25
The Paris Independent
January 13, 2024
F I N A N C I A L M AT T E R S RRSPs vs. TFSAs: head-to-head
*If you don’t use up your limit, you can carry it over to the next year *Any withdrawals are added to your contribution limit the next year *If you were over 18 in 2009 and have never contributed to a TFSA, the total contributions you could make in 2024 are $95,000 *You can make TFSA contributions at any age above 18,
RRSP
TFSA
Maximum annual contribution
18% of earned income (max. $31,560 in 2024)
$7,000
Carry forward unused amount
Yes
Yes
Tax deductible contributions?
Yes
No
Investments grow tax-free?
Tax-deferred
Yes
Tax-free withdrawals?
No
Yes
Re-contribute withdrawals?
No
Yes
Purpose
Primarily retirement
Anything
Contribute to spouse's plan?
Yes, tax deductible
Yes, but not tax deductible
End date to make contributions?
Year owner turns 71
No
so you can keep saving after 71. TFSAs are far more flexible than RRSPs. They can be used for retirement, but also for any other reason, including an emergency fund, a wedding or a down payment on a home. While you won’t receive an immediate tax break with a TFSA contribution, the important difference is that you won’t be taxed when you withdraw from it. Written and published by IG Wealth Management as a general source of information only. Not intended as a solicitation to buy or sell specific investments, or to provide tax, legal or investment advice. Seek advice on your specific circumstances from an IG Wealth Management Consultant. Jacob Gaudet is an Associate Consultant on the wealth advisory team Gaudet Group Private Wealth Management. He helps clients get more out of their money, so they can get more out of life. Jacob specializes in six key areas: Investment, Retirement, Estate, Tax, and Insurance, and Mortgage Planning. With more than 60 years of combined experience, Gaudet Group Private Wealth Management is committed to making clients’ interests their top priority. Do you have questions you’d like Jacob to Answer? Email him at jacob.gaudet@igpwm.ca. Investors Group Financial Services Inc.
