RRSP

Don’t Use Your TFSA as a Savings Account

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According to a recent post by Garth Turner, the gift, only 4 in 10 Canadians have a TFSA (Tax Free Savings Account). Of those only half actually do anything with it. In addition 80% of people with a TFSA have it sitting in high interest savings accounts. Garth writes: “Despite being able to shelter all this money from any kind of tax, most don’t. Only four in ten people have a TFSA, even five years after it was created. Of those only half actually contribute to them. And (are you sitting?) eighty per cent of people with a tax-free savings …

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RRSP and TFSA Strategies You Can Take to the Bank

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It’s that time of the year again – RRSP Season. Canadians will be lining up at the bank to either contribute to their RRSP (Registered Retirement Savings Plan), or borrowing for an RRSP loan. For most Canadians, that net benefit will be a tax-refund. What many Canadians don’t realize however, is the refund from contributing to their RRSP is not a gift. It has to be paid back later with taxes. That’s because any money withdrawn from your RRSP is considered income and is fully taxable. This makes the RRSP nothing more than a tax-deferral plan. Any money withdrawn from …

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Should You Contribute to Your RRSP or TFSA?

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My first post at BankNerd.ca… At the beginning of February I was delighted to be accepted into the Guest Authorship Program at BankNerd.ca. I’ve written my first article, fortuitously launched on Valentine’s Day. 🙂 The post is titled Should You Contribute to Your RRSP or TFSA? In this post I look at the basic differences between the TFSA and RRSP, and why I think the TFSA is a better option for most Canadians. I also bring up the point that RRSP Withdrawals become taxable income, and that the RRSP is really a tax deferral plan. “Not only can Canadians contribute …

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Should I contribute to my TFSA or RRSP?

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With the end of January nearing, Canadians are focused on contributing to their RRSPs and getting their tax refunds. In an ideal world we would make maximum contributions to both our TFSA and our RRSP accounts. However, most Canadians simply don’t have enough income to be able to contribute significantly to either plan – yet max out their annual TFSA contribution. Here at home many Canadians still prefer to contribute to their RRSPs instead of their TFSAs. Yet for many Canadians the TFSA may be a better choice. The TFSA The Tax Free Savings Account (TFSA) was introduced by the …

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