Here’s the Average TFSA and RRSP at Age 45

The Tax-Free Savings Account (TFSA) and the Registered Retirement Savings Plan (RRSP) are two of the most popular tax-sheltered registered accounts, and a gift for Canadians who want to make retirement a more comfortable affair.

Making the best use of these retirement accounts can actually be crucial for Canadian retirees. The Canada Pension Plan (CPP) and Old Age Security (OAS) benefits are pensions that Canadians can start collecting at the typical retirement age of 65. However, these benefits are designed to help you cover only part of your expenses as a retiree. The rest of it must come through the savings and investments you make.

Wealth-building tools

The TFSA and RRSP are the best retirement accounts Canadians can have. The former is entirely tax-free, and all the returns you generate inside the account are free from taxes. You do not even have to pay taxes on withdrawals, and there is no limit to how much you can withdraw from the account in any given year.

The RRSP gives you a tax break through deductions in your taxable income when you contribute. During the peak of your income years, regular RRSP contributions can let you enjoy significant tax savings. Any returns from investments within the account can grow tax-free. However, withdrawing from the account will be seen as income. This means you will be paying a withholding tax on your withdrawals.

The idea behind the RRSP is to help you boost your savings and effectively use them to withdraw when you’re retired to cover any gaps in income. If you use your RRSP well, it can essentially be another tax-free tool.

The average 45-year-old’s RRSP and TFSA balance

Considering the advantages that these accounts offer, you would imagine every Canadian is making the most of them. However, Statistics Canada data shows that as of 2024, Canadians aged 45 to 49 have accumulated an average of only $28,084 in their TFSAs, which is significantly lower than the $95,000 cumulative contribution room in 2024.

Canadians in this age band have an average balance of $86,500 in their RRSPs, which seems to be a bit better. While the combined amount makes a respectable sum, it might not be an adequate amount of savings to fund a happy and tension-free retirement.

Fortunately, it’s still not too late to start saving and investing in TFSAs and RRSPs. You might need to be careful with your discretionary spending to maximize savings. Using a smart strategy can help you accelerate your wealth growth and boost your retirement nest egg to a better figure.

Investing in an undervalued growth stock trading at a significant discount might be just what works. To give you an example, let’s take a look at Descartes Systems Group (TSX:DSG).

The $8.50 billion market cap company provides tech-based solutions for the logistics industry worldwide. The tech firm has seen a significant decline in share prices due to disruptions caused by artificial intelligence (AI). As of this writing, it trades for $99.18 per share, down by 34% from its 52-week high.

While it seems alarming to see share prices fall so much, the underlying business itself is doing well. A significant portion of the global supply chain industry relies on products and services by Descartes, giving it a defensive appeal. As far as AI disruption goes, the company is integrating the technology to continuously improve its offerings and cement itself in the changing industry.

Foolish takeaway

Descartes Systems stock is trading around its lowest valuation in years, and this can be the opportunity to invest in its shares and bank on the recovery to boost your tax-free capital growth.

The post Here’s the Average TFSA and RRSP at Age 45 appeared first on The Motley Fool Canada.

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More reading

• The TFSA Strategy I’d Be Following Heading Into the Rest of 2026
• 2 Canadian Stocks That Could Utterly Destroy a $100,000 Portfolio
• This Canadian Stock Is 41% Off Its Highs and Built to Hold Forever
• 10 Stocks Every Canadian Should Own in 2026
• 2 Canadian Stocks Supercharged to Surge in 2026

Fool contributor Adam Othman has no position in any of the stocks mentioned. The Motley Fool recommends Descartes Systems Group. The Motley Fool has a disclosure policy.