Six in 10 Gen Zers are saving their refund this year, up from just three in 10 last year
Gen Z is quietly becoming the most savings-conscious generation in Canada: 63 percent plan to save their tax refund this year, up from 30 percent in 2025, and 33 percent intend to invest it — more than double last year's 14 percent.
A new TD survey revealed that economic pressure is reshaping how Canadians plan to spend their tax refunds this year, with a sharp pivot away from discretionary spending toward saving, debt repayment, and investing.
Eight in 10 Canadians (80 percent) expect a refund this year.
Of those, 41 percent say economic conditions are changing how they'll use it — rising to 53 percent among Gen Z.
Nearly half of all respondents (47 percent) plan to save their refund, up from 29 percent in 2025, while debt repayment climbed to 36 percent from 23 percent. Investing intentions rose 10 points to 25 percent.
Discretionary spending ranked last: only 11 percent plan to use the refund for travel and 8 percent for a major purchase.
Gen Z's shift is the most pronounced.
Sixty-three percent plan to save their refund, up from 30 percent in 2025, and 33 percent plan to invest it, more than doubling from 14 percent last year and above the national average of 25 percent.
That generational shift is also showing up in account preferences and contribution habits.
TFSAs have overtaken RRSPs as the most common primary investment account nationally — 38 percent versus 26 percent.
Among Gen Z, 55 percent hold a TFSA against 29 percent with an RRSP, and 54 percent of Gen Z contributes to a registered account at least monthly, compared to 47 percent nationally.
Gen Z also skews toward stocks (30 percent) and ETFs (24 percent), while the broader population favours mutual funds (36 percent) and GICs (34 percent).
The barrier to entry remains knowledge, not just capital.
Among Canadians without a registered account, 44 percent cite insufficient funds — but for Gen Z, 63 percent say they simply don't know enough about registered accounts, versus 27 percent nationally.
TD's Aaron Clark, senior vice-president of everyday banking, saving and investing, said stretched budgets can make it hard to know where to start.
“Starting small, focusing on one account and building over time can make investing feel more manageable,” he said.
TD Bank gave 5 questions on investing and how to use your tax refund
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What's a smart way to use a tax refund in Canada?
Putting a tax refund into a registered account like a TFSA, RRSP, or FHSA offers tax advantages and can help grow money while working toward goals like homeownership, retirement, or education. Even a small contribution can help build investing habits.
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Should I save my tax refund or invest it?
The choice often comes down to timeline. If the money may be needed within a couple of years or there's no cash cushion in place, saving may be the better route; for longer-term goals, investing may allow the money to grow beyond what a savings account offers.
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TFSA vs RRSP vs FHSA: which should I choose?
Each account serves a different purpose: RRSPs are designed for retirement with tax-deferred growth, TFSAs offer flexible, tax-free withdrawals for any goal, and FHSAs provide tax advantages for first-time homebuyers. Contribution limits and individual goals should guide the choice.
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Can I start investing in Canada with a small amount of money?
Yes — starting small is a practical way to build confidence. Contributing a consistent amount to a TFSA or RRSP, where registered accounts allow money to work more efficiently, is a workable entry point regardless of the size of the initial contribution.
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Why might some Canadians find it hard to start investing — and what can help?
Investing can feel too expensive or too complicated to start. Keeping it simple helps: setting a clear goal and time horizon, automating a small contribution, and starting with diversified options avoids the pressure of having to "figure everything out" at once.
