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Earn $6,000 Tax-Free Annually With This TFSA Strategy

^{Published on 2024-12-10 01:01:09 - The Motley Fool Canada}
 

• Canadians, particularly Tax-Free Savings Account (TFSA) users, look forward to January 1, 2025. While the annual limit is $7,000 or unchanged from 2024, expanded contribution room is always welcome news. Regular TFSA investors know that the key to earning the desired tax-free income is to maximize yearly contributions as much as possible.

The article from Fool.ca outlines a strategy for earning $6,000 tax-free annually using a Tax-Free Savings Account (TFSA) in Canada. It discusses how investors can leverage the TFSA's tax advantages by investing in high-yield dividend stocks. The piece highlights that with the 2024 TFSA contribution limit set at $7,000, an individual could potentially invest up to $95,000 if they have never contributed before. By selecting stocks with an average yield of 6.3%, one could generate the desired $6,000 in tax-free income each year. The article suggests focusing on sectors like utilities, real estate investment trusts (REITs), and telecoms for stable dividends, and mentions specific examples like Fortis Inc., which offers a 4.4% yield, and others like Enbridge and BCE. It also emphasizes the importance of diversification to mitigate risk and the potential for dividend growth over time, which could increase the annual income beyond the initial $6,000.

Read the Full The Motley Fool Canada Article at:
[ https://www.fool.ca/2024/12/09/earn-6000-tax-free-annually-with-this-tfsa-strategy/ ]

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