TFSA Limit for 2019 Rises to $6,000
Just as expected, the TFSA contribution limit for 2019 is $6,000, up from $5,5000 in 2018. In addition to the TFSA contribution limit rising to $6,0000 for 2019, the cumulative TFSA contribution limit will be $63,500 for Canadians who has never contributed to a TFSA and who was 18 years old or order in 2009.
Under changes announced by the Canadian government in a Department of Finance news release on December 7, 2015, 2016, and each subsequent year, the annual TFSA limit is fixed at 5,000, indexed to inflation for each year after 2009, and rounded to the nearest $500, using the consumer price index provided by Statistics Canada.The TFSA contribution limit for 2013, 2014, 2016, 2017, 2018 was $5,500. The limit for 2015 was $10,000 and the limit for 2009, 2010, 2011, 2012 was $5,000.
If you have withdraw from TFSAs, your crystalized gains and losses from withdrawals are factored in to your TFSA room. Here’s the formula:
Unused TFSA contribution room to date + Total withdrawal made in this year + next year’s TFSA dollar limit = TFSA contribution room at the beginning of next year.
Sources
https://www.canada.ca/en/revenue-agency/services/tax/individuals/frequently-asked-questions-individuals/adjustment-personal-income-tax-benefit-amounts.html
https://www.advisor.ca/tax/tax-news/tfsa-limit-for-2019-released/
https://www.investmentexecutive.com/news/industry-news/tfsa-annual-contribution-limit-rises-to-6000/
Basic Insurance Policies Everyone Should Have
There are various options when it comes to buying insurance. You can find an insurance policy to cover almost anything imaginable.
How do you know which insurance policy is necessary for you? You work hard to build wealth in order to live a comfortable life, so you’d want to protect your most important assets. You also don’t want to pay too much money for insurance because it’ll take money away from your emergency fund or retirement savings.
Here are the 5 basic insurance policies everyone should have:
1. Health Insurance
One of the most important types of insurance to have is health insurance. Health insurance is a type of insurance coverage that pays for medical and surgical expenses. This means that you’ll be taken care of incase of an unexpected injury, illness, or even disability. Having health insurance will replace lost income and provide guaranteed coverage for hospital expenses during this time.
There are 2 different types of health insurance: critical illness insurance and disability insurance. Critical illness insurance will provide you with a tax-free lump sum payment when you become seriously ill. Disability insurance will help you to replace a portion of your income if you become disabled and have no way of earning an income due to a disability.
2. Car Insurance
Car insurance is mandatory in Canada. If you’re caught driving without car insurance, you’ll face heavy fines, your license will be suspended, and your vehicle will be impounded.
There are 3 different types of auto insurance coverage in Canada: collision insurance, liability coverage, and comprehensive coverage. Collision insurance pays for the vehicle repairs and medical costs whether you’re at fault or not. Liability coverage covers any damages to property or another person due to an automobile accident. Comprehensive coverage provides you coverage for events that are out of your control such as falling objects, natural disasters, and theft and vandalism.
3. Homeowner’s Insurance
Your home is your largest financial investment, therefore it’s important to protect your home against risks. Homeowner’s insurance protects: your home, your belongings, living expenses, and liability claims. Homeowner’s insurance will help to protect your home against risks like fire, theft, and more. Homeowner’s insurance will protect your belongings against insured loss or damage to clothing, furniture, and other personal property. Homeowner’s insurance will protect your living expenses like a hotel room and storage costs if you’re not able to live in your home while repairs are made after an insured loss or damage. Homeowner’s insurance protect your liability claims if you accidentally cause property damage or bodily injury to others.
4. Life Insurance
Life insurance protects the financial security of the people you live by giving them a tax-free payment upon your death. The cost of life insurance will depend on your age, gender, health, lifestyle, and medical history.
There are 2 different types of life insurance: term life insurance and whole life insurance. Term life insurance is flexible, inexpensive, and allows for temporary coverage. You’ll be insured for a certain amount of time which is going to be fully guaranteed during the entire term. Whole life insurance is a permanent type of life insurance. Your coverage is in place for life and as long as your premiums are paid, your beneficiary will receive the benefit amount upon your death.
5. Disability Insurance
Disabilities can be short term or long term which include major illness, personal injury, and mental health problem. Disability insurance protects you and your family from an unexpected illness or accident that leaves you unable to work and earn an income.