The Optimal Account Priority Framework

Not all investment accounts are created equal. The smartest approach is to fill them in order of tax efficiency and government incentives. This framework maximizes your wealth-building: capture free employer money first, then use tax-deductible savings, then tax-free savings, then taxable accounts.

The 5-Step Account Priority Hierarchy

1. Employer RRSP match (free money!): Contribute enough to get your employer's full match. Example: 3% match = $4,500 on $150k salary. This is an instant 100%+ return — don't leave it on the table.
2. FHSA if buying a home within 5 years: Contribute up to $8,000/year to get the tax deduction + tax-free withdrawal combo ($40k lifetime).
3. RRSP if high income (40%+ tax rate): Contribute to get the tax refund. Use the refund to fund your TFSA or pay down debt.
4. TFSA for flexibility & retirement: Fill after employer match and RRSP. Tax-free growth + flexible withdrawals.
5. Non-registered for excess savings: Only after maxing registered accounts. Use for dividend stocks and long-term growth.

Exception: High-Interest Debt Comes First

Before investing in ANY account, eliminate credit card debt (19.99%+ interest). No investment reliably beats paying off 20% interest. Exception: If you have an employer match, take it anyway — it's free money. Then attack debt with maximum intensity.

Emergency Fund Foundation

Before investing, save 3–6 months of expenses in a TFSA HISA. This prevents you from going into debt during emergencies. Then follow the priority hierarchy above.