Where Can I Save my Money?

By Michael Demner

The federal government has legislated several tax-effective programs for saving for the future, for yourself or your children.

There are a lot of variables to consider when thinking about whether a TFSA or an RRSP is better for you. It depends on your employment situation, your age, your tax bracket, and your investment goals.

Generally speaking, a TFSA is better for people who are younger, have a lower income, and are in a lower tax bracket. RRSPs are better for people who are older, have a higher income, and are in a higher tax bracket.

Here's a more detailed breakdown:

If you're younger than 18, you're probably not working and thus not earning an income. You also probably don't have much money saved up. A TFSA is a better option for you because you won't have to pay taxes on the money you withdraw from it.

If you're 18-24, you're probably just starting out in your career. You probably don't have a lot of money saved up, and your income is probably low. A TFSA is a better option for you because you won't have to pay taxes on the money you withdraw from it.

If you're 25-34, you're probably starting to establish yourself in your career. You may have started a family, and your income is probably rising. A TFSA is a good option for you because you can use it for short-term savings goals, like a down payment on a house. You won't have to pay taxes on the money you withdraw from it.

If you're 35-44, you're probably in the prime of your career. You may have a family, and your income is probably high. An RRSP is a good option for you because you can use it to save for retirement. The money you withdraw from your RRSP will be taxed, but it will be taxed at a lower rate than if you had invested the money in a non-registered account.

If you're 45-54, you're probably nearing the end of your career. You may have a family, and your income is probably high. An RRSP is a good option for you because you can use it to save for retirement. The money you withdraw from your RRSP will be taxed, but it will be taxed at a lower rate than if you had invested the money in a non-registered account.

If you're 55-64, you're probably retired or close to retirement. You may not have a family, and your income is probably lower than it was during your working years. An RRSP is a good option for you because you can use it to withdraw money tax-free in retirement.

If you're 65 or older, you're probably retired. You may not have a family, and your income is probably low. An RRSP is a good option for you because you can use it to withdraw money tax-free in retirement.