Once you’ve topped up your RRSP, you’re allowed to contribute another $2,000 without tax penalty, as long as you can deduct them in the future. Even though such a contribution would not be deductible from your current taxable income, it would be sheltered from income tax as it grew. See below for how $2,000 extra in your retirement portfolio appreciates over time.
Value of a $2,000 excess RRSP contribution*
| Period | Accumulated value |
| After 10 years |
$3 754 |
| After 20 years |
$7 047 |
| After 30 years |
$13 229 |
After 30 years, if your spouse uses the same strategy, you could accumulate up to $26,450 more, and really enjoy your retirement!
* Calculation based on a diversified portfolio with an effective rate of 6.5% compounded annually.