Newcomers to Canada can sometimes find themselves in straitened financial conditions.
Hard-earned money seems to disappear quickly while they search for employment.
And it’s not uncommon for them to find themselves owing money.
But take hope.
Experts say there is a way to save money and pay down debt at the same time.
With recent statistics showing that Canadians are carrying more debt than ever before, many feel it must be one or the other: pay down the debt or save for retirement. But according to personal finance experts, it’s possible to have the best of both worlds and it’s not as hard as you think.
“Start by taking a proactive approach to your finances,” says Wade Stayzer, Vice President of retail and investment services at Meridian, Ontario’s largest credit union.
“By identifying your financial goals and then working with a trusted financial advisor to build a plan to achieve them, you’ll find that the payoff is well worth the effort.”
Stayzer offers some additional tips for achieving your goals:
Set up a personalized financial plan. Once you and your advisor complete a plan it will be like driving with a GPS system: you’ll reach your end goal faster and with less stress. Make sure you are honest with your advisor and give the full picture, so he or she can help you reach the chosen destination. Check in at least once a year to re-evaluate your plan and make the course corrections needed to keep you on track.
Be strategic. Pay off the debt with the highest interest rate first, while paying the minimum on the rest of your debts. Once that is accomplished, concentrate your efforts and available funds on the next debt with the highest interest rate.
Invest automatically. Saving for the future is easy if you put it on autopilot. Many financial institutions provide pre-authorized contribution (PAC) plans, which will automatically transfer funds from your chequing account into your savings investments at regular intervals.
PACs are a great tool for contributing to RSPs or TFSAs and if you coordinate the withdrawals to align with your payday, the money won’t even be missed.
More information is available online at www.meridiancu.ca.
– News Canada
Posted: Feb 3, 2015