5 TFSA Mistakes YOU MUST Avoid
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- เผยแพร่เมื่อ 13 ก.ค. 2024
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There are a number of different reasons why you may not be using your TFSA correctly. Maybe you do not understand the difference between a beneficiary or a successor holder, or maybe you are stuck on what a TFSA can actually provide for you because it was poorly advertised early on.
Whatever reason it may be, in this video we'll go through the 5 main mistakes that we often see when we meet with our clients. By the end of the video, you'll get a good idea of when & how you should be investing within your TFSA, as well as some planning strategies so that you can take full advantage of the tax benefits that come with a TFSA.
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If you have any further questions about this video's topic or any financial planning questions in general, I encourage you to find a certified financial planner in your area or book a consultation with us to get your savings plan on track. You can email Info@Parallelwealth.com or call 604-256-1151 and we will set up a meeting with you.
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DISCLAIMER: The videos and opinions on this channel are for informational and educational purposes only and do not constitute investment advice. Adam Bornn is not registered to provide investment advice and as such does not provide recommendations - those looking for investment advice should seek out a registered professional. Adam is not responsible for investment actions taken by viewers and his content should not be used as a basis for investment trades.
TL:DR
1. Don't do a TFSA Beneficiary Designation, make a successor holder instead
2. Don't use your TFSA as a 1-3% savings account, make it a 3-100% investment account
3. Don't put money into your TFSA when you owe money at a high interest rate to someone else, like a credit card company, pay them off first
4. Don't contribute and withdraw from your TFSA in the same year, only let your TFSA money flow in one direction per year
5. Withdraw TFSA money in December this year if you know you need it next year to buy something
You are hired
Step 2, That's why it really should be called a TFIA. I guess too complicated for some people.
Point 1 - when moving monies to your TFSA as a Beneficiary Designation, can l assume you wouldn’t be charged 1% by the gov’t for over contribution ?
This saved me 6 minutes of my life, thank you.
Need this in the video description.
No one has ever mentioned the Beneficiary vs the SH configuration to me before. Thank you very much for this.
You are very welcome
Great comment!! I never hear about the Successor holder.
Correct but he failed to mention the RC 240 form from the CRA to rectify (the situation) in the same calender year when the annuitant becomes deceased.
@@boricuadetorontocanada that would be dealt with upon death when adjudicated! His video is awesome and too much detail just adds confusion… as long as it doesn’t impact taxes/limits, he didn’t fail to mention any details in my view… but good to know 👍
Great video and informative, thank you for being very clear. As for some viewers, a positive comment is more appreciated than a negative one. It takes a lot of time and effort to put these videos out to inform us Canadians, for those who are not aware of all this find it valuable like myself. Thank you so much. 👍🙏
@@boricuadetorontocanada ey Boricua, anything you can add to increase our knowledge is welcome. Just make it in a positive way, remember we are Canadians, we are polite 😀
@@ginocolello4241 we definitely aren't that polite. Maybe in comparison to Americans lol
Based on what I usually see on TH-cam, I was expecting simplistic advice and a thinly disguised sales pitch for your services. What I got was some good solid financial tips. Nice work!
Lol we will pitch you eventually 🤣🤣🤣.
Just trying to help Canadians 1 video at a time.
Awesome job
@@ParallelWealth First, absolutely love the show! I'm wondering if you guys would consider if index investing makes sense going forward, consider this: If you were making $21.50/hr at the lows of the great recession, you could by 1 share of spy for around 4 hours worth of work ($86). Now, say you are making around $35/hr, 1 share of spy is going to cost you about 13 hours of work. Is the risk-reward ratio too high, as Peter Lynch seems to suggest? I used a nominal wage tracker to get the rough average hourly US wages for the low of the great recession and current. Obviously, wages have not even come close to keeping up with the increases in the market, and therefor the relative risk of the market is multiple times as high as it once was.
@@ParallelWealth llllllĺqwertyuiop
His advise is always this good!
The TFSA is my favourite account. By the time I retire it’s my plan that it’ll be worth several hundred thousand and have significant dividend income for me to withdraw tax free to help fund my retirement
Used at it's best, the TFSA is the most valuable retirement tool in registered plans.
I am a teacher and I definitely appreciate well-communicated, thorough and accessible information when the subject matter can be hard to grasp. You are an excellent resource and I want to thank you! Please keep it up.
Thanks Lise, very kind of you to say.
You are doing canadians a great service with these videos. Thanks!
Thanks Peter
This is some solid info and recommendations. Great channel! Thank you for doing these videos for us!
Love your videos. This has been really helpful. Very informative. Thank you!
This is an EXCELLENT video, clear and concise and great advice.
Excellent info. Short and directive and I guarantee that everyone will learn at least one thing.
Thanks for getting to the point quickly Well done.
Thank you so much for explaining this so well, I can follow what you are saying and it makes sense.
I am going to watch your videos to help me and my job, I'm in finance.
Great vid, looks like I avoided these mistakes by chance, not skill. Thanks for helping others meet their goals.
Great video!! Especially the beneficiary part. A lot of people including me, did not know about the successor rules.
I am going to scroll through your videos for anything else of interest to my situation.
Awesome info. So informative. Thanks a lot. I will keep & share it to people that I know have TFSA
That last one, Great advice never heard that one before. Thank you for sharing.
thanks for the clear explanations , keep up the great work!
Good Information. Also, the discussion about Successor Holder also applies when setting up your RRIF although some institutions may call it Successor Annuitant.
Great tips! Didn’t know about the successor holder. Will look into that. Thank you! Subscribed.
Thanks for the comment and sub.
Excellent video. I have seen a few now. I just subscribed. Yes, the successor holder mechanism was new to me. I'm going to rewatch. Thanks👍
Thanks for the view and sub
Thanks for an interesting educational video. Easy to understand with clear language. Didn't make me nod off or my eyes glaze over. Well done!! Thank you :)
Great job and very well presented 👍👍nice to see some Canadian content that is valuable! Thank you
Many thanks!
Always excellent advice !
This is what I call knowledge is power. Thank you.
Glad it was helpful!
Thank you Adam, same as Kevin Jackson, I find your videos provide good solid financial tips in a humble and clear way; straight to the point.
Thanks! Appreciate the kind words.
Great tips. Extremely useful. Thanks!
Nice video. I'm familiar with several of these, but the whole beneficiary/successor holder distinction is entirely new to me! Thanks!
No worries. Glad you took something away from it.
Thank you for these wise advices.
God bless you.
Thank you so much! Very informative!
thank you!!! this video is just what i needed !!!
thanks Adam again. Your financial wisdom is far better than I have ever seen.
Thanks, very much appreciate that. Glad the videos are helping!
Awesome information. Thank you.
Excellent to the point video! Very informative! Thanks a bunch!
Glad it was helpful Kosina
Love it. So we’ll explained. Thankx
awesome video, thanks for that ! good work !
Great information Thank you
As a fellow Canadian ... Totally appreciate your advice!
Thank you!
Thanks, it's very informative
On point one: if you are listed as a beneficiary but are a spouse you can actually just apply to have it changed. Yes it's a bit more work but you don't actually lose that opportunity simply because it was filled out poorly. Though I do agree with you getting it right from the start is just better.
Thank you very much.
Great channel.
Thanks for the excellent tips
Awesome informative video.thanks
Very new subscriber so I have some catching up to do, I'm off work construction worker and 56 watching older vlog.
I get the retirement aspect and the working serino when you talk about money, just don't want you to forget about a segment of our population whose financial situation is more dynamic and unfortunately have to use retirement money now to pay the bills.
Awesome information and I wasn't talking about myself but know of others that are struggling.
Thank you! Very useful.
Thanks for the Video. Regarding #5, I think you should clarify that this is for people that already have maxed out their tfsa. The contribution room is the same no mater what. Contribution room is added regardless of wether you take it out or not. If you have 65k in your Tfsa and you take out 10k you have 10k of room. Wether it’s before or after January, it doesn’t matter.
Excellent Info appreciate your Amazing vloggs keep up a great work Merci for sharing
My pleasure!
If I could like and subscribe 1000 times I would. Just found your channel and binge watching your vids. I have an investment advisor that I meet with yearly and I'm happy with, but you just add a whole other level of knowledge while I watch and learn sitting on my couch having an adult beverage.
Thanks Ken. If you could sub 1000 times I would let you too!!
Great tips thanks
Great summary!
Great info!
Excellent video
Thank you. Very helpful
Well done.
Successor TFSA beneficiary I did not know. Now I do.
Thank you.😃
Very informative video
As an advisor, you nailed it!
I thought I knew the TFSA rules.
This video really cleared up some confusion.
Especially the first tip..had no clue
Well done and thanks!
Glad it was helpful!
Fantastic video and recommend everyone to watch!
Thank you!
Good Video , thanks
Honestly the biggest life hack in Canada, glad I bought tsla in my tfsa few years back 😁
Such a good video. I didn't know about the Successor holder and have now changed the designation on my TFSA. Thanks so much!!!
😁
So, this answers my question: “For my existing TFSA and my wife’s TFSA, can I change from beneficiary to successor holder after the fact?”. Adam, maybe you should confirm this is actually true. Going to make this change next time I meet with my FP. Great video Adam, as they all are!
How did you make the change? I can’t get my bank to confirm if my husband is listed as beneficiary or successor holder.
this is great. i was not aware of this. thank you
You're welcome!
Thanks ,have a good Day
Thanks for the info. 😀
VERY good vid!
Thank you I never heard of a Successor. Odd why my financial adviser didn't mention it or the Lawyer when he drew up my Will.
Thanks again.
Thanks for this great video! The first point was the only point I didn’t know! But glad what I did know you reaffirmed my knowledge!
I shall subscribe! You rock!
Thanks. Important Stuff.
Succession holder. Never heard of this. You may have saved me a tonne of taxes. Thanks
Honestly thought this was gonna be one of those videos with the stupid easy, everybody knows tips. But this was actually really good info!
Lol thanks.
great info
Great videos and channel overall!!
Thanks!
This is great knowledge thank you
Thanks Cathy!
Could you have 2 Successor Holders on your TFSA? Split evenly? as in your Kids?
Quick Recap:
1. Don't do a TFSA Beneficiary Designation, make a successor holder instead
2. Don't use your TFSA as a 1-3% savings account, make it a 3-100% investment account
3. Investing while having HIGH INTEREST DEBT - Pay Down the Debt First
4. Don't contribute and withdraw from your TFSA in the same year - Do One or the Other
5. Withdraw TFSA money in December this year if you know you need it next year to buy something
Successor holders can only be a spouse or CL partner....so good luck naming 2!! LOL.
Nice video ...appreciate the effort you put in..🎉🎉😊😊
My pleasure 😊
Impressed. I need a tax advisor for retirement and would be happy to hear from you.
Great information! My wife and I just this week set up TFSA's at our bank. The advisor there made absolutely no mention of the "successor holder" designation.
Not surprised.
We've since had that designation added.
This is because....banks are horrible. They don't really work for you. They work for themselves.
Great advice. I will send the video to my Sister and she can make my BIL as a Successor. I subscribed also and sent them the link to your channel as well. Keep up the good work,
I had no idea about the first tip, thus made this mistake. Now calling my banker for an appointment. Thank you.
Does the successor holder have to be the spouse/common law partner or anybody being designated?
Great advice! Just downloaded the forms to make sure my husband and I have each other set as Successors and not Benefiaries. Thank you!
Where did you find these forms?
THAAANK You!!!
In Quebec, the designation of a beneficiary and/or successor holder can be made only in a will or marriage contract.
Great info on tfsa
I thought I was relatively proficient on how best to use the TFSA, but have to admit I learned a few more key things. I did not know about Successor vs Beneficiary. I don't even recall seeing that option being offered on any of my (or my spouses) TFSA accounts. I'll need to call them to find out where we can make that designation. The end-of-year withdrawal strategy is also a great tip. Your YT channel (and the solid advice/tips it provides) deserves more views / subscribers. Well done!
Thanks Jax! Appreciate the kind words and always good to hear our efforts are making a difference.
Hi Adam! Thank you for all this informative videos you put out. I am learning more than ever. I am wondering if you could make a video about US penny stocks and delisted US/international stocks in registered accounts (TFSA, RRSP, RESP). What happens to my high risk investments and what should I do? Can I just transfer the US stock(s) over to my Margin account and continue to see if their values go up? What would be the best solution for my situation? What would CRA in this case? Thank you in advance.
The option to leave your TSFA is on your mailed form which shows your latest deposit. If you call the 1800 on your bank card where you have a TSFA they will guide you to where these options are so it will show on your forms. Leaving it to your estate etc.
If your spouse is a “U.S. person,” name him or her as BENEFICIARY, not successor holder. Current U.S. tax law does not recognize earnings within TFSAs as tax-free and characterizes them as “foreign trusts,” adding yet another layer of onerous reporting requirements on the surviving US spouse.
Great advice!👌
Thanks Jade
That’s good to know
Thank you.
Thank you
Fabulous!! Thank you sooooooooooooooo much!
You are welcome Rick.
Fun thing I ran into is if you transfer securities in-kind to a TFSA from a non-registered account and the price of those securities dropped since the time of purchase then you can't claim a capital loss as the loss is considered superficial.
ty I need this.
What a great video!
Nice informational video
😊 thanks
For folks who don't need cash from RIF minimums, these can be scheduled at he end of a year in order to fund a TFSA contribution at the start of the new year.
Great video
Glad you enjoyed it
Great information , very hard to come by.
Thank you.
Hi, really good info, 👍 especially about effective way to get TFSA given to someone in ones estate. Is it my understanding, from watching a few of your vids on cpp delaying considerations, that if one was to delay the CPP from 65 to using it at 70yrs of age, that during this 5 yr period the better strategy is to dip into using your RRSP and just before CPP kicks in at 70 dissolve the RRSP. Then once CPP at 70 yrs of age has started, and there is no RRIF (a former RRSP) use the TFSA savings (dividend income) as additional income to ones pension, CPP and any other savings accounts (by then you recommend to not have an RRSP or RRIF due to unfavourable taxation, correct?). 🤔. 🇨🇦
Recently retired/medical reasons.
Videos helpful in many respects .
Married 32 yrs grown children .
Money strategies not my forte, but we’ve done ok . The multiple income sources and how and when to initiate these is something I did not even think about . Thank you
Happy retirement William!
Another mistake is to hold very risky individual securities in your TFSA in a hope to make a killing tax free. If it goes to zero (and you close position), you will have a permanent impairment of your TFSA room as the loss is not deemed a withdrawal.
@@adamjung6104 if you just open your eyes, you will see, that I said exactly that.
@@viacheslavsavateev6522 my apologies I read your statement incorrectly late last night, is it possibly it has changed since I see you edited it?