Why I Used EasyCredit to Max Out My TFSA

Carly Esterhuizen, Marketing Officer at EasyEquities, shares her personal investing journey and decision to use EasyCredit to fully fund her annual TFSA allowance - why she chose it, how she ran the numbers, and why the long-term benefits outweighed the short-term costs.

I’m a TFSA girlie through and through, and maxing out my annual limit is a ritual. But this year, I gave priority to my RA contributions - which meant my cash flow wasn’t quite strong enough to do both. Then I ran the numbers and realised something: I could still hit my R36,000 TFSA allowance with EasyCredit - and for me, it made total sense.

The Loan in Numbers

I borrowed R36,000 through EasyCredit. Here’s what it’s costing me:

• Monthly interest: around R400
• Once-off initiation fee + VAT: R423
• Total annual cost if I hold the loan for 12 months: roughly R5,274

That means the effective “hurdle rate” I’d need my investments to beat is around 14.5% (interest + fees).

Context from My Portfolio

That’s just shy of the hurdle. So in a strict one-year sense, the returns may not fully “beat” the loan cost. But the point isn’t just about one year - it’s about locking in the contribution room that compounds tax-free forever.

The Bigger Picture: TFSA Allowance

The clincher? TFSA room doesn’t roll over. It’s use it or lose it.

Even if my portfolio only grows at, say, 8% per year, the return largely offsets the loan cost - and more importantly, I’ve secured a block of tax-free growth that compounds for decades.

• ~R66,000 at 8% growth*
• ~R113,000 at 13.95% growth*
• ~R189,500 at 20% growth*

All of it tax-free. That’s on top of the growth on my existing TFSA balance.

Why This Worked for Me

This isn’t a one-size-fits-all strategy - it’s a personal choice, backed by a few key factors:

• I can comfortably afford the monthly R400 repayment
• I’m investing in ETFs I already trust and have held for years
• The long-term, tax-free compounding matters more to me than the short-term cost of borrowing

It’s not about trying to time the market. It’s about making the most of a powerful tool while I still can.

How I Made the Call

Taking an EasyCredit loan to max out my TFSA wasn’t about being reckless or overleveraging myself - it was a calculated trade-off: predictable borrowing costs now in exchange for the kind of tax-free growth I’ll never be able to retroactively unlock.

Even if I end up marginally “paying in” this year, the long-term compounding benefit of maxing my TFSA makes it worth it. Some opportunities you can never get back - and a missed TFSA allowance is one of them.

*Past performance does not guarantee future results, different types of investments involve varying risk. Take time to do your own research on your investments in order to make informed decisions.