Quote:
Originally Posted by GGG
This is only the case if the individual currently invests less than 5k per year into Canadian stocks
In fact if you wanted to do it better you’d do it on the RRSP side as that would means the governments portion is also invested in Canadian companies. You could also do it as a restriction on existing TFSA investments rather than an increase. There is really only a small edge case where this extra 5k would change investment make up.
It also encourages more active management which is a disaster for most people. Buying an all in ETF like your Vgro or Veqt is a very good solution for the self directed investor. This program creates incentive to split that into multiple funds and add complexity to the system.
Either an extra 10 k per year of TFSA room per couple it will make it very easy for people to collect GIS from 65 to 70 by delaying CPP shifting funds to Capital gains only products, and living off the TFSA.
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Issue with increasing RRSP side is people who are self employed and pay themselves in dividends , etc who don’t generate any space aren’t affected - and a lot of these people are the ones you want contributing as they actually have more potential for having excess taxed savings currently as they can’t use RRSPs