TFSA vs RRSP vs FHSA: What’s the Difference — and Which One Is Right for You?
Saving money is great — but saving the right way can make a big difference at tax time. In Canada, three popular accounts help you grow your money while reducing taxes: TFSA RRSP FHSA While they all allow tax-free growth , each one has a different purpose. Here’s how they work — in simple terms. Comparison of TFSA, RRSP & FHSA Bookmark this page or save this graphic as a quick reference for TFSA, RRSP & FHSA TFSA — Tax-Free Savings Account What it’s for A TFSA is best for flexible savings . You can use it for emergencies, investing, travel, or future plans. Key features Money grows tax-free Withdrawals are tax-free Take money out anytime, for any reason Contribution rules Annual limit set by the government Unused room carries forward Withdrawals create new room in future years Tax impact Contributions are not deductible Withdrawals do not affect your taxes Best for Beginners Emergency savings Short- and medium-term goals RRSP — Registered Retirement Savings Plan What it’...