# How do you invest your TFSA ?



## sags (May 15, 2010)

I have read different strategies for investing TFSA money. There seems to be 3 distinct methods.

1) Use the TFSA to invest in stock market "flyers". Take a chance on hitting a home run. If you lose on one.........try again. (some people are doing it)

2) Use the TFSA to invest in GICs or HISA. Almost no tax free growth, but capital preservation is guaranteed, (most people are doing it)

3) Use the TFSA to create a balanced and diversified portfolio of blue chip stocks, bonds, GICs.........etc. (some people are doing it)

According to the statistics, the vast majority of people fit into category 2...................what is your number ?

Edit........hopefully responses will provide some insight and options for those who are asking the question.........."what should I do with my TFSA".


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## newfoundlander61 (Feb 6, 2011)

#3 For me, I hold only one investment the Mawer Balanced Fund and buy units with an auto purchase plan weekly.


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## My Own Advisor (Sep 24, 2012)

#3. It's a Tax Free Retirement Account (TFRA) for me!
http://www.myownadvisor.ca/name-changes-needed-canadian-financial-accounts/


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## mind_business (Sep 24, 2011)

#3.


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## 1980z28 (Mar 4, 2010)

all equities large cap

I am the odd one out,I look at it as just in case money,easy to trade out off


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## Ag Driver (Dec 13, 2012)

#3

I keep my tater and stocks in there. Once it reaches capacity, my RRSP will be used there after.


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## Woz (Sep 5, 2013)

#3

I use it to shelter part of a balanced portfolio. On it's own though my TFSA isn't balanced.


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## rikk (May 28, 2012)

sags said:


> 1) Use the TFSA to invest in stock market "flyers". Take a chance on hitting a home run. If you lose on one.........try again. (some people are doing it) 2) Use the TFSA to invest in GICs or HISA. Almost no tax free growth, but capital preservation is guaranteed, (most people are doing it)


I'm currently using the Peoples TFSA savings account to help reduce taxable interest income ... #2. I may reopen the QTrade TFSA for a #1 :hopelessness:, but not likely. Retired 3 years with more than enough savings and pensions income, trading was fun, but that was then.


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## Toronto.gal (Jan 8, 2010)

sags said:


> .................*what is your number?*......hopefully responses will provide some insight and options for those who are asking the question.........*."what should I do with my TFSA"*.


With the below comment in mind, and your 2 TFSA threads today, you appear to be conducting polls with your closed-ended questions, so not sure how these threads would help the undecided? 



sags said:


> ...The TFSA limit raise is mostly to the benefit of wealthy people...........and people know it.


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## Rebecca (Aug 10, 2014)

Woz said:


> #3
> 
> I use it to shelter part of a balanced portfolio. On it's own though my TFSA isn't balanced.


+1


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## sags (May 15, 2010)

Toronto.gal said:


> With the below comment in mind, and your 2 TFSA threads today, you appear to be conducting polls with your closed-ended questions, so not sure how these threads would help the undecided?


The issue of if the TFSA is a good long term strategy by the government is different than if people should take advantage of what is currently offered.

Of course people should take advantage of it............there is little downside except for their investment choices.

It isn't a stretch to say that wealthy people will be able to take "more" advantage of it than most others. 

Would not having the money to fund numerous family TFSA accounts be an advantage ?

What the undecided may be influenced by..........is that the majority of CMFers appear to prefer choice number 3.


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## pwm (Jan 19, 2012)

#3 with all div paying equity. (No bonds or GICs).


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## GreatLaker (Mar 23, 2014)

pwm said:


> #3 with all div paying equity. (No bonds or GICs).


Same here.
One part of a balanced portfolio across all my accounts.


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## heyjude (May 16, 2009)

2 and 4, 4 being index funds. 

In 2009 and 2010, half decent returns were available on GICs so that's what I put in my TFSA. As these GICs have matured, I have withdrawn them and used them to pay down mortgages at ~4%, which I would class as a secure fixed income investment. I can't possibly get 4% with new money! My more recent TFSA investments have gone into index funds. I see the TFSA as being a multipurpose account; a good place to hold savings for future purchases, such as my next car, as well as for long term investment. I am trying to use it strategically.


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## Eclectic12 (Oct 20, 2010)

Priority #1 ... cover off emergency fund in TFSA HISA.

Priority #2 ... built a dividend/cash distribution set of investments (some bought, some transferred from a taxable account when there was a nominal CG tax to pay) to keep money for re-investing into bargains.


When both those were taken care of to my satisfaction, I've been playing with a small percentage of higher risk stuff.


Cheers


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## Toronto.gal (Jan 8, 2010)

sags said:


> Would not *having the money to fund numerous family TFSA accounts be an advantage?*


You must be thinking about the investment banker with 5 kids. :biggrin:



sags said:


> A guy who works in a factory, and is supporting a wife and 5 kids...........isn't going to have money left over to max out a TFSA..........even for himself. *A guy who works as an investment banker, and is supporting a wife and 5 kids..................has lots of money to buy TFSAs for everyone in the family that is eligible.* Hence............the TFSA is inherently advantageous to the wealthy.


However, you don't think so much about the taxes paid by the higher-income earners, just the amount that they are able to save after tax-income. 

But never mind, this is a poll, which I don't find all that helpful because there are many variables involved, e.g., age, investment knowledge, goals, & so on. 

You're right that most people are doing #2, which is not a safe strategy for all. Depending on the case, in order to take advantage of the growth potential, spreading out the risk is safer than taking no risk.


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## gibor365 (Apr 1, 2011)

Bigger part in Canadian stocks include 1 ETF (ZRE) , smaller part in PT HISA at 2.5%


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## IFITSTOBEITSUP2ME (Mar 6, 2015)

1 mainly sometimes since inception has been 3. Cherry pick stocks at certain times and price patterns to swing trade for the most part. Once hits over 6 figures will switch to Bogle style.


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## nathan79 (Feb 21, 2011)

3. Tangerine balanced growth fund + small GIC @ 3.25%. When the GIC matures later this year I'll probably put everything the Tangerine fund.


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## CalgaryPotato (Mar 7, 2015)

For me it's #3, but I haven't fully utilized the advantages of it for option #2 (I have unused contribution room). I probably should have taken more advantage of it for short terms savings up until this point.

I see a lot of people with really negative comments towards the fact most people have their TFSA "invested" in cash equivalents. However that's missing the point that many of those same people are utilizing their RRSP for the investment portion of their portfolio and are simply using the TFSA to shield their savings.


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## rikk (May 28, 2012)

^ Yep, I'm HISA in the TFSA and have in recent months picked up a few oily equities in the RRSP ...


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## scorpion_ca (Nov 3, 2014)

#3 - zre (55%) & zag (45%)


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## wendi1 (Oct 2, 2013)

LOL. My TFSA is completely unbalanced, consisting entirely of a Cdn REIT ETF.

The whole portfolio is balanced, though.


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## PrairieGal (Apr 2, 2011)

I have $12,000 in a People's Trust HISA as my emergency fund, the rest of my TFSA is in the Tangerine Balanced Fund. Going forward it will either be more in Tangerine, or branch out into ETF's.


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## Cal (Jun 17, 2009)

#3. Just part of a larger portfolio imo.


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## CPA Candidate (Dec 15, 2013)

TFSA is nearly all equity. Entire portfolio is 90% equity.


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## Gimme the Green (Feb 4, 2014)

100% Canadian dividend payers. Never plan to sell, collect divs in retirement.


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## avrex (Nov 14, 2010)

For me the answer is* 1.*


sags said:


> 1) Use the TFSA to invest in stock market "flyers". Take a chance on hitting a home run. If you lose on one.........try again. (some people are doing it)


As, I mentioned in my other post, 


avrex said:


> The TFSAs use is very *dependent on your age.*
> Older people like me, will use their *RRSP* as their *main source* of retirement income, and the TFSA will be a *secondary source* of retirement income.


Based on my age, I know that my RRSP will be much larger than my TFSA, when I reach retirement / financial independence.

Therefore, *my strategy is to take on more risk with my TFSA*. 
For example, I'm trying to hit home runs with *equity options* (calls, puts).

If I'm successful, I'll hit financial independence sooner. If I'm not successful, financial independence will just be a little later.


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