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RRSP Loan Calculator (Canadian)

An RRSP loan can be an excellent way to jump start your retirement savings. Use this calculator to see how an RRSP loan could help you in your retirement savings plan.
By changing any value in the following form fields, calculated values are immediately provided for displayed output values. Click the view report button to see all of your results.



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RRSP Loan Calculator (Canadian)
*indicates required.
Monthly loan payment:
Total interest to be paid:
Tax refund:
Tax refund applied to principal:
Time to repay your loan:
**FIG_GRAPHTITLE** Column Graph: Please use the calculator's report to see detailed calculation results in tabular form.

Definitions

Amount to borrow

The amount you wish to borrow for your RRSP Loan. The calculator has assumed the amount borrowed is the same as the amount you will deduct on your personal income tax return. Please consult your Tax Advisor to determine the amount you could deduct for your personal income tax purposes.

Interest rate

The interest rate for your RRSP loan. All interest is compounded monthly.

Repayment period

The number of years to repay the loan. This is the length of time to repay the loan if you do not use any of your tax refund to pay down the principal balance.

Marginal tax rate

For illustrative purposes, the tool assumes a marginal tax rate of 40%. If this is not your marginal tax rate, please change it. Please consult your Tax Advisors if you are unclear as to what tax rate to use. The calculator has assumed that the Tax refund is equal to the loan amount multiplied by your marginal tax rate. However, your tax refund may differ depending on other personal income tax factors.

Estimated annual RRSP return

The annual percentage rate you expect to earn on your RRSP. The average annual rate of return for the TSX has been 11% for the last 20 years. You may wish to use a more conservative rate of return if you are within 10 years of retirement. This calculator compounds all earnings annually.

Years until retirement

Number of years before you expect to retire.

Tax refund to apply to loan balance

This is the percentage of your tax refund that you wish to apply to the principal balance of your loan. This amount will be used to reduce your balance in month four of your loan.


Information and interactive calculators are made available to you only as self-help tools for your independent use and are not intended to provide investment or tax advice. We cannot and do not guarantee their applicability or accuracy in regards to your individual circumstances. All examples are hypothetical and are for illustrative purposes. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues.