It may seem counter-intuitive to think about refinancing your mortgage right before your income taxes are due. After all, how are they even related? The reality is that your mortgage is probably the single largest debt you carry, and you're paying it off with after-tax income.
Is there another kind of debt?
There is a way to turn your loans into good debt. Even the wealthy have debt, but with the help of expensive accountants and lawyers they are able to make the interest tax deductible. You can harness the same benefits with a simple yet powerful method that converts mortgage interest into tax refunds. It's so easy you and your financial planner can start turning your bad debt into good debt almost instantly!
Here's how it works
- Most people don't "max out" their RRSPs every year because they don't have the available cash flow to make a full contribution.
- If you have equity in your home, you may be able to refinance your mortgage for the amount of RRSP contribution room you have available.
- By topping up your RRSP, you'll also be in line for an income tax refund.
- Use your tax refund to pay down your mortgage faster, settle an outstanding debt, make next year's RRSP contribution, or diversify your other investments.
Sounds simple, right? This one strategy can dramatically improve your cash flow, which in turn can be further used to build more wealth. Once you get into the cycle of good debt you'll be able to save more money and become mortgage-free sooner.
The RRSP contribution deadline is March 1 to claim a deduction on your 2017 taxes. If you're interested in how you can turn your mortgage into a tax refund, get in touch with our team for a free consultation to discuss your options. Call us toll-free at 1-855-590-6520 or visit us at 307 Goldstream Avenue during regular business hours. We can also arrange an appointment at our Fort Street location, evenings, or weekends to work with you.