Paul Martin's Business Update - January 3rd

Paul Martin's Business Update - January 3rd

The start of a new year is synonymous with resolutions centred on financial goals. And one of the most important vehicles available to the average person to make that happen is the TFSA or Tax-Free Savings Account.

It is a relatively new tool that was developed by the senior levels of government to encourage saving in an era when there is concern that too few people are adequately planning for their retirement.

And, it turns, out more of us are catching on to this particular idea.

A survey by BMO Bank of Montreal shows a remarkable increase in the number of folks who now have a TFSA. Nearly half of us have one…that’s 23 per cent higher than in 2012. The average contribution is $3600 and it is especially popular in the West. Alberta has the highest adoption rate at 55 per cent while we’re right behind at 53. Uptake is particularly slow in Atlantic Canada where only a third have embraced the tool.

The most common holding in these accounts? Cash tops the list across the country followed by mutual funds.

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