When the TFSA was first introduced in 2009, it was mostly used as a place to stash a bit of short-term money. Back then you could only contribute $5,000, but additional room has been generated every year since. (Last year, the annual investable amount increased to $5,500 in order to adjust for inflation.)
As more room becomes available, the TFSA is an even more important savings vehicle.
As more room becomes available, the TFSA is an even more important savings vehicle, says David Ablett, Director of Tax and Retirement Planning with Investors Group. Why? Because any money in the account is allowed to grow tax-free. That includes dividends, capital gains, bond income and more: Whatever’s in the TFSA won’t be touched by the government.
Now that the contribution room is more substantial, we wanted to know how people should be using their TFSA today.