TFSA Treasure Chest
The Tax Free Savings Account or TFSA was a great addition to Canadians retirement savings portfolios for 2009, but many people remain unclear about how they should use the account. There are many different ways to employ your TFSA so that it too works for you; you are trying to reach financial independence aren’t you?
In the account, you are allowed to hold most asset classes including common shares and bonds. Many investment professionals have varying opinions about the types of assets to hold in accounts, but the general consensus from an unbiased investment advisor would place your money in investment vehicles that are very different to what most people have done.
Many were sold by their banks on investing their $5000 annual contribution into high interest savings accounts. This makes sense…if you are a bank. Since the banks love to have cash on their books to lend out–of course they are going to recommend you to one of their many low return options for their own benefit. Do you know anyone that bought term deposits in their TFSA or simply left the funds in a high interest savings account? From my point of view this is not putting your Tax Free Savings Account to work for you.
The reason this page has been created was simply to publicly disclose exactly what my TFSA holdings are. This page will be updated to show my account holdings throughout the year.
2009 TFSA Holdings
- 200 shares x Westshore Terminals Income Fund (TSE:WTE.UN)
- 100 shares x A&W Revenue Royalties Income Fund (TSE:AW.UN)
- 1000 shares x The Brick Group Income Fund (TSE:BRK.UN)
- $515 Cash and counting (Accumulates every month from dividend distributions
- December 07, 2009 – Added 400 shares of BRK.UN at $1.24/share. This takes my holding from 600 shares to 1000.
good for you on the income trust idea.
Our 3rd child just turned 18, and we have ‘borrowed’ their TFSA until they have enuff to start contibuting. [College students]
I am the beneficiary if necessary.
With my wife and myself, we will have $25K inside before year end.
I decided to put one trust into each account.
IPL.un
Pif.un
JE.un
fce.un
cpg
Will update to let you know how it goes.
slick
Thanks.
I really do believe income trusts are a great addition to a TFSA, especially when the new tax burdens come into play in 2010.
I like Parklands … PKI.UN
Just finished expanding into Atlantic Canada. With the additional earns of it’s recent acquisition, the distributions will almost equal it’s earnings.
Otherwise it concerns me when the earns of the Income Trusts is less than their distributions.
I am curious to know why you decided to put BRK.UN into your TFSA. In your previous post, you were wary of putting BRK into your TFSA, it doesn’t pay any dividends currently. Are you Long on BRK? (You added more shares to a total of 1000).
Have you had any info on what will happen to A&W units at the start of 2011 when the new legislation regarding the change in taxation comes in on Income Trusts ? I hold these units in my Trading Account as they are more efficient for tax purposes and use my TFSA for my GIC and other interest investment which is taxed at 100%. Two other trust that have held their price well and pay a decent dividend, you may want to look at are Firm Capital ( FC.un) and Fort Chicago Energy (FCE.un)
What’s your total difference in taxable amounts with both investments being held in a taxable account? I would imagine that the amount you would pay in tax on the income trust is greater than the amount your are paying on GICs simply from the higher income from the trust. The income trust may be more efficient from a tax perspective versus a GIC at this point in time; however, you are still paying tax on all distributions and likely of a much higher amount compared to your GICs.