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The Citizen, 2006-02-02, Page 13JACQUIE GOWING ACCOUNTING SERVICE Accounting & Income Tax Preparation Monthly Bookkeeping Tailored To "YOUR" Needs • Reconciliations • Personal, Farm • Government Remittances Business & Corporate • Payroll • Electronic Tax Filing All services available on site or at onr office RR 2 Bluevale (519) 887-9248 Fax 887-9454 THE CITIZEN, THURSDAY, FEBRUARY 2, 2006. PAGE 13. Financial Does your credit report paint a pretty picture? (NC)-If you're like most Canadians, you probably know that information on your credit history is on file, somewhere. But did you know that you can get a summary of your credit history mailed to you, free of charge? Your credit history If you've ever taken out a loan or used a credit card, you have a credit history. Every financial institution that gives you credit also sends information to credit-reporting agencies (or credit bureaus) about how much time it takes you to pay back money you borrow. If your credit is not good, a lender may charge you a higher interest rate or refuse to give you a loan. Landlords may also refuse to rent you an apartment. Needless to say, an error in your credit file could cause you difficulties. Your credit report A credit report, which is a "snapshot" of your credit history, is what potential lenders see when they check your credit. Fortunately, you can see for yourself what's in your credit report. If you ask them, all three credit-reporting agencies in Canada will mail you a copy of your credit report, free of charge. You can contact these agencies as follows: Equifax Canada, website: www.equifax.ca Tel. (toll-free): 1- 800-465-7166; TransUnion Canada, website: www.tuc.ca Tel. (toll-free): 1-866-525-0262; Northern Credit Bureaus Inc., website: www.creditbureau.ca Fax (toll-free): 1-800-646-5876. It's a good idea to obtain a copy of your credit report from all three agencies once a year and review it carefully, to make sure there are no errors. If you do find an error, it's in your interest to get it corrected immediately. If you have difficulty understanding the information in your credit report, help is available. The Financial Consumer Agency of Canada (FCAC) offers a guide on how to interpret the information and get errors corrected, as well as how to improve your credit petting. You can order the guide, Understanding Your Credit Report and Credit Score, by calling FCAC toll-free at: 1-866-461-3222. You can also download it at: www.fcac.gc.ca Some advice to help you budget for a home (NC) - Budgeting is a financial management discipline that is crucial if you are considering buying a home for the first time or are already a home owner. Budgeting helps you keep track of your spending. It allows you to put aside money for a down payment or to cover the many costs of owning and operating a home, such as mortgage payments, property taxes, utilities, insurance and maintenance. The average house price in Canada in the first three months of 2005 was $238,230, up from $226,230 in 2004. Thanks to mortgage insurance, Canadians can buy a home with as little as a five per cent down payment. ' Mortgage insurance helps protect lenders and mortgage investors from (NC)-Buying a home is often the largest and most fulfilling investment you will ever make. Home ownership, in nearly every case, involves the responsibility of carrying a mortgage. A good number of mortgages are paid over a 25-year period. However with discipline you may be able to pay it off sooner than you think. How? To illustrate how you can save, suppose you have a five-year, fixed- rate mortgage of $120,000 with a 25-year amortization and a constant annual interest rate of 5.80 per cent over the entire life of your mortgage, compounded semi-annually with regular monthly payments of $754. Below are four ways that can help you pay off your mortgage faster. 1. Increase Your Payment Amount If you increased your mortgage payment amount by just $246 from $754 to $1,000, you could save almost $47,408 in interest over the entire amortization period of your mortgage. You'll own your home about 10 years and one month sooner. Increasing your payment by even a few dollars lets you pay down your principal faster. Any increase in your regular mortgage payment is applied directly to the principal, reducing the length of time it takes to pay off your mortgage. You can increase the amount you pay on the principal anywhere from 10 per cent to 100 per cent depending on your financial institution. 2. Making -Payments More Frequently If you made bi-weekly payments of $377 instead of monthly payments of $754, you could save almost $19,776 in interest over the entire amortization period of your mortgage. You could own your home in approximately three years and 11 financial losses in case a loan is not repaid. This insurance benefits lenders and investors, but it also helps homebuyers. Because lenders are protected by mortgage insurance, they are able to offer low down payment loans to homebuyers at competitive rates. Sticking to a budget will actually improve your chances of getting a mortgage. By establishing a regular savings pattern you make your loan application stronger and increase the chances of having it approved by the lender. The money you have saved and put in your Registered Retirement Savings Plan (RRSP) can be used to help you with your home purchase. First-time buyers can withdraw up to $20,000 from their RRSP to buy or build a home. The amount months sooner. Making payments more frequently saves you money in interest charges over the long run as this helps pay down your principal faster. 3. Use your prepayment privilege and make a lump-sum payment If you made a $1,000 lump-sum payment every year, you could save about $22,307 in interest over the entire amortization period of your mortgage. You could own your home about four years and eight months sooner. By setting aside a lump sum each year to apply against the balance of your mortgage, you can save thousands of dollars in interest and shorten the time it will take to pay off your mortgage. Don't forget that you can make a lump sum payment of any amount The right tax planner can make tax season a lot less taxing. This year, let us prepare your taxes and enjoy the convenience and peace of mind that comes with knowing your return is in the hands of an experienced, trusted professional. We'll make sure you get all of the credits and deductions you deserve, so you keep more of your hard-earned money. Stop Stressing! withdrawn is treated as a loan and must be repaid within 15 years starting in the third year after the withdrawal. Budgeting is also an important part of successful home ownership, which allows you to get the most enjoyment out of owning a home. New homeowners have many new types of bills they probably didn't have when they were renting. They may be paying utilities such as heating and electricity and may be faced with unexpected bills to repair a roof, hot water heater, furnace and air conditioner or other maintenance costs. Budgeting can help you avoid the temptation of making major purchases on your credit card. If you know exactly how much you have to spend each month, you'll be less without having to pay any associated prepayment costs on your mortgage renewal date. Even a small lump sum payment can add up to big savings. - 4. Pay as much as you can at renewal If you chose five-year, fixed rate terms, and made a $10,000 lump- sum payment every time your mortgage came up for renewal, you would save.about $29,675 in interest over the entire amortization period of your mortgage. You could own you home about six years and seven months sooner. More information on how to become mortgage free faster is available from your local CIBC branch, by calling 1 800 465-CIBC (2422) or visiting www.cibc.com likely to build up debt payments. Here are a few tips for building a monthly budget. • For one month, write down all your daily expenses, no matter how small. Take a small note pad with you and write everything down. • Identify all of your large, regular monthly expenses such as rent, utilities, phone, insurance and figure out how much you have to set aside to pay them when they're due. • Calculate your monthly, after-tax income. Include everything - take home wages, tips, bonuses, any investment income, alimony, child support and pension benefits. • Compare your expenses and savings with your net income. Look for areas where you can cut expenses and increase your savings. Many people find they can CLINTON 48 Ontario Street (519) 482-3466 cut down on entertainment, clothing, and dining out. Reducing the number of credit cards you have to a maximum of two or three and consolidating the payments is a good financial management measure. Once you've created a budget and found ways to increase your savings, you can plan ahead to afford living in your home. The more you can save each month, the faster you can build the money you need to buy or maintain and improve your home. And continue to save each month as an emergency fund over and above your monthly living expenses can provide you with extra peace of mind. For more information on homeownership, please visit Genworth Financial Canada's website at www.genworth.ca Become mortgage free sooner Returns completed in one week or less Electronic filing available One Stop Bookkeeping & Income Tax Services Glenda Morrison, CIM Personal tax return preparation & bookkeeping services 81 Alfred St.., Brussels 887-8642 HEARTLAND T UNION RRSPs We make it easy ... so YOU can take it easy! Fixed Rate Term Deposits 5% Rate subject to change (54 month term) Call Us for Details EXETER 118 Main Street N. (S19) 235-0640 LISTOWEL Smith's Market Square (519) 291-6189 www.hea rtia ndcom m unitycu.on.ca