Question 1

How much money do you need to start investing in Canada?

Accepted Answer

You can start with as little as $1 at most platforms. Wealthsimple (robo-advisor or self-directed) has no account minimum. Questrade requires $1,000 to open a self-directed account. Most robo-advisors require $0–$500 to start. Many ETFs trade for $20–$200 per unit. The more important question is consistency: $100/month invested at 7% average annual return for 30 years grows to about $113,000. The sooner you start — even with small amounts — the more time compound growth has to work. Do not wait until you have a "meaningful amount" to invest; start now and increase contributions as your income grows.

Question 2

What account should I open first: TFSA or RRSP?

Accepted Answer

For most Canadians under $60,000/year: open and max the TFSA first. Growth is tax-free, withdrawals are flexible, and there's no tax deduction trade-off needed. For Canadians earning $80,000+: RRSP often becomes more compelling because the tax deduction at a high marginal rate (40%+) creates an immediate return. The deduction refund can be re-invested in the TFSA. Ideally, use both: contribute to RRSP for the deduction when income is high, use the RRSP refund to fund your TFSA, and draw down RRSP/RRIF in later years when income is lower. The FHSA is now a third priority for first-time home buyers — it gives both a tax deduction AND tax-free growth.

Question 3

What is a robo-advisor and should I use one?

Accepted Answer

A robo-advisor is an online platform that automatically manages a diversified investment portfolio (usually ETFs) based on your risk tolerance. You answer a questionnaire, and the platform allocates your money across stocks and bonds, rebalances automatically, and reinvests dividends. Canadian robo-advisors: Wealthsimple Invest, Questwealth, Justwealth, RBC InvestEase, BMO SmartFolio. Fees are typically 0.20–0.50%/year on top of the ETF MER (~0.20%), totalling roughly 0.40–0.70%/year. Robo-advisors are ideal for: investors who want to "set and forget," don't want to manage rebalancing, or feel uncertain making individual investment decisions. DIY with a single all-in-one ETF (XEQT, VGRO, VCNS) is cheaper (~0.20% total) but requires self-discipline.

Question 4

What is compound interest and why does it matter for investing?

Accepted Answer

Compound interest (or compound returns) means your returns earn returns. Example: $10,000 at 7% annual return. Year 1: $700 return → $10,700. Year 2: 7% on $10,700 = $749 → $11,449. Year 10: balance is $19,672. Year 30: $76,123. The "Rule of 72": divide 72 by your annual return to estimate doubling time. At 7%, money doubles every ~10 years. The compounding effect is why starting at 22 vs 32 with the same monthly contribution can result in 2–3× more wealth by retirement — time is the most powerful investment variable.

Your Situation	First Account	Why
Student / low income	TFSA	Tax-free growth; no deduction needed at low rate
Income $60K–$100K	TFSA, then RRSP	TFSA first for flexibility; RRSP for top bracket
Income $100K+	RRSP first	Deduction at 43%+ marginal rate is high-return immediate benefit
First-time home buyer	FHSA (up to $8,000/yr)	Tax deduction + tax-free growth + FTHB use
Employer RRSP match available	Employer RRSP	50–100% instant return; always match first
Maxed registered accounts	Non-registered	Canadian dividend income tax-efficiently

Age	Suggested Equity/Bond Split	All-in-One ETF Equivalent
20s	100% equity	XEQT (0% bonds)
30s	90% equity, 10% bonds	XGRO (80/20 mix works too)
40s	80% equity, 20% bonds	XGRO
50s	70% equity, 30% bonds	XBAL
60s	60% equity, 40% bonds	XBAL or XCNS

How to Start Investing in Canada: Beginner's Guide 2026

Which account to open first

Asset allocation by age

Investing 101 articles

Getting started

How much to invest

Compound interest & calculations

Asset allocation

Robo-advisors

Miscellaneous

Trading and advanced

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