When you invest your savings, you’re allowing your money to grow. And you don’t have to be an expert to make it happen. Here are four strategies that could have you laughing all the way to the bank.
The Registered Retirement Savings Plan (RRSP) is a popular investment for retirement. Contributions are tax-free, which puts more money in your pocket to reinvest or to pay for other projects.
The amount you save will depend on the amount you’ve invested, your tax bracket and your province. In Quebec, for example, if your annual income is $35,000 and you contribute $1,000, you will receive a tax refund of $275 in 2018. If your income is $50,000, your savings will increase to $371. The higher your income, the better.
Plus, if you’re expecting a significant salary increase, you can postpone your deduction – saving you even more money!
Can an RRSP be used for other projects? Yes! There are programs you can use to withdraw money tax-free.
TFSA: invest tax-free
Unlike an RRSP, a Tax-Free Savings Account (TFSA) does not reduce your taxable income, but it does provide tax-free investment income. And that means significant savings!
This tool is particularly beneficial if your goal is to save for a short-term project like a vacation or home renovations. It’s also great to have as an emergency fund.
If your net income is low, you might even consider using a TFSA to save for retirement. Because it generates no taxable income, you’re able to keep your Guaranteed Income Supplement (GIS).
RRSPs and TFSAs each have their advantages and disadvantages. An advisor can help you make the right choice for your situation.
Are you planning to pay for your child’s post-secondary education? The Registered Educations Savings Plan (RESP) is the perfect tool to help you achieve your goal. You’ll get access to generous government grants that will help your money will grow even faster.
The following financial benefits are available within an RESP:
In other words, if you invest $1,000, you’ll receive at least $300 in the form of grants!
Upon your retirement, the grants and investment income will become taxable to your child. However, since your child will most likely start out with a low income, he or she will have very little to pay.
If you'd like to have more control over your finances, why not use a direct brokerage platform and personally manage your investments? You’ll learn everything there is to know about investments and how to best invest your savings.
Even when investing on your own, you’re never alone. The platform provides powerful tools to help you make the right financial decisions. Plus, agents are always available to meet and offer advice.
This easy-to-use tool offers cost-effective pricing that can save you money. Your profile makes it easy to track your portfolio’s progress, while the speed of transactions means you can benefit from the best deals on the market. Make the right choices, and you'll make some money.
Whatever your projects or your budget, it’s time to make smart investments and grow your money. Explore your options and decide what’s best for you.
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