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Wealth Professional | 19 Jun 2015, 09:11 AM Agree 0
While a new study suggests that Canadians don’t understand TFSAs and desperately need education from advisors, the truth is they really can’t afford them.
  • Brad jardine | 19 Jun 2015, 10:00 AM Agree 0
    I think the least we can do here is get the acronym correct in the headline... meanwhile how many TFSA accounts are simply that... an account earning 1-1.5% tax free interest. I'll wager over 90% of them . What a colossal waste of time. Program should be named TFSP as in "Plan" maybe then the DIY people and the banks will use the program properly...
  • Ken MacCoy, CHS | 19 Jun 2015, 10:19 AM Agree 0
    The only thing worse than no TFSA is one where the money is parked in a 'savings account' at a bank ... because no one has taken the time to actively invest or manage the money as a part of an overall financial plan.
  • Robert Roby | 19 Jun 2015, 10:36 AM Agree 0
    One point you may want to consider is that the more savings Canadians make the less they are dependent on government programs. Thus, those who have the ability to save more will certainly see more clawback etc leaving systems in place to pay those who have less.
  • Brad jardine | 19 Jun 2015, 12:03 PM Agree 0
    Ken, Shhhh there! We wouldn't want the full and necessary transparency to certain customers in certain institutions learning their friendly in-house advisor has incentives to set up a TFSA vs paying down their credit card, LOC, student loan, mortgage, utilizing an RSP, etc...
  • Sarah Holland | 19 Jun 2015, 12:45 PM Agree 0
    I want them re-named - let's call them the TFIA, tax-free investment account, so that people don't think they're only savings accounts. Who named them, anyway, the banks?
  • Robert Roby | 19 Jun 2015, 09:52 PM Agree 0
    Call it a tax free investment account.
  • Ravi Syal | 23 Jun 2015, 05:56 PM Agree 0
    We should call them TFIA .
  • Niki | 24 Jun 2015, 12:38 PM Agree 0
    With all the emphasis on commissions, (there is ignorance in general and bliss specifically) within the banking institutions, who willfully advise their customers to go as far into debt as they can, while paying them less than peanuts in their TFSAs -- where they loan out that cash and earn more on it than the customer. (Note: they call them customers, and not clients.) So earning money at both ends (debt and lazy cash) serves best the purpose of the corporation. In the US, there is a movement being motivated by the Obama administration to hold the industry accountable for the differences in returns between investors who save for retirement. Me thinks the industry will again explode on brokers, insurance agents and MFDA reps, while leaving the TFSA lie (as oppossed to high) interest savings be. I suggest a name change--call it the new and improved TFSA--the TFIA, where your money really does have a chance to grow.
  • Robert Roby | 24 Jun 2015, 04:35 PM Agree 0
    Niki..your comments are spot on. You can imagine however how many advisors will be potentially sued when the market suffers a correction. Either way you can't win except by educating each of your clients. we have made tremendous returns over the years by owning bank stocks. I have always said own the banks don't invest with them. This brings me to the next point. Those Canadians opening up tfsa"s with banks are, as you have stated are placed into low interest accounts. Meanwhile their dividend on their stock is 4% plus per year more than twice the interest rate all tax free plus tax free capital gains. this is not profitable for banks to advise. Pay the client 1.5% and then utilize these funds to lend to others at 6-8 percent for car loans etc. Now who is winning this shell game?
  • Ken MacCoy, CHS | 24 Jun 2015, 05:47 PM Agree 0
    TFIA - Great idea Sarah, my old but younger friend.

    Niki has simply explained another reason why nobody makes more money than the banks.

    ...and why is that?

    Because they prey on those who don't have the financial savvy (especially the young & the elderly) to use credit, go in debt and then pay high interest rates and service fees.

    Meanwhile, the banks push their customers to contribute to low interest savings or TFSA accounts ... as opposed to recommending they pay off the debt.

    If the regulators really wanted to help the Canadian consumer ...they would be taking the banks to task about giving bad &/or no advice to their customers.

    However, realistically ... there is a distinct difference between what the banks do and what advisors do.

    The bank has a 'customer' who is a recipient of a good, service, product, or idea from a seller, vendor, or supplier. - really no different from selling a widget in a retail store.

    Whereas, advisors have a 'client' who (they care about and) is a recipient of professional advice or services.
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