Tax tips for students

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Tax tips for studentsDespite what you read about Gen Y and how bad they are at saving for retirement, many experts say this generation are better than their parents were at planning ahead and securing their futures. If the market collapse and housing bubble burst have taught Gen Y anything, it’s that investing early in your retirement is the key to a more prosperous future.

One of the biggest myths of investing is not having enough money to make it worth the effort. No amount is too small to invest. Once you get into the habit of saving some money every month, you’ll develop a positive attitude towards financial security.

But what about student debt? Should I pay off my loan first?

This is one of the most troubling decisions. Where to start – do I pay off my student loan first? Or do I invest in stocks right away?

Student debt should not be ignored and you certainly do not want to repeat the bad spending-and-borrowing habits of your parents. Book an appointment with a financial advisor and set out a ‘debt-free living’ plan to get that loan paid off. This means sticking to a budget and resisting the temptation of going into debt over the latest and greatest gadget.

While you should work hard to pay off your debt, you can’t ignore the low stock prices of the current market. Because you’re young enough to sit back and watch your investments grow, the turbulent market shouldn’t put you off investing. For Gen Y, time is on your side and now is as good a time as any to invest in the future.

With tax time right around the corner, there are a few money-saving tax tips you can apply to help you save money.

Student Tax Tips

  • Public transport – keep those metro passes and other ticket stubs and use them as a non-refundable tax credit.
  • Moving expenses – if your summer job requires you to move residences, you may be able to claim this expense as a deduction.
  • Children – if you have children, you can claim childcare expenses, day camp fees, etc.
  • Full or part-time student – check what deductions are available to you for the 2012 tuition year.
  • Textbook costs – full-time students get to claim $65 of their textbook costs per month; for part-time students, it’s $20 each month.
  • Tuition fees – some non-refundable tax credits apply to students.
  • Student loan interest – non-refundable tax credits apply to the interest paid on your student loan.
  • GST/HST credit – make sure you complete this form to be eligible for this tax credit.
  • Transferring and carrying forward amount – you can transfer unused portions of your claim from year to year.

For more information about debt, taxes and saving for your retirement, contact one of our financial advisors at 1 866 833-7690 or visit workhealthlife.com

 

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