Here are some key TFSA and RRSP differences:
- You need earned income to contribute to an RRSP, but not a TFSA.
- RRSP contributions are made with pre-tax dollars, TFSA contributions are made with after-tax dollars.
- TFSA withdrawals are tax-free, but you’ll pay tax on RRSP withdrawals.
- You can only contribute to an RRSP until you are 71, and can only contribute to a TFSA after you turn 18.
- RRSPs are intended for retirement savings, but you can use a TFSA to save for anything.