Tax relief with no deadline fever

Despite this year's lower limit, TFSAs remain an attractive complement to RRSPs.

Matthew Elder 25 January, 2016 | 6:00PM

Note: This article is part of Morningstar's January 2016 Five keys to retirement investing special report.

It's RRSP season and we are exposed as always to a barrage of save-for-retirement rhetoric. Everyone from your financial advisor to your neighbour is either lecturing you or seeking RRSP advice from you. The reason for all this fuss is the looming Feb. 29 deadline for making a contribution to a registered retirement savings plan for 2015. Miss the deadline and you lose a lucrative deduction on your 2015 income-tax return.

But there's another tax-advantaged means of saving for future needs that isn't subject to deadline fever: the tax-free savings account. Because TFSA contributions aren't subject to the same deadline -- they aren't tax-deductible -- it matters not when you put your money in.

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Matthew Elder

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