This post was sponsored by TD but, as always, opinions are my own.
Our office looks like a cyclone has gone through it! There are receipts, piles of paper, and three mugs of cold coffee on the desk. No, the kids haven’t been making a mess, it’s just Paul doing our taxes!
Once again it’s that stressful time when my husband gets up in the middle of the night to plug in the numbers and see how we did financially this year. It’s when we work together to find all of our charitable donation receipts, compile the kids’ expenses and relive the financial stress from the year. In the back of our minds live all the ideas of what we will do with that coveted tax refund. Last year, our return meant that we could finally build our dream deck, but what about this year? Will we finally complete the exterior renovations to our front porch and pillars? Could we actually take another trip this year? Will we trade in Paul’s car and use this money for a deposit on a new one? Or, should we simply save it?
While we have tons of great ideas on how to spend our tax return, we had to figure out how to save the money until we’ve made our final decision. We could just let it sit in our account or maybe contribute to our RSP but we’ve decided to put it in a Tax-Free Savings Account (TFSA) from TD. I didn’t really know what a TFSA was, until an event with TD last summer. I learned that TFSAs are great for long or short-term goals because your savings can grow more quickly when you don’t have to pay tax on investment income.
So many people choose to put their tax return into an RSP, but did you know that you are taxed on a withdrawal from an RSP, but not a TFSA? RSPs make the most sense for long term savings like retirement, education and buying a home, but TFSAs have far more flexibility to help you save for shorter term home renovations, family vacations and really ANY other purpose you and your family have in mind.
Here is some information about Tax-Free Savings Accounts or TFSAs from TD:
- The ability to earn more with a tax-free investment because your savings grow tax-free
- You can earn up to 8.88% with a 3-year Security GIC Plus
- TD will help you find the right Tax-Free Savings solutions for every type of investor from high interest savings accounts, to term deposits or mutual funds
- Please visit TD Canada Trust to find out more info on the various TFSAs available at TD, FAQs, what a TFSA is and what the difference of an RSP and a TFSA.
It’s a tough decision, but with the right information, you can make this money work for you and your family and even achieve your short or long term savings goals!
So, what will you do with your tax return this year?