Quote:
Originally Posted by MarchHare
I think this is a mischaracterization of the Liberal position re: TFSAs. They're not cancelling the program or saying that only rich people use it. They're proposing rolling back the maximum annual contribution limit from $10k to the previous $5.5k amount. It's a fair assessment that typically only the wealthy can afford to take advantage of the $10k cap. That amount is certainly beyond the means of all low-income Canadians and most middle-income earners as well.
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I'm well aware of what they are proposing and I don't think that is a fair assessment at all for a number of reasons:
- Around 60% people who have maxed our their TFSAs at the current limited make under $60,000.
- The Liberals define the middle class as those earning between $44,700 and $89,401. Individuals earning near the upper reaches of this bracket can surely take advantage of the increased contribution limit (I myself am somewhere in the middle, so while I doubt I'll be able to max out under the new limit, I can certainly take advantage of the increased room now and the unused contribution space in the future)
- My main issue is that the reduction is a disincentive towards investment and savings. The government should be encouraging citizens to make disciplined financial decisions and this is a negative signal. It basically says to your average Joe that "investing is for rich people and you shouldn't worry about it". I've heard a number of middle class people say things like "I'm not rich enough to even have a TFSA," and that's a very unfortunate sentiment.