Making a contribution to a deductable registered plan, like your RRSP, is a good thing if your want to reduce the taxes you pay and claim more non-refundable credits like medical expenses. That's because net income, figure upon which these amounts is calculated, is reduced by making an RRSP contribution. A low net family income will also increase federal refundable tax credits like the Child Tax Benefit, the Working Income Tax Benefit, or the GST/HST Credits. It all means more cash for you throughout the year.
When it comes to tax advantages, investing within a registered account essentially enables some double-dipping: new dollars are created for investment purposes with your tax deducation, while tax on investment earnings is deferred into the future. That's a great game plan, and it's legal too!
From Evelyn Jacks "Essential Tax Facts 2011 Edition"
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