Can I withdraw from RRSPs to pay bills?

When an unexpected bill lands and the cash isn't there, an RRSP can look like the obvious place to turn. This piece walks through why dipping in early is rarely the easy fix it seems. Money pulled out gets added to your income for the year, so it's taxed at your marginal rate, and a withholding tax is taken right off the top before the funds even reach you. There's also the quieter cost: every dollar withdrawn is a dollar that stops compounding, and over the decades before retirement that lost growth can be substantial. Allan also gets at the behaviour underneath the request, noting that reaching for savings tends to treat the symptom rather than the cash-flow problem itself. It's a useful read for anyone tempted to solve a debt squeeze by raiding their retirement account.