What to do With Your Tax Return?
I suppose the first question is ‘Have you done your taxes?’ and the second question ‘Why do them?’.
A) If you owe money, pay Canada Revenue Agency (CRA) promptly to avoid penalties and interest.
B) If CRA owes you money then it would be nice to get it sooner rather than later.
Once you know you will have a refund coming:
- Have a plan. Decide what you want to do with it before you get it.
- Consider splitting the funds for different purposes such as repay debt, savings and splurge.
What to do with the extra $ in your jeans…..here are some ideas:
- Pay down a credit card. Often these are the highest interest debts.
- Pay off a debt or if there isn’t enough to repay it entirely, a lump sum payment on your mortgage or loan will save you a lot of interest.
- Save in a Registered Retirement Savings Plan (RRSP), bank account or other investment.
- Put it towards a weekend away or a vacation.
- Save it for a large purchase such as a home or car.
- Splurge on something you will enjoy!
Posted: May 5th, 2011 under CEO of the House, Money Savvy Tips.
Tags: Financial Planning
