Big news for Canadian savers! The TFSA limit for 2025 has been announced, and it comes with a game-changing milestone: the total contribution room is now over $100,000!
In this article, I’ll break down what this new limit means for you, how to maximize your contributions, and tips to make the most of your tax-free investment power.
Understanding TFSA Contribution Room Over $100K
In 2025, the contribution limit is $7,000, the same as it was in 2024. Here’s a breakdown of the yearly TFSA contribution limits:
| Year | TFSA Dollar Limit | Cumulative Total |
|---|---|---|
| 2025 | $7,000 | $102,000 |
| 2024 | $7,000 | $95,000 |
| 2023 | $6,500 | $88,000 |
| 2022 | $6,000 | $81,500 |
| 2021 | $6,000 | $75,500 |
| 2020 | $6,000 | $69,500 |
| 2019 | $6,000 | $63,500 |
| 2018 | $5,500 | $57,500 |
| 2017 | $5,500 | $52,000 |
| 2016 | $5,500 | $46,500 |
| 2015 | $10,000 | $41,000 |
| 2014 | $5,500 | $31,000 |
| 2013 | $5,500 | $25,500 |
| 2009-2012 | $5,000 | $20,000 |
Total for 2009-2025: $102,000
By 2025, the total TFSA contribution room will be $102,000 for anyone eligible since 2009. This is cumulative, so if you’ve never contributed but have been eligible each year, you’ll have $102,000 available. I’ll explain how to check your eligibility later in this video, but first I want to show you…
How to Unlock The Power of a $102,000 TFSA
Let’s talk about the incredible power of having a $102,000 tax-free investment vehicle. To see how much this could grow over time, we’ll assume an 7% annual rate of return and you making $0 contributions each year, and you’ve maxed out your TFSA to $102,000. Now, let’s take a look at what happens over the long term:
- In 10 years, that $102,000 grows to around $200,649. So, with no extra effort, you’ve nearly doubled your investment just by letting it grow.
- In 20 years, your investment reaches approximately $394,708—almost four times the original amount. This shows how powerful compounding becomes as time goes on.
- In 30 years, your investment grows even further to $776,450, nearly eight times your starting amount.
- And in 40 years, the growth really accelerates, with your $102,000 turning into $1,527,395! That’s more than 15 times your initial investment, simply from letting it grow and compounding those returns year after year.
This shows how long-term investing and compounding can transform your savings into serious wealth. The longer you let your money grow, the more dramatic the results.
Adding in an annual investment
Now, let’s see what happens if you add just $5,000 a year to that initial $102,000 investment, still growing at an 7% rate of return. Here are the results:
Now, let’s see what happens if you add just $5,000 a year to that initial $102,000 investment, still growing at a 7% rate of return. Here are the results:
- In 10 years, your investment grows to $269,732. That’s a significant boost compared to letting the $102,000 grow on its own.
- In 20 years, the total grows to $599,685. By consistently adding $5,000 each year, you’ve dramatically increased your future value.
- In 30 years, your investment reaches $1,248,754. You’ve surpassed the million-dollar mark, all from steady contributions.
- In 40 years, your total investment reaches a remarkable $2,525,570. Just by adding $5,000 a year, you’ve built more than 2.5 million dollars in wealth.
This shows the power of consistent, small contributions. By adding just $5,000 a year, you can dramatically increase your wealth over time through the power of compounding.
Think of your TFSA limit as a high-score target in a game—every year, you level up by getting more room to score big on your investments.
If you’re a spreadsheet nerd like me, I have this spreadsheet available for you to download and play around with the variables yourself on the “tools” section of our website.
Be Careful of Over-Contribution Penalties
Let’s say Jennifer mistakenly contributes $20,000 to her TFSA this year, but her available contribution room is only $8,000. That means she has over-contributed by $12,000.
Now, Jennifer will face a 1% penalty on the excess amount of $12,000. That’s $120 per month in penalties. If she doesn’t realize her mistake for a full year, she will be charged $1,440 in penalties over 12 months ($120 x 12 months).
Not only does Jennifer lose $1,440 in penalties, but she also misses out on the potential growth of that money. For instance, if she had invested her contribution within the correct limit, she might have earned around 7% on her $8,000, or $560 over the year. But instead of growing her money, she’s losing more than twice that amount to penalties.
This example shows just how costly it can be to over-contribute to your TFSA, especially with larger sums.
Over-contributing to your TFSA is kind of like eating too much at a buffet—you’ll definitely regret it when you see the penalty.
How to Calculate Your TFSA Contribution Room
Method 1: Quick Estimate
Let’s say you turned 18 in 2015. To calculate your available TFSA contribution room, you’ll need to add up all the yearly TFSA contribution limits from 2015 to 2025. Here’s how the limits break down:
| Year | Contribution Limit |
| 2015 | $10,000 |
| 2016 | $5,500 |
| 2017 | $5,500 |
| 2018 | $5,500 |
| 2019 | $6,000 |
| 2020 | $6,000 |
| 2021 | $6,000 |
| 2022 | $6,000 |
| 2023 | $6,500 |
| 2024 | $7,000 |
| 2025 | $7,000 |
Total contribution room (2015-2025): $71,000
Now, let’s assume you’ve contributed $30,000 to your TFSA over the years. To figure out your available contribution room for 2025:
| Total Room | $71,000 |
| Total Contributions | $30,000 |
| Available Room for 2025 | $41,000 |
If you made any withdrawals in 2024, you can add that withdrawn amount back to your available room in 2025.
Method 2: Use an Online TFSA Calculator
If you want to skip the math, you can use an online TFSA calculators. These tools are available from many online Canadian publishers, and you can find it on the tools section on our blueprint site, which I’ll link to below.
All you need to do is input your age, the year you became eligible, your past contributions, and any withdrawals. The calculator will give you an estimate of your remaining contribution room instantly.
Method 3: Check Online with CRA
For an official, CRA-verified number, you can log into your CRA My Account. Go to the “Savings and Pension Plans” section, where you’ll find your TFSA contribution room as of the BEGINNING of the current year. Keep in mind, this number won’t reflect any contributions or withdrawals you’ve made throughout the current year.
Pro Tip: To avoid over-contributing and facing penalties, it’s crucial to track your own TFSA contributions and withdrawals during the year. I’ve personally made this mistake before and ended up with penalties for an over-contribution—it’s not fun!
To make tracking easier, I suggest using tools like Google Sheets or Microsoft Excel to create a custom tracker for your contributions and withdrawals. You can also explore budgeting apps that help you stay on top of your finances.
Method 4: Call CRA for Contribution Room
If you’d prefer to talk to someone directly, you can call CRA’s Tax Information Phone Service at this number (1-800-267-6999). They can help you figure out your current TFSA contribution room. Just make sure you have your SIN and other identification ready for verification.
TFSA Eligibility Criteria
Eligibility for a TFSA is based on three key factors.
- You must be at least 18 (or 19 in some provinces) to start accumulating contribution room, regardless of when you open a TFSA.
- You also need to be a Canadian resident, as non-residents can’t accumulate new room while abroad.
- Lastly, a valid SIN is required to open and contribute to a TFSA.
Examples of Eligibility and Contribution Room
Note that not everyone will qualify for the full $102,000 limit, it depends on when you started being eligible for the account. Here are some examples:
Example 1: Eligible Since 2009 (Alex’s Story)
Alex turned 18 in 2009 and has been eligible for a TFSA ever since. By 2025, Alex would have accumulated the full $102,000 in contribution room. Despite not contributing anything to his TFSA so far, he now has the option to invest up to $102,000 tax-free. Since Alex has never used any of his contribution room, he will have the full amount available to him in 2025.
Example 2: Turning 18 in 2015 (Sarah’s Story)
Sarah turned 18 in 2015, so she wasn’t eligible to accumulate contribution room before then. Her TFSA contribution room started from 2015 when the limit was $10,000. Here’s how Sarah’s available room breaks down:
| Year | TFSA Contribution Limit |
|---|---|
| 2015 | $10,000 |
| 2016 | $5,500 |
| 2017 | $5,500 |
| 2018 | $5,500 |
| 2019 | $6,000 |
| 2020 | $6,000 |
| 2021 | $6,000 |
| 2022 | $6,000 |
| 2023 | $6,500 |
| 2024 | $7,000 |
| 2025 | $7,000 |
By 2025, Sarah will have accumulated $72,000 in total contribution room, starting from the year she turned 18.
Example 3: Becoming a Canadian Resident in 2020 (David’s Story)
David moved to Canada and became a resident in 2020. He started accumulating TFSA contribution room from that year onward. Here’s what David’s contribution room looks like:
- 2020: $6,000
- 2021: $6,000
- 2022: $6,000
- 2023: $6,500
- 2024: $7,000
- 2025: $7,000
David will have $38,500 in available contribution room by 2025 since he only started accumulating room when he became a resident in 2020.
Example 4: Non-Resident Status (Emily’s Story)
Emily lived in Canada and had been contributing to her TFSA since 2012. In 2019, she moved abroad to Costa Rica and became a non-resident. By that time, she had accumulated $57,500 in contribution room (including 2019). After becoming a non-resident, she stopped accumulating new room, so no additional contribution room was added after 2019.
2019: $6,000
2020: $6,000
2021: $6,000
2022: $6,000
2023: $6,500
2024: $7,000
2025: $7,000
Total by 2025: $48,500
Although Emily can keep her existing TFSA, she won’t be able to accumulate new contribution room while she’s a non-resident.
Making the most of your TFSA isn’t just about contributing—timing your withdrawals is key to maximizing your wealth year after year. At Blueprint Financial, we help you develop a TFSA contribution and withdrawal strategy tailored to your needs. Visit our services to learn more!
