Investment accounts are where you hold your investments—like stocks, bonds, mutual funds, or ETFs. Choosing the right account depends on your goals, timeline, and tax situation. Some accounts offer tax advantages, while others give you more flexibility or access to government benefits.
In New Brunswick, you must be the age of majority (19 years old) to open an investment account in your own name. If you’re younger, a parent or guardian may open an account on your behalf.
Here are some of the most common investment accounts available to Canadians:
An RRSP is designed to help you save for retirement. Contributions are tax-deductible, which means they can lower your taxable income. Your investments grow tax-free while they’re in the account, but you’ll pay tax when you withdraw the money—usually in retirement, when your income may be lower.
RRSPs can hold a wide range of investments, including mutual funds, stocks, bonds, and GICs. You can also use RRSPs for the Home Buyers’ Plan or Lifelong Learning Plan.
A TFSA lets you earn investment income—like interest, dividends, or capital gains—without paying tax on it. You don’t get a tax deduction for contributions, but you won’t pay tax when you withdraw the money.
TFSAs are flexible and can be used for short-term goals, long-term savings, or emergency funds. You can hold many types of investments in a TFSA, and unused contribution room carries forward each year.
RESPs help you save for a child’s post-secondary education. Contributions aren’t tax-deductible and can be withdrawn tax-free at any time. The government may also add grants to your RESP, depending on your income and how much you contribute.
When the money is withdrawn to pay for education, the student pays the tax—usually at a lower rate. If money is not used for education, any government grants must be returned to the government.
A first home savings account (FHSA) allows first-time home buyers to save for their first home tax-free (up to certain limits). An FHSA can hold savings or qualified investments. The contributions are tax-deductible (like an RRSP) and the money grows tax free (like a TFSA).
An RDSP is designed to help people with disabilities save for long-term financial security. Contributions aren’t tax-deductible, but the account grows tax-free. The government may also provide matching grants and bonds to help build savings.
Withdrawals are taxed in the hands of the beneficiary, who may be in a lower tax bracket.
These accounts don’t offer tax benefits, but they’re flexible and easy to access. You can open a non-registered account at a bank, credit union, or online brokerage. They’re useful for general investing, and you manage your portfolio either on your own or with an advisor.
You’ll pay tax on any income or gains earned in the account, depending on the type of investment and how long you hold it.
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When deciding which account is right for you, consider:
Your goals: Are you saving for retirement, education, or something else?
Your timeline: When will you need the money?
Your tax situation: Do you want to reduce your taxable income now or avoid taxes later?
Your eligibility: Some accounts have age or income requirements.
You can open most investment accounts through a financial institution or online brokerage. If you’re unsure which account is right for you, talk to a registered financial advisor or visit the Government of Canada website.