If you Google this question, you will find a hundred articles that say “it depends on your tax bracket.” That is true, but it is not the whole truth. The honest answer turns on three numbers — your marginal rate today, your expected marginal rate in retirement, and your behaviour. The third one is the one nobody talks about.
The arithmetic
If you expect to pay tax at a lower rate in retirement than you pay today, the RRSP wins on a pure-math basis. If you expect the opposite, the TFSA wins. If the rates are identical, the two are mathematically equivalent — which surprises most people.
The behaviour
TFSAs feel different. The money does not look “taxed away” when you contribute, and it does not look “taxed” when it comes out. That feels good — and it also makes the TFSA dangerously easy to withdraw from. RRSPs, by contrast, are sticky. The tax hit on withdrawal is a friction that protects you from yourself.
For households with a tendency to dip into savings, the RRSP is often the better tool — even when the math is a wash.