Tax credits, tax deductions, smart ways to save money?
What’s the best ways to save money? Don’t let me stress you out right of the bat! With all these questions, it depends on where your priorities are (what you allow yourself to buy). As a firm philosophical foundation, saving money as a personal culture needs to be the central part of any financial plan. Given today’s money-cultural, social and digital habits, it seems harder than ever to save money effectively and efficiently.
Here in Canada, we have the high interest savings account and RSP plans. These seem to be the common first thought as a way to tax effectively save. Saving seems to be on the back burner for most. We’re guilty of over-buying with our homes and our cars. The large purchases that the current low interest environment seems to make easier to afford. This ability to afford more is encroaching on funds that are otherwise needed for future use in a sound savings vehicle.
People today should be looking at what their true necessities are, and staying within those concrete boundaries. For those fortunate people who can save, there remains the question of where to put the hard-earned money.
Here is where it’s important to turn the focus towards efficiency. What is the one thing that most delays the growth of our savings? Taxation. Estate planning, Living Wills, and future inheritances, all fall prey to taxation which decimates any significant growth. Many don’t even realize how much of their future money gets stolen by the effects of annual taxation.
Have you ever asked yourself which investments in Canada are able to grow money tax free are? There are only three: there is capital gains on principal residence, and the tax-free savings account. Unfortunately they both have a ceiling. Lastly (and the most misunderstood) is Life Insurance.
Families who are able to reduce the effects of taxation on their savings as well as maximize multi-generational wealth are those who seek proper advice. Advice about how to amplify your future net worth. All while reducing the burden of taxation on your money.
Planning Ahead
Proper management of the income/savings ratio is the ‘seed’, planning is the gardener and good advice is the fertilizer! Initial conversation is free and we encourage you to get in touch. This could be your first step towards having your money really work for you.