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 The
Money Management Newsletter: Managing
Money
Investment planning throughout the life-cycles:
ABCs & 123's
Ages 31-40:
Making the dollars go further - juggling priorities
By the Money Management Editor
Money Management Newsletter
For most, these are the prime spending years when mortgage payments,
childcare expenses, education savings and other things put a strain on
the bank balance. You'll be wondering if there will be enough money to
go around. The following strategies will help make your savings dollars
go that much further.
The first thing to be mindful of is the reduction of what is probably
your largest annual expense - personal income taxes.
- Take full advantage of your RRSP contribution limits to maximize tax
savings.
Unused contribution room carried forward from previous years can also
be utilized to further reduce current taxes but be mindful not to apply
too much to any given year as your tax savings rate may be reduced.
- Consider making bi-weekly or monthly RRSP contributions to your RRSP
- saves the last minute scramble. With regular contributions, you can
arrange to get the tax savings with every pay cheque. This will require
the co-operation of your employer along with CRA approval.
- With the extra savings, consider rearranging your mortgage payment
schedule - changing from monthly to rapid weekly or bi-weekly payments.
This will save you thousands in interest payments, by cutting years
from your overall mortgage amortization.
- Structure your non registered investment portfolio with an emphasis
towards dividend and capital gain investment returns; as against earning
interest income that attracts a higher tax rate.
Pointers:
Review and consider your accumulated responsibilities, towards your family's
welfare - do you have enough insurance to fulfill your goals - children's
education, debt free dependents or maintain your financial well-being
if you become disabled or critically ill?
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Next page: Ages 41-50 -
Accumulating wealth and the transition to savings |
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, Fiscal Agents Money Management Newsletter
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