TFSA

A Tax Free Savings Account (TFSA) is a registered investment or savings account that allows for tax free gains. The amount of money that can be contributed to a TFSA is limited each year. A TFSA can be used for any savings goal and withdrawals can be made free of tax.Though TFSA is an acronym for Tax Free Savings Account, it’s not really much at all like those savings accounts you probably had as a kid. Ones that earned almost no interest but provided access to all-you-can-eat stale lollipops from your local bank branch. Instead, think of a tax-free savings account (TFSA) as a basket. You can pick what to put in that basket from a bevy of financial instruments—exchange traded funds, guaranteed investment certificates, stocks, bonds and yes, actual cash savings. The Canadian government introduced TFSAs in 2009 as a way to encourage people to save money. Since you paid tax on the money you put into your TFSA, you won’t have to pay anything when you take money out.