RRSP Q&A: Should I use my refund to pay down debt?

Answers to your RRSP questions.

by

Online only.

egg_322
From February 16 to 19, 2010, MoneySense.ca’s top financial planners are answering your RRSP questions. For the full list of questions answered — or to submit a question of your own — click here.

I am 46 years old, single with no children and I will have a good pension when I retire, as I am a teacher. I am contributing to RRSPs but I also have a mortgage and line of credit that I am paying down. The RRSPs are a tax break for me but should I be using that money for debt reduction right now? — Heather

Barbara Garbens: It sounds like you’ve been taking advantage of the wonders of compounding by contributing to your RRSP and watching your money grow over time.  Everyone’s situation is different, but generally speaking, a good strategy is to contribute to the RRSP and use the tax refund to make an additional payment on your Line of Credit or mortgage (whichever one has the highest cost and assuming that you have prepayment privileges on your mortgage).

You indicate that you will have a good pension when you retire and yes, generally teachers’ pensions are good and the funds well managed so that you reap the benefits of market growth etc.  If you have done a detailed cashflow analysis of your longer term needs, you will know if the pension (which will be indexed) will be enough to cover your post retirement spending patterns.  This is key.  If the pension will do the trick by itself, you may want to divert some of the RRSP contribution money to the mortgage/LOC now in order to free up monthly cashflow sooner once the debt is paid off.  Once paid off, this extra cashflow could go toward the RRSP room (if it has not been maximized), towards the new TFSA or even just towards yourself (vacations, etc.)  There are also other considerations such as how big the RRSP will get and whether you will be in the same or a lower bracket when you withdraw the money.  This may make a difference as to your decision as to how long to contribute to the RRSP and at what level.

Next question: Will I save money if I withdraw on maternity leave?

Back to main RRSP Q&A page.

Have a different opinion? Let us know in the comments.

138 comments on “RRSP Q&A: Should I use my refund to pay down debt?

  1. Pingback: RRSP Q&A: I’m 69 — should I put money from house sale in RRSP? | MoneySense

  2. Just thought I’d comment and say superb theme, did you code it by yourself? Looks excellent! I simply added your website to my bookmarks. I like reading your posts. Thank you!

    Reply

  3. This is getting a bit more subjective, but I much prefer the Zune Marketplace. The interface is colorful, has more flair, and some cool features like ‘Mixview’ that let you quickly see related albums, songs, or other users related to what you’re listening to. Clicking on one of those will center on that item, and another set of “neighbors” will come into view, allowing you to navigate around exploring by similar artists, songs, or users. Speaking of users, the Zune “Social” is also great fun, letting you find others with shared tastes and becoming friends with them. You then can listen to a playlist created based on an amalgamation of what all your friends are listening to, which is also enjoyable. Those concerned with privacy will be relieved to know you can prevent the public from seeing your personal listening habits if you so choose.

    Reply

  4. I real thankful to find this internet site on bing, just what I was searching for : D too saved to bookmarks . -Ryann

    Reply

  5. Well, it is great, however what about the other options we’ve got here? Would you mind making another article about all of them as well? Regards!

    Reply

  6. I love your writing style genuinely loving this internet site . -Mavis

    Reply

  7. That appears decent though i’m still not so certain that I prefer it. Anyways will look even more into it and choose personally! :)

    Reply

  8. Okay, that’s a good start but i’m going to take a look at that a touch more. Will show you what else there is.

    Reply

  9. That looks good nonetheless i am still not too sure that I prefer it. Nevertheless will look a lot more into it and choose personally! :)

    Reply

  10. What a lovely day for a 2736511! SCK was here

    Reply

  11. I do agree with all of the ideas you have presented in your post. They are really convincing and will certainly work. Still, the posts are very short for novices. Could you please extend them a little from next time? Thanks for the post. Find iPhone Developers on oDesk

    Reply

  12. The new Zune browser is surprisingly good, but not as good as the iPod’s. It works well, but isn’t as fast as Safari, and has a clunkier interface. If you occasionally plan on using the web browser that’s not an issue, but if you’re planning to browse the web alot from your PMP then the iPod’s larger screen and better browser may be important.

    Reply

  13. Can I just say what a reduction to search out someone who truly knows what theyre talking about on the internet. You positively know easy methods to carry a difficulty to gentle and make it important. More people must read this and perceive this facet of the story. I cant imagine youre not more widespread since you definitely have the gift.

    Reply

  14. Good old Cheryl Cole still loves her cuppa tea from Newcastle – good on yer gal! LOL!

    Reply

  15. Fine, it really is a good start however i’ll have to take a look at that a tad more. Will let you know exactly what more i’ve found.

    Reply

  16. I represented totally seeking this information awhile. After that from day to night of uninterrupted Googleing, ultimately I got it in your website. I inquire whats exactly the absence much like Google schedule your dont social station this original sort of informative websites in pinnacle of the inclination . Most of the highest regarded websites are full much like scraps.

    Reply

  17. I just want to say I’m all new to blogs and truly liked your web page. More than likely I’m planning to bookmark your blog . You really have fabulous posts. Bless you for revealing your web site.

    Reply

  18. I’m aware about this previously, however there were a few helpful bits which finalized the image for me, thanks a ton!

    Reply

  19. What a lovely day for a 3697059! SCK was here

    Reply

  20. Well, this is good, but think about additional options we have here? Do you mind publishing one more post about all of them as well? Kudos!

    Reply

  21. Hi webmaster, commenters and anybody else !!! The website is certainly wonderful! Plenty of good information and facts and creativity, each of which all of us require! Keep them coming… you all accomplish such an admirable job at such Principles… cannot explain to you how very much I, for one love all you do!

    Reply

  22. I seemed to be aware about this already, however there was clearly several helpful pieces which completed the picture for me, appreciate it!

    Reply

  23. Well, this is excellent, however what about the other choices we’ve got here? Would you mind making a further post about all of them too? Many thanks!

    Reply

  24. Well, that’s decent, but what about additional options we’ve got here? Do you mind making a further article regarding them as well? Thanks a bunch!

    Reply

  25. Right, that’s a nice beginning however i’m going to look into that a tiny bit more. Will let you know just what else there is.

    Reply

  26. Zune and iPod: Most people compare the Zune to the Touch, but after seeing how slim and surprisingly small and light it is, I consider it to be a rather unique hybrid that combines qualities of both the Touch and the Nano. It’s very colorful and lovely OLED screen is slightly smaller than the touch screen, but the player itself feels quite a bit smaller and lighter. It weighs about 2/3 as much, and is noticeably smaller in width and height, while being just a hair thicker.

    Reply

  27. thus far Pepsi has been known for inventing and distributing strangely flavored versions of their renown Pepsi soda. They’ve gone clear, white, clear, red, and now they’re going blue with Pepsi blue.

    Reply

  28. O . k ., it really is a nice beginning but i’m going to check into that a little bit more. Will let you know just what else there really is.

    Reply

  29. I do agree with all the ideas you’ve presented in your post. They’re very convincing and will certainly work. Still, the posts are very short for novices. Could you please extend them a little from next time? Thanks for the post.

    Reply

  30. hey there and thank you for your info – I have certainly picked up something new from right here. I did however expertise several technical points using this website, as I experienced to reload the web site a lot of times previous to I could get it to load properly. I had been wondering if your web host is OK? Not that I’m complaining, but slow loading instances times will often affect your placement in google and could damage your high-quality score if ads and marketing with Adwords. Well I’m adding this RSS to my e-mail and could look out for much more of your respective interesting content. Make sure you update this again very soon..

    Reply

  31. The heart of your writing whilst sounding reasonable initially, did not really settle perfectly with me personally after some time. Somewhere within the paragraphs you actually were able to make me a believer but just for a very short while. I nevertheless have got a problem with your jumps in assumptions and you might do well to help fill in all those breaks. In the event you actually can accomplish that, I will certainly end up being fascinated.

    Reply

  32. Along with almost everything which appears to be developing throughout this specific area, all your viewpoints happen to be rather stimulating. Even so, I beg your pardon, because I do not subscribe to your entire plan, all be it exciting none the less. It seems to everybody that your comments are not completely rationalized and in simple fact you are yourself not really wholly convinced of your assertion. In any event I did enjoy reading it.

    Reply

  33. In this awesome scheme of things you receive an A+ with regard to hard work. Where you lost me was first in all the specifics. As people say, the devil is in the details… And it couldn’t be much more accurate here. Having said that, permit me reveal to you exactly what did deliver the results. Your authoring is certainly quite persuasive and this is most likely why I am taking the effort in order to opine. I do not really make it a regular habit of doing that. 2nd, despite the fact that I can certainly see a jumps in reason you make, I am not certain of how you seem to connect the points which make the actual conclusion. For now I will subscribe to your position but hope in the near future you actually link your dots better.

    Reply

  34. I do love the way you have framed this specific challenge plus it does indeed supply us some fodder for thought. Nevertheless, coming from everything that I have witnessed, I just simply trust when the remarks stack on that men and women remain on point and not get started on a tirade of the news du jour. Still, thank you for this superb point and although I can not really agree with this in totality, I respect your point of view.

    Reply

  35. A lot of of whatever you state is astonishingly precise and that makes me wonder why I hadn’t looked at this in this light before. This piece really did switch the light on for me as far as this topic goes. Nonetheless at this time there is actually one particular factor I am not really too comfortable with and while I attempt to reconcile that with the actual core idea of your issue, permit me see what all the rest of your readers have to say.Well done.

    Reply

  36. The root of your writing while sounding agreeable at first, did not work perfectly with me personally after some time. Somewhere within the paragraphs you managed to make me a believer but only for a very short while. I still have a problem with your leaps in assumptions and one might do nicely to help fill in all those gaps. In the event that you can accomplish that, I will undoubtedly be amazed.

    Reply

  37. I do enjoy the manner in which you have framed this specific issue plus it does indeed present me personally some fodder for consideration. Nonetheless, from everything that I have personally seen, I simply just hope as the commentary stack on that men and women continue to be on issue and don’t start on a tirade associated with some other news of the day. Anyway, thank you for this excellent point and though I do not necessarily go along with the idea in totality, I respect your standpoint.

    Reply

  38. Blame you during another extraordinary article. Where else could anybody get that philanthropic of poop in such a incomparable path of writing.

    Reply

  39. You made some respectable points there. I looked on the internet for the issue and found most individuals will go along with together with your website.

    Reply

  40. Wasn’t sure where to ask this but I would like to add your site to one of my directories. Please contact me at your convience because I will only list sites with the webmasters consent – thank you.

    Reply

  41. Of course, what a splendid site and informative posts, I definitely will bookmark your blog.Best Regards!

    Reply

  42. I commend the instructive article you provide in your articles. I’ll bookmark your blog and play a joke on my friends check up in your blog frequently.

    Reply

  43. I actually wanted to construct a simple remark so as to thank you for these great tricks you are giving out here. My particularly long internet look up has finally been recognized with excellent ideas to go over with my relatives. I ‘d declare that many of us site visitors are quite endowed to be in a fine network with so many perfect professionals with interesting tricks. I feel truly blessed to have come across your weblog and look forward to many more exciting times reading here. Thanks a lot once again for a lot of things.

    Reply

  44. It is indeed my belief that mesothelioma is actually the most fatal cancer. It contains unusual attributes. The more I actually look at it the greater I am persuaded it does not act like a true solid human cancer. In the event that mesothelioma is a rogue virus-like infection, so there is the prospects for developing a vaccine as well as offering vaccination for asbestos open people who are vulnerable to high risk regarding developing upcoming asbestos associated malignancies. Thanks for giving your ideas on this important health issue.

    Reply

  45. Great beat ! I wish to apprentice at the same time as you amend your web site, how could i subscribe for a weblog web site? The account aided me a applicable deal. I were tiny bit familiar of this your broadcast offered shiny clear concept

    Reply

  46. I definitely loved reading your post. Thanks!A topic nearby to my heart cheers, do you partake of a RSS graze ?

    Reply

  47. I’ll make sure to don’t forget this internet site and devote it a look consistently .

    Reply

  48. hi. I see that you’re involved in creating backlinks and stuff. I’m merchandising scrapebox auto approve link lists. Would you like to trade ?

    Reply

  49. Advantageously, the post is in fact the sweetest on this creditable topic.

    Reply

  50. Terrific information, I value all of these opinions. Everyone needs to sensible of unbidden to expose themselves freely

    Reply

  51. Very nice post. I just stumbled upon your weblog and wished to say that I’ve truly enjoyed surfing around your blog posts. In any case I’ll be subscribing to your feed and I hope you write again very soon!

    Reply

  52. And also judged to be you can add much motion pictures on your posts to your readers very much having a blast? I’m talking about I just read car item of or perhaps a connect with one another was initially certainly superior but because The other pages on a visible student,I stumbled upon that do that you should a good deal useful incredibly well identify the way it turns out! It’s the best need to fellas are often ready way too. This type of advanced the job furthermore coverage! Stick to the best effective adult men I’ve contributed you guys to make sure you my very own blogroll. Might be addicted . really good report thanks for writing about this valuable explanatory resources.. I’ll visit your blog typical only a few fashionable mail.

    Reply

  53. Well I sincerely liked reading it. This article offered by you is very useful for good planning.

    Reply

  54. Hi I love this comment and it was so fabulous and I am definetly going to save it. One thing to say the Indepth analysis you have done is trully remarkable.Who goes that extra mile these days? Well Done!! Just another suggestion you shouldinstall a Translator Application for your Global Readers :)

    Reply

  55. Man I love this comment and it is so fabulous and I am gonna save it. One thing to say the Superb analysis this article has is trully remarkable.No one goes that extra mile these days? Well Done!!! Just one more suggestion you shouldinstall a Translator for your Global Audience !

    Reply

  56. hi admin, your website’s concept is cool and i like it. Your blog posts are stunning. Please keep it up. Greets.

    Reply

  57. Easy to run out of methods that obviously affair, perception again!

    Reply

  58. I believe avoiding ready-made foods is a first step for you to lose weight. They could taste good, but packaged foods possess very little nutritional value, making you try to eat more to have enough vitality to get over the day. When you are constantly having these foods, switching to cereals and other complex carbohydrates will assist you to have more vitality while taking in less. Thanks alot : ) for your blog post.

    Reply

  59. This site won’t display properly on my iphone – you might want to try and repair that

    Reply

  60. To me, it seems a bit irregular that while the The web was around for many years, and asudden it just exploded over the course of a couple years and presto, we have everything. I think the government decided in the later part of the last century to commence Email/Internet to the public in order to keep track of all that human beings do. So while you may suspect the Internet is free and open, everything that is typed, or sent can be examined by the government.

    Reply

  61. hey, kindly blog…absolutely like it and added to bookmarks. restrict up with admissible exertion!

    Reply

  62. Very cool blog post! I almost entirely only comment on roofing-related articles, but I had to to show my appreciation.

    Reply

  63. gry darmowe gry pl online nieziemskiegry.pl [url=http://nieziemskiegry.pl ]gry online[/url] darmowe gry [url=http://nieziemskiegry.pl ]gry[/url] gry [url=http://nieziemskiegry.pl ]gry[/url]gry pl [url=http://nieziemskiegry.pl ]gry pl[/url] nieziemskiegry.pl gry online

    Reply

  64. Pingback: Check out my FB profile

  65. I derive pleasure reading it. I need to learn more on this subject.. Thanks over the extent of criticism this extraordinary post.. Anyway, I am gonna subscribe to your feed and I hanker you mail again soon.

    Reply

  66. Pingback: Fathers Day Gift

  67. Pingback: Black Friday

  68. Pingback: poly mva

  69. Pingback: Sweaters On Sale

  70. Pingback: bathroom scales

  71. Pingback: Remove Tonsil Stones

  72. Pingback: genital warts symptoms in men

  73. Pingback: The Birdhouses

  74. Pingback: Event Tickets

  75. Pingback: Drug Rehab

  76. Pingback: Frye Paige

  77. Pingback: Syrup for Snow Cones

  78. Pingback: The natural haircolor

  79. Pingback: Married Dating

  80. Pingback: Wedding Gift Suggestions

  81. Pingback: Gold Party

  82. Pingback: Waterkettle

  83. Pingback: Air Conditioning Filters

  84. Pingback: Bungalows Ile Maurice

  85. Pingback: Acai Berry Scam

  86. You should take part in a contest for one of the best blogs on the web. I will recommend this web site!

    Reply

  87. Pingback: Kelloggs Coupons

  88. Pingback: marketing search firm

  89. Pingback: Zune phone

  90. Pingback: Mauritius Villas

  91. Pingback: Asthma Homeopathy

  92. Pingback: Mauritius Villas

  93. Pingback: What Is Adoption

  94. Pingback: Online Paralegal Courses

  95. Pingback: Minor Sex Education

  96. Pingback: make money online from home

  97. Pingback: hotels in benidorm

  98. Pingback: seo

  99. Pingback: Associate Degrees Online

  100. Pingback: how to ear money online

  101. Pingback: Fathers Day Gifts

  102. Pingback: holiday comparisons

  103. Pingback: kitchen remodel sacramento

  104. Pingback: sacramento patio covers

  105. Pingback: roofing contractors austin

  106. Pingback: Location Vacances Ile Maurice

  107. Pingback: Online Dating Sites

  108. Pingback: patio covers austin

  109. Pingback: Mauritius Villas

  110. Pingback: Whole Life Insurance Rates

  111. Pingback: property & casualty insurance license texas

  112. Pingback: Cheap Car Insurance Quotes Online

  113. Pingback: Cheap Personal Secured Loans

  114. You made some first rate points there. I searched on the internet for the issue and located most individuals will go along with together with your website.

    Reply

  115. You really make it seem so easy with your presentation but I find this topic to be really something that I think I would never understand. It seems too complex and extremely broad for me. I’m looking forward for your next post, I’ll try to get the hang of it!

  116. Thank you for your site post. Johnson and I are saving for our new e book on this theme and your blog post has made people like us to save our money. Your notions really responded all our inquiries. In fact, in excess of what we had thought of before we ran into your superb blog. I no longer nurture doubts plus a troubled mind because you completely attended to all of our needs here. Thanks

    Reply

  117. Pingback: Credit Card Consolidation

  118. Good post here. One thing I would really like to say is most professional domains consider the Bachelor Degree as the entry level requirement for an online course. Even though Associate College diplomas are a great way to start, completing a person’s Bachelors opens many entrances to various jobs, there are numerous internet Bachelor Course Programs available by institutions like The University of Phoenix, Intercontinental University Online and Kaplan. Another concern is that many brick and mortar institutions offer you Online editions of their degree programs but generally for a substantially higher cost than the companies that specialize in online degree programs.

    Reply

  119. Pingback: http://www.pubarticles.com/article-an-easy-way-to-locate-the-alternatives-you-need-1303133808.html

  120. Pingback: Herbal Incense

  121. Pingback: I like this site

  122. Pingback: וילונות

  123. Pingback: Schwinn 240 recumbent exercise bike

  124. Pingback: Marriage Problems

  125. Pingback: Discount Lanyards

  126. Pingback: The Best Diet Plan

  127. Pingback: relationship problems

  128. Pingback: עבירות מס

  129. Pingback: Sexchat

Leave a comment

Your email address will not be published. Required fields are marked *