RE: TFSA VS RSP all about rates Not quite being all about rates. One needs a security net they can draw upon from time to time in an emergency.
RSP's, you are allow to withdraw the funds, however you will pay taxes on it at your marginal rate. If I am not mistaken, the monies cannot be replaced (excluding home ownership provisions).
TFSA's, funds can be withdrawn TAX FREE, and be recontributed the following calendar year in addition to one's normal contribution.
In addition, if one is already in the lowest marginal rate, below $41,000 at the federal rate, then it is of marginal benefit to contribute to an RRSP. In their retirement years, it is quite possible to be in the mid to higher tax bracket. One could also be faced with clawback of their OAS, reduced tax credits, higher health premiums in Ontario (health tax begins at $20,000).
There is no right or wrong answer... depends on one's circumstance which needs to individually assessed. And it could change year to year.
mNm