Registered Retirement Savings Plan // Tax-Free Savings Account
Send us your instructions at anytime for processing your 2014 TFSA and don’t forget to start making your 2014 RRSP contributions!
Tax-Free Savings Account (TFSA)
A Tax-Free Savings Account (TFSA) allows all of your investments to grow tax-free throughout their lifetime.
Open your No-Fee Tradex TFSA today
Note:The Canada Revenue Agency (CRA) will track your contribution room. The CRA reports this amount to individuals through the “My Account” function on the CRA web site.
Registered Retirement Savings Plan (RRSP)
An RRSP is a personal savings plan that allows you to save for the future on a tax-deferred basis. You can contribute to your RRSP until December 31 of the year in which you reach age 71.
Open your No-Fee Tradex RRSP today
TFSA or RRSP?
The chart below illustrates the after tax return of $31,000 of income earned by an individual who invests in either a RRSP or TFSA for a 25 year period, assuming a 5% rate of return. This example depicts the result of taxation at the same rate, at a lower rate, and at a higher rate during an individual’s retirement years versus their working years. All things being equal, with the same compound return, the same time frame and a constant tax rate before and during retirement, the amount of cash after tax in the RRSP and TFSA is identical and no preference should be give to one over the other. In the event your retirement income tax rate will be lower, the RRSP option would be preferable, while if your retirement income tax rate will be higher in retirement than your current tax rate, the TFSA wins out. Please contact a Tradex advisor to discuss in greater details which options are best for your individual needs and specific situation.