Goal Savings Planner: how it works in 2026, with a worked example

Questions people ask

How much do I need to save each month to reach my goal?

Divide the amount by the number of months, then trim a little for interest. $3,000 in 12 months is $250 a month at 0% and about $246 a month at 2.75% with deposits at the start of each month. Over longer periods interest does more of the work: $50,000 in 10 years at 5% needs about $321 a month, not $417.

Should the money go in a TFSA?

Yes, whenever you have room. Interest and growth inside a TFSA are tax-free, and you can withdraw for the goal at any time; the room you used comes back the following January. The 2026 limit is $7,000 and unused room from earlier years carries forward. Outside a TFSA, savings and GIC interest is fully taxed at your marginal rate.

What is a GIC ladder and why does the planner suggest one?

A GIC ladder is several one-year GICs bought at different times so they mature at different dates. For a goal one to five years away, buying a one-year GIC every three months locks in a rate the bank cannot cut, while each GIC still matures before you need the money. Deposits made in the last year stay in the savings account because a one-year GIC would not mature in time.

Is a savings account or a GIC better for a one-year goal?

For anything under a year, a high-interest savings account: it is fully liquid, pays interest monthly and is CDIC-insured at a member institution. A GIC pays a little more but locks the money, so a change of plans costs you. For an emergency fund the savings account wins at any horizon, because the whole point is same-day access.

Why not invest the money for a higher return?

Because a fund can be down 20% in the year you need the cash. The planner only suggests an index fund for goals more than five years away, and even then at an assumed return you should treat as an average, not a promise. As the date gets within about two years, move the money to GICs or a savings account.

I'm saving for a first home. What about the FHSA?

Use it first. The First Home Savings Account takes $8,000 a year up to $40,000 in a lifetime; the deposit is tax-deductible like an RRSP and the withdrawal for a qualifying first home is tax-free. Put the first $8,000 a year there, and the rest of the down payment in a TFSA.

What interest rate should I assume?

The rate your bank actually pays today, which you can type in under More options. The defaults (2.75% for a savings account, 3.5% for a one-year GIC, 5% for an index fund) are assumptions, not quotes, and rates move with the Bank of Canada policy rate. Try a lower number to see how much the answer depends on it: for short goals it barely matters.

What if I can't afford the monthly amount it shows?

Switch to "What I can save a month" and the planner tells you when you get there instead. Or push the date out, lower the target, or add a lump sum such as a tax refund to what you already have; every $100 of savings today is $100 less to find later, plus its interest.