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.

A RRSP Loan of LOAN_AMOUNT could be worth RRSP_VALUE_AT_YOUR_RETIREMENT at retirement.

A RRSP Loan of LOAN_AMOUNT, earning ESTIMATED_ANNUAL_RRSP_RETURN per year in your RRSP, could be worth RRSP_VALUE_AT_YOUR_RETIREMENT when you retire in YEARS_UNTIL_RETIREMENT years. Your monthly payments for this loan would be MONTHLY_PAYMENT. By using TAX_REFUNDAPPLIED_TO_PRINCIPAL of your RRSP tax refund to pay down your loan balance, you could payoff this loan in TIME_TO_REPAY_YOUR_LOAN. **GRAPH**
Results Summary
Amount to borrow LOAN_AMOUNT
Interest rate INTEREST_RATE
Monthly loan payment MONTHLY_PAYMENT
Tax refund TAX_REFUND
This assumes a marginal tax rate of MARGINAL_TAX_RATE.
Tax refund applied to principal TAX_REFUNDTO_APPLY_TO_LOAN_BALANCE
This is TAX_REFUNDAPPLIED_TO_PRINCIPAL of your tax refund. This amount is applied to your loan balance at month four.
Repayment period TIME_TO_REPAY_YOUR_LOAN
Without the payment of TAX_REFUNDAPPLIED_TO_PRINCIPAL from your tax refund your repayment period would have been TERM.
Total interest to be paid INTEREST_PAID
Estimated annual RRSP return ESTIMATED_ANNUAL_RRSP_RETURN
Years until retirement YEARS_UNTIL_RETIREMENT
RRSP value at loan payoff RRSP_VALUE_AT_LOAN_PAYOFF
RRSP value at your retirement RRSP_VALUE_AT_YOUR_RETIREMENT

Loan and RRSP Balances

**REPEATING GROUP**

RRSP Loan Calculator (Canadian) 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, we have assumed the 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.


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