Q: <strong>How long does it take to max out a TFSA if I contribute R3,000 per month?</strong>

According to the current regulations, it takes 13 years and 11 months to reach the lifetime TFSA contribution limit of R500,000 if you're contributing the maximum allowed amount of R3,000 per month every month.

Question 1

Technical notes

Accepted Answer

The exact calculation for Current Future Value in the first part of the calculation can be tricky when mixing annual/monthly contributions with monthly compounding and hitting a lifetime limit. The current loop approximates this by compounding the existing sum monthly and adding the annual/monthly contribution within the year. For highly precise financial calculations, specialised financial libraries might be used, but this should be sufficient for our purposes of a web calculator's estimation. The crucial part is accurately tracking 'Total Contributions Made' against the Lifetime Limit.

Question 2

How long does it take to max out a TFSA if I contribute R3,000 per month?

Accepted Answer

According to the current regulations, it takes 13 years and 11 months to reach the lifetime TFSA contribution limit of R500,000 if you're contributing the maximum allowed amount of R3,000 per month every month.

Question 3

What’s the future value of a TFSA if I start saving for my child from birth?

Accepted Answer

If you contribute R3,000 a month for 13 years and 11 months (starting from age 0), and the investment earns 10% interest compounded monthly, the lump sum at the end of the contribution period could be just over R1 million. If you leave that to grow untouched until age 65, it could grow to more than R170 million, depending on the interest rate.

Question 4

What is the maximum I can contribute to a TFSA in South Africa?

Accepted Answer

As of current SARS rules, the maximum you can contribute to a TFSA is R36,000 per year and R500,000 over your lifetime. Any extra contributions above these limits are taxed at 40%.

Question 5

Can I open a TFSA for my child in South Africa?

Accepted Answer

Yes. Parents can open a TFSA in their child’s name. Contributions will count toward the child’s lifetime limit, not the parent’s. It’s a popular way to build long-term wealth for your child, especially if started early.

Question 6

Why are my TFSA returns different from what I see on TikTok or YouTube?

Accepted Answer

Many online examples use different interest rates, ignore SARS limits, or assume unrealistic timeframes. This calculator uses actual TFSA limits and lets you tweak real variables like contribution size, age, and interest rate so you get a more accurate and personalised estimate.

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