The most poorly communicated financial instrument available to Canadians is the TFSA.  Most people know that they need to have one, but they don't really understand why.  Most people I've met who have a TFSA keep it at the bank branch, and use it very much like a savings account.ie., they have idle cash sitting in it, and a few might have it in a so called high interest option.  Folks, I'm sorry to have to burst your bubble, but your bank is robbing you blind.  They are borrowing your money at a 1% return and using it to generate at least a 2% income or spread.
To me the words Tax Free mean, this is the place to put those of my investments that are going to earn the highest amount of income or return over the next little while, because I don't this income to be taxed.  So what's the point of saving tax on a 1% income, that's $1 on $100 invested for the year.  If I was in the 30% tax bracket, the TFSA just helped me save 30 cents - big deal!  If you're going to have a TFSA load it up with the riskiest of your investments in stocks or mutual funds - remember high risk, high return, and when I cash in on that return, I don't want it to be taxed.




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