TFSA — what newcomers should know
Lesson 2 of 8 in Investing Basics — TFSA, RRSP, FHSA & RESP · 22 minutes
The Tax-Free Savings Account. The most flexible Canadian investing account — and often the first one newcomers open. Here's how it works, and the rules nobody tells you.
What you'll learn
- Calculate your specific TFSA contribution room as a newcomer
- Explain why the TFSA is often a good FIRST account
- Avoid the three TFSA traps that cost newcomers thousands
From the lesson
Content note
General information, not financial advice. Rules and limits change — check canada.ca. For advice about your own situation, talk to a qualified, registered professional.
For many newcomers, the TFSA is the most flexible first account. Here's how it works — and how to set it up the right way.
The Tax-Free Savings Account explained
What it is
The TFSA is a Canadian investment account where you contribute AFTER-tax money — money you've already paid income tax on. Once inside, it grows tax-free FOREVER. When you withdraw, no tax. No tax on dividends. No tax on capital gains. No tax on interest. Despite the name 'savings', a TFSA can hold cash, GICs, mutual funds, ETFs, stocks, bonds —…