TFSA contribution vs. paying down mortgage?
Hi all, My husband and I have been discussing our finances (as is everyone else!) and are trying to decide where to put our money. We are newlywed. Perhaps I should mention that my husband has investments (mutual funds, company stock and bonds), and a life insurance policy with his company. We both have RRSPs and are repaying into the new home buyers plan. We are otherwise debt-free, save our car lease and mortgage. Given the economy going as is, the idea of a TFSA became interesting as extra liquidity in case one of us loses our jobs. But so is paying off our mortgage as early as we can. I have $5000 saved up from last year. Are we better off putting this in a tax-free savings account, and then investing it, OR should we put this into our mortgage as an extra payment? Any guidance would be appreciated.
Asked By: Cat V - 1/15/2009
Best Answer - Chosen by Asker
Open up a discount brokerage account like Charles Schwab or Fidelity... More
Answered By: Judy - 1/15/2009
Additional Answers (2)
It is a personal choice but I have always liked paying down my mortgage early. However, I also am conservative enough to want to have available cash in the event of unexpected expenses or the loss of income. You should set a goal of so many months of living expenses in a cash account and a little extra in case of car... More
Answered By: Othniel - 1/15/2009
Do you have at least 6 months of living expenses saved up? If one or both of you lose your jobs, then it could be 6 months or longer in today's job market before you find another job. If you don't have that emergency fund built up, then I'd put the money into a money market account or into a savings account and leave... More
Answered By: rockjock_2000 - 1/15/2009
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