Which savings account is right for you?
Canada has 4 tax-advantaged savings accounts, each designed for a different goal. The right choice depends on your income, life stage, and what you're saving for.
Side-by-side comparison
| Feature | RRSP | TFSA | FHSA | RESP |
|---|---|---|---|---|
| Tax on contributions | Deductible | After-tax | Deductible | After-tax |
| Tax on growth | Tax-deferred | Tax-free | Tax-free | Tax-deferred |
| Tax on withdrawal | Taxed as income | Tax-free | Tax-free (for home) | Taxed (student) |
| 2026 annual limit | 18% of income (max $32,490) | $7,000 | $8,000 | No annual limit ($50,000 lifetime) |
| Best for | Retirement | Flexible savings | First home | Children's education |
| Government match | No | No | No | CESG 20% (up to $500/yr) |
Find the right account for your situation
Just starting out
Start with TFSA for flexibility while your income is low. Your tax bracket is likely too low for RRSP deductions to be worth much. Once your income rises above $55,000, start contributing to your RRSP.
TFSA first, then RRSP
Saving for first home
FHSA gives you a tax deduction on contributions and tax-free withdrawal for your home purchase. Combine with the RRSP Home Buyers' Plan ($35,000) for maximum down payment.
FHSA + RRSP HBP
Mid-career earner
Max your RRSP if your marginal rate is above 30% — the tax deduction is significant. Then fill your TFSA with after-tax dollars for tax-free growth and flexible access.
RRSP + TFSA
Parent saving for education
Open an RESP as early as possible. The government matches 20% of your contributions (up to $500/year via CESG) — that's a guaranteed 20% return, up to $7,200 per child over their lifetime.
RESP for education grants
Approaching retirement
Maximize RRSP contributions while your marginal rate is high. You must convert to a RRIF by age 71. Consider drawing down RRSP in low-income years before CPP/OAS kick in to minimize lifetime tax.
RRSP → RRIF conversion
Calculate your savings
RRSP Calculator
See how much tax you save with RRSP contributions. Calculate deductions and contribution room.
Tax-freeTFSA Calculator
Track contribution room, project tax-free growth, and plan withdrawals.
First homeFHSA Calculator
Calculate FHSA tax savings and project growth toward your first home down payment.
EducationRESP Calculator
Project education savings with CESG government grants and compound growth.
Related articles
Comparison
RRSP vs TFSA: Which Is Better?
A detailed comparison to help you decide where to put your savings based on income and goals.
First home
FHSA vs RRSP for First Home
Compare the First Home Savings Account and RRSP Home Buyers' Plan for first-time buyers.
2025 limits
RRSP, TFSA & FHSA Contribution Limits
Current contribution limits, carry-forward rules, and deadlines for all registered accounts.
Frequently asked questions
Should I contribute to RRSP or TFSA first?
It depends on your marginal tax rate. If your rate is above 30%, RRSP contributions give you a bigger immediate tax break. If you're in a lower bracket (under $55,867 federally), start with TFSA — your tax savings from RRSP deductions are smaller, and TFSA gives you more flexibility to withdraw without tax consequences.
Can I have all 4 accounts at once?
Yes. You can hold an RRSP, TFSA, FHSA, and RESP simultaneously. Each has its own contribution room and tax rules. Many Canadians use a combination — for example, FHSA + RRSP for a first home, TFSA for flexible savings, and RESP for children's education.
What happens to unused contribution room?
RRSP and TFSA unused room carries forward indefinitely. FHSA allows up to $8,000 carry-forward of unused room (maximum $16,000 in one year). RESP has no annual limit — only a $50,000 lifetime limit per beneficiary — so there's no unused room concept.
Which account gives the best tax savings?
FHSA gives the best combined benefit for first-time homebuyers: tax-deductible contributions (like RRSP) plus tax-free withdrawals (like TFSA). For retirement savings, RRSP is best if your current tax rate is higher than your expected retirement rate. TFSA is best if your current and future rates are similar. RESP offers a guaranteed 20% return via government grants.