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Author Topic: TFSA  (Read 2178 times)

Offline wing

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TFSA
« on: January 07, 2009, 12:51:27 pm »
Anyone know if you can have 2 tax free savings accounts?

I had signed up with ING at 2.7% but now found out PC is offering 3.75% so I signed up with them.

Will the GOV say no you can't do that, or will I have now have 2 accounts but must ensure I don't over contribute.  Calculating the interest difference on 2 accounts could get a wee bit tricky!
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Offline ovr50

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Re: TFSA
« Reply #1 on: January 07, 2009, 12:53:18 pm »
I think you can have more than 1 account, but can't exceed the $5K/year amount contributed.
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Offline safristi

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Re: TFSA
« Reply #2 on: January 07, 2009, 12:58:36 pm »
..I'll be a PAL and take ONE off yer hands FER FREE!!! ;D
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baumer00

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Re: TFSA
« Reply #3 on: January 07, 2009, 01:04:02 pm »
You can have as many accounts as you'd like, as long as you do not exceed the $5k contribution limit per year.
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Offline Dante

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Re: TFSA
« Reply #4 on: January 07, 2009, 01:49:53 pm »
What's the benefit of the TFSA other than tax-free interest on the money you deposit? I understand that the principal is not tax deductible.
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Offline ovr50

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Re: TFSA
« Reply #5 on: January 07, 2009, 01:59:44 pm »
Quote from: carcrazy on January 07, 2009, 01:49:53 pm
What's the benefit of the TFSA other than tax-free interest on the money you deposit? I understand that the principal is not tax deductible.

That's the only real advantage. There is no tax deduction for the contributions (like there is for RRSPs, etc). Just that the earnings (interest or gain) are not taxed at all.

Can be invested in more than just interest-bearing assets, can be investing in equities (if anyone has the guts, but could be a good move since the market has to recover at some point, and the downside MAY be finished (or not?)).

Your call.
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Offline tenpenny

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Re: TFSA
« Reply #6 on: January 07, 2009, 02:03:29 pm »
Quote from: wing on January 07, 2009, 12:51:27 pm
Anyone know if you can have 2 tax free savings accounts?

I had signed up with ING at 2.7% but now found out PC is offering 3.75% so I signed up with them.

Will the GOV say no you can't do that, or will I have now have 2 accounts but must ensure I don't over contribute.  Calculating the interest difference on 2 accounts could get a wee bit tricky!

But you don't have to worry about the interest - you can contribute a max amount of $5000, doesn't matter how much it earns.  You just have to make sure that your total contributions aren't over the limit each year.

Really, for anyone who saves or invests, it's a no brainer - you can do pretty much whatever you want with it, and it's tax free growth.
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Offline tpl

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Re: TFSA
« Reply #7 on: January 07, 2009, 02:04:04 pm »
US$ dividends, capital gains, interest   and for retired people, Canadian dividends as the gross up of dividends does not affect your pension clawbacks when those dividends are inside a TFSA. That last one alone may be worth a fair amount to people on the edge of having their pension clawed back. ( I don't know if that applies also to other means tested benefits)
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Offline wing

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Re: TFSA
« Reply #8 on: January 07, 2009, 02:45:26 pm »
Also the amount going in grows with inflation and you can put in $0 this year and $10k never year if you wish.   It's great, you won't see much advantage for awhile but none the less.

I'll just move my money around then from one account to the other!  Apparently the penalty for more money in the account than allowed is 1% per month... that's a lot.
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Squishy

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Re: TFSA
« Reply #9 on: January 07, 2009, 04:18:04 pm »
I just signed up for one with TD.  They only offer 1.75%, but all my other stuff is with TD and it's the easiest to access where I live.

When does the "year" start?  January 1st?  Or is it just that accumulated contributions within the last 12 months can't exceed $5000?  I think I'll keep putting some of my paycheck into a GIS account and just funnel $5000 into the TFSA whenever the cycle starts.
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Offline The Mighty Duck

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Re: TFSA
« Reply #10 on: January 07, 2009, 04:24:34 pm »
Quote from: wing on January 07, 2009, 12:51:27 pm
Anyone know if you can have 2 tax free savings accounts?

I had signed up with ING at 2.7% but now found out PC is offering 3.75% so I signed up with them.

How's PC for service and getting your money out?  I'm got a regular savings account with ING, and am thinking of opening a TFSA...  if PC is offering better rates than I might go ith them instead of ING...
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Wolfe

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Re: TFSA
« Reply #11 on: January 07, 2009, 05:33:27 pm »
Quote from: Demosthenes X on January 07, 2009, 04:24:34 pm
Quote from: wing on January 07, 2009, 12:51:27 pm
Anyone know if you can have 2 tax free savings accounts?

I had signed up with ING at 2.7% but now found out PC is offering 3.75% so I signed up with them.

How's PC for service and getting your money out?  I'm got a regular savings account with ING, and am thinking of opening a TFSA...  if PC is offering better rates than I might go ith them instead of ING...

Online PC Financial works just like ING, and in the real world you can use any CIBC ATM too. I haven't had any problems with either.

Be sure to check that the 3.75% at PC is not just a teaser rate for 3 months, I'd be surprised if it isn't.


The TFSA is a good place to put any income trust holdings until 2011.
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Offline wing

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Re: TFSA
« Reply #12 on: January 07, 2009, 08:32:19 pm »
I see no mention of a teaser 3.75% rate, but even if it is a teaser put the $5k in now and get the interest for 3 months, sounds good to me.
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Offline tpl

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Re: TFSA
« Reply #13 on: January 08, 2009, 07:14:38 am »
Gordon Pape videos on The Wealthy Boomer about TFSA

http://www.financialpost.com/money/wealthyboomer/index.html
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