General Goals 1) to be debt free in 3.5 years 2) save lots of money

Thursday, February 3, 2011

Saying No to RRSPs and Yes to TFSA

I mentioned yesterday that I had tried to open up a TFSA for my company stock. The first place I had started was with my employer bank to open up a staff account. The gentlemen on the other end of the phone asked me why I had not opened up RRSP. I explained that I had no interest that it was a tax deferral system and not a tax saving system. And since I am currently in the lowest tax bracket it made no scene to me to defer paying taxes now to later when I might be in a higher tax bracket. The guy launched into a spiel about how I would be in a lower tax bracket when I retired, and blah, blah, blah. I stopped him in mid sentence; there was no point in him wasting his breath. I said let me be frank with you last year I made less then 15,000 RRSP will do nothing for me!! This is of course not taking into consideration the political, charitable and education credits that I have built up over the years because my income while at school has been on average less than $5,000. The last nail in the coffin for RRSP for me is that I have over 10,000 of TFSA room to play with and before I go tax deferring my money I would rather max out my opportunity to completely shelter my money form tax in at TAX FREE SAVINGS ACCOUNT!! I know that the bank agents are pressured by the management to sell sell sell RRSP but come on commonsense should kick in when the answer of No is backed up with lots of solid reasons.

I was having this conversation with the bank agent while on the bus home and when I got off the phone the bus driver throw her two cents in. She said she thought I had made the right decision and that guy on the phone needed to learn to take NO for an answer.

This morning I wrote the cheque and sent it off to ING. I have also just sent off my paper work for entering into company stock.

Lat night I made my mom do a leg exercise with me to strengthen our core mussels. I use to be able to do 3 sets of 5min of this exercise no problem. I mean it would hurt afterwards and for the next few days but I still could do them. I am more out of shape than I thought. I struggled to do the exercise for just one set of 5min and had to take several brakes within the 5min. I clearly need this exercise and will now endeavour to do it everyday as it only takes about 5min any ways. Mom however might not be as enthusiastic to do it again. I will likely have to put her feat to the fire. :P


  1. I'd have said something like: Do you want to help me open my TFSA account or not today? I can always call back and talk to someone else.

  2. Agreed. It's not like you were calling him to say you were not using his bank for RRSP and using another bank for TFSA. Good for you for understanding all the nuances of saving/investing. I probably wouldn't have know that.

  3. I know bank employees have to adhere to some rule to do with 'due diligence', however, I don't think it's right that he was trying to get you to change your mind.
    for me, part of my trouble with the whole TFSA vs. RRSP issue is that I doubt my income will be any higher in retirement. Sometimes I wonder if I'm making the right choices? Good thing I'm not letting indecision scare me into doing nothing at all.