Here’s my 2023 financial goal – saving for my 2024 TFSA contribution.
I’m kind of lazy that way about making New Year’s resolutions. I’m a procrastinator and I’d be breaking resolutions two days into the New Year.
Instead I’m more about creating goals for myself, sometimes financial goals, and other times something that I might want to purchase. If you read my post about 6 steps to save for big ticket purchases, I put them into action for smaller purchases and ongoing annual expenses.
My first big financial goal of the year is contributing to my TFSA – that’s a registered financial product in Canada called a Tax Free Savings Account that was introduced in 2009. There are strict guidelines about how much money a person can put into this account each year, usually around $5500, except for one year it was $10,000.
The benefits to the TFSA are that you can withdraw money as needed without being taxed on it. An RRSP will cost you 10% to 20% in taxes depending on how much you withdraw in a year. If a person has withdrawn money from the TFSA, they can also top it up again to the maximum allowed amount.
As of 2023 an individual can have a total of $88,000 they’ve contributed to their TFSA. The great thing about the TFSA is that people can purchase stocks, mutual funds, term deposits and other financial products and increase their value.
I’m happy to report that my full 2023 TFSA contribution was met. It was hard suddenly coming up with that extra $500 as year end closed in. I’d been saving $500 a month to reach my $6,000 goal. Now I have to make that $550 a month. Inflation all around.
Check that one off my list.
2023 financial goal – saving for my 2024 TFSA contribution
Now I have to start thinking about my TFSA contribution in 2024 and start saving. Let’s just say it’s going to be $6500 again unless inflation does something even crazier in 2023.
Divided by 12 months I know I have to put in $542 a month into my savings account that I call “save for next year’s TFSA”. And because I prefer to work in round numbers, make that $550. That’s a lot of money, so I’m putting in a percentage of each paycheque plus about half my monthly dividends from investments. I’m putting my dividends to work towards next year’s TFSA contribution.
My TFSA savings plan looks good in writing, but you never know what can happen. It’s a lot of money. I might need it for basic living expenses which keep creeping higher all the time.
2023 is all about keeping an eye on my retirement planning and having more fun experiences.
I’m working on meeting my monthly target for my 2023 TFSA contribution, not an easily manageable goal. If I still had debt, I wouldn’t be able to fully fund my TFSA.
New Year’s resolutions and goals for most people have to do with health and wealth.
Next step is getting more serious about creating a financial plan.
Do you have any financial goals for 2023?
Published by Cheryl @ The Lifestyle Digs on January 8, 2023.