Compute RRSP refund + long-term tax-deferred growth.
Future RRSP value
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Annual tax refund
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Total contributed
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Your breakdown
Updates live as you type| Item | Amount (CAD) |
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Worked example
Contribute $10,000 a year to an RRSP at a 33 percent marginal tax rate, earning 6 percent, for 30 years. Each year the contribution is deducted from taxable income, so $10,000 at 33 percent generates an immediate tax refund of about $3,300. Over the contribution period you put in $300,000 of your own money (30 years at $10,000). Treated as an annuity earning 6 percent, that stream of deposits compounds to roughly $790,582 by year 30. The deferral is the key benefit: you invest pre-tax dollars and pay no tax on the growth along the way. Tax only applies when you withdraw, at your marginal rate at that time, which is often lower in retirement than during your working years.
How it is calculated
The tool computes two things. The refund is simply the contribution multiplied by your marginal tax rate, because the deduction reduces income taxed at that top rate. The future value uses the future-value-of-an-annuity formula, contribution times ((1 plus r) to the power n, minus 1) divided by r, with r as the annual return and n as the number of years. RRSP room for 2026 is 18 percent of prior-year earned income up to a $32,490 ceiling, minus any pension adjustment, and unused room carries forward. The model assumes a level contribution each year and reinvested growth, all tax-sheltered until withdrawal. Because RRSP withdrawals are fully taxable as income, the real comparison against a TFSA depends on your marginal rate now versus in retirement.