Monthly Archives: February 2010

Pay yourself first

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The unsung hero of wealth creation: Pay  yourself  first.

 One of the most powerful strategies for building wealth is to pay yourself first. What this means is taking your pay cheque and setting aside money for your future BEFORE you pay any bills. Of course, this can be difficult if you’re living from pay cheque to pay cheque. But the reality is, if you want to build financial security, you have to start investing for tomorrow—even if it means taking a part-time job, starting a home business, reducing expenses or clipping coupons.

 Here are some helpful tips:

  • Start small. Start with an amount you’ll hardly notice, like 5-10% of your income, then work toward 20%.
  • Make a budget. Only by knowing where your money goes can you see where savings can be made.
  • Automate your saving. Transfer it automatically from your chequing account into a separate account. Or buy a Canada Savings Bond and make monthly payments.
  • Lock it into a RRSP. Take away temptation by putting the money into an account that charges a penalty for early withdrawals.
  • Increase your mortgage payments. By dedicating it to your mortgage, you’ll enjoy huge savings over the long run.
  • Invest in a revenue property. Once you’ve saved enough for a down payment, buy an investment property and use the rental income – and if need be, a portion of your “pay yourself first” funds –  to cover your mortgage payments. After a few years, you’ll have the financial security you’ve always dreamed of!

 Make a commitment today to you and your financial future, start paying yourself first!

Use your RRSP for your down payment

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Radio Real Estate Interview February 6 2010

On the weekend I had the great privilege of being invited to speak on the Radio Real Estate Show on AM 650.

This is what I said …. “ There are a number of financial incentives for First Time Home Buyers.  As this is RRSP season, I am going to talk about using your RRSP contributions towards buying your first home.

First-time homebuyers who are Canadian residents can withdraw up to $25,000.00 from their RRSP tax free.  Through Canada’s home buyers plan you and your spouse can each withdraw up to $25,000 to build or buy a qualifying home.

You can still make an RRSP contribution TODAY!  You will get the income tax deduction for 2009  and then use that RRSP contribution 90 days later towards your down payment on the purchase of your first  home.

Make sure you are not locking in your RRSP savings into a fixed term investment, such as a 5 year GIC. You need know you can have access the funds when you do buy.

RRSPs are great way to save for your first home purchase and a great way to get yourself into the real estate market”

If you have questions about planning for your first mortgage, call me. I look forward to helping you achieve that goal this year!