It’s Canada tax season 2023, and you might be wondering what to do. What should you do with your tax refund, should you get RRSPs, or should you throw money at the mortgage? Here’s my opinion:
It’s our favourite time of the year, tax season! No, I hate tax season too, but it raises a good question as to what to do with your tax refund. Should you get RRSPs, et cetera or should you throw money at the mortgage? My answer to that is kind of all of the above.
First off, should you contribute to RRSPs? Yes, you should, because you get a tax deduction. And so let’s say you do end up with a refund. What should you do with that money? Well, it depends. You could put that refund into RRSPs as well and get a bigger refund, potentially. Or you could pay down your mortgage, or you could potentially pay down more expensive debt.
Personally, I would say go after credit card debt first with your refund and then throw extra money on your mortgage. The more you can chip away at your mortgage—it does not have to be huge amounts of money, every little bit counts,—but the more you put at it, the sooner you can get that mortgage paid off. And then life really changes. You’ll have lots of cash flow and you can save for retirement.
If you have questions, feel free to give me a call.
I have a great video on if you should refinance your mortgage to pay off debt too.
About Jason Scott, Edmonton Mortgage Broker
Looking for a personalized mortgage solution? As an Edmonton Mortgage Associate, I’ll be your trusted partner who will help you get the right mortgage for your family home or Investment property. I’m Jason Scott, and I’ll be your Mortgage Broker Edmonton.