The right amount is different for everyone. It depends on your income, what you can afford to save, and when you'll need the money. Before deciding how much to put in your RRSP, it helps to compare your options:

• An RRSP is designed for retirement savings. Contributions can reduce your taxable income now, and withdrawals are generally taxable when you take the money out.
• A tax-free savings account (TFSA) can work for short-term or long-term savings. Contributions aren't deductible, but investment growth and withdrawals are generally tax-free. It can be a good fit if you pay little income tax now or want easy access to your savings.
• If you're saving for your first home and are eligible, consider a first home savings account (FHSA). Contributions are generally deductible, and qualifying withdrawals to buy a home are tax-free.

Check how much you can contribute and deduct

If an RRSP fits your plans, check your latest notice of assessment or CRA account. You'll find two related amounts: your deduction limit is how much you can generally deduct for the year, while your available contribution room is how much you can add.

Contributions you've already reported but haven't deducted use up room, so your available contribution room may be lower than your deduction limit. Start with the available room on your statement, then subtract contributions you've made since, including any to a spousal RRSP. That tells you how much more you can put in.

See how a contribution could affect your tax return

Try our income tax calculator. Choose your province or territory, enter your income, and try a few amounts in the RRSP deduction field. Compare the estimated refund or balance owing with and without the deduction. This gives you a starting point; your full return may include other deductions and credits.

An RRSP deduction reduces the income you pay tax on. For example, if the whole deduction falls in a combined federal and provincial tax bracket of 30%, a $1,000 deduction saves about $300 in income tax. Your savings depend on your income and where you live. A larger deduction can cross into a lower tax bracket, so each extra dollar won't necessarily save you the same amount.

Will you earn more next year?

If you expect to be in a higher tax bracket next year, an RRSP deduction could be worth more then. You can leave contribution room for later, or contribute now and carry the deduction forward. If you contribute now, report the contribution on your return even if you aren't claiming the deduction yet.