Select Page

Three tips to make the most out of your tax return this season

Three tips to make the most out of your tax return this season

Spring has sprung, and with it comes fresh flowers, chirping birds and tax returns.

Many of us are expecting to walk away a little richer this season – out of all filed returns from the last tax year, the CRA published that 59 per cent resulted in an average return amount of $1,682 – and although a new iPhone or a shopping spree sound like a way better way to spending your return, here’s a smarter idea: Invest it!

We tend to fall into a trap of considering our tax returns to be ‘found money’ – money that was previously unaccounted for but we’ve now stumbled upon as a bonus. Because we see it as a bonus, many feel like it can be spent more frivolously than money already budgeted for bills, housing or food.

Whether you’re spending your tax return, or dipping into your savings, spending $1,000+ reduces your net worth by that amount regardless of where it came from.

So, instead of that sweet new pair of shoes, think about following these tips from the financial experts at ModernAdvisor. Also known as a robo-advisor or online portfolio manager, their mission is simple: To give Canadians access to high quality, low-cost investment advice – regardless of their net worth.

Pay off your high-interest debt

The number one way to use your tax return is to rid yourself of debt. Pay off high-interest credit card bills, loans or any other debt that is charging high rates of interest. A poll done for BMO shows that in recent years, 40 per cent of Canadians used their tax refunds (or a portion of them) to reduce their debt. This is compared to the 25 per cent who put their money in savings or investments, 14 per cent towards travel and leisure and the nine per cent used it to pay down their mortgage.

Build your emergency fund

Use your tax return to start an emergency fund or bulk up your savings in an existing fund. You never know when a hot water tank will burst or your car will break down. It’s important to have funds set aside that are easily accessible. Ideally, you want to have enough in an emergency fund to cover your living expenses for up to six months.

A great way to set aside money is a High Interest Savings Account (HISA). HISAs offer interest rates that are above what regular savings accounts typically offer. You can get a HISA at most banks, so be sure to shop around for the best interest rate. In some cases, you can get rates as high as 1.85%. Make sure you do your research – Highinterestsavings.ca is a good place to start.

Invest in your future

Finally, think ahead. Invest in your future, whether it’s a TFSA you’re using for a down payment, your RRSP for retirement, or an RESP for your children’s education. There are many different options for Canadians to make smart investments. When considering your investing options, make sure you are investing wisely and not spending too much money on high-fees or portfolios that don’t give you best bang for your buck.

Did you know that with fees substantially lower than the banks, ModernAdvisor can help you retire 7 years earlier? If you need help planning out your next move, the team of modern entrepreneurs, engineers and financial gurus behind ModernAdvisor are on hand to help with any portfolio. Forget the fees, appointments and confusing financial jargon. ModernAdvisor’s on-demand platform is easy to use and their low fees mean you’re keeping more of your money, without sacrificing returns. You can stay up-to-date on all your investing activity with the easy-to-read dashboard, accessible from any of your devices.

The best part? ModernAdvisor offers a 30-day free trial with an account funded by them for $1000. If you decide to invest, you keep the earnings!

Sign up for your free trial today at https://www.modernadvisor.ca/springboard.

About The Author

Surrey604 Staff

Surrey604 is an online magazine and media outlet based in Surrey, BC. Through writing, video, photography, and social media, we secure an intimate reach to the public. We promote local events and causes.

Advertisement




Recent Posts

PHOTOS: VISAFF 2017 Opening Gala at Surrey City Hall

Published 11/19/2017 in Surrey604 Magazine

The Opening Night Celebration for Vancouver International South Asian Film Festival (VISAFF) was “THE” event to be seen at as it kicked off the festival with unforgettable entertainment.

Attendees walked the red carpet with one of the finest actresses in Bollywood, “Ms. Huma Qureshi” to indulge in some distinctly Indian delicacies and experience a night to remember to begin a week of… read more ❯

PHOTOS: Drishti Awards Gala 2017 at Aria Banquet Hall

Published 11/18/2017 in Surrey604 Magazine

Last night the Drishti Media Group celebrated its 7th anniversary and presented the 3rd Annual Drishti Awards Gala honouring 10 individuals who have achieved innovation and excellence work in their fields of endeavour.

It was a splendid night featuring a cocktail reception, award presentation, mesmerizing entertainment, fashion show, dinner and dance. Partial proceeds go to BC Children’s… read more ❯

Social Innovation Summit Report November 2017

Published 11/18/2017 in Sr3y

Maximum Canada
How do we build the strategic imagination that can shape our cities and communities to lead the world in achieving prosperity, sustainability, equality and reconciliation? Questions such as this are raised by Doug Saunders in his book ‘Maximum Canada: Why 35 Million Canadians Are Not Enough’. His book roots for the open, pluralistic and… read more ❯

Meet Surrey Girl, Steph Hassell

Published 11/17/2017 in Surrey604 Magazine

Co- Owner of Violet + Ruby
Grew up in: Whalley | I’m proud to be from a place that four generations before me lived, I went to the same high school as my dad and my grandfather – I’m not sure many people can say… read more ❯

The Shell Busey 75th Birthday Roast & Toast Fundraiser

Published 11/15/2017 in Surrey604 Magazine

The Surrey Hospice Society will be hosting a 75th Birthday Roast and Toast for home expert broadcaster, Shell Busey, on Saturday, November 25th at the Mirage Banquet Hall in Surrey, BC.

The celebration will feature a good-natured roast of Shell, a delicious dinner, silent auction, table raffles, door prizes and a live band with room to dance.

100% of the proceeds benefit the Surrey… read more ❯

Recent Videos

Loading...

Recent Tweets