One of the benefits of being a year older is that you now have more contribution room how to invest using tfsa to invest in your TFSA. 5,000 per year starting from the year you turned 18 or 2009, whichever is later up to to 2012. 20,000 emergency fund which fits our TFSA accounts like a glove.
There are many different potential uses for TFSA accounts, but keeping an emergency fund is a good one, since all interest earned in the account is tax free. The basic rules and limits haven’t changed since last year. Unused contribution room carries over indefinitely. Any contributions made to the TFSA will result in a similar reduction to your available contribution room.
Any withdrawals from your TFSA will result in a similar addition to your available contribution room, but only effective January 1st of the following year. All income earned in the TFSA is not taxable. You can have multiple TFSA accounts at different financial institutions. However it is up to YOU to keep track of your contributions. The government knows if you go over the limit and will charge an over-contribution fee. Type of investments allowed in TFSA accounts It’s a common perception that only bank accounts and GICs are allowed in TFSAs.
RRSP account are also allowed in TFSAs. GICs, high interest savings account are all eligible for TFSAs. This is the place to buy stocks, ETFs, bonds, mutual funds, index funds. See my Canadian online discount brokerage comparison for a complete look at options and fees. Questrade brokerage is my personal favourite.