TORONTO, ONTARIO--(Marketwire - Nov 20, 2012) - To mark Financial Literacy Month and Financial Planning Week (November 19th - 25th), BMO Financial Group is releasing a series of financial tips. As part of BMO''s commitment to ''Making Money Make Sense'', the tips are designed to help individuals and families save and manage their day-to-day finances more effectively.
BMO''s Tip of the Day: Use the tax refund generated by your Registered Retirement Savings Plan (RRSP) contribution to pay down your mortgage.
"We often hear the question, should I pay off my mortgage or save more for retirement?" said Marlena Pospiech, Senior Manager of Enterprise Wealth Planning, BMO Financial Group. "If you don''t have any other high interest debt, the answer could be both."
Ms. Pospiech encourages Canadians to consider using the tax refund generated by an RRSP contribution to make a lump sum mortgage payment each spring - potentially taking years off the life of their mortgage.
For example, if the tax refund is equivalent to one mortgage payment and that lump sum payment is made every year, this can reduce the mortgage by three years on a 20-year mortgage. If the return is more than double a regular mortgage payment, this could reduce the number of years on the mortgage by eight or more, depending on interest rates.
"CFEE commends BMO''s ongoing efforts to support Financial Literacy in Canada and promote ways in which Canadians can increase their competence and confidence when managing their personal finances on a day-to-day basis," said Gary Rabbior, President, Canadian Foundation for Economic Education (CFEE).
To learn more about how financial planning can help you feel confident about your future or to contact a financial planner visit www.bmo.com/retirementplanning or call 1-888-389-8030.
BMO Financial Literacy Month Tips
November 5: Space out payments to avoid cash-flow problems.
November 10: Understand what you can hold in your RRSP.
November 17: Take advantage of spousal RRSPs.
About BMO Financial Group
Established in 1817 as Bank of Montreal, BMO Financial Group is a highly diversified North American financial services organization. With total assets of $542 billion as at July 31, 2012, and more than 46,000 employees, BMO Financial Group provides a broad range of retail banking, wealth management and investment banking products and solutions.