Three things decide the real cost
A car, a home repair, a trip or a second property is a one-time spend, not an ongoing cost, so it is one of the most testable things in a retirement plan. Name it, put a year on it and the plan can tell you what it does to the money you have left.
The three levers are the amount, the year you need it and where the money comes from. The first two are yours to set. The third quietly changes the price, because a withdrawal from one account can cost far more than the same withdrawal from another.
The account you fund it from changes the price
Two withdrawals of the same size can carry very different tax bills, so the account writing the cheque matters as much as the sticker.
- Cash or non-registered savings: close to the face amount, though selling non-registered holdings can add a little capital gains tax.
- TFSA: the face amount, with no tax and no effect on income-tested benefits, and the room comes back the next calendar year.
- RRSP or RRIF: taxable income the year you withdraw, so you must take out more than you spend. A large single-year withdrawal can also push your net income past the $95,323 OAS clawback line, costing 15 cents of Old Age Security for every dollar over.
- FHSA: tax-free only for a qualifying first home. Any other withdrawal is fully taxable and gives up the first-home room, so it is not a general purchase account.
Today's dollars versus the year you spend
A price you know today is not what the purchase costs in the year you actually make it. At 2.5% inflation, a $20,000 purchase five years out is about $22,600 by then.
Planning in today's dollars and letting the plan inflate the figure to the target year keeps the goal honest, so the amount set aside is enough when the time comes rather than a little short.
A worked example
Dana, 62, wants a $40,000 kitchen renovation at 66. In today's dollars that is $40,000. At 2.5% inflation it is about $44,150 by 66. Funded from a TFSA or from cash, that is the whole cost. Funded from an RRSP at a 36% marginal rate, netting $44,150 means withdrawing about $68,980, since RRSP withdrawals are taxable, and a withdrawal that size can lift a year's income over the $95,323 OAS clawback line. The renovation is identical. The account writing the cheque changes the bill.
Calculated with the same 2.5% inflation assumption and RRSP withdrawal tax the TruePath engine uses.
How TruePath fits in
In TruePath a savings goal lives in the Net Worth view. You name the purchase, set the amount in today's dollars and the year you need it, and choose whether to fund it from cash, a TFSA or an RRSP. The plan inflates the amount to that year and, for an RRSP goal, grosses it up for the tax, then models the money leaving your savings so you see the effect on your net worth in the years after.
You can set a goal for either spouse or as a joint goal, and each one shows the monthly amount that reaches it. Ask TruePath can add or change a goal for you when you approve it. One honest limitation: a purchase like a vehicle is treated as money spent, not as an asset that holds resale value, which is the conservative way to test whether it fits.
Related questions people ask
Does it cost more to buy something from my RRSP than my TFSA?
Usually yes. A TFSA withdrawal is tax-free, so it costs the face amount. An RRSP or RRIF withdrawal is taxable income, so to end up with the same spendable amount you have to withdraw more, and the extra is tax. At a 36% marginal rate, netting $20,000 takes about $31,000 out of the RRSP.
Will a one-time purchase hurt my OAS?
It can if you fund it from an RRSP or RRIF. Those withdrawals are taxable income, and if a large one pushes your net income past $95,323 the OAS clawback takes 15 cents of every dollar above the line that year. Cash or a TFSA does not count as income, so it does not trigger the clawback.
Do I enter the amount in today's dollars or future dollars?
Today's dollars, meaning what the purchase would cost now. The plan inflates it to the year you need it, at 2.5% a year, so the target reflects what it will actually cost then. A $20,000 goal five years out is modelled as about $22,600.
Can I plan for more than one purchase?
Yes. You can add several goals, each with its own amount, year and funding source, and each can belong to one spouse or to both. The plan shows how each one moves your net worth and the monthly amount that would reach it.
Sources
This page is general education about Canadian retirement rules, not personalised financial advice. Figures are for the 2026 tax year and change with government updates.