I’m 30 and earn a high income, but owning a home feels out of reach — should I pause my RRSP contributions to make it happen?

Buying a new home is a major financial decision with a hefty price tag. But is it worth slowing down your retirement savings for? That’s the question one high-income earner recently pondered.

Consider this hypothetical situation: Lena, 30, lives in a high-cost part of the country and is thinking about pausing her RRSP contributions temporarily to afford a home.

Lena's work puts 15% of her pay into her Registered Retirement Savings Plan (RRSP) instead of a matching program. She normally maxes out her contributions into the account, but argues that if she stops contributing for two years, there would still be more than $50,000 to $55,000 of room to carry over into her RRSP by the third year.

It’s not just the down payment that’s giving Lena pause. She anticipates her mortgage payments to be between $3,000 and $4,000 a month. If she stops making $2,000 in monthly RRSP contributions, she could manage the mortgage, and hopes to increase her retirement contributions in the future.

Considering a home is also an investment with high-growth potential, should Lena go ahead with her plan?

Is pausing RRSP contributions worth it?

There are really two questions to unpack here:

Should you pause retirement contributions to buy a home? Generally, no — but it depends.

Is it still a bad idea if you’re getting $50,000+ contributed by your employer? Maybe not.

Lena earns about $330,000 a year, and currently maxes out her RRSP contributions at $32,490, reaching the Canada Revenue Agency (CRA) total annual limit for 2025.

By pausing her $2,000 monthly contributions, she’d free up $24,000 a year for mortgage payments and other housing costs. In a market where mortgage payments could hit $3,500 a month, that extra cash could mean the difference between a tight budget and a more manageable one.

And while putting retirement savings on a temporary hold to buy a home is generally a bad idea, she’d still be saving a significant amount due to her employer’s contributions.

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But what’s the trade-off?

If Lena doesn’t contribute $24,000 toward her available RRSP contribution room, the missed growth adds up fast. For example, $24,000 contributed annually over 10 years at 5% to 6% growth means she’ll miss out on between $301,869 and $316,339 in her RRSP. Stretch that over 20 to 30 years — depending on how far you are from retirement — and the missed growth becomes more significant.

Even a single $24,000 investment compounded at 6% over 30 years would grow to about $137,844 with no additional contributions. The $316,339 she could have invested would multiply to approximately $1.82 million in 30 years: enough for a comfortable retirement before considering home equity or other retirement investments.

The reality is that most people won’t find themselves in Lena’s situation. For many Canadians, pausing retirement savings could mean missing out on their only nest egg. That’s why advice on pausing contributions — even temporarily — has to come with a big asterisk: unless you’re still saving significantly through other means, it’s usually not worth it.

What to keep in mind if you choose to spend over saving

If you’re facing a similar decision, remember that it’s generally not worth the loss in retirement savings to stop or pause contributions — unless you’re a high earner or already have sufficient funds in your retirement account.

But, if you’re still considering it, ask yourself these questions:

How long will the pause last?

A short pause, say six to 18 months, to save for a down payment might be manageable, especially if you resume contributions quickly. But the longer you delay, the harder it is to catch up. Run the numbers to see how much you’ll lose out on — and whether you’ll still be able to have the retirement you want if you pause contributions.

What happens if you lose your job?

If your employer stops contributing, or you move to a new job without a similar benefit, you’ll be behind on your savings. Moreover, you also risk losing your home if you're let go from your job and can’t find another with the same high salary.

What do your savings look like?

If you already have an emergency fund and some investments outside of retirement, that may justify a temporary pause. Try running the numbers on how much your RRSP will grow by your retirement date if you never contribute again.

Will a new home stretch your budget permanently?

If affording a mortgage requires skipping retirement contributions for years, it likely means you can’t afford the home. It might be better to wait or buy a lower-priced dwelling.

If your employer is contributing a hefty amount to your RRSP, you’re in a better position than most to pause personal contributions without sacrificing a stable retirement. But that doesn’t make it a risk-free move.

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Bottom line

If the only way you can afford a home is not to save for retirement, then you either can’t afford the home, or you can’t afford to retire. Which would you rather sacrifice?

Buying a home should improve your quality of life, not derail your retirement. Ensure your financial plan balances homeownership and retirement in a way that puts your long-term goals first.