simplifying and democratizing savings & investments

A TFSA (Tax-Free Savings Account) is a savings and investing account that helps your money grow without paying tax. After RRSPs, this is the most common type over savings account that I work with. 

Here's some key advantages:

• You put after-tax money into a TFSA (money from your paycheque, for example).
• Any growth (interest, dividends, investment gains) is completely tax-free.
• When you take money out, you don’t pay tax on it.
• You can use it for saving or investing
• The government gives you a yearly limit on how much you can add 
• If you take money out, that amount is added back to your contribution room the next year.
• You can withdraw money anytime for any reason—no penalties

An RRSP (Registered Retirement Savings Plan) is an account designed to help you save for retirement while lowering your taxes today.

Here's some key advantages:

• You put pre-tax money into an RRSP (or get tax back after you contribute).
• Your contribution reduces your taxable income, so you pay less tax now.
• Your money grows tax-deferred while it stays in the RRSP.
• You pay tax when you take the money out, usually in retirement.
• RRSPs are best when you expect to be in a lower tax bracket later (most commonly, in retirement)

An FHSA (First Home Savings Account) is a savings account made to help first-time home buyers save for a down payment — with extra tax advantages:

• You put pre-tax money into an FHSA (like an RRSP).
• Your contribution reduces your taxable income (you get a tax refund).
• Your money grows tax-free (like a TFSA).
• When you use it to buy your first home, you can take the money out tax-free.

So it combines the best parts of an RRSP and a TFSA.

A LIRA (Locked-In Retirement Account) is a retirement account that holds pension money you can’t freely access yet.

A LIRA is usually used when you leave a job with a pension. For clients who are leaving their employer or who want to have more control over what the money is invested in, they can often transfer their pension into a LIRA.

Important things to remember with the LIRA:

• The money stays locked in for retirement.
• It grows tax-deferred, just like an RRSP.
• You generally can’t take money out early.

Key things to know:

• You don’t contribute new money to a LIRA — it’s only for transferred pension funds.
• The money must eventually be converted to a LIF (Life Income Fund) or similar account to start retirement income.

An RRIF (Registered Retirement Income Fund) is what your RRSP turns into when it’s time to start paying you income.

You move your RRSP into an RRIF when you’re ready to start retirement income. The money stays invested and keeps growing tax-deferred, but must take out a minimum amount every year. Whatever you withdraw is taxed as income.

You must convert your RRSP to an RRIF by December 31 of the year you turn 71 (or earlier if you choose).

A non-registered savings or investment account is just a regular account with no special tax shelter from the government. I often open a non-registered account for clients who have contributed the lifetime maximum to their TFSA (in 2025, this lifetime maximum was $102,000).

Essentially, you put in after-tax money (money you’ve already paid tax on). There are no contribution limits. You can take money out anytime, for any reason.

You pay tax on the growth each year.

How it’s taxed:

• Interest → fully taxable
• Dividends → taxable (often at a lower rate if Canadian)
• Capital gains → taxed only on half of the gain