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Published January 8, 2024
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RBC TFSA Review: Pros, Cons and Who It’s For

An RBC TFSA offers a tax advantage on your savings but may come with transaction fees and limited investment options.

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RBC TFSA: Best for RBC customers who prefer easy access to their tax-free savings.

An RBC TFSA won’t offer the highest interest rates in Canada, but the Big Bank can offer a variety of TFSA investment options.

    RBC TFSA pros and cons



    RBC TFSA full review

    Royal Bank of Canada, or RBC, is one of the big six banks in Canada and offers several types of tax-free savings accounts to its customers. What makes a TFSA appealing is that any interest, dividends and capital gains earned in the account are completely tax-free. Plus, eligible Canadian residents gain a TFSA contribution room yearly, regardless of their income.

    Types of TFSAs available from RBC

    RBC offers different types of tax-free savings accounts depending on the kind of savings and investments you want to hold and how you want to manage your TFSA

    Benefits of an RBC TFSA

    The major benefit of an RBC TFSA is the flexibility it gives investors. It doesn’t matter if you’re a first-time investor in your early 20s or preparing for retirement. RBC TFSAs allow you to purchase various investment products within your account, so you can build a portfolio that meets your goals, risk tolerance and timeline.

    It’s important to note that a TFSA is strictly a type of registered account. Once you’ve opened an account, you’ll need to deposit cash and purchase investment products within your new TFSA. If you’re new to investing, an RBC advisor can recommend products based on your risk profile.

    Drawbacks of an RBC TFSA

    The major drawback of any TFSA is the yearly contribution limit, which is $6,500 for 2023. This limit is set by the government and is the same regardless of where you open your TFSA. That said, any unused contribution room carries forward indefinitely, so you’ll have a chance to catch up in the future.

    The other drawbacks of RBC TFSAs depend on the type of TFSA you open. With a standard TFSA account, you’re limited to investing in GICs, mutual funds and savings deposits. If you want access to individual stocks, bonds and ETFs, you must open an RBC Direct Investing account. Opening this type of account is easy, but it does require some additional investor knowledge. Investors can opt-in for the RBC InvestEase platform to manage their investments for a fee.

    What is RBC?

    RBC was founded in 1864 in Halifax, Nova Scotia, as the Merchants Bank of Halifax. Since then, the bank has grown to be one of the big six banks and now has over 97,000 employees and 17 million clients worldwide. 

    In addition to TFSAs, RBC offers products such as bank accounts, investment advice, mortgages, credit cards, and more. RBC’s head office is located in Toronto, Canada, but it also has global offices in the United States, Australia, China, France, Hong Kong, the United Kingdom, Spain, and more.

    RBC customer satisfaction ratings

    RBC ranks first in customer satisfaction with retail banking advice, according to J.D. Power’s 2023 Canada Retail Banking Advice Satisfaction Study[1], a survey of 2,911 retail bank customers in Canada. 

    RBC ranks third in online banking mobile app satisfaction, according to J.D. Power’s 2023 Canada Online Banking Satisfaction Study[2], a survey of 8,242 retail bank and credit card customers nationwide. 

    At the time of this writing, RBC had a Trustpilot rating of 1.2 out of 5 possible stars, based on more than 1,100 customer reviews.

    At the time of this writing, RBC had a Better Business Bureau rating of 1.21 out of 5 possible stars, based on more than 130 customer reviews.

    Is RBC reliable and secure?

    RBC is a member of the Canada Deposit Insurance Corporation (CDIC). That means your eligible deposits are insured up to $100,000, per account. RBC GICs, term deposits and cash in your TFSA would qualify for protection under CDIC insurance.

    RBC is also a Canadian Investor Protection Fund (CIPF) member. In the unlikely case that RBC fails, your investments, such as stocks, mutual funds, and ETFs held within your TFSA, would be covered up to $1,000,000.

    In addition, RBC uses the highest possible standards when it comes to security. The bank has multi-layered secure servers, multiple layers of internal and external firewalls, Secure Socket Layer (SSL) 128-bit encryption and more.

    RBC TFSA details and eligibility

    Who qualifies for an RBC TFSA?

    To open an RBC TFSA, you must:

    Who should get an RBC TFSA?

    The RBC TFSA account is ideal for an RBC Royal Bank customer who finds it convenient to have their spendings, tax-free savings and investment accounts all under one roof. This arrangement will help save time with online banking and cut costs on transfer fees. 

    Although, you may find a higher interest rate with an online bank if you don’t mind having multiple bank accounts.

    How to know if an RBC TFSA is right for you

    If you’re an RBC customer looking to hold or invest your savings, tax-free with an unused TFSA contribution room, an RBC TFSA might be right for you.

    How to open an RBC TFSA

    Method and general steps 

    Opening a TFSA with RBC is easy. Just follow these steps:

    1. Go to the RBC website.
    2. Hover over the “Investments” menu and click “Tax-Free Savings – TFSA.”
    3. Scroll down to “Invest in a TFSA Today” and choose the type of TFSA you want (access to advice, build and managed for me, or TFSA I can trade in).
    4. If you already have an RBC account, sign into your online banking profile and you’ll be able to open an account right away.
    5. If you’re a new RBC customer, you’ll need to call an RBC advisor or visit a local branch to open a TFSA.

    Deposit and withdrawal process

    Once you’ve set up your RBC TFSA, you need to fund your account or purchase investment products. How you do this depends on your account. With a standard TFSA, you can have your advisor withdraw funds directly from your bank account to purchase products. 

    If you opened an RBC InvestEase or Direct Investing account, you’ll need to move money into it before you can invest it. You’ll do this through your RBC online banking. Choose the “Move Money” tab and then choose the bank account you’re moving funds from and the account you’re moving funds to. Once the money is in your InvestEase TFSA, you can invest in the recommended portfolio. 

    When it comes to withdrawals, you can only access funds from cashable investment products. One of the exceptions is the non-redeemable GICs that are only available at maturity. Once the funds are available in cash, you could move them back into your bank account.

    If you withdraw money from a TFSA, you can re-contribute that amount in the following year.

    Customer service options

    If you need assistance opening a TFSA with RBC or have questions about your account, you can contact an advisor for help via several methods:

    How to maximize the benefits of the RBC TFSA

    Opening an RBC TFSA is simple. However, if you want to maximize the benefits of your account, consider the following:

    RBC TFSA alternatives 

    Most financial institutions offer similar TFSAs, so it doesn’t make a huge difference which bank you choose. That said, a TFSA may not be for everyone. Some people may prefer to focus on contributing to a registered retirement savings plan (RRSP), since these contributions help reduce their taxable income.

    Reasons you might want a different TFSA

    Even though the benefits of an RBC TFSA are clear, you may want to open an account at a different institution for one of the following reasons:

    TFSA vs. high interest savings account

    Each of these RBC savings accounts serve a purpose. Compare the features, interest rates and other factors to find the most ideal account to satisfy your immediate or future financial needs. 

    RBC TFSARBC High Interest eSavings
    PurposeA registered account for tax-free earnings and withdrawalsHigh interest-earning account
    Interest rate0.90%1.70%
    Annual contribution limit$6,500 for 2023N/A
    Monthly feeNoneNone
    Over-contribution penalty tax1% per month on excess contributionsN/A

    RBC TFSA facts

    What is a TFSA?

    A TFSA is a registered account where capital gains, dividends and interest earned are tax-free. There’s a yearly contribution limit, but any unused room gets carried forward indefinitely. There is no tax break when making contributions.

    Interest Rates

    Promotional rate as of January 2024

    RBC’s TFSA has no promotional interest rate as of Jan. 8, 2024.

    Ongoing interest rate as of January 2024

    RBC’s TFSA’s ongoing interest rate is 0.90% as of Jan. 8, 2024.

    Minimum balance

    RBC TFSAs have no minimum savings amount, though you may need to invest a minimum amount when purchasing GICs or mutual funds. 

    Contribution limit 

    The TFSA contribution limit for 2023 is $6,500. 


    Monthly fee

    RBC’s standard TFSA has no monthly fees. 

    RBC InvestEase comes with an annual management fee of 0.5%, which is calculated on your average Assets under management (AUM) and billed monthly.

    RBC Direct Investing users are charged $25 each quarter. That fee is waived if you maintain a minimum balance of $15,000 across all of your RBC Direct investing accounts. It’s also waived if you:

    Transfer fee

    There is a $150 transfer fee when you transfer your RBC TFSA to another institution. 

    Withdrawal fee

    There is no fee associated with withdrawing funds from an RBC TFSA. That said, a trading fee of $9.95 will apply if you sell securities within RBC Direct Investing before making a withdrawal.

    Other Features & Benefits

    RBC’s standard TFSA and InvestEase allow you to make automatic monthly contributions. If you use RBC Direct Investing, you can set up your account so any eligible dividends are automatically reinvested without fees.

    Frequently asked questions for RBC TFSA

    How to contribute to your RBC TFSA?

    If you have an existing RBC chequing or savings account, you can add funds using the RBC online banking or mobile app, via phone banking (call 1-800-463-3863), or by visiting your nearest branch.

    What are the RBC TFSA fees I should know about?

    You don’t pay any monthly RBC TFSA fees. 

    There’s no fee for withdrawing funds from your account. But a $9.95 trading fee will apply if you sell securities within RBC Direct Investing before making a withdrawal.

    RBC Direct Investing users are charged $25 each quarter but this fee is waived when you meet certain conditions. There is a $150 transfer fee if you transfer your RBC TFSA to another institution.

    Article Sources

    Works Cited
    1. J.D. Power, “2023 Canada Retail Banking Advice Satisfaction Study,” accessed January 8, 2024.
    2. J.D. Power, “2023 Canada Online Banking Satisfaction Study,” accessed January 8, 2024.


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