Six Tips for Spending

Your Tax Refund

A wide-screen TV might entice you. A tropical beach might beckon. But if you can resist the temptations, there are ways to get a bigger bang for your tax refund buck.

1. Pay down debt

Especially that high interest, non-deductible credit card debt and free up some monthly cash flow.

2. Pay off RRSP loans

Apply your tax refund to the balance of your loan. You’ll save on interest charges and free up money that would otherwise go toward monthly loan payments.

3. Make a lump sum RRSP contribution for the current tax year

The sooner you contribute, the sooner your investments start to compound, and the more you end up with when you cash out.

4. Create a rainy day fund

Set up a separate rainy day fund consisting of three to six months living expenses in secure, liquid assets to cope with emergency purchases or unexpected interruptions to your household income. Remember…taking the money out of circulation is the only way to get ahead.

5. Save for a child’s education

Drop your refund into a Registered Education Savings Plan on behalf of a child or grandchild and earn a 20% bonus from the federal government.

6. Avoid getting a tax refund in the first place

Set up a Pre-Authorized Contribution Plan to make regular monthly payments to your RRSP, and request a tax deduction at source. Your regular tax deductions will be lowered based on the PAC amount, which means you’ll have more cash in your pocket each month, instead of receiving a tax refund once a year.

Call Grandview Credit Union today and make an appointment to discuss your options.

See our website at www.grandviewcu.mb.ca for details.