Double Down on your TFSA

January 25, 2023

The TFSA is a great short-term savings vehicle intended for the next big-ticket purchase or rainyday fund. However, we have found that many affluent clients make the maximum deposit each year and never make any withdrawals.

The Tax-Free Savings Account effectively becomes a Tax-Free Estate Account.

We can show you how to create a second Tax-Free Estate Account without the low annual maximum contribution limit that the TFSA has.

For example, two spouses, age 65, create a Tax-Free Estate Account and deposit $12,000 annually.

Let’s see how it stacks up to a 5% return in a traditional TFSA:

The Estate Account outperforms the 5% tax free investment to age 90; a guaranteed immediate tax-free benefit is created, payable on the last death of the two of them and allows the opportunity to diversify the portfolio further.

If you want to create more tax-free savings, contact your Echelon advisor today and see if this strategy is right for you.

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