Comments on: High Interest Tax Free Savings Accounts (TFSA) http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm Building Wealth through Saving and Investing Sun, 12 Feb 2012 23:42:26 -0330 http://wordpress.org/?v=abc hourly 1 By: David http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-116432 David Thu, 18 Nov 2010 02:09:44 +0000 http://www.milliondollarjourney.com/?p=763#comment-116432 The and of the year is close. Does anybody know who offers the best rates on TFSAs? The and of the year is close. Does anybody know who offers the best rates on TFSAs?

]]> By: FRANK http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-114621 FRANK Fri, 06 Aug 2010 20:58:16 +0000 http://www.milliondollarjourney.com/?p=763#comment-114621 12. CHUCK I believe USD investments will be automatically converted to CDN upon withdrawl. Check that out. 12. CHUCK

I believe USD investments will be automatically converted to CDN upon withdrawl. Check that out.

]]> By: Marcus http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-112812 Marcus Sat, 01 May 2010 14:37:22 +0000 http://www.milliondollarjourney.com/?p=763#comment-112812 I checked my ING TFSA savings account yesterday (30 Apr), and they dropped it to 2%. Marketing ploys... tisk tisk. I checked my ING TFSA savings account yesterday (30 Apr), and they dropped it to 2%. Marketing ploys… tisk tisk.

]]> By: RUSS http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-109274 RUSS Fri, 08 Jan 2010 00:36:19 +0000 http://www.milliondollarjourney.com/?p=763#comment-109274 Bev, As of Jan 1, 2010 ING raised the TFSA rate back to 3%. It's likely a marketing ploy to draw a bunch of deposits in early in the year and then they'll start dropping the rate again, but it's a good deal while it lasts! Cheers, Russ Bev,

As of Jan 1, 2010 ING raised the TFSA rate back to 3%. It’s likely a marketing ploy to draw a bunch of deposits in early in the year and then they’ll start dropping the rate again, but it’s a good deal while it lasts!

Cheers,
Russ

]]> By: Bev http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-108689 Bev Mon, 21 Dec 2009 00:24:15 +0000 http://www.milliondollarjourney.com/?p=763#comment-108689 ING Direct has dropped their rate to only 1.2% ING Direct has dropped their rate to only 1.2%

]]> By: FrugalTrader http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-72381 FrugalTrader Tue, 03 Mar 2009 03:17:17 +0000 http://www.milliondollarjourney.com/?p=763#comment-72381 Thanks for the link DAvid. Thanks for the link DAvid.

]]> By: DAvid http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-72374 DAvid Tue, 03 Mar 2009 00:46:23 +0000 http://www.milliondollarjourney.com/?p=763#comment-72374 ed, See this link: http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/tfsa-celi/dth-eng.html or do a web search: "TFSA upon death" Basically the amount accrued until the date of death is transferred to the estate as a TFSA, but any income after that date becomes taxable to the estate (and therefore heirs). DAvid ed,
See this link: http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/tfsa-celi/dth-eng.html or do a web search: “TFSA upon death”

Basically the amount accrued until the date of death is transferred to the estate as a TFSA, but any income after that date becomes taxable to the estate (and therefore heirs).

DAvid

]]> By: ed http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-72359 ed Mon, 02 Mar 2009 22:00:05 +0000 http://www.milliondollarjourney.com/?p=763#comment-72359 what kind of tax do i have to pay on a TFSA inherited from a parent when they pass away? what kind of tax do i have to pay on a TFSA inherited from a parent when they pass away?

]]> By: John Doe http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-70289 John Doe Sat, 14 Feb 2009 01:58:08 +0000 http://www.milliondollarjourney.com/?p=763#comment-70289 What I've read about contribution limits in the responses to this post (other than Bob's) doesn't make a lot of sense.... the way I've understood this is that you can only inject a max of $5000 cash every year into any TFSA per year, and that accumulates annually. *Earnings* from a TFSA I can't imagine are a factor towards this contribution limit. For example, if I strike it rich in a penny stock and my $5000 (after the first year) grows to a million, and I withdraw it as cash (not transfer to another TFSA). I can't imagine that would mean I would have a million dollars+ in TFSA contribution space the following year. The example mentioned by "chococrazy" is perfectly fine as it deals with an amount below the max. contribution limit. Sample scenario as I understand it: Year 1: I put in $5000 in the TFSA Year 2: I put another in $5000 in the TFSA Year 3: I put another in $5000 in the TFSA. My total account (due to amazing investing) doubles to $30000, and I decide to withdraw it all as cash. I'm not allowed to reinject *any* cash into the TFSA as I've used up my space for this year, and all previous years. Year 4: I'm *allowed* to reinject a max of 4*$5000=$20000 into the TFSA this year, due to the withdrawal ( >= $20000 ) I made previously. Somebody please correct me if I'm wrong... What I’ve read about contribution limits in the responses to this post (other than Bob’s) doesn’t make a lot of sense…. the way I’ve understood this is that you can only inject a max of $5000 cash every year into any TFSA per year, and that accumulates annually. *Earnings* from a TFSA I can’t imagine are a factor towards this contribution limit. For example, if I strike it rich in a penny stock and my $5000 (after the first year) grows to a million, and I withdraw it as cash (not transfer to another TFSA). I can’t imagine that would mean I would have a million dollars+ in TFSA contribution space the following year. The example mentioned by “chococrazy” is perfectly fine as it deals with an amount below the max. contribution limit.

Sample scenario as I understand it:
Year 1: I put in $5000 in the TFSA
Year 2: I put another in $5000 in the TFSA
Year 3: I put another in $5000 in the TFSA. My total account (due to amazing investing) doubles to $30000, and I decide to withdraw it all as cash. I’m not allowed to reinject *any* cash into the TFSA as I’ve used up my space for this year, and all previous years.
Year 4: I’m *allowed* to reinject a max of 4*$5000=$20000 into the TFSA this year, due to the withdrawal ( >= $20000 ) I made previously.

Somebody please correct me if I’m wrong…

]]> By: Wade http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-70230 Wade Fri, 13 Feb 2009 16:38:18 +0000 http://www.milliondollarjourney.com/?p=763#comment-70230 I opened TFSAs for my wife and I at E-Trade. I bought $5,000 (face value) of discounted Bell Aliant bonds paying 4.72% and maturing in Sept 2011. I'll continue putting relatively short term bonds rated BBB or better, into these accounts each year, rolling the interest into new bonds each time I put more money in. If interest rates increase in a few years, I'll start laddering out to longer terms. I think this is a great place to put interest income because I won't be paying tax on it. I'll keep capital gains and dividends primarily for my regular accounts. Wade I opened TFSAs for my wife and I at E-Trade. I bought $5,000 (face value) of discounted Bell Aliant bonds paying 4.72% and maturing in Sept 2011. I’ll continue putting relatively short term bonds rated BBB or better, into these accounts each year, rolling the interest into new bonds each time I put more money in. If interest rates increase in a few years, I’ll start laddering out to longer terms.

I think this is a great place to put interest income because I won’t be paying tax on it. I’ll keep capital gains and dividends primarily for my regular accounts.

Wade

]]> By: Canadian Money Review http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-70023 Canadian Money Review Thu, 12 Feb 2009 04:28:07 +0000 http://www.milliondollarjourney.com/?p=763#comment-70023 I've just posted an update on my blog if you want to see the latest rates. (http://www.canadianmoneyblogs.com/2009/02/they-really-want-your-money-high.html) Manulife seems strangely high. Any idea why? I’ve just posted an update on my blog if you want to see the latest rates. (http://www.canadianmoneyblogs.com/2009/02/they-really-want-your-money-high.html)

Manulife seems strangely high. Any idea why?

]]> By: DAvid http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-69611 DAvid Mon, 09 Feb 2009 02:09:32 +0000 http://www.milliondollarjourney.com/?p=763#comment-69611 D-mac, See the discussion on this topic<a href="http://www.milliondollarjourney.com/federal-budget-2008-tax-free-savings-account-tfsa.htm" rel="nofollow"> here.</a> DAvid D-mac,
See the discussion on this topic here.

DAvid

]]> By: D-Mac http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-69581 D-Mac Sun, 08 Feb 2009 21:22:26 +0000 http://www.milliondollarjourney.com/?p=763#comment-69581 Just happened upon the site and getting a lot of reading done! Quick question. I noticed the Smith Manoevre you are involved in. Can the money from the HELOC be put into a TFSA. Seems like a good deal... get the tax shelter from the TFSA but also the deductible interest because you are borrowing to invest? I hope it's not a silly question. Just happened upon the site and getting a lot of reading done! Quick question. I noticed the Smith Manoevre you are involved in. Can the money from the HELOC be put into a TFSA. Seems like a good deal… get the tax shelter from the TFSA but also the deductible interest because you are borrowing to invest?

I hope it’s not a silly question.

]]> By: Carole http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-68320 Carole Tue, 27 Jan 2009 17:45:47 +0000 http://www.milliondollarjourney.com/?p=763#comment-68320 Avoid PCF...they dropped their rate twice in the first two weeks of Jan. Now one of the lowest. Avoid PCF…they dropped their rate twice in the first two weeks of Jan.
Now one of the lowest.

]]> By: Leu http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-68123 Leu Mon, 26 Jan 2009 00:53:21 +0000 http://www.milliondollarjourney.com/?p=763#comment-68123 Also, what ahppens if you simply close down the account because you don't have the money? Is there going to be a significant minimum monthly balance type of thing required to stop tehm taking whatever you have left? I don't know the answers, but worth reading the fine print, and remember that they can always change their rules, usually to your disadvantage, as hapened with RRSP fees, which were very low at the beginning, or non-existent. They usually introduce them sometime when you're in the middle of a 5year GIC, so you are stuck! Also, what ahppens if you simply close down the account because you don’t have the money? Is there going to be a significant minimum monthly balance type of thing required to stop tehm taking whatever you have left? I don’t know the answers, but worth reading the fine print, and remember that they can always change their rules, usually to your disadvantage, as hapened with RRSP fees, which were very low at the beginning, or non-existent. They usually introduce them sometime when you’re in the middle of a 5year GIC, so you are stuck!

]]> By: Leu http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-68121 Leu Mon, 26 Jan 2009 00:45:23 +0000 http://www.milliondollarjourney.com/?p=763#comment-68121 Regarding fees for tese accounts, what you have to watch out for is the fee for moving the account to another financial instiution. Many of them are charging $100 for this privilege, just like they do with RRSPs. I think I'll go with ING, where I can be sure of no hidden costs. Ellen Roseman had a column in the Toronto Star yesterday which is probably online and is instructrive, or at least raises questions. Apparently these are subject to some kind of inheritance tax in Ontario because Ontario has not yet passed enabling legislation. I didn't understand her calculation. Did anyone? Regarding fees for tese accounts, what you have to watch out for is the fee for moving the account to another financial instiution. Many of them are charging $100 for this privilege, just like they do with RRSPs.
I think I’ll go with ING, where I can be sure of no hidden costs.
Ellen Roseman had a column in the Toronto Star yesterday which is probably online and is instructrive, or at least raises questions. Apparently these are subject to some kind of inheritance tax in Ontario because Ontario has not yet passed enabling legislation. I didn’t understand her calculation. Did anyone?

]]> By: newbie http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-67920 newbie Thu, 22 Jan 2009 15:10:18 +0000 http://www.milliondollarjourney.com/?p=763#comment-67920 BMO has a 2 year GIC at 3.50%. BMO has a 2 year GIC at 3.50%.

]]> By: DAvid http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-67885 DAvid Thu, 22 Jan 2009 01:09:05 +0000 http://www.milliondollarjourney.com/?p=763#comment-67885 Opened my TFSA today. RBC has a sale on 2 year non-redeemable GIC at 3.25%. Seemed more of a sure thing than Manulife, given their recent decisions on the M1 interest rate, and far better than the RBC high interest savings account at 2.5%. DAvid Opened my TFSA today. RBC has a sale on 2 year non-redeemable GIC at 3.25%. Seemed more of a sure thing than Manulife, given their recent decisions on the M1 interest rate, and far better than the RBC high interest savings account at 2.5%.

DAvid

]]> By: Buck http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-67864 Buck Wed, 21 Jan 2009 21:13:09 +0000 http://www.milliondollarjourney.com/?p=763#comment-67864 http://www.scotiabank.com/rates/savings.html#tfsa http://www.scotiabank.com/rates/savings.html#tfsa

]]> By: Mark http://www.milliondollarjourney.com/high-interest-tax-free-savings-accounts-tfsa.htm/comment-page-2#comment-67859 Mark Wed, 21 Jan 2009 20:36:34 +0000 http://www.milliondollarjourney.com/?p=763#comment-67859 I have been calling around to the banks today and Scotiabank's current rate is 2.6%. I have been calling around to the banks today and Scotiabank’s current rate is 2.6%.

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