What is a TFSA?

A TFSA, which stands for Tax-Free Savings Account, is a type of investment account that you can open with a financial institution. Once you've opened a TFSA, you can put money into it and use this to buy different types of investments, for example, shares, bonds, or mutual funds.

The "Tax-Free" portion of its name means that any profit you make from the investments in this account, such as interest earned or increase in value (capital gains), won't be taxed. This makes it a super tool for saving and investing!

Please bear in mind that there are limits on how much you can put into your TFSA each year (currently R36,000 per year in South Africa). If you go over these limits, you may have to pay extra taxes.

Always remember, before making financial decisions it's good to take advice from a certified advisor. Understanding more about finances is the first step toward making empowered decisions! - Zaka Chat by OM