Tax Free Savings Accounts

What is a Tax Free Savings Account?

When your financial needs can’t be met by a traditional RRSP, a Tax Free Savings Account (TFSA) may be the perfect step up to keep growing your post-employment wealth. A Tax Free Savings Account is Canada’s go-to solution for wealth growth and management with more flexible terms than other federally registered savings instruments.

Like an RRSP but different

Tax Free Savings Accounts in Canada offer much more than a supplement to your pension. Your TFSA is capable of helping you save for almost anything. Whether you plan on using it to help fund a new business venture in the near future or provide a cushion for times of emergency, contributing to a strategically-managed TFSA will help you reach your financial goals. However, that isn’t to say it isn’t a wonderful addition to any retirement plan. Depending on what strategies you use to put your Tax Free Savings Account to work for you, it can be the perfect companion to an Individual Pension Plan, RRSP, RRIF, or any other savings instrument.

Differences between Tax Free Savings Accounts and RRSPs

To put it simply, in the words of the Canada Revenue Agency, “An RRSP is primarily intended for retirement. The TFSA is like an RRSP for everything else in your life.” The inclusion of both in your wealth management plan will provide you with more contribution room, investment opportunities, and potential future wealth.

Numerous plan possibilities

Since a TFSA isn’t limited to just cash investment, there are plenty of opportunities for you to both grow and diversify your account’s wealth. With so many choices to make in order to keep your wealth and portfolio robust, your plan deserves access to the best TFSA investment strategy to meet your unique needs. To help you meet your future financial goals, MLD Wealth Management offers plenty of innovative and sustainable ways to keep your Tax Free Savings Account growing both before and after you’ve retired. That way, you can keep living the life you want to live.

Accelerate your savings

As one of the numerous benefits that opening a TFSA affords you, your assets have the potential to grow much faster within these instruments than they may in a traditional cash-based savings account. This is because when TFSAs are used in tandem with MLD Wealth Management strategies we can tolerate a different class of risk and accelerate the compounding effect of your wealth. You’re also able to withdraw and reinvest your assets as you see fit enabling you to be agile in times of uncertainty and resilient in times of hardship.

You may also want to consider opening multiple Tax Free Savings Accounts as part of your wealth management strategies. When you transfer funds directly between two TFSAs, the transaction is non-taxable and does not count as an extra contribution. With such a provision in your strategy, you’ll have even more room to save for your future goals without penalties.