Is a TFSA for higher or lower risk investments?
A – Either. It depends on personal priorities. It can be used as an emergency fund, in which case such low-risk assets as a savings account or a money market fund are appropriate. At the other end of the scale, a TFSA can be used to maximize long-term growth, in which case higher-risk stocks or equity mutual funds can be used. Q – Can I transfer my Canada Savings Bonds to a TFSA? A – Yes. However, surprisingly, the CSB program itself does not offer a TFSA. The bonds would have to be placed in a self-directed plan set up at a financial institution or a brokerage firm. Remember that all accrued interest up to the time the CSBs go into a TFSA is taxable. Q – If I deposit $5,000 now and earn $200 inside the plan this year, does that put me in an overcontribution position? A – No. Profits made within a TFSA are not considered to be “contributions.” Q – Is a TFSA a good option for a retiree? A – Yes. Although they work best for young people because of the many years of compounding they will
