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Taking Advantage of the TFSA

Canadians are Catching on to the TFSA.

According to a survey by a global market information and insight group, the introduction of the new Tax Free Savings Accounts or TFSAs has caught the attention of many Canadians. “The combination of advertising by government and financial institutions has translated into a high awareness of the new investment vehicle and good initial uptake,” said Rhonda Grunier, vice-president of TNS Canadian Facts and director of the market research firm’s TFSA study. The survey found that 79 per cent of Canadians are aware of TFSAs, and this is only somewhat behind awareness of the longer running RRSP (94%) and RESP (84%) accounts. There is also little reported confusion between TFSAs and RRSPs. Only 27 per cent say that they do not understand the difference between the two.

Who’s Most Likely to Take Advantage of the TFSA?

According to the survey Middle and Higher Income households are most likely to take advantage.

When it comes to opening a TFSA, already 14 per cent of Canadians have already jumped on the savings wagon. Another 36 per cent of Canadians are either very likely (18%) or somewhat likely to do so (18%) in 2009. Adding those statistics and subtracting from 100 leaves 48 per cent who are not likely to open an account this year.

Not everybody is jumping on the savings wagon.

Although the adoption rate for the new accounts is quite high, it is also true that lower income households are less likely to open an account (28% of Canadians with a household income below $35,000 have opened or plan to open a TFSA versus half of all Canadians).

The number on reason for not opening a TFSA is…

If you haven’t opened up a Tax Free Savings Account chances are it’s not because you don’t see the value. So what is stopping most Canadians from taking control of their financial future? You probably guess it… Money! In fact, among the most frequently cited reasons for not opening a TFSA is a lack of financial resources (41%).

About the TFSA survey.

The survey was conducted using the firm’s national bi-weekly telephone omnibus service, TNS Express Telephone. A total of 1,016 nationally representative Canadian adults were interviewed between February 2 and 5, 2009. For a survey sample this size, the margin of sampling error is plus or minus 3.1 percentage points, 19 times out of 20.

Find out more information on Canada’s adoption of the TFSA or read the full article here: Awareness of Tax Free Savings Accounts Very High: Survey

This entry was posted on Saturday, June 6th, 2009 at 9:45 am and is filed under statistics. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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