It's a new year which means it's a great time to make some solid financial resolutions that can help you get closer to your money goals.
Here are five strategies to consider that will help you make financial health a priority in the coming year.
You can find your RRSP deduction limit on your Notice of Assessment from the CRA. It's calculated as 18% of earned income for the preceding year, to an annual maximum of $26,230 for 2018. It’s usually a good idea to contribute as much as you can afford to your RRSP, as your contributions may lower your taxable income, while your earnings grow tax-deferred.
IMPORTANT DATE: March 1, 2019 is the deadline for contributions to an RRSP for the previous calendar year.
In 2019, you can contribute up to the annual limit of $6,000 plus any unused contribution room from past years. Your contributions are not tax-deductible, and you can access the money in your TFSA with no tax consequences for any need. Any withdrawals are added back to your contribution limit amount the following year.
Try to build an emergency fund containing three to six months’ worth of living expenses, with the money held in a low-risk, liquid account. This fund can help you avoid dipping into your long-term investments to pay for unexpected costs, such as a new furnace or a major car repair.
It’s never easy, but do what you can to keep your debts under control. The less you have to spend on debt payments, the more you can invest for your future.
If we experience a sharp market downturn in 2019, don’t overreact by taking a “time out” from investing. Market drops are a normal feature of the investment landscape, and you may ultimately gain an advantage by buying new shares when their prices are down.
Remember, it's important to measure your progress throughout the year with your Financial Advisor. Take some time to review your short-term and long-term financial goals and determine if your investment portfolio is still appropriate for these goals.
Edward Jones, its employees and Edward Jones advisors do not provide tax or legal advice. You should review your situation with your tax or legal professional for information regarding, or issues concerning, the tax implications of making a particular investment or taking further action.
Investors should understand the risks involved of owning investments, including interest rate risk, credit risk and market risk. The value of investments fluctuates and investors can lose some or all of their principal.