These are the prime earning years in the life of an individual. Some of the goals to include in your list of priorities are:
- Maximize RRSP contributions
- Reduce debt
- Minimize taxes
- Develop non registered investments and review investment holdings
- Monitor children’s education fund and allow for flexibility to grow fund if necessary
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For information on RESP click here.
The best tax is no tax. That is the view held by most people and some go to the extent of trying to avoid taxes, a serious offence under Canadian tax laws.
“The first known incident of avoidance appears about 4,000 years ago in Mesopotamia. A king, embroiled in a war, needed money for his army. He levied a small tax on individuals who crossed a bridge across a local river to farm on the other side.
The citizens began swimming across the river to avoid the tax – an act of lawful tax mitigation. Not to be outdone by, the king enacted the first anti-avoidance rule in history by decreeing that it was a capital crime to swim across the river. It put an end to the tax avoidance scheme. “
Source: Vern Krishna, The Bottom Line (June 2010)
Income tax in Canada was first introduced in 1916 for businesses. Personal income taxes followed in 1917. Both taxes were intended as temporary measures to finance the First World War effort.