Is an RRSP always “self-directed”?  What makes a “self-directed” RRSP special?
The term self-directed generally refers to RRSP accounts where the account holder has not only the ability to determine a basic investment asset mix (such as can be accomplished even with a limited selection of mutual funds) but, more specifically, the self-directed account holder has a much wider choice of financial instruments beyond mutual funds, GICs, and/or cash savings. A self-directed RRSP generally permits the account holder to also invest or trade directly in financial instruments such as: Those kinds of instruments are not typically available in a non-self-directed mutual fund or bank RRSP.  Typical mutual fund or bank RRSPs offer you only their choice of products  – often with higher fees attached. Related resources:
No, there is no advantage.  There may be some peace of mind at no cost if you are already in the lowest tax bracket.  Otherwise, it is actually disadvantageous. Consider the following scenario: RRSP HBP withdrawal $15000 ($1000/y repayment), You are required to pay back $1000 a year with no tax advantage. Any additional RRSP payments can be designated as HBP (no tax advantage) or as a regular RRSP contribution Tax = (Taxable Income - contributions) * rate. So, you are forgoing the tax benefit for no advantage. When you withdraw from your RRSP, you lose that contribution room and you will never get it back. Let's say you have room to contribute a total of $50,000 to RRSPs. If you withdraw $5000 from one institution and deposit it in another, you will now have a total contribution room of $45,000. This will only matter to you if you hope to max out your RRSP contributions sometime in your life, of course, but almost everyone should be aiming for this. Otherwise, you are correct. Your extra income will be mitigated by your immediate recontribution to your RRSP. Note that there are two circumstances where withdrawing from your RRSP does not reduce your contribution limit. The home-buyers plan lets you withdraw up to $25,000 to buy a home. You have to repay this over no more than 15 years. The second is the Lifelong Learning Plan, which lets you withdraw up to $20,000 (up to $10,000 annually), to be repaid over a 10-year period. Any other withdrawals (or failure to repay under the HBP or LLP) will lower your RRSP contribution room. In summary, it's almost certainly worth paying the $125 fee unless you are certain you will not be maxing out your RRSP contributions in your lifetime. Why would someone invest in other instruments (e.g. stocks) to pay for   childrens' college education when the capital gains on those are   taxed, unlike a home equity loan? Many tax advantageous vehicles exist for the purpose of saving for college education such as 529 plans, Roth IRAs, Series EE and I bonds. Tax and penalty free distributions from a portfolio of stocks is possible if the distributions are for qualified education expenses and the account is in the form of a Roth IRA.  A house is collateral for a home equity line of credit.  A combination of unfortunate events could cause someone to default on the loan and loose their residence. Also, the tax advantages of 529 plans, and Roth IRAs are not applicable to purchase a motor boat.  With respect, some people like to leave the home equity loan untapped for other uses. More Details: 529 plans are not taxed by on the Federal level when the withdraws are used for college.  In many states, contributions to state sponsored 529 plans are deductible on the state level.  These are not self directed so you can't trade stocks/bonds in a 529 plan, however, certain plans allow you to lock in the rate you pay for credit at today's prices. If you want a self directed (ability to trade stocks/bonds) vehicle with tax free disbursements for qualified education, consider a Roth IRA. There are yearly contribution limits, and penalty if the proceeds are not used for qualified educational expenses. Also I believe interest revenue from Series EE and I bonds is tax free if the bond is used for education. There are special conditions and situations to 529 plans, Roth IRAs, Series EE and I bonds, the purpose of this answer was to expand upon the tax advantageous vehicles for higher education. When you withdraw money from an RRSP account, it is added to your current year's taxable income. It does not matter what year the money was previously deposited in. If you deposited money into an RRSP this year and withdrew the same amount of money, then the net effect is that you have $5000 RRSP contribution and $5000 extra income, and the two effects should cancel out. The only remaining effect is that you wasted $5000 of contribution room which can never be regained. The exception to this rule is that after 90 days, you can withdraw funds from an RRSP for the HBP and LLP without adding to your taxable income. There is the underpayment penalty, and of course the general risk of any balloon-style loan. While you think that you have enough self-discipline, you never know what may happen that may prevent you from having enough cash at hands to pay the accumulated tax at the end of the year. If you try to do more risky investments (trying to maximize the opportunity) you may lose some of the money, or have some other kind of emergency that may preempt the tax payment. "Your bank's fund is not an index fund.  From your link: To provide a balanced portfolio of primarily Canadian securities that produce income and capital appreciation by investing primarily in Canadian money market instruments, debt securities and common and preferred shares. This is a very broad actively managed fund.  Compare this to the investment objective listed for Vanguard's VOO: Invests in stocks in the S&P 500 Index, representing 500 of the largest U.S. companies. There are loads of market indices with varying formulas that are supposed to track the performance of a market or market segment that they intend to track.  The Russel 2000, The Wilshire 1000, The S&P 500, the Dow Industrial Average, there is even the SSGA Gender Diversity Index.  Some body comes up with a market index.  An ""Index Fund"" is simply a Mutual Fund or Exchange Traded Fund (ETF) that uses a market index formula to make it's investment decisions enabling an investor to track the performance of the index without having to buy and sell the constituent securities on their own.  These ""index funds"" are able to charge lower fees because they spend $0 on research, and only make investment decisions in order to track the holdings of the index. I think 1.2% is too high, but I'm coming from the US investing world it might not be that high compared to Canadian offerings.  Additionally, comparing this fund's expense ratio to the Vanguard 500 or Total Market index fund is nonsensical. Similarly, comparing the investment returns is nonsensical because one tracks the S&P 500 and one does not, nor does it seek to (as an example the #5 largest holding of the CIBC fund is a Government of Canada 2045 3.5% bond). Everyone should diversify their holdings and adjust their investment allocations as they age.  As you age you should be reallocating away from highly volatile common stock and in to assets classes that are historically more stable/less volatile like national government debt and high grade corporate/local government debt.  This fund is already diversified in to some debt instruments, depending on your age and other asset allocations this might not be the best place to put your money regardless of the fees. Personally, I handle my own asset allocations and I'm split between Large, Mid and Small cap low-fee index funds, and the lowest cost high grade debt funds available to me." Yes, the supply side is probably permanently restricted, and if NIMBY/regulations eased, there might be a temporary dip in prices (possibly even something that could be regarded as a bubble pop, but in reality that is very unlikely.)  The self-regulating system I see is on the demand &amp; employment side; companies can't keep raising wages but still require the workers, so they will have to sort workers by location: executives, creatives, and professionals in large cities; back-office white-collar in suburbs and/or smaller cities and production/manufacturing in rural areas. It really depends on your taxable income.  If you are in a higher tax bracket and expect to be in a lower tax bracket in retirement, the RRSP is probably your best bet.  If, however, you are in a low tax bracket now, then it might be best to start with your TFSA. Hope this helps!