With an RCU Tax Free Savings Account (TFSA),

your earnings are tax-free

The flexibility of a TFSA can help you achieve your goals


How a TFSA works:

  • Any Canadian (age of majority or older) with a valid SIN number can open a TFSA.
  • Invest up to your TFSA contribution limit. This year, the limit is $6,000, but if you have unused contribution room from previous years, you may be able to invest more.
  • Fill your TFSA with a mix of savings and investments. 
  • Don’t pay tax on any growth earned inside your TFSA (including interest, dividends and capital gains).

Variable Rate TFSA

Set up a recurring monthly deposit and watch your savings grow!

  • Maximize your return with automatic monthly deposits
  • Compounding interest
  • Option to move to fixed rate at any time

Fixed Rate TFSA

Fixed rate TFSA terms provides the security of knowing your rate of return is guaranteed for a fixed period of time while earning higher rate of interest.
Funds typically cannot be withdrawn before the maturity date. 

You choose the option that best fits your financial goals.

TFSA Over-Contributions

If you don’t follow your TFSA contribution levels closely, you can end up having to fix over-contributions. 

  • That excess amount is subject to a 1% per-month penalty tax.   You pay that penalty of every month for as long as that excess sits in your TFSA.
  • The Canada Revenue Agency (CRA) sends you a letter when there is a TFSA over-contribution. The notice insists you withdraw the funds.
  • Over-contributions happen all the time. You must remove it immediately. Fixing an over-contribution is a relatively easy process. 

Should I invest in an RRSP or a TFSA?

While both of these types of accounts allow your investments to grow tax-free, they each have different rules. Let us help you decide which might be best for you.

What is an RRSP and how does it work?

A Registered Retirement Savings Plan (RRSP) is a government tax-deferred account. In this plan, the contributions you make are deducted from your taxable income. You will enjoy a reduction of income tax in the year you add money to your RRSP — and your savings will grow tax-free within the account.

When you retire, the money is typically converted to a Registered Retirement Income Fund (RRIF). At that point, you would begin to withdraw your saved money from the plan and would have to pay tax on the withdrawal. This allows you to defer paying tax on that income for as long as you hold these funds in the account.

What is TFSA and how does it work?

The Tax-Free Savings Account is very similar to the RRSP, but the difference between these plans lies in the rules around taxation.

The money you have contributed to the TFSA can be allocated to any of the same savings and investment products that are eligible for the RRSP. The interest, dividends or capital gains that your investments earn will be sheltered from taxation.

Unlike the RRSP, your contributions to the TFSA do not attract a deduction from income tax. The money in your plan is therefore regarded as ‘after-tax’ proceeds, and you will not pay any taxes on withdrawals.

So, which is better for you: an RRSP or a TFSA?

The answer is different for everyone. It depends on your circumstances and why you’re saving.

Contact our Investment Specialists at Rocky Credit Union to get advice on what is suitable for your stage of life and goals. 

Mutual Fund

Investment Options 

We know your financial needs go beyond traditional banking products. Choose to invest your money in Mutual Funds or other securities. Through Credential Asset Management Investment Inc. professionals at Rocky Credit Union, we can provide access to a comprehensive line of investments, including a variety of mutual fund companies.


Mutual funds are offered through Credential Asset Management Inc. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Unless otherwise stated, mutual fund securities and cash balances are not insured nor guaranteed, their values change frequently and past performance may not be repeated. Credential is a registered mark owned by Aviso Wealth Inc.

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