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Save Money For a Wedding Using a TFSA

Save Money For a Wedding Using a TFSA
Saroj Aggarwal is an accomplished content writer working in a range of niches for the past 7 years. She has a keen interest in environmental and conservation issues. With a Bachelor's degree in Commerce, Saroj is currently working to assist people with their investment and financial queries.

Can you save money for your wedding using a TFSA?

The modern practice of long engagements could be a blessing because it gives couples more time to save money for a wedding using a TFSA, or a tax-free savings account.

Costs of modern weddings

With the rise in popularity of destination weddings and other expensive options, costs have been rising steeply since the early 2000s. Weddings cost around $15,000 for a catered, but otherwise simple, event. This can stretch to $50,000 and more for couples determined to arrive in a stretch limo. Also, families often pressure couples into inviting a large number of people. Keep in mind that we haven’t even factored in the cost of the honeymoon. Parents are increasingly objecting to such prices, so couples are choosing to stand the cost themselves.

How to afford a wedding

Millennials are a practical generation. As divorce statistics remain high, younger couples are devoting more time getting to know each other before committing to marriage. With longer engagements, couples have more time to save up for the wedding using a tax-free savings account (TFSA). At present, the maximum you can contribute to a TFSA is $5,500 per annum. It’s a solid way to save since you don’t pay any taxes on investment returns or interest income. If the bride and groom can put the annual maximum in a TFSA, within three years they will have enough for the ceremony, venue, catering, and DJ, plus the honeymoon. They will even have enough left over to purchase a couple of household appliances. And these are just part of the benefits of TFSAs.

Advantages of tax-free savings accounts

TFSAs are a far better choice for a short-term savings effort than any other tax-sheltered vehicle. Gains or interest from regular savings accounts and other non-registered investment funds are taxed when you withdraw funds. TFSAs, on the other hand, do not incur these taxes. Once your TFSA holds only liquid investments, withdrawing from it is as easy as taking funds out of a conventional bank account.

16 Results Updated: June 24, 2019

0.75%

Interest Rate

Daily

Interest Compounding

No Minimum

Minimum Balance

Institution:  BMO – Bank of Montreal
Institution Type: National Bank
Account Suited For: -

1.00%

Interest Rate

Daily

Interest Compounding

No Minimum

Minimum Balance

Institution: 
Institution Type:
Account Suited For: -

1.05%

Interest Rate

Daily

Interest Compounding

No Minimum

Minimum Balance

Institution:  Scotiabank
Institution Type: National Bank
Account Suited For: -

1.15%

Interest Rate

Daily

Interest Compounding

No Minimum

Minimum Balance

Institution:  HSBC
Institution Type: National Bank
Account Suited For: Everyone,Seniors,Children,TFSA,RRSP

1.15%

Interest Rate

Daily

Interest Compounding

Minimum Balance

Institution:  Scotiabank
Institution Type: National Bank
Account Suited For: -

1.20%

Interest Rate

Daily

Interest Compounding

No Minimum

Minimum Balance

Institution: 
Institution Type:
Account Suited For: Everyone,TFSA,RRSP

1.20%

Interest Rate

Daily

Interest Compounding

No Minimum

Minimum Balance

Institution:  Tangerine
Institution Type: Online Bank
Account Suited For: Everyone,Seniors,Children,TFSA,RRSP

1.50%

Interest Rate

Monthly

Interest Compounding

Minimum Balance

Institution:  Meridian Credit Union
Institution Type: Credit Union
Account Suited For: -

1.60%

Interest Rate

Daily

Interest Compounding

No Minimum

Minimum Balance

Institution:  Duca Credit Union
Institution Type: Credit Union
Account Suited For: Everyone,Seniors,TFSA,RRSP

1.75%

Interest Rate

Daily

Interest Compounding

No Minimum

Minimum Balance

Institution:  Luminus Financial
Institution Type: Credit Union
Account Suited For: Everyone,Seniors,TFSA,RRSP

Misconceptions about TFSAs

Many people have misconceptions about TFSAs. Introduced in 2009, TFSAs were presented by financial planners as investment vehicles. However, TFSAs were created to increase savings options for all Canadians. Consumers also perceived TFSAs as vehicles for individuals with higher net worth. In reality, TFSAs are for everybody and are a straightforward way to pay for that big day.  

Compare All TFSAs in Canada
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