As tax season approaches one financial advisor said it’s important to take your income level into account when weighing the benefits of a tax-free savings account (TFSA) or registered retirement savings plan (RRSP). 

Melanie Johannink, financial advisor at Sun Life Assurance Company of Canada, said contributing to an RRSP functions just like deferring income. 

“If you're earning $55,000 or less a year, you may want to consider putting it into your tax-free savings account because you know that those RRSP contributions are not going to bring you a significant amount for a rich income tax return,” said Johannink.

It is important to understand your income level and marginal tax return to determine which savings method is right for you, she said. 

The RRSP contribution deadline is Mar. 1, 2023. 

Check out the full video at the top of the article to learn more.