Quote:
Originally Posted by Flames89
This makes perfect sense. Every dollar you put into your RRSP is a tax deduction. The money that grows in your TFSA is tax exempt - why move it to your RRSP, which will get taxed once you take it out.
Put whatever money into an RRSP that you can, to reduce your taxes. More value for your working dollar. Then any dollars that have been taxed, grow them in your TFSA because any growth is free growth.
|
Because when you move it into the RRSP you will get the tax deduction at that time. There is no deduction for TSFA. Both are free growth.
Both vehicles offer sheltered growth.
RRSP contributions you don't pay tax on until they come out.
TSFA contributions are done with after tax money, and there isn't any tax on withdrawal.
The early estimates I've seen say that if you are in the middle bracket when you contribute to and RRSP, and will be in the middle what you withdraw, then the choice between RRSP and TSFA is essentially a coin flip.
Every person will be different. Speak to your financial consultant.