Contribute to an RRSP account to maximize your refund and save for retirement. Amounts contributed to an RRSP are tax deductible and lower your taxable income.
Bonus: You can contribute to a spouse’s RRSP account and claim the deduction as well. Do this on the person with the highest marginal tax rate.
Check: Always check your latest notice of assessment to make sure you have RRSP contribution room available before you add to your RRSP account. Use the paper copy that was sent to you in the mail for last years taxes or check online through the CRA MyAccount portal.
Be Aware: Keep in mind that you’ll need to pay tax on amounts eventually withdrawn from your RRSP account in this future. The benefit of compounded investment growth should make the strategy worthwhile however over the longer term.