Financial dilemma

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roxany

roxany

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im just curious to see ur opinions.

...

Here we go...

i have 14 000$ debts (loan)
but i have enough money in my rrsp to pay it in full.

Should I , keep the rrsp and pay my loan very slowly
Should I remove my rrsp and pay all the loans...

or wait until to get a "hypotheque", get my loan in the hypotheque, and rap? wrap ? (even in french i dunno the good word) my rrsp ?

or other smart idea ?

p.s. i plan to buy before next fall.aka 2006
 
you're gonna get taxed to shit if you pull out you rrsp. Find out how much you'll be left with after taxes then decide.
 
What is the debt you have and what interest rate?
Do you have a credit line?
Of what is comprised your rrsp?
How much income are you making this year?
Do you have any unused tax credits?

PM me if this info is too personal to be shared on the forum.
 
sell your car, pay off your loan. DO NOT take out your rrsp's to pay a loan.. that's stupid. Keep that for a wrap on a house.
 
save your rrsp to use as a downpayment on your home, rox. 14k really isn't that bad of a debt load to carry, particularly if your interest rate is below 8 percent.
 
ya keep those rrsp and tough it out...youl thank yourself later when your sitting on your cheese.
 
re

the best is a marge de credit at 4 1/4 % interest, keep ur rrsp for more important buys like a house, 14 k isnt much to take care of, depends what you make also, check with planificator for best choice.

good luck*tu*
 
Prelude01 said:
What is the debt you have and what interest rate?
Do you have a credit line?
Of what is comprised your rrsp?
How much income are you making this year?
Do you have any unused tax credits?

PM me if this info is too personal to be shared on the forum.
Click to expand...
debt is marge de credit 7.0% i/r maybe 8 %
i dont have any unused taxes credit

Daso said:
sell your car, pay off your loan. DO NOT take out your rrsp's to pay a loan.. that's stupid. Keep that for a wrap on a house.
Click to expand...
sell the car = money = pay my personnal loan for my car, not my other loan
 
btw it's not WRAP but RAP as in Regime Acces a la Propriété

keep your RRSP for your house/condo and pay off the loan slowly, especially since your interest rate on your loan isnt that high
 
roxany said:
debt is marge de credit 7.0% i/r maybe 8 %
i dont have any unused taxes credit


sell the car = money = pay my personnal loan for my car, not my other loan
Click to expand...

The general consensus is right don't touch your rrsps, its not worth it. When you buy your house don't forget to max out your allowed RAP (25K) and if you have extra cash flow don't reimburse it before the maximum allowed (10 years), instead you should shorten your mortgage.
 
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If you have money taken from your paycheks or a monthly amount taken from your bank account that goes into your RRSP, redirect that money to reimburse your credit line. You'll get a direct paybeck of 7% that way (that's 7% garanteed payback and riskfree.) No RRSP, mutual fund have paybacks that come even close to that. Very few shares offer such a good payback too.

As for the house, if you're planning on living in it, I would put that idea on hold for a while. Buying a house is financialy the worst move you can make, it's second to only renting a house. The third worst financial move is buying a car.
 
MrFondu said:
If you have money taken from your paycheks or a monthly amount taken from your bank account that goes into your RRSP, redirect that money to reimburse your credit line. You'll get a direct paybeck of 7% that way (that's 7% garanteed payback and riskfree.) No RRSP, mutual fund have paybacks that come even close to that. Very few shares offer such a good payback too.

As for the house, if you're planning on living in it, I would put that idea on hold for a while. Buying a house is financialy the worst move you can make, it's second to only renting a house. The third worst financial move is buying a car.
Click to expand...
i'm buying a house with my best friend, it will be cheaper than paying a rent
 
MrFondu said:
If you have money taken from your paycheks or a monthly amount taken from your bank account that goes into your RRSP, redirect that money to reimburse your credit line. You'll get a direct paybeck of 7% that way (that's 7% garanteed payback and riskfree.) No RRSP, mutual fund have paybacks that come even close to that. Very few shares offer such a good payback too.

As for the house, if you're planning on living in it, I would put that idea on hold for a while. Buying a house is financialy the worst move you can make, it's second to only renting a house. The third worst financial move is buying a car.
Click to expand...

I have to disagree with you on two major points. "Redirecting" is a misleading term to give to any money placed in an RRSP - RRSP contributions, up to a yearly maximum, are NOT TAXED. It is TAX FREE INCOME. If this income were to be deposited elsewhere, it would instantly be taxable, thus negating or at the least, seriously crippling your perceived 7 percent payback. Your understanding of how an RRSP functions is fundamentally flawed.

Second, I can see no reason why buying a house is a bad financial move. How can the prospect of acquiring equity as opposed to renting a dwelling such as an apartment even be compared? Acquiring equity at a young age is one of the most EXCELLENT choices that can be made financially, and if you are in a position to do so, then do so.
 
roxany said:
i'm buying a house with my best friend, it will be cheaper than paying a rent
Click to expand...


And you are building equity. Rent is close to setting money on fire. Sure you get shelter, but no return. It's not the best way to fulfill that basic need.
 
roxany said:
i'm buying a house with my best friend, it will be cheaper than paying a rent
Click to expand...

yeah, that's what people think. It's also what banks want you to believe because they make an awful lot of money from mortgages. Actualy, buying a house is the number one cause of breakups and divorce. A house is a real financial money pit. It is more than just paying the nortgage and property taxes.

Anyway, if you're financialy tight, I would think about it twice.
 
MrFondu said:
As for the house, if you're planning on living in it, I would put that idea on hold for a while. Buying a house is financialy the worst move you can make, it's second to only renting a house. The third worst financial move is buying a car.
Click to expand...

Buying any property is far from being the worst move, your building equity, you have something against your money, only part your loosing is interest, unless you manage to sell your house for more than you paid for (inflation, interest and opportunity cost included)

A car is the worst thing you can buy, it depreciates, renting an appartment, while being cheaper, is money down the drain, you get nothing against it
 
MrFondu said:
yeah, that's what people think. It's also what banks want you to believe because they make an awful lot of money from mortgages. Actualy, buying a house is the number one cause of breakups and divorce. A house is a real financial money pit. It is more than just paying the nortgage and property taxes.

Anyway, if you're financialy tight, I would think about it twice.
Click to expand...

what do you propose as a solid financial alternative to home ownership????????????????????????? Renting your entire life?

Like it or not our economy thrives on credit, and a solid asset like a house or property is the most important asset you can use to borrow or increase net worth.
 
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