher in retirement, when you want flexible tax-free access, or when you want to avoid income-tested clawbacks like the OAS recovery tax. Many Canadians use both.
An RRSP contribution generates a tax refund equal to your contribution times your marginal rate. That refund is what gives the RRSP its edge — but only if you invest it (for example, in a TFSA). If you spend the refund, an RRSP and TFSA behave very differently, and the RRSP usually loses its advantage. This calculator lets you toggle between reinvesting and spending the refund so you can see the difference.
Use the rate on your next dollar of income — your combined federal and provincial marginal rate. The calculator estimates it from your province and income, but you can type in your exact rate. For retirement, estimate the rate that will apply to your RRSP/RRIF withdrawals based on your expected retirement income.
Old Age Security is reduced (a 15% recovery tax) once your net income passes a threshold (about $93,454 in 2025). RRSP and RRIF withdrawals count toward that income; TFSA withdrawals do not. So for retirees near or above the threshold, drawing from a TFSA can preserve OAS that an RRSP withdrawal would erode — an advantage a simple rate comparison misses.
No. This tool is for education and uses simplified, estimated tax figures. It does not account for your full tax picture, benefits, employer plans, or investment specifics. For a decision tailored to your situation, speak with a licensed advisor.
Go deeper on the RRSP vs TFSA decision
This tool gives you the numbers. Our plain-English guide explains the strategy — when to prioritize each account, and how to use both together — and our retirement hub shows how it fits the bigger picture.
The information on this website is for educational purposes only and does not constitute financial, legal, tax, investment, insurance, or mortgage advice. Personalized recommendations must be provided by a qualified licensed professional based on your individual circumstances. Secure Future Financial connects visitors with licensed advisors and does not sell financial products directly. Calculator results are illustrative estimates based on simplified tax assumptions and the figures you enter; they are not a projection, guarantee, or tax advice.