The New TFSA Contribution Limit for 2022 Is Here – And It’s Higher Than Ever!

If you're like most people, you probably don't think about your taxes until it's time to file your return. But if you want to get the most out of your tax-free savings account (TFSA), it's important to plan ahead. The TFSA contribution limit is set by the Canadian government and is subject to change from year to year. For 2022, the new TFSA contribution limit is $6,000. Here's what you need to know about this important change.

Get the Latest News and Offers straight to your inbox

Many of the products/services listed on this page are from our affiliate partners. We receive commissions if you purchase any of those items, but it does not influence how we review them or what ratings starS (or lack thereof) appear next to each product category in reviews like these ones! Learn more by reading Advertiser Disclosure prior to making your decision.

The Tax-Free Savings Account (TFSA) is a great way to save money for short- and long-term goals. And the best part is, any money you make in a TFSA is tax-free! The TFSA contribution limit is the maximum amount of money you can contribute to your TFSA in a given year. For 2022, the TFSA contribution limit has been increased to $6,000. This is up from $5,500 in 2021 and $5,000 in 2020.

What Is the TFSA Contribution Limit?

The Tax-Free Savings Account (TFSA) is one of the best ways to save money for both short- and long-term goals. The money you earn in a TFSA is not taxed, so you get to keep more of your hard-earned cash!

The TFSA contribution limit is the maximum amount of money you can contribute to your TFSA in any given year. The current contribution limit for 2021 is $6,000. This means that you can contribute up to $6,000 to your TFSA this year without incurring any taxes on your earnings.

If you haven’t contributed to a TFSA before, now is a great start! This article will give you an overview of the TFSA contribution limit for 2022 and how you can make the most of it.

How Can I Maximize My Contributions?

If you’re looking to maximize your contributions, there are a few things you can do:
1. Make sure you have enough TFSAs: You can have multiple TFSAs, so if you haven’t maxed out your contributions for this year yet, consider opening another account.
2. Invest early and often: The sooner you start investing in a TFSA, the longer your money has to grow tax-free. Try to contribute at least annually, if not more often if possible.
3. Consider using a savings account: If you need easy access to your money or want to avoid investment risk, consider using a savings account instead of investing in stocks or mutual funds.
4. Compare products: Not all TFSAs are created equal – make sure you compare features and fees before opening an account.

TFSA Contribution Calculator 

 

Why save money in TFSA?

The TFSA is a great way to save for your future, and the new TFSA contribution limit for 2022 means you can save even more. The TFSA is a registered account that allows you to earn tax-free investment income. This includes capital gains, dividends, and interest. You can hold various investments in a TFSA, including cash, stocks, bonds, mutual funds, and exchange-traded funds (ETFs).

The main advantage of a TFSA over other investment accounts is that you don’t have to pay taxes on your investment income. That means more money in your pocket when you need it. And since the contribution limit for 2022 has been increased to $6,000, you can take advantage of this great tax shelter now more than ever.

If you’re not already maxing out your TFSA contributions, now is the time to start. You can open a TFSA at most banks and credit unions in Canada. Bring your ID and proof of residence with you when you open an account. And if you’re unsure how much you can afford to contribute each year, talk to a financial advisor. They can help you come up with a plan that meets your needs.

Now that you know the new TFSA contribution limit for 2022, it’s time to start planning how you’re going to make the most of it! With some careful planning and strategic saving, you could be well on your way to reaching your financial goals sooner than you think.

Conclusion:

The new TFSA contribution limit for 2022 is 6,000. That’s up from $6,000 in 2021 and $5,500 in 2020. The TFSA is a great way to save for your future because it allows you to earn tax-free investment income. If you’re not already maxing out your contributions, now is the time to start. Talk to a financial advisor if you’re not sure how much you can afford to contribute each year. They can help you come up with a plan that meets your needs.

Vik Palan

Vik Palan

Chief Editor - Findbetter.ca

FindBetter.ca
Logo