Three registered accounts, three different tax treatments, one question: which one should you fund first? Enter your numbers. Get a straight answer based on 2026 Canadian tax brackets.
It compares the after-tax value of your investment across accounts. The RRSP gives you a tax deduction now but taxes withdrawals later.
The TFSA gives no deduction but all growth is tax-free forever. The FHSA gives you both — deduction now and tax-free withdrawal for a home.
The key variable: your tax rate now vs retirement. If you're in a high bracket now and expect a lower bracket in retirement, RRSP wins. If your tax rates will be similar, TFSA usually wins because it doesn't affect OAS clawbacks or other income-tested benefits.
FHSA is a cheat code — if you're buying a first home. Tax deduction on the way in (like RRSP) plus tax-free on the way out (like TFSA).
$8,000/year, $40,000 lifetime max. If you qualify, max this first. It's the best registered account Canada has ever created.
Employer match is free money. If your employer matches RRSP contributions, always contribute enough to get the full match before funding anything else.
A 50% employer match is an instant 50% return. No investment will beat that.
| Taxable Income | Federal Rate | On First $X |
|---|---|---|
| $0 – $57,375 | 15% | First $57,375 |
| $57,375 – $114,750 | 20.5% | Next $57,375 |
| $114,750 – $158,468 | 26% | Next $43,718 |
| $158,468 – $220,000 | 29% | Next $61,532 |
| Over $220,000 | 33% | Remainder |
Your marginal rate includes provincial tax too. An Ontario resident earning $85,000 has a combined marginal rate of about 29.65% (federal 20.5% + Ontario 9.15%).
That's the rate at which an RRSP contribution saves you tax. For a full breakdown, see our RRSP vs TFSA guide.
Income under $55K? TFSA first.
Your marginal tax rate is low, so the RRSP deduction isn't worth much. Save RRSP room for higher-earning years.
Income $55K–$100K? It depends on your expected retirement income.
If you'll have a pension, TFSA might still win (you'll be in a similar bracket in retirement). If no pension, RRSP starts making more sense.
Income over $100K? RRSP first (after employer match).
The tax deduction is worth 30%+ at this income level. You'd need unusually high retirement income for TFSA to beat this.
Buying a first home? FHSA first. Deduction now, tax-free later, $8,000/year.
No other account gives you both. Then TFSA or RRSP depending on your income.
Have an employer RRSP match? Get the full match first.
Before FHSA, before TFSA, before anything. It's free money.
The MER factor nobody talks about: An RRSP tax refund invested in a 2.00% MER mutual fund loses much of its advantage. If you contribute $10,000 to an RRSP, get a $3,000 refund, and invest the refund in a bank mutual fund at 2.00% MER, fees erode the tax benefit over time.
The same refund in a 0.20% ETF keeps nearly all of it. Your fund fees are part of the TFSA vs RRSP equation.
The account type is half the battle. The other half is picking low-fee investments to hold inside it.
Best Low-Fee Funds Best ETFsNothing on this site is financial advice. Tax brackets are approximate and change annually.
This calculator uses simplified assumptions and does not account for all personal circumstances. Consult a tax professional for personalized advice.
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