Investment guidance for newcomer to Canada - RRSP or TFSA

BBThumbHealer wrote: ↑ Hi RFD'Fam,

Hope y'all had a great weekend!

A brief intro : came to Canada around 2 years ago and settled into a generic corporate job. The next thing that I'm looking forward to is a house ownership in the next 2 years.

At present, I do have an emergency fund stacked in a EQ HISA, an ongoing group RRSP with my employer with Manulife and to test waters, I did open an individual TFSA account with Wealthsimple Invest (robo) with a risk tolerance of 10.

Now I do have ample contribution room remaining in my TFSA and RRSP and considering my goal towards home ownership, I need to plan accordingly and looking forward to the wisdom of fellow members for guidance. My questions are listed below:

1. Should I first max out my RRSP or TFSA? From my viewpoint, I was inching towards the RRSP and wanted to bring it up to $35k that I can then withdraw as a downpayment towards my home under the 1st time home buyer plan. I'll have to repay/contribute it back in 15 years. As on date, I have around only $7K parked there.

2. Even if I choose a RRSP or TFSA, I wanted to invest in ETF's using Questrade - is it a wise choice or should I open another account in Wealthsimple Trade only?

3. I am wanting to invest in a $10k portfolio as a start followed by monthly contribution of around $250-$500, could you please suggest the ETF's and their %age allocation for me? I am primarily looking for capital growth and if there is nominal dividend income, that's a bonus. I'm the "buy it and forget it" kinda guy and will be happy if there's a ~10-12% growth YoY. I won't likely play around once I've bought the units.

4. I'm aware of the associated market risks considering that investment is not an overnight game but stacking $x amount for 2 years in a HISA bank account won't reap any benefits to me towards my goals - so if there's something else that you guys can suugest apart from RRSP/TFSA investment in order to protect my principal amount with nominal growth, I am open to suggestions.

I'll look forward to your valuable advice - thank you!

BardoonD52881 wrote: ↑ always tfsa, shouldnt even be a question.

callernamet wrote: ↑ +1

But problem with OP is newcomer. Only two years here. So chances are his RRSP amount 18% might be higher than TFSA contribution limit, 12K+, for last two years.

SalmanZ93266 wrote: ↑ For the newcomer, how does the TFSA contribution limit work actually? If I am 30 year old and newcomer for 2 year, shouldn't I get the full 70k(max contribution amount) initially and then 6K per year. Or will it be 12K for the 2 year I live in?

I had the impression, newcomers can park their initial savings by opening TFSA.

sunbat wrote: ↑ TFSA room will only accumulate when you become a Canadian resident with a SIN. No previous TFSA will accumulate for years you were not Canadian resident. So in your case, it will be 2 years room = $12000. You can also check your limit by calling CRA or logging into CRA my account if you have created one.

https://tfsahelper.ca/for-foreigners/ne ... to-canada/

HyperTech wrote: ↑ the only and valuable reason to use RRSP, is to defer tax, because you expect to earn LESS, when retired.

let say you earn 100k / year now, you invest in a RRSP to lower your tax bill today.

then at your retirement, if you earn less than 100k, you will safe some money, in theory...

in reality, that doesnt happen really often.