TFSA or RRSP? Here's how to decide

  RRSPs or TFSAs? The age old question comes up most often early in the year, at RRSP season. Which is right for you? The answer is sure to differ in each case. This article from the Globe and Mail offers case studies to assist those who are unsure to make this important financial decision, and also offers the following basics of both savings vehicles: Taxes:

• RRSP contributions are tax deductibe (which means you get a tax refund), but you pay tax when you withdraw from your RRSP.
• TFSA contributions are not tax deductible, but withdrawals are tax-free.

Contribution limits:

• For RRSPs, 18% of your previous year's income, to a maximum of $24,270 in 2014 (less any pension adjustment).
• For TFSAs, $5,500 in 2014. If you haven't put money in a TFSA since they were introduced in 2009, your cumulative limit is now $31,000.

Age limits:

• You can't make contributions to RRSPs after the year in which you turn 71.
• No age limits for TFSAs.

Click here for the full article from the Globe and Mail.