Before you spend any tax refund you receive, be sure to consider these five great ways to get the most out of your tax refund.
The very best thing you can do with a tax refund, is plan to avoid getting one. After all, the refund is actually a repayment of an interest-free loan you made to the government by overpaying your taxes. If you make a big RRSP contribution each year ask your employer to deduct less tax off your pay cheques. You wont get a big refund each spring, but your monthly cash flow will increase and youll be able to put your money to work in your interest instead of the governments. Talk to your Human Resource Department about how to get less tax taken off at source.
If you come into extra cash at any time of the year, be sure to talk to your financial advisor about your best course of action. An advisor should be able to help you decide which one of the above strategies works best for you. Or, he may even tell you to live a little and spend some of it!
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