Monday, December 14, 2015

Taking Control of Your Money in 2016

With talk about the climbing real estate prices, a recovering global economy keeping investment analysts cautious and the decline in oil prices, it is challenging for the average Canadian to know where to invest or even how to simply manage your personal funds.

The good news is 2016 is no different when it comes to the basic rules on sound personal financial planning.

The first rule has been and always will be; reviewing your personal and household debt. Reviewing how much debt exists, how it could be lowered and setting a time frame for repayment or eliminating it can help you to take control of your money and focus on your financial goals and priorities for the year.

Once your debt is under control and it is determined whether or not you are living within your means, cash flow can be considered. The traditional idea that monthly expenses are identified first and leftover savings second still applies.

Upon confirming cash flow, tax review comes next. Experts recommend families look at all tax incentives they can take advantage of. Although the anticipation for 2016 is the Tax Free Savings Account limit will be clawed back from $10,000 to $5,500, tax analysts report middle class families should watch for a tax break on the rate for the middle income tax bracket moving from 22 percent to 20.5 percent.

Discussing your financial situation with the whole family is another recommended step in your personal financial planning process. By involving family members, the final financial plan can better reflect everyone’s interests equally. Experts point out today’s family definition may extend beyond the conventional family unit and include siblings, aging parents or close acquaintances.

Finally, after the year’s plan has been established, experts recommend families look to resources for more detailed information about financial planning.

As a mortgage professional, I can be a crucial resource and tool to help you.  Ask me how you can reduce your overall mortgage costs so you can put more into your home equity or savings.

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