Tag Archives: RRSP

Save Your TFSA, Use Your RRSP To Buy A House

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Well, it’s official: the TFSA contribution limit is now $10,000 for 2015. This brings your total TFSA contribution since 2009 to $41,000. This is a huge sum, and makes the TFSA the best retirement savings vehicle available to Canadians of all ages. The catch is, of course, that Canadians start using their TFSA for retirement rather than weddings, cars, and vacations. Because you’re allowed to make withdrawals from the TFSA before retirement, many people use the account as a planned spending catch-all, rather than the powerful investment vehicle it is. This is a waste of the TFSA’s power and potential, and will hurt your wealth-accumulation in the long run. You don’t need to earn tax-free returns on your vacation fund, but tax-free returns compounded over decades of your lifetime will make you a millionaire. If you manage to max out your TFSA to $41,000 by the end of 2015, and contribute […]

My TFSA RRSP Portfolio Is A 40/60 Split

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One of the major (only?) financial undertakings I’m managing this year is building the “perfect” TFSA RRSP portfolio, with everything appropriately balanced and in the right accounts. If you’ve read my posts about whether or not to investing in a TFSA or RRSP and the basics of index investing, you already know there’s some intricacies to getting to six-figures beyond simply depositing money each month. FYI: I keep both RRSPs and TFSAs with Tangerine. They’ve been my bank for years and their high-interest savings and no-fee chequing accounts have been an integral part of helping me build long-term wealth. If you don’t have an account with Tangerine, you can set one up using my Orange Key (32251507S1) and receive a $50 bonus. Free money is the perfect way to tackle a major financial goal! My primary goal in 2015 is increasing my net worth by $100/day or $36,500 for the year. Where […]

Should You Contribute To An RRSP or TFSA?

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I know I’ve written about this before, but this is a topic that needs to be addressed regularly because the answer is always different depending on your age, income, and financial personality! It’s not always easy to know if you should contribute to an RRSP or a TFSA, but there are some clear rules of thumb to follow. As of January 1, the TFSA contribution limit grew by $5,500 to a total of $36,500 for anyone over the age of 18 as of 2009. If you came of age after 2009, you have $5,000 to $5,500 less in contribution room for each year you missed. No worries though, you can contribute to a TFSA until you’re dying day, so you have a lot of time to catch up! The RRSP limit is 18% of your gross income each year, to a maximum of $24,270 for 2014 (you would have to […]

Your TFSA is For Saving For Retirement

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The Tax-Free Savings Account is the best saving and investment vehicle available to Canadians. To date, you can contribute up to $31,000 (with an additional $5,500 of room coming available for 2015), and all the interest, dividends, and capital gains you realize in the TFSA are totally tax-free. You can hold any investment vehicle within the TFSA, from a savings account to common stocks, and you can withdraw your funds without penalty at any time. The only thing you have to watch is over-contributing to the accounts, for which there are steep penalties. Under the TFSA umbrella, I hold cash in a savings account, GICs, and a brokerage account in which I buy common stocks and ETFs. My balance between these vehicles essentially represents my risk profile, which means most of my money is in stocks rather than cash. As I’m making my financial plan for next year and years […]

How I Earned a 17% Return on My Money in The Stock Market By Doing Absolutely Nothing

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In the last week of October 2013, I received my retirement savings from my old job. When I worked full-time at the University of Alberta, participation in the employer pension plan was mandatory, which means ~11% of my gross salary was put in a retirement fund before my paycheque even hit my bank account. The university matched this contribution, but because I left before the 2 year mark (only 1 week shy!), I forfeited my employer contributions. You might think it’s dumb to bail out of an employer-matched retirement plan only days before securing the funds, but the university pension plan was extremely poorly managed. Semi-annually I’d receive a report about how they were paying out more than was going in, which was not that reassuring that the funds would still be there for me 40 years for now. Furthermore I had no say in how this money would be invested. […]