The Tax-Free Savings Account (TFSA) is one of the most powerful tools for Canadians to build wealth. Unlike a traditional savings account, any capital gains, dividends, or interest earned within a TFSA are completely tax-free.
Key Benefits of a TFSA
- Tax-Free Growth: You don’t pay taxes on investment earnings.
- Flexibility: Withdraw funds at any time without penalty.
- Contribution Room: Unused room carries forward indefinitely.
For 2024, the annual contribution limit is $7,000. If you have never contributed and were at least 18 in 2009, your total cumulative room could be as high as $95,000.
