My Mortgage Blog

If you need an option that's quite flexible and can assist you with saving some of your hard earned money, consider opening up a Tax Free Savings Account (TFSA), your portfolio may thank you. As an alternative, you could rummage through your storage locker and sell everything of importance on craigslist, but we all know how much fun that can be. Conveniently, but unrelated, I happen to be selling some stuff on craigslist right now, interested?

The idea of a TFSA was introduced in the 2008 Federal Budget by Jim Flaherty, Canada's Finance Minister. This program came into effect on January 1, 2009 and was brought in as an option for Canadian residents over the age of 18 years to save for the future. 

TFSA's offer a number of great features and for this reason are set apart from the RRSP's; another great savings vehicle which I can highlight in a separate blog. For instance, TFSA's allow you to withdraw funds at any time, free of taxes including the dreaded capital gains tax. This is a fantastic option as you're able to access your money at any time if the need arises. Another great feature is that you are able to re-contribute the amounts that you withdraw beginning the following year. By paying no tax on the investment income or growth generated, you'll be able to build your savings even faster.

You may contribute up to $5,000.00 each year and any unused contribution limit that is left over for the year, can be carried over to the next. For instance, if you've contributed $5,000.00 in 2009 and then nothing for 2010, you'll be able to contribute $10,000.00 for 2011. 

You may also choose from a wide variety of investment options such as Mutual Funds, Guaranteed Investment Certificates (GIC's) and Bonds.  Keep in mind that most returns yield you anywhere from 2-4% per year if you're investing into a traditional savings account. Be warned that if you are investing in high risk stocks, your losses are not deductible. Some banks are charging administration and withdrawal fees for TFSA holders that wish to invest in the stock market, I recommend contacting your financial advisor or myself prior to those investment strategies. 

Get your TFSA today and start saving more by paying less.

As always, I encourage you to contact me if you have any questions with your current mortgage or are looking for one. Please find me on facebook at Jason Nesseth l Mortgage Specialist l British Columbia and on twitter @jasonmortgages.

"Working with you for the life of your mortgage!"

Jason Nesseth with TMG The Mortgage Group Canada Inc. If you have any questions or comments about this blog, please feel free to call Jason at 604.375.7375, email or visit his website at