It is now officially less than two weeks away to the RRSP deadline for the fiscal year. This one honestly snuck up on me, I really thought I had a little more time. I still have almost none of the tax forms that I need to be able to file, so taxes aren’t really on my horizon yet. I still haven’t decided whether or not to contribute for the year.
I have always contributed to my RRSP to the max (which has not been all that much) because I thought that it was the responsible thing to do. However, a couple of years ago the accountant who files my taxes mentioned that I might be better off to hold off on contributions. While I am in school, I will presumably not owe any taxes (although this year might/will be an exception). My RRSP contributions therefore don’t really give me a tax advantage. On the other hand, if I saved up my contribution room over the next few years, I could contribute to my RRSP in big lump sums the first couple of years that I am working to reduce the amount of taxes I have to pay by quite a lot. This makes sense to me, although please chime in if you have a different opinion, because I have not 100% committed to this plan.
As I’ve written before however, I think I will probably owe taxes this year. Last year was $500, and I’m anticipating it will be around the same this year. At some point over reading week, I am going to fool around with some online tax programs to see how my tax return is looking with estimated numbers. Then I will have to make a call and decide whether or not to contribute.
If I do contribute, it won’t really affect my financial goals. I will obviously have to account for the money, as it will have to come out of my law school expenses for now, but I will probably still hold off until the fall to replace it to keep the summer for “fun saving”.
PS. I should add that I also contribute to my TFSA, but I do not count this as retirement income. Since you can pull it all out at any time without penalty, I plan to use this money when I make a downpayment on a home.

