A new season of freshness is in the air, and as you start spring cleaning your home, you’ll want to spring clean your finances and avoid some big money traps.
In this four-part series, we’ll examine the first financial fail you might fall prey to: pre-spending your tax refund.
This is a big one. If you’re lucky enough to get what feels like a windfall, a tax-refund, keep in mind this is really your money being returned to you by the government without interest. It’s not a bonus at all. Plus, if you have a financial plan and have sat down with a pro like a Certified Financial Planner, they might have earmarked that pot of money to go towards paying down high interest rate debt, your mortgage or, into your retirement savings.
I weighted-in with Jennifer Crosby at Global News to talk about this phenomenon. Have a watch here.
If you’d like to learn more, check out this great article on how faulty mental accounting can trip us up with regards to our tax refund by my friends Preet Banerjee and Professor Dilip Soman. It was recently published in the Globe and Mail. Have a read here.
Check back in few days and we’ll look at the next financial trap – not rebalancing your RRSPs and TFSAs.