TFSA
Business & Finance abbreviation · Personal Finance
| Stands for | Tax-Free Savings Account |
|---|---|
| Categories | Business & Finance |
TFSA stands for Tax-Free Savings Account, a personal finance abbreviation.
Canadian account in which investment income and withdrawals are tax-free, although contributions are not deductible. Every resident adult accumulates contribution room each year, unused room carries forward, and amounts withdrawn are added back to available room the following January.
Example: I max my TFSA first because I might need the money before retirement.
Usage notes
Introduced in 2009. Despite the name, a TFSA can hold stocks, ETFs and bonds, not just cash savings. Over-contributing triggers a penalty tax of 1% per month on the excess. Its closest counterparts are the US Roth IRA and the UK ISA.
Related abbreviations
More personal finance abbreviations
- 401(a) – Qualified retirement plan (Internal Revenue Code section 401(a))
- 401(k) – Employer-sponsored retirement savings plan (Internal Revenue Code…
- 403(b) – Tax-sheltered annuity plan (Internal Revenue Code section 403(b))
- 457(b) – Deferred compensation plan (Internal Revenue Code section 457(b))
- 529 – Qualified tuition program (Internal Revenue Code section 529)
- ABLE – Achieving a Better Life Experience account
- AER – Annual equivalent rate
- APR – Annual percentage rate
- APRC – Annual percentage rate of charge
- APY – Annual percentage yield
- AU – Authorized user
- BT – Balance transfer