Understanding your TFSA

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2021 TFSA Room: $6000

by Amber investment staff

Tax-Free Savings Accounts (TFSAs) are a great way to save and invest. 14 million Canadians have a TFSA, with a combined total value of more than $276 billion.1 In this article, we will explore some facts to help you get the most out of your TFSA.


As the name suggests, TFSAs are tax-free, meaning that you won’t pay tax when your investments increase in value, nor will you pay tax when you withdraw. The funds you contribute are after tax dollars.

The contribution limit for 2021 — as determined by the federal government — is $6,000. Unused contribution room gets carried forward each year. The program started in 2009, and contribution room accumulates from when you are 18 and a tax resident of Canada. This means that if you fit these criteria since 2009, and have never had a TFSA before, your accumulated contribution room would be $75,500. If you have an existing TFSA, and withdraw from it, you will regain that contribution room the following calendar year. The best way to check your room is to create an account directly with CRA.

Unlike an RRSP, you can invest in a TFSA at any age over 18, regardless of whether you earned income in the previous year. For investing, this allows funds to continue to compound into your senior years.

A common misconception is that TFSAs can only hold savings. They are actually flexible and can hold a range of investments, including cash, mutual funds, ETFs, stocks, bonds, GICs, and our category of investment, MICs. Speak to our team to find out why our fixed income solution may be a right fit for your TFSA. It has generated 8% annually since inception, paid out through quarterly dividends. These can also be reinvested, which would have thereby generated 8.24% annually.*

*Past performance does not guarantee future performance.


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