RRSPs RRIFs and TFSAs -> Stocks, Bonds etc. -> Is it Better to Invest in RRSPs or a Non-Registered Account?
Is it Better to Invest in RRSPs or in a Non-Registered Account?
For the average Canadian taxpayer, it is usually better to invest in RRSPs, because:
 | you will probably be in the same or a lower tax bracket when you retire |
| your investment income grows tax-free inside the RRSP |
| you can invest in stocks, bonds, foreign and other investments without worrying about the tax implications |
| you are less likely to withdraw the money than if you are saving it in an unregistered account, so you will build up a sizeable nest egg by retirement |
It may be better to invest in a non-registered account (outside of RRSPs) if:
| you will be in a higher tax bracket after retirement, and |
| you invest all your money in investments which produce capital gains or eligible Canadian dividends, and |
| you are comfortable not owning any bonds or other interest-producing investments, and |
| you do not sell any investments until retirement, because the sale would generate taxable capital gains. |
Tax Tip: most people should invest in RRSPs.
TaxTips.ca Resources
Recommended stocks/ETFs for inside or outside of your RRSPWhat is better - TFSA or RRSP?
Revised: October 15, 2021