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The losing party of Liberals' decrease on TFSA contribution

on Tue, 12/08/2015 - 20:41

So, finally, the day came... the Liberals announced the rollback of Tax Free Savings Account's contribution room to $5,500 (from $10,000) in 2016, such a sad thing.

As stated in the Globe & Mail report dated Monday Dec 7th, Darren Coleman, senior vice-president and portfolio manager with Raymond James Ltd, "It’s unfortunate when we are given a tool to provide better investment planning and now it’s being taken back from people who want to work towards having their own financial independence"... I totally agree with him.

I really don't know since when people have this misconception of "TFSAs are only for wealthy people". In fact, the main group getting affected by the roll back, is the senior citizens.

We should all know by now, there are only 3 vehicles in Canada are structured legally and legitimately for tax-favoured savings for seniors: RRSP, TFSA and life insurance policies (for families have kids, there is RESPs too, not for seniors obsoviously - for those who would like to know RRSP, TFSA or RESP makes more sense to them, please read this post). We all know, seniors can only make RRSP contribution till age 71. Anyone over 71, the best vehicle for them to save is TFSA!

Now that the TFSA contribution room had rolled back, our seniors have more limits on one great vehicle we enjoyed since 2009.

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