{"id":550,"date":"2016-05-09T09:28:00","date_gmt":"2016-05-09T16:28:00","guid":{"rendered":"https:\/\/chaltenadvisors.com\/blog\/?p=550"},"modified":"2016-05-09T09:41:30","modified_gmt":"2016-05-09T16:41:30","slug":"do-you-want-a-million-dollar-tfsa-account","status":"publish","type":"post","link":"https:\/\/chaltenadvisors.ca\/blog\/do-you-want-a-million-dollar-tfsa-account\/","title":{"rendered":"Do you want a million dollar TFSA account?"},"content":{"rendered":"

You’ll need time, discipline and a little help from the taxman. \u00a0The Globe and Mail’s simple TFSA calculator<\/a>\u00a0can help you quickly and easily figure out what your\u00a0TFSA (Tax Free Savings Account) might<\/em> be worth down the line under different assumptions. \u00a0The calculator takes into account current TFSA contribution limits including planned limit increases based on inflation. \u00a0The following inputs will get you to $1 million +:<\/p>\n

Expected Annual Rate of Return: 5%<\/strong> (fairly conservative from a historical perspective but prudent looking forward)<\/p>\n

Dollar Amount I Will Start With: $46,000<\/strong> (if you’re just starting out today this is your cumulative contribution limit through 2016)<\/p>\n

Number of Years That I Will Contribute: 35<\/strong><\/p>\n

So if you’re 30 today you’ll have your $1 million by the time you reach normal retirement age at 65. \u00a0Now it’s unlikely $1 million in 35 years will\u00a0have the same purchasing power it does today but nonetheless the calculator clearly illustrates the often overlooked \u00a0magic of\u00a0compound interest over time. \u00a0In order to get to $1 million\u00a0under the above assumptions you only actually contribute $368,000 – the rest comes from compounding investment returns. \u00a0Of course you have to do your best to ensure you actually achieve your target rate of return. \u00a0This doesn’t mean you need to swing for the fences. \u00a0Just stay out of trouble – the trouble we see most often includes:<\/p>\n