TFSA Withdrawals Explained (Saving You Thousands)
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- เผยแพร่เมื่อ 5 ก.พ. 2025
- TFSA Withdrawals Explained
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Understanding how to maximize your Tax-Free Savings Account (TFSA) can be a game-changer for your financial future. Whether you're saving for a major purchase, retirement, or an emergency fund, knowing the ins and outs of TFSA withdrawals is crucial. Our latest video, "TFSA Withdrawals Explained," is your ultimate guide to navigating the complexities of TFSA withdrawals, ensuring you make the most of this powerful savings tool. Tailored specifically for Canadians, this video breaks down everything you need to know about withdrawing funds from your TFSA without incurring penalties or missing out on potential growth opportunities. Watch now to unlock the full potential of your TFSA!
The flexibility of the TFSA is one of its greatest advantages, allowing you to withdraw funds at any time without paying taxes on the earnings. However, there are important rules and considerations to keep in mind to avoid costly mistakes. This video explains why understanding the rules around TFSA withdrawals is essential for Canadians who want to make the most of their savings.
We start by explaining the basic mechanics of TFSA withdrawals, including how they differ from other registered accounts like RRSPs. You'll learn about the withdrawal process, when and how you can take money out, and what happens to your contribution room after a withdrawal. This section provides a clear, step-by-step overview, so you're never caught off guard.
One of the most important aspects of TFSA withdrawals is understanding how they affect your contribution room. We dive into the details of how withdrawals create additional contribution room for the following year, allowing you to re-contribute withdrawn amounts without penalty. However, timing is key-make a mistake, and you could face penalties from the CRA. We explain how to avoid these pitfalls and ensure you're managing your TFSA contribution room effectively.
From funding a down payment on a home to covering unexpected expenses, there are many reasons why Canadians might need to tap into their TFSA. We explore common scenarios where TFSA withdrawals make sense, and offer advice on how to plan for them strategically. By understanding the best times and reasons to withdraw from your TFSA, you can ensure you're using this account to its fullest potential.
Re-contributing after a withdrawal can be a bit tricky. We discuss the rules around re-contributions, including the timing of when you can put money back into your TFSA without triggering penalties. Understanding these rules is crucial for avoiding costly mistakes and maximizing your tax-free savings.
One of the biggest benefits of a TFSA is the tax-free nature of withdrawals. However, it's important to understand the broader tax implications of using your TFSA, especially in conjunction with other investment accounts. We cover the key tax advantages and potential pitfalls, helping you to navigate the tax landscape effectively.
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Before, I didn't understand the relationship between annual contribution limits and the lifetime limit. This TFSA presentation was a huge help. Thank you very much.
This is the most detailed explanation I've seen yet about TFSAs and I actually understood it. Thanks David!
Wow. Thx. Im paying my mortgage off and im taking a substantial amount of money to do so from my TFSA. I was so upset because i thought I would lose the amount in regards to contribution towards my TFSA. This is awsome. Im excited to pay it off now especially because the mutual fund the money is in reboubound and its a good time to pull it. Thanks again.
Great video - thanks for the explanation and great clarity - cheers
Thanks for that clear explanation. Getting close to looking at sorting retirement and been watching a bunch of videos and this by far the clearest.
Thanks for the video!
My TFSA plan (a year away from retirement) is that I have maxed contribution room, and focused on dividend paying ETFs to a point where it generates over $1000 a month…I just keep reinvesting for now.
In retirement, I will withdraw $1000 per month and then in January move in kind, $$19,000 of investments from my Cash account into my TFSA, $12,000 previous year withdrawals plus the $7000 per year added contribution room.
Thanks for the video
while I get the math, I do not understand why not withdrawing from the rsp and withdraw from the tfsa? then I suppose the tfsa investments are no investments only liquid savings, as investments tend to be large sums of money blocked for some number of years to have some decent interest return. This is why I think that the 5.15% generic interest it is not achievable with some CPGs on 1y term.
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RRSP withdrawals are also part of the plan, in fact, they are the first to go following the meltdown strategy. The plan is RRSP withdrawals (liquidate investments as needed), TFSA withdrawals of dividends, CASH account withdrawals of dividends and liquidation of investments as/ if required, but with that plan to move investments from the CASH (non-registered account) to TFSA to continue to withdraw dividends as tax free income. On top of everything else, a smallish defined pension.
Multi faceted retirement income and tax strategy
Outstanding TFSA presentation! 👍 ✅
Thank you. Nicely explained. I suppose another scenario (perhaps in an alternate universe) is that the investments in the TFSA were all Mag 7 and perhaps a few early investments in Canopy or what-have-you, and completely exploded in value since 2009.
What I get from this is that withdrawing from ones TFSA should not be viewed as a bad-thing. I'm not sure why I have or had that impression, but there you go. The house down-sizing scenario is most likely, but in my case, I was cajoled out of retirement and working ~ 3days per week. That income is going straight to a Non-Reg account into some basic ETF's. Based on your video, I guess I could use the TFSA for any purchases (car, Black Swan event) and top up with this retirement income.
Thanks again.
Enjoying your well constructed and explaining videos - so helpful
U can but have to pay a monthly penalty percentage i think its 1% per month on the over contributions
thank you very much for the information . Thanks again
Great explanation
Thank you 🙏 Much appreciated.
Thank you for well explain
As a person who quit school at 15, i feel it wixer to rent a nice apartment and live with out the extra fee. What do you think
The biggest thing I struggle with is what stocks to buy in my tax-free and what stocks to buy in RSP that is my next research item. The other thing I struggle with is some experts recommend withdrawing from my RSP and move it over to tax-free. I definitely have lots of room in my tax free and I know over the long term I would probably benefit because of the tax savings. I would appreciate someone’s advice over this.
Keep US dividend paying stocks in the RSP, otherwise you lose a certain percentage in withholding tax.
My husband is 88 years old can he avail all those increase of CPP and OAS even if he is staying in York
Well explained thanks!
But...I'm guessing that person is eluding the guy from the Canadian Armed Forces that already has $1.8 million in his TFSA.
Which, if you followed it, he lucked put on some good stock picks...mainly shopify and a few other picks & etf's.
So I think your viewer doesn't realize it's an investment account...not savings. As such, it can grow & you keep the dividends etc...as long as you're not day trading.
Well explain.
I have never used a TFSA saving account, I' am well into retirement, work parttime, collect OAS, GIN, and Canada pension. Question! if I contribute $7000 or more, would this effect my pensions?
Question: In 2024, the total TFSA limit is $95,000.
The investment has increased to $200,000.
In 2024, the withdraw was $120,000.
In 2025, what is the maximum TFSA contribution room? $127,000 or $102,000?
@@nano69an 127
Very helpful;
If TFSA contributions are made through 2 different wealth management firms, does the Government keep track of that?
Informative, I was just wondering if I transfer funs from GIC or RSP do I have to pay taxes on amount I am taking out of GIC or RSP?
No tax on withdrawals from a TFSA. A withdrawal from an RRSP will trigger income tax
In 2024 would you contribute back the $10k from a regular savings or a TFSA savings.
My thought is TFSA as then you keep contributing and gaining tax free $.
I was wondering about dividend withdrawls from etf's in a tfsa....can I put that back in at a later date?
Explain how in 2035 he can contribute $156,623 to his TFSA. Assuming no earlier contributions, his total limit (based on projected increases to contribution limits) in 2035 is $181,000. However, his 2027 balance of $116.637 clearly indicates earlier contributions were made, therefore reducing contribution room. Something doesn't add up.
How do you earn 5.15 %
I haven't contributed to a T SP for any years since it was started. I would like to start now if I can to reduce my RRIFs so I don't have to be playing Taxes on them when I make withdrawals , I just turned 84. Can you please give me some advice.
Aaron. Lets say you contributed 95000. Portfolio dropped to only 10000. End of year someone decides to bail out and withdraw the remaining 10k the current calander year. Is it correct the next year contribution is 10000 plus next years contribution only
Yes, the 10k withdrawn cannot be put back the same year but can be deposited back into TFSA after January 1st plus the new year's contribution amount
I dont get it,,,,i have been maxed out on my TFSA for a few years probably 10 years. All i can put back in is any withdrawa and the new years limit,,,so i dont see why you say they can put over the 90 k limit
How can I make withdrawal if I never put money in my account but I have 54k in contributions room ?
I contributed TFSA every year in January or February with yearly allowed amount. Last year 2024, i have record i did in January C$7000 because CRA showing it. Then , this year 2025, it shows $14000. Is that mean my financial institution HSBC not reporting my contribution because they're closed? How can I check? Now, RBC took over my HSBC account.
Like your videos, how do I get this tool please. Thank you
Thanks for watching. It’s a software program called Snap Projection
Thanks for the detailed explanation! Have a question, if I have a 10k contribution room and have put this amount in an income etf where I receive $250 in dividends every month, would withdrawal of just this dividend amount every month without touching the original 10k be counted towards withdrawal amount of the TFSA?
Yes, absolutely
If I invest in a GIC within my TFSA and the interest goes in to the same TFSA, will the interest count towards my yearly TFSA contribution limit?
No
Thank you. May I ask, is mutual fund or segraegated fund good to invest TFSA contribution? I’m 40yo and just starting, my goal is to contribute 7k yearly. What’s the best investment I should go to maximize income for the next 25 years?
Index fund of s and p 500 it's hard to beat the market and segregated funds have higher fees usually and lower returns but less volitile
Clarification. Ex) If you have $95 room, invest $95k, the market drops and you loose $25k and you panic and sell, would you not now loose that portion of loses as contribution room?
Market fluctuations of your portfolio do not affect your TFSA deposit limits. There's a difference between selling and making a withdrawal. By contributing $95K you've used up your TFSA room. By selling you've simply exited a position. Now let's say you decide to withdrawal $10K, you would have to wait until next year to redeposit the $10K in addition to your annual TFSA deposit limit of $7K.
@@AaronWealthManagement Thanks. I understand all of the TFSA, except the loss due to selling position in a down economy. Not withdrawing, just losing due to fluctuation. I thought one would lose the room, as they already maxed out. A loss would not create more room due to negative fluctuation. Thanks
@@joef4248 you lose that amount forever. if you put 95K in your TFSA, and let's say it grows to 120K because of a risky stock that paid off, but then 2 months later it crashed 50% and your TFSA is now worth 60K and you panic sell. you are at 60K, you cant add anything back until jan 1st of the next year and even then it will ONLY be the annual max llimit of 7K so you will be at 67K on jan 1st of the following year.
Why does the speaker have a mole under his right eye, but in his CPP/OAP video has a mole under his left eye?
Mirror effect. I figured one was taken from front camera another is back.
Sorry he is staying good in philippines
what happens when you die?
@@gobbeldy1 the balance on that day goes to your beneficiaries tax free 😀
NOT true! You shouldn’t say there is no maximum limit. There is a lifetime TFSA contribution room.
Your lifetime TFSA contribution limit increases each year by the annual contribution limit. If we’re the same age and you live 2 years longer than me your limit was more than mine was it not? Right now the maximum is $95K but that will increase next year and every year you live. There are other programs that have limits such as RESP, Fires-time time home buyers, RDSP, and IPP to name a few.
@@AaronWealthManagement INCORRECT! You have a lifetime maximum contribution limit for TFSA set by CRA, it is $95,000. Once you already reached this limit, you do NOT get further contribution room with age, you can increase in age but there will be no more contribution room given after reaching $95,000
@@TravelBuzzAdventures
Somebody here is “INCORRECT” but my current maximum contribution limit of $102,000 (+$7K from last years limit of $95K) clearly shows it’s not David. Educate yourself instead of spewing false accusations and claims as facts, you’ll be much better off for it.
Hi what I saw as another click bait, I now see smth as a poorly explained scheme.
So here is my take on why there is 156k instead of 96k. Well because of the interest that all that money gathered, I guess. Bc I think is bs that the explanation is unused contribution plus that withdrawals. Without taking into account the interest, 96k would always be 96k at the end of the day, with all the back and forth of the regaining the contribution ammount withdrawn the previous year.
Then the main source of magical saving of thousands is the sell of the house and the magical existence of these practical unused tfsa contributions. Without you selling your house AND without you having some leeway in the tfsa contributions, there is nada.
My2c
Tax free savings account. 2 words. High risk.😂
My rrsp in 2024 made 58 percent.
I don’t know the point of your video.
So SAID differently .. You cannot cannot cannot deposit into a TFSA over and beyond 95,000 from 2009 to 2024 that’s it. You can grow it from there of course but you cannot you cannot you cannot deposit into a TSA willy-nilly more than 95 up to 2024 most likely January 25 add 7500 as most likely the limit for next year .. ~ 102,500. PERIOD. OR MAYBE NOT and im confused 🥸
You can put in your contribution room up to 2024 if you haven't used it plus the new 7500 contribution which would be 95000 + 7500. If you do not take any out you would be limited to around 8000 for 2025. The limit would go up every year after about 500 dollars.