Why the container comes first
Most people start with "what should I buy?" A better first question is "where should I hold it?" In a regular account, you pay tax on interest, dividends and gains. Inside a registered account, growth is sheltered. Same investment, different result, and the only thing that changed is the container.
Canada gives most adults three of them.
| Rule | TFSA | FHSA | RRSP |
|---|---|---|---|
| Built for | Anything | A first home | Retirement |
| Going in | After-tax money | Tax-deductible | Tax-deductible |
| Growth | Tax-free | Tax-free | Tax-deferred |
| Coming out | Tax-free, anytime | Tax-free for a qualifying first home | Taxed as income |
| New room in 2026 | $7,000 | $8,000 | 18% of last year's earned income, up to $33,810 |
How room works
TFSA
You get new room every year, starting the year you turn 18 and are a resident of Canada with a valid SIN. Unused room carries forward forever. Someone who has been eligible every year since 2009 and never contributed has $109,000 of room in 2026.
If you came to Canada as an adult, your room starts the year you became a resident, not 2009.
FHSA
Room only starts the year you open the account: $8,000 a year, up to $40,000 in your lifetime. You need to be a first-time home buyer as CRA defines it. If you never buy, the money can move to your RRSP.
RRSP
Room comes from your earned income. Your exact number is on your Notice of Assessment and in CRA My Account.
Maya turned 18 in 2019 and has lived in Canada the whole time. She has never used her TFSA. Her room in 2026:
| Years | Limit each year | Room |
|---|---|---|
| 2019 to 2022 | $6,000 | $24,000 |
| 2023 | $6,500 | $6,500 |
| 2024 to 2026 | $7,000 | $21,000 |
| Total | $51,500 |
You're probably not behind
CRA's latest figures (2024) put the average unused TFSA room at $52,735 per holder. For people in their thirties and forties it's around $64,000 to $67,000. Empty room is normal. It's also the opportunity.
Canada Revenue Agency, 2024 contribution year. Averages per TFSA holder.
The one mistake to avoid
When you take money out of a TFSA, that room comes back on January 1 of the next year, not right away. If you put the money back the same year without spare room, CRA charges 1% a month on the excess until it's removed.
Don't have an account yet?
Any bank or brokerage in Canada can open a TFSA, FHSA or RRSP, and the CRA rules are the same wherever you hold it. If you already bank somewhere, that's a fine place to start.
I use Wealthsimple. If you open a new account with my referral link and deposit $100 or more within 30 days, Wealthsimple pays each of us $25, and may pay me an extra bonus based on how much you deposit. Their terms can change. This isn't a recommendation, and nothing in these lessons depends on which provider you choose.
Do this before the next lesson
- Find your TFSA room. Log in to CRA My Account, or use the room finder if you have never contributed.
- The figure in your CRA account is updated once a year and leaves out this year's activity. Subtract anything you have put in since January 1.
- Not sure which container to fill first? The 60-second quiz walks through it.
You take $3,000 out of your TFSA in June. When does that $3,000 of room come back?
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