It is that magical time of the year, when folks are barraged with countless megatons of advice about financial matters. Some say it is RRSP season, others say it is Tax Preparation season, and still others say it is really TFSA season, but I disagree. It is also RESP season and for some of us RDSP season, because if you are doing financial planning and you have kids you had better include your RESP in those discussions as well. Is it RRSP , Tax , TFSA , RESP or RDSP season ?

RRSP , Tax , TFSA , RESP , RDSP or Dance Season ?
Image courtesy of Danilo Rizzuti, at FreeDigitalPhotos.net

The decision point for a lot of parents is always confusing but allow me two possible lines of attack for your financial decisions in February:

RRSP Pas De Deux

• Put an amount of money into your RRSP (assuming you have spare cash, and no debt to pay off, if you have debt, pay off debt)
• From the Refund that you receive (remember you are only deferring your tax on this money, they should really rename the thing, the Registered Tax Deferal Program)
  • ½ of the money into your TFSA, to build up (tax free) the tax you will need to pay when you take the money out of your RRSP.
  • ½ of the refund into your child’s (or childs’) RESP up to the max for the year. The RESP payment will get you added money from the government too.

RRSP Grand Jete (redux)

• Put an amount of money into your RRSP (assuming you have spare cash, and no debt to pay off, if you have debt, pay off debt)
• From the refund (again only deferred tax here), do the following
  • ½ of the refund up to the max for the year to your family member’s RDSP
  • ½ of the refund up to the max put into your kids’ RESP
  • Any remaining moneys put into your TFSA to build up the Tax Payment needed to take your money out of your RRSP.

The funny thing I am seeing on line is that many writers do not take into consideration the fact that many folks have many different registered accounts that “need to be fed”.

My Writings for Week Ending February 10th

This week I saw a really good article on the Stats Canada Web site, and that inspired, You are Spending More, where I do some comparison with the numbers in the Stats Canada report and report and contrast them. You can use these numbers to help plan your financial future, if you are not tracking your own numbers.

A Money Thought

As usual the folks at the Fraser Institute pokes at the Public Service with their latest report on the differences between the Public and Private sector employees.

Money News from the Ottawa Winter Wonderland

In Ottawa we are celebrating Winterlude, which seems to be going well, temperatures are conducive to the festival (not too cold, but not melting either). No mention of RRSPs down on the Rideau Canal these days.

• The Blunt Bean Counter asks Is Your Estate Planning Horizontally Challenged? What does he mean by horizontally challenged? Family relationships and how the will affect your estate. Mark has a lot of experience in these kind of areas.
• Stephen at HowToSave.ca asks, Are Robo Advisors Right For Your Retirement Savings? It all depends on the algorithms inside the advisors and whether they line up with your goals.
• Frugal Fringe brings you 50+ Money Saving Checklists. There is a lot of info here, but have a look, you might find some good ideas.
• You think your cell phone bill is bad? The CBC reports on a Telus customer hit with $24K cellphone bill: Could it happen to you? Yes, quite easily, especially if you turn on auto-roaming on your phone.
• Jon Chevreau writes about the 10th anniversary of Pension Income splitting with a piece in Moneysense, Pay less tax with pension income splitting. I thank the Tories for this essential part of my retirement plan.
• Mark from My Own Advisor points out something I have pointed out a few times, and that is The best time to invest was yesterday. If you had started yesterday you would be 1 day farther ahead!
• Are you looking for fixed income ETFs? Vanguard Introduces Four Canadian Fixed Income ETFs, you should have a look at them, if that is one of the styles of investing you want to use in your financial plans
• Michael James talks about Sharing Vacation Costs and the problems you can run into  when you vacation with friends.

RRSP? TFSA? Which One?

Kerry at Squawkfox brings us her spin on the topic with Should you contribute to an RRSP or TFSA? The answer is of course? Anyone? Bueller?

2016 Random Thoughts Year End

• February 3rd, Year of the Fire Rooster, Financial Groundhog Day and #MoneyTalk
• January 27th, Alternate Financial Facts, 1984 and #Moneytalk
• January 13th, Bungled Mortgages, Friday the 13th and #Moneytalk
• January 6th, Merry New Year, CPP, EI and #MoneyTalk

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