Tax Free Savings Accounts (TFSA)

Donna WillanLatest, Money cents


There has been a lot of talk about the (relatively) new tax free savings accounts, so I thought I would reflect on how best to “seize this opportunity.”  Each person can put a maximum of R30 000 a year into a tax free savings account. That means my children and I could each be doing this.

Last year I cashed in a pretty ineffective scheme for paying for tertiary education and I put that money straight into a tax free savings account, which I add to every month. So last year was easy and I did ‘the right thing,’ but what about this year?

I don’t have R30 000 to pop into an account (and sadly nor do my children!) so I began to wonder if this tax relief only applied to the super-rich who have R30 000 a year to save? Then I realized I clearly didn’t understand this tax free savings thing very well.

I spoke with Simon (yip, of Just One Lap) to get his advice, and he was very clear that each year I should sell R30 000 worth of my ETFs and buy ETFs through a tax free savings account. This took me a while to understand, but then I got it. Wow – that’s easy, and now I realise that even for the middle class, if you have ETFs or shares, you can make this tax free saving work for you. And I can do this every year.

So have you opened your tax free savings account this year?

In my next column I’m going to talk about annual increases – I am very lucky to be getting one this year, what should I do with it?


Below is the Power Hour Tax Free Video Simon did back in February and you can find the list of ETFs one is able to include in a Tax Free Savings Account here.

Money Cents blog

Meet the Just One Lap team at these free live events

Click here to meet the Just One Lap team at one of our live, free events.

Subscribe to Just One Lap