RRSP Calculator
Contribute, get the refund, reinvest the refund. See what decades of that loop build — with the 2026 C$33,810 RRSP limit baked in.
Your inputs
Balance growth over time
What is an RRSP?
A Registered Retirement Savings Plan is Canada’s main retirement account: contributions are tax-deductible, growth inside is tax-sheltered, and you pay tax only when you withdraw — ideally in retirement, when your income and tax rate are lower. Contribute C$10,000 at a 30% marginal rate and the CRA effectively hands you C$3,000 back at tax time.
Your room works differently from a TFSA: each year you earn new room equal to 18% of the previous year’s earned income, up to C$33,810 for 2026. Unused room carries forward indefinitely, and an employer pension plan reduces your room through the pension adjustment. There is a C$2,000 lifetime over-contribution buffer, then a 1% monthly penalty on the excess.
The math behind this calculator
This calculator models the classic “gross-up” strategy: every year you contribute your amount plus reinvest the tax refund it generates (contribution × your marginal rate). That combined sum compounds annually until retirement. It is the fairest comparison against a TFSA, because it assumes you actually invest the refund instead of spending it.
Each year: balance = balance × (1 + r) + yearly invested
Worked example
Contribute C$10,000 a year for 25 years at 6%, with a 30% marginal rate. Your out-of-pocket cost is C$250,000, but the reinvested refunds add C$3,000 a year — C$75,000 total — so C$325,000 actually goes to work. At retirement the account holds roughly C$713,000, of which about C$388,000 is growth. The refund did real work: without reinvesting it, the same contributions would reach only about C$548,000.
RRSP vs TFSA: the rule of thumb
It comes down to tax rates. If your marginal rate today is higher than it will be in retirement, the RRSP usually wins — you deduct at 40% now and withdraw at 25% later. If your rate is the same or lower now, the TFSA usually wins — no deduction today, but nothing taxed ever again. Early-career and lower-income savers generally favour the TFSA; peak-earning years generally favour the RRSP. Most Canadians end up using both: TFSA for flexibility and medium-term goals, RRSP for the heavy retirement lifting.
Caveats worth knowing
- Withdrawals are fully taxable. Every dollar out is income, with withholding tax at source. An RRSP is a poor emergency fund.
- The clock runs out at 71. By December 31 of the year you turn 71, the RRSP must become a RRIF or annuity — forced withdrawals begin.
- Two tax-free escape hatches exist. The Home Buyers’ Plan (up to C$60,000 toward a first home) and the Lifelong Learning Plan let you borrow from your RRSP, but both must be repaid on schedule or the amount becomes taxable.
- Spouses can income-split. Contributing to a spousal RRSP shifts future withdrawals to the lower-income partner — a legitimate way to cut a couple’s lifetime tax.
Sources: CRA — RRSPs and related plans; Fidelity Canada — 2026 RRSP limit; Wealthsimple — RRSP FAQs.