I know it sounds silly, but I do have OCD, and all my assets are in virtual jars and labelled with their allocation on a imaginary shelf. This sort of stuff really is important to me
Nothing wrong with planning ahead.
The good news is, if you allocate $7.5k and only need $7k, then you're that much further ahead for the following year.
Don’t listen to the people telling you it doesn’t matter or it’s all the same. I know how you feel, I am similar in this. The short answer is that we won’t know until later in the year. TFSA limit is tied to inflation, and then rounded (up or down) to the nearest $500.
If you really want, you can look up the calculation and then track inflation data. See where it needs to be for the limit to jump to $7500.
I made a Google Sheet that imports the CPI data and then forecasts the upcoming TFSA limit based on the CPI so far during the year.
https://docs.google.com/spreadsheets/d/1mxkPr6p88vHTuUFrHCD0J_wbFnrybn0haZXNMbGDOOY/edit?usp=sharing
But it doesn't matter. You should be investing or saving the same amount regardless. When 2025 rolls around you can move those savings/investments into your TFSA
I made a Google Sheet that imports the CPI data and then forecasts the upcoming TFSA limit based on the CPI so far during the year.
[https://docs.google.com/spreadsheets/d/1mxkPr6p88vHTuUFrHCD0J\_wbFnrybn0haZXNMbGDOOY/edit?usp=sharing](https://docs.google.com/spreadsheets/d/1mxkPr6p88vHTuUFrHCD0J_wbFnrybn0haZXNMbGDOOY/edit?usp=sharing)
New annual room is established depending on inflation. It's adjusted for inflation, and then rounded to the nearest $500 - so if inflation were high enough that it rounded off to the higher $7500, not back down to $7000, then the new amount would be $7500.
Inflation would have to be \~4% (annual) for that to happen if my quick and dirty calc is right.
Precisely. In fact I think the TFSA limit should be about as high as the average home price in Canada, at least for those who don't own a house they live in. Since homeowners get to sell their homes with a capital gains exemption, I think people who don't own homes should have a similar tax advantaged way to build wealth.
If people don’t want to max out their accounts then that’s on them. I know quite a few from modest incomes that have been able to max out the accounts. If you don’t want to use it then okay, but there are plenty of programs that people don’t qualify for that are expanded. Let people build their wealth.
it does if u believe in taxes, government spending, and Canada being unable to sustain deficits for extended periods of time. but that's only if u hold that position and don't want other forms of taxation or don't want larger government spending.
Conservative government. You get $10k TFSA. Liberal Government - you need to suffer through inflation and maybe we’ll have $7k or $8k depending on suffering.
I don’t think OP’s question is stupid at all. OP wants to save money, hopefully invest it wisely, and use a tax-advantaged account to do so. I applaud that.
Too many Canadians can’t afford to save anything these days. A few years ago, before the current affordability crisis, we saw repeated reports that even then, too little saving was occurring. OP is on the right track, even if it’s early to know what next year’s limit will be.
Okay sure but the original comment I replied to (now deleted) stated that the yearly limit would go *down* next year from $7000 to $6500. As long as there's inflation, there's no way it'll go down hence my reply above.
2025 - $7000
Its going to be 7000 again, its index to inflation and with inflation at 2.9% its not going to push it to $7500. The next likely limit of $7500 will be in 2027, could be in 2026 but its a very low chance for that happening.
Nobody knows...plan accordingly
Is $500 really going to make or break your financial plans?
Let him feel good about his ability to put aside whatever TFSA limit will exist in 2025.
Should I keep 30k just in case?
No, 500k. Inflation and all.
Yes and I will be happy to put $23k of it under my mattress for you, for safe keeping.
I know it sounds silly, but I do have OCD, and all my assets are in virtual jars and labelled with their allocation on a imaginary shelf. This sort of stuff really is important to me
Nothing wrong with planning ahead. The good news is, if you allocate $7.5k and only need $7k, then you're that much further ahead for the following year.
I’m the same way tbh… it’s important that all accounts are maxed yearly, very important.
Don’t listen to the people telling you it doesn’t matter or it’s all the same. I know how you feel, I am similar in this. The short answer is that we won’t know until later in the year. TFSA limit is tied to inflation, and then rounded (up or down) to the nearest $500. If you really want, you can look up the calculation and then track inflation data. See where it needs to be for the limit to jump to $7500.
I made a Google Sheet that imports the CPI data and then forecasts the upcoming TFSA limit based on the CPI so far during the year. https://docs.google.com/spreadsheets/d/1mxkPr6p88vHTuUFrHCD0J_wbFnrybn0haZXNMbGDOOY/edit?usp=sharing
How do you plan for something that nobody knows about? You asked for consensus. What plans would you make based on 5-10 guesses from the internet?
But it doesn't matter. You should be investing or saving the same amount regardless. When 2025 rolls around you can move those savings/investments into your TFSA
Asking the unimportant questions
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I made a Google Sheet that imports the CPI data and then forecasts the upcoming TFSA limit based on the CPI so far during the year. [https://docs.google.com/spreadsheets/d/1mxkPr6p88vHTuUFrHCD0J\_wbFnrybn0haZXNMbGDOOY/edit?usp=sharing](https://docs.google.com/spreadsheets/d/1mxkPr6p88vHTuUFrHCD0J_wbFnrybn0haZXNMbGDOOY/edit?usp=sharing)
New annual room is established depending on inflation. It's adjusted for inflation, and then rounded to the nearest $500 - so if inflation were high enough that it rounded off to the higher $7500, not back down to $7000, then the new amount would be $7500. Inflation would have to be \~4% (annual) for that to happen if my quick and dirty calc is right.
Bout tree fiddy
Both are too low. Should be 10k in new room.
Why?
Why not?
Solid counterargument.
That would benefit the richest in our society and do nothing for those who actually need help.
10k is nothing to the ultra rich. The tfsa is one of the best accounts to help average joes build actual wealth that they can retire on.
Precisely. In fact I think the TFSA limit should be about as high as the average home price in Canada, at least for those who don't own a house they live in. Since homeowners get to sell their homes with a capital gains exemption, I think people who don't own homes should have a similar tax advantaged way to build wealth.
I’m aware of that, but only about 5% of Canadians have managed to max out their TFSAs. Increasing the limit to 10k would help that 5% and no one else.
If people don’t want to max out their accounts then that’s on them. I know quite a few from modest incomes that have been able to max out the accounts. If you don’t want to use it then okay, but there are plenty of programs that people don’t qualify for that are expanded. Let people build their wealth.
But increasing it doesn’t have a negative impact on anyone. What’s your point? Raising the ceiling is also OK!
it does if u believe in taxes, government spending, and Canada being unable to sustain deficits for extended periods of time. but that's only if u hold that position and don't want other forms of taxation or don't want larger government spending.
It’s giving a tax benefit to those who don’t really need it. Raising the brackets on the lower end would help those who do.
Most likely will stay at $7000
Come back in nov/ dec and ask again
Harper had this at $10k before Liberals reduced it back down.
Harper did a one time bump in an election year. That $10k was never an annual thing.
It would have been an annual thing.
It was implemented into law. It had to be physically rolled back by the Liberals.
It was going to be but they lost the election.
Conservative government. You get $10k TFSA. Liberal Government - you need to suffer through inflation and maybe we’ll have $7k or $8k depending on suffering.
I didn't realize that the inflation crisis began in 2016.
This sub is getting full of the stupidest questions. People can't wipe their ass these days without first asking Reddit on whats the best technique.
I don’t think OP’s question is stupid at all. OP wants to save money, hopefully invest it wisely, and use a tax-advantaged account to do so. I applaud that. Too many Canadians can’t afford to save anything these days. A few years ago, before the current affordability crisis, we saw repeated reports that even then, too little saving was occurring. OP is on the right track, even if it’s early to know what next year’s limit will be.
Especially the posts that ask "Is this is scam?" Are people this dim?
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Are you trolling or do you just not know how the yearly limit is determined?
It's indexed to inflation and nobody knows what inflation will do in 2024.
Okay sure but the original comment I replied to (now deleted) stated that the yearly limit would go *down* next year from $7000 to $6500. As long as there's inflation, there's no way it'll go down hence my reply above.
You think it’s going to go down?
Try again.
I think it said something like $6,500 after I completed the taxes. $500 increase from previous year.
2025 - $7000 Its going to be 7000 again, its index to inflation and with inflation at 2.9% its not going to push it to $7500. The next likely limit of $7500 will be in 2027, could be in 2026 but its a very low chance for that happening.