RRSP contributions have a February deadline for your 2025 tax year. You walk into your bank. They want your money. They’re not asking whether you should actually be making a contribution. They don’t know you well enough. That’s not the advice they’re giving. You’re pressured. RRSP season feels urgent. But what if contributing now costs you more tax later? You get a deduction today against your 2025 income. Then at 65, 70, 75, you withdraw it and pay tax. Will your tax rate be lower then or higher?

Bruinsma’s rule of thumb: if you earn more than $50,000 taxable income, RRSP contributions probably make sense. Below that? Your tax bracket now might be lower than your retirement tax bracket when you combine Canada Pension Plan, Old Age Security, workplace pension, and savings withdrawals. You’d be getting a small tax break now to pay higher tax later. That’s backwards. The TFSA has no deadline, no RRSP season marketing push, and works for anyone regardless of income. Money goes in after-tax. Growth is never taxed. Ever.

The pressure to contribute by February end assumes everyone benefits equally. Life never unfolds the way financial plans predict. Make the best decision with information you have now, not the marketing timeline the banks created.

Topics: RRSP contributions, tax planning, TFSA benefits, retirement income, financial deadlines

GUEST: Anita Bruinsma | http://clarityonyourmoney.com

Originally aired on2026-02-02