What key factor does Janice's high marginal tax rate influence regarding her RRSP contributions?

The high marginal tax rate Janice faces significantly enhances the tax savings associated with her contributions to a spousal RRSP. When individuals are in a higher tax bracket, contributions made to an RRSP provide a larger immediate tax deduction compared to those in lower tax brackets. This means that the tax savings from the contribution can be substantial, making it an advantageous strategy for individuals like Janice to contribute to a spousal RRSP.

This not only reduces her taxable income for the year, potentially resulting in a lower tax bill, but it also allows her to accumulate savings in a tax-deferred manner until withdrawal in retirement. At that time, if her spouse is in a lower tax bracket than Janice when withdrawals are made, they would benefit from a lower tax rate on those funds, further enhancing the overall tax efficiency of the strategy.

In contrast, a high marginal tax rate would not limit Janice's ability to invest in segregated funds or dictate her eligibility for annuities. Neither would it inherently require her to withdraw more from her RRSP; instead, it emphasizes the strategic advantage of using tax-deferred accounts like a spousal RRSP to optimize her financial position.