Tax reduction is what i want/need???....since i'm single, no dependents and now have had an income(2yrs) that seems to make it impossible for tax credits(ont.) that last year i had to pay(H&R Block) and will probably have to pay for 2008, i should be looking into RRSP's....just afraid of the market...i'll look at the link Monty supplied!!...Thanks

Be sure to use form T1213 when contributing to RRSP. The benefit is tax reduction, not refund, because you contribute pre-tax income. You use only $1,000 income for a $1,000 contribution.

The alternative is the tax refund option. Cbviously to get a refund you must have paid tax in the first place. If you are in say a 33.33% tax bracket you used $1,500 income, subject to $500 tax, to have $1,000 savings to contribute.

In this example the extra $500 income used for the refund option means you are out $333.33 cash after tax. The extra hidden cost is always equal to the refund.

Canadian Registered retirement savings plan contributions

http://www.statcan.gc.ca/daily-quotidien/081105/dq081105a-eng.htm

Just under 6.3 million taxfilers contributed to registered retirement savings plans (RRSP) in 2007, up 1.6% from 2006. Their contributions rose by 5.3% to $34.1 billion. These data are based on tax returns filed for 2007.

Among the provinces, the highest percentage increase in the number of contributors occurred in Newfoundland and Labrador (+5.3%). However, in absolute numbers Quebec had the largest gain with almost 25,700 persons.

The largest increase in contributions occurred in Saskatchewan (+12.8%).