Tips on how to make use of your tax refund

1. Pay down your RRSP loan or make your 2010 RRSP contribution now

2. Pay down credit card debt
(interest on some credit cards can eat away at your savings. Reduce the cost of credit by using your tax refund to reduce or pay down your credit card balances, targeting the highest rates first).

3. Lump sum mortgage payment
(if you have a mortgage, it is a good idea to use your tax refund to make a lump sum payment. Applied directly to your principal, a lump some payment could save you significant dollars in interest costs over the life of the mortgage).

4. Top-up your TFSA
(if you are not carrying any extra debt then make your refund work for you. Contributing to a Tax-Free Savings Account (TFSA) can let you grow your money tax free. Even if you maxed out your TFSA contribution in 2009, you have room for an additional $5,000 this year).

5. Save for education
(an education can be an expensive thing. Contributing to a Registered Education Savings Plan (RESP) can help alleviate some of the pressure that all parents feel when planning for their children's future. Consider opening an RESP using your income tax refund. A $2,500 dollar contribution to an RESP can earn a $500 grant from the government. Maximize your contributions every year and you could earn up to $7,200 in lifetime grants for every child).

Bank of Canada says rate increase may be coming as soon as June 1st.

The Bank of Canada signaled Tuesday that a half point rise in the overnight rate could happen as early as the June scheduled rate announcement. Canadians may even be hit with a 1/2 point rate increase at the next announcement June 1st. The premature move, a month ahead of the scheduled July increase, is due to a stronger than expected economic recovery. A rate hike in June would position Canada 1st amongst the G7 countries to raise rates.

Click here to read the full article.

$450-million complex/casino coming downtown

The B.C. government announced their plans yesterday to develop a new $450-million retail and entertainment complex just west of BC Place downtown. It will include 2 hotels, a new casino and 5 restaurants.

Read about it and see a video HERE

Interest rates may rise sooner than expected

Bank of Canada Governor Mark Carney acknowledged today that inflation is running hotter than he had predicted, and emphasized the central bank’s commitment to containing price increases, a combination of fact and nuance that increases the odds of an interest rate increase within the next few months.

The measure of inflation the central bank uses as a guide to where overall prices are headed touched 2.1% in February, a pace the Bank of Canada was not expecting until at least the second half of 2010.

“Core inflation has been slightly firmer than projected,” Carney said in the text of his speech to the Ottawa Economics Association.

Some economists have dismissed the stronger core rate as the result of temporary factors, such as a surge in hotel costs related to the Vancouver Olympics. Carney agreed that some of the increase is the result of “transitory factors”, but also said that a “higher level of economic activity” is also playing a role, suggesting policymakers are taking the jump in the core rate seriously.

Click here to read the full article

Housing Market to stay very stong through Spring 2010

Looks like Canada's housing boom will continue throughout the Spring. The inevitability of rates rising sometime later this year, combined with historically record rates on both the variable and fixed rates have kept Canadians on the hunt for properties. Other factors include buyers hoping to get into the market before the tighter mortgage rules come into effect April 19th, and the HST in July.

Click here to read the full article

The effects of our rising Canadian Dollar

Financial experts are saying that even with the Canadian dollar hitting par with the US, it may not slow down the inevitable rate increases that are planned by the Bank of Canada later this summer.

David Rosenberg, chief economist at Gluskin Sheff + Associates says "The Bank of Canada has had ample opportunity to talk the money markets out of pricing in a series of interest rate hikes beginning this summer,"

A strong dollar, which slows down our domestic trade to the US is supposed to slow our economic recovery by keeping inflation below the target 2% rate, thus keeping interest rates low. I guess we will have to wait and see.

To read the full article click here

Young Canadians lead home buying this year

If you're between the ages of 18 and 24- you're the age group expected to lead the way in home buying this year in Canada.
This according to a new survey done by Royal Bank; they found that 15% of Canadians in this age group are very likely to buy this year, almost double that of last year. And 35% of young Canadians are intending to buy a home due to "good real estate prices and low interest rates".

Canadian Press says " It's a marked shift in the attitudes of younger Canadians, who have tightened their budgets over the past few years to cope with tough jobs markets and the recession."

Read the full article here