Last week we talked about emergency funds. Why you need one, when it should be used, and how much you should aim to have in it. This week, we’re taking it a step further. So you have an emergency fund or you’re in the process of building one… Where should you put it? At TaxForce, we’re big fans of the Tax-Free Savings Account.
In this video, we’re talking about multiple different types of accounts. We’re putting the focus on tax free savings accounts (TFSAs) and why it’s so important to be maximizing your TFSA room.
TFSAs allow you to earn interest tax free! This means that any income you earn from investments kept in your TFSA, will not be taxed. Unlike an RRSP, you do not receive a tax deduction when you put the money into the TFSA. TFSAs allow your money to be more accessible than an RRSP does. Your money can also grow without you having to worry about being taxed on the extra income.
We think these accounts are very under-utilized by Canadians, which is why we wanted to explain more about them!
Hopefully this video will help you decide where to keep your emergency fund AND teach you about the opportunity that exists with a TFSA. Be sure to give it a like and subscribe to our channel for more tax tips and informational videos every week.
It is always a good idea to contact your advisor to discuss your personal or business finances. We are always happy to help our clients with business and tax planning. If you’re in need of an accountant, check out our services page or book a “Get to Know You” meeting with us by clicking here!
