SPONSORED | Most financial institutions allow you to make an initial lump sum payment into a TFSA, then you can contribute monthly, annually or not at all. sygnia
It’s a great idea for parents to open a TFSA for their child as it’s possibly the best savings vehicle for their future education.
Warning: just because you can withdraw from your TFSA doesn’t mean you should. Dipping into your TFSA too often can derail your investment outcomes, because every withdrawal counts against the one-off R500,000 tax-free lifetime limit. You can open as many TFSAs as you like with as many different service providers as you like. The only restriction is that the total of your annual contributions across all your TFSAs must not exceed the yearly tax-free savings limit of R36,000.
You can withdraw from a TFSA whenever you like, whereas you are not allowed to withdraw from an RA until you are 55. This is set to change when the government's new two-pot retirement system comes into effect on March 1 2024.The new system will see contributions to RAs split into a retirement pot, which cannot be touched until retirement age, and a smaller savings pot, which you will be able to make a withdrawal from once every 12 months.
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