If you’re 40 and wondering whether your Tax-Free Savings Account (TFSA) is on track, the numbers may surprise you.
According to Statistics Canada data released in 2025 (based on the 2023 contribution year), Canadians aged 40 to 44 held an average TFSA balance of $20,670. Even more striking? The same group had an average unused contribution room of $62,618.
That’s not just spare room. That’s untapped tax-free compounding power.
Source: Getty Images
The $20,670 question: Is that enough?
On the surface, $20,670 may not look alarming. But context changes everything.
If that average balance were invested entirely in the Canadian stock market — say through the iShares S&P/TSX 60 Index ETF as a proxy — it would have grown more than 33% at the time of writing, pushing the value to roughly $27,615.
That’s meaningful growth in a short period.
The Canadian market has delivered a compound annual return north of 20% over the past two years — well above its 10-year average of about 14.5%. But here’s the uncomfortable truth: markets don’t compound at 20% forever. Betting on continued outperformance is risky.
Which raises the real question:
If markets cool, will your contribution habits carry the load?
Why many 40-year-olds are behind
The average unused room of $62,618 tells a clear story. Many Canadians aren’t maximizing one of the most powerful wealth-building tools available.
The TFSA limit for this year is $7,000. That works out to about $583 per month — manageable if you automate contributions.
But falling behind gets expensive quickly.
If you contributed only half your limit over the past five years, catching up in one year would require roughly $1,937 per month. That’s a serious stretch for many households, especially with inflation squeezing cash flow.
The lesson? Consistency beats catch-up.
At 40, time is still on your side — but not as generously as it was at 30. The next 20 to 25 years are prime compounding years. Missing them is costly.
Investing beyond contributions
Maxing out your TFSA is step one. Step two is putting that capital to work intelligently.
One candidate for long-term investors is Restaurant Brands International (TSX: QSR), the global operator behind major quick-service restaurant chains like Burger King and Tim Hortons.
In its latest 2025 results, the company reported:
- System-wide sales up 5.3% to US$46.8 billion
- Comparable sales growth of 2.4%
- Restaurant count rising 2.9% to 33,041 locations
- Revenue up 12% to US$9.4 billion
- Adjusted earnings-per-share (EPS) climbing 10.5% to US$3.69
International operations were particularly strong, with comparable sales up 6.1% in the fourth quarter.
At roughly $94 per share, the stock trades about 8% below the analyst consensus target (suggesting a fairly valued stock) and offers a dividend yield around 3.7%. For long-term TFSA investors seeking global growth plus income, it’s a reasonable candidate — especially on market pullbacks. Of course, diversification matters. A TFSA shouldn’t hinge on one stock. But combining steady contributions with quality businesses can materially accelerate long-term tax-free growth.
Investor takeaway
The average Canadian TFSA at age 40 sits at $20,670 — but the more revealing number is the $62,618 in unused room. That gap represents missed compounding potential.
Markets may not always deliver 20% returns, but disciplined monthly contributions and thoughtful investing can still build substantial wealth. At 40, you still have time — just not time to waste.
The real comparison isn’t against the national average. It’s against where you could be in 20 years if you start maximizing today.
