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For Canadian investors and savers, it’s always some of the best news to come each year: new TFSA room that becomes available each January 1. For 2022, the TFSA contribution limit is $6,000, and for 2023, it is $6,500.

The actual TFSA yearly limit was set at $5,000 back in 2009 when the investment account was first created, but it’s indexed to inflation each year and rounded to the nearest $500 to simplify things for investors. The exception was 2015, when the TFSA limit was hiked up to $10,000 for a single year before being decreased to $5,500.

Someone who has never contributed to a TFSA and was born in 1991 or earlier could have cumulative contribution room of $88,000 as of Jan. 1, 2023.

TFSA contribution limit—2009 to 2023

Year
TFSA Annual Limit
TFSA Cumulative Limit

2009
$5,000
$5,000

2010
$5,000
$10,000

2011
$5,000
$15,000

2012
$5,000
$20,000

2013
$5,500
$25,500

2014
$5,500
$31,000

2015
$10,000
$41,000

2016
$5,500
$46,500

2017
$5,500
$52,000

2018
$5,500
$57,500

2019
$6,000
$63,500

2020
$6,000
$69,500

2021
$6,000
$75,500

2022
$6,000
$81,500

2023
$6,500
$88,000

Investing ideas for your TFSA

TFSAs are not just for savings…

Continue Reading On moneysense.ca »

As the name suggests, tax-free savings accounts (TFSAs) offer a tax break on contribution income—meaning that, unlike with a regular savings account or non-registered investment account, what you earn inside your TFSA isn’t taxed, even when you make a withdrawal. TFSAs are flexible, too, allowing you to hold cash, guaranteed investment certificates (GICs), stocks, bonds, exchange-traded funds (ETFs) or mutual funds, so you can tailor your account to different financial strategies and goals. The TFSA contribution limit for 2022 is $6,000, and for 2023 is $6,500, but keep in mind that if you qualified to make a contribution in 2021, but didn’t, that contribution room is still available to you. For those who turned 18 before or in the year 2009, the lifetime contribution limit is $81,500 in 2022 and will increase to $88,000 on Jan. 1, 2023.

Watch: What is a TFSA

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Continue Reading On moneysense.ca »

What the heck is a TFSA?

– moneysense.ca

One of the side-effects of working for a personal finance magazine is that my buds good-naturedly ask me for advice. I always oblige, albeit sheepishly, without letting on that I’m still learning, too (which I freely admit here).For instance, the other day I was having lunch with some friends when we started talking about money. The exchange went something like this:
Friend: Ugh, I’m so lost when it comes to money. What should I do?
One of the greatest mistakes young people can make right now (other than blow their money on something stupid, like, say, a house in Toronto) is not realize that their money can do more than just sit there.
Me: Well, do you have a TFSA?
Friend: Yes (in a proud voice).
Me: That’s great, you’re ahead of the game. What are you investing in?
Friend: W-w-what?
I then went on to explain what a TFSA really is. The tax-free savings account is NOT, I repeat, NOT just a savings account.
What is a TFSA?
A tax-free savings account (TFSA) should really be called a tax-free INVESTMENT account…

Continue Reading On moneysense.ca »

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