In this article:
http://www.milliondollarjourney.com/...-manoeuvre.htm
it says "
Maxing out your RRSP and investing for the long term will outperform the Smith Manoeuvre."
I tend to agree. One of the most amazing and productive ways of putting your money to better use for you involving RRSP's is this:
Temporary loan strategy:
(How to make a 50% higher RRSP contribution for the same money)
Example --
- Let's say you can afford $1,000 savings and decide to get an RRSP.
- You borrow $536 to go with your usual $1,000 RRSP contribution and you make an RRSP contribution of $1,536
- No payments are due on the loan for 6 months. The rate is 7%.
- You get a tax refund of $545 because of the RRSP.
- You use the refund to pay the loan off including $9 for 3 months interest.
- You have now put $1,536 in your RRSP for only $1,000.
- Your RRSP growth is 50% more than without the Temporary Loan.
I love this strategy, and wish I had of figured it out or been told about it years ago. I only ran across it last year.