Making Tax Refunds Work for you


 
Everyone loves receiving a tax refund. You’ve worked hard for your money and getting some back is a bonus. However, everyone’s financial situation is unique during these challenging times and what people do with their refund will vary. Talk to us about the best options for your tax refund, we can discuss debt management or we can help you invest the funds. Whatever situation you are in, we can help you take control of your finances.
 

Investing your tax refund

An RRSP contribution is one of the best ways to build your retirement savings.
By investing your tax refund into an RRSP, you can:
• Reduce your taxable income for the following year
• Generate a potential tax refund for the following year
• Grow your savings for retirement
 
Once you get into a yearly routine of investing your tax refunds into RRSPs and generating potential refunds for the following years, you will discover how your retirement savings can quickly grow.
 
CSCU offers other retirement solutions like RRSP Future Plan. It is designed to make RRSP contributions extremely easy and affordable to suit your monthly budget. Start with your tax refund as the initial deposit, then set up a monthly RRSP Future Plan.
• Convenient automatic monthly deposits
• Minimum monthly deposit is only $50
• Earn interest equivalent to the One Year Term Deposit rate*
 
An RRSP Future Plan started in July can give you up to 6 months to deposit and grow your RRSP for 2021. Add these monthly deposits to your initial tax refund deposit and you are building a more secure financial future.
 

Using your tax refund to manage debt

The pandemic has reduced income for many people with limited changes in their monthly essential expenses, including debt payments. Out of necessity, debt may have risen and paying off or down debt with your refund is a smart financial move.
 
Advice on managing debt:
* Determine how much you owe. This can make debt manageable.
* Determine the interest rates you are being charged. Pay off the debt with the highest interest rate (ie: retail credit cards)
* Avoid taking on new debt to pay off existing debt without a strategy. Debt repayment strategies include debt consolidation with a low-interest loan.
 
If your debt is higher than your tax refund, talk to us about debt consolidation. A Community Savings’ debt consolidation loan will allow you to blend your outstanding debts into one low-interest loan.
* Save on interest: Since your consolidation loan will most likely have a lower interest rate than your outstanding debt (such as retail credit cards), you will be able to reduce your interest payments.
* Lower monthly payments: By consolidating to a lower interest rate and/or extending your terms, you will be able to reduce your total monthly payments.
* Simplify your life: By replacing your numerous monthly payments with one simple payment, it will make it easier to manage your monthly household budget.
 
We are here to help you with debt management.
 
Let up help you take control of your finances, call us today at 604-654-2000