RRSP Loan Calculator
Should I get a loan to contribute to my RRSP?
You have to consider the following factors before considering a RRSP loan:
- Loan rate
- Term of loan
- Years to retirement
- Future rate of investment return
- Marginal tax rate
What happens if you get a RRSP loan?
You get tax-free compounding of your investments and a tax refund that you can use to repay the loan.
What happens if you don't?
You save on interest costs but defer building your RRSP and taking advantage of a tax deduction.
Calculation Inputs
Enter the amount of the RRSP loan, the expected rate of return, interest rate on loan, duration and marginal tax rate to see which option is better.
RRSP Loan Calculator
Calculation results...
Assumptions
The calculator uses the following assumptions:
- Both the Federal and Provincial Governments apply the same capital gains inclusion rate
- Marginal tax rate is the rate in effect at the time of sale of the investment
- The tax refund for the RRSP contribution is available immediately for re-investment
- The unused RRSP deduction limit is sufficient to allow a full deduction for the RRSP contribution
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