Starting in January, every Canadian age 18 and older will be able to contribute up to $5,000 per year into a tax free savings account. Financial experts have called it the single most important savings vehicle since the RRSP, but few of us know what it is.

When he's not working as a bartender, Mike MacDonald is an actor. The nature of the work means he'd like to save a nest egg just in case -- and maybe for a holiday

"I'm pretty sure just like everyone else it would be nice to take a vacation in the winter when it's rainy in Vancouver," he said.

Mike recently sat down with Bruce Campbell of the Bank of Montreal for advice. He wanted to know more about his saving options.

"Something that I can pull money out of at any given moment," he requested.

Starting next year, there will be some new accounts available to Canadians called Tax Free Savings Accounts. Starting in January, Canadians can put away up to $5000 a year into the Tax Free Savings Account. Unlike an RRSP - you do not get a tax deduction but any money you earn -- is all tax free.

"Some people might say that's not very good compared to RRSPs you get a tax deduction. But the flip side is that you aren't negatively impacted when you take that money out either," Campbell explained.

And if you miss a year the $5000 carries over every year after you turn 18.

"So if you think about it, a lot of students coming out of university will have $20,000 to 30,000 available room in a Tax Free Savings Account," said Campbell.

Campbell says the Tax Free Savings Account can be used in conjunction with an RRSP or RIF.

He recommends sitting down with a financial advisor.

"Really an investor can take advantage of as many of those options as they'd like but without a solid plan and advice they won't be nearly as successful," warned Campbell.

"Could I even use it say for a down payment on a house?" asked Mike.

"Sure," said Campbell. Mike likes what he's hearing.

"It looks like it's a very user-friendly, consumer friendly way to invest without a lot of the pressures and risks that a lot of people are wary about," summarized Mike at the end of his meeting.

Canada used to be known as a country of "savers."

But over the years that has eroded to the point where we are becoming a country of spenders with little or nothing in reserve. It's hoped the Tax Free Savings Account encourages us to save more, and do more planning for the future.

With a report by CTV British Columbia's Chris Olsen