I have never once considered dipping into my RRSPs. Not once. Not even when we hit some financial bumps in the road. In many ways, I don’t even consider it mine yet. It belongs to my future self, the woman with more wrinkles and a paid off house. It’s not for me to take.

As soon as the TFSA was introduced, we thought it made the most sense max out our TFSA with our ‘retirement savings’ money before making any contributions to our RRSP. For our situation it makes sense. Brian is still a student and we both work in non-profit which although personally satisfying, isn’t exactly lucrative.

We may not be making much now, but in the future our financial choices will allow us a great deal of freedom in retirement. I’d rather pay the taxes now and get to keep all the money from our TFSA that we’ve saved over the years. I want the freedom to take out $10,000 one year for a dream vacation and not take an extra tax hit as a result.

In truth, I’ve found the TFSA to take considerably more self control then I had hoped. It feels as though it belongs to my present self, the one that would really like a kitchen renovation and a second car not to even mention a laptop and a dream guitar for Brian.

Presently our TFSA is our emergency fund which we drained last year buying a car. Having the TFSA at ING keeps it one step removed from being able to access it quickly. I like having the security of an emergency fund. Once the emergency fund is fully funded and the money going into the TFSA are for future use only, will we have the self control to keep it in there long term?

This concern is coming from someone who prides herself on self control. I can make short term sacrifices for long term results. I can eat 1800 calories a day to maintain my weight. I can exercise regularly even when I don’t feel like it. I save up for things before I buy them.

For each of these issues of self control, there is present negative impact if I stray off plan. If I dipped into my RRSPs I’d take a tax hit. If I ate more or exercised less I’d be buying new pants fast. If I spent too much on credit, my monthly cash flow would decrease.

Taking money out of my TFSA has no immediate negative impact.

• There are no fees to pay.
• No one would know
• I wouldn’t go into debt
• It doesn’t change my credit score
• I could buy stuff I want

However, it would rob me of my future financial dreams. Only time and as much self control as we can muster will tell if we’ll be able to continue saving our retirement funds in a TFSA instead of an RRSP.

I wonder though, if I, who usually does well when it comes to issues of self control struggle with saving the money in my TFSA for my future self, how are those with even less self control managing to keep it in there for the long term?

Do you feel any differently about your TFSA earmarked for retirement than you do about your RRSPs?

Kathryn works in public relations and training for a non profit. In her off hours, she volunteers as a financial coach helping ordinary Canadians with the basics of money management. Her passions include personal finance and adult education. Kathryn, along with her husband and two children live in Ontario.

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