5 critical money moves to make in 2024 that will fatten your bank account

1. Grow your wealth and retire early with the help of a trusted advisor

Securing your financial future with confidence through a personalized plan designed to optimize investments, navigate taxes and ensure a comfortable retirement can seem daunting. Why do it alone when there’s a wealth of financial experts out there to help? Studies show that working with an advisor can add nearly 3% more to your annual returns.

There are plenty of ways to source a trusted advisor in Canada, whether through major banks such as Scotiabank, RBC or TD, or a simple online search (be sure to specify Canada or, more specifically, your city). The Government of Canada also has a great resource for choosing a financial advisor.

But, it’s crucial to be vigilant and thorough throughout this process. Financial advisors should have a minimum of one professional designation, such as Certified Financial Planner (CFP), Chartered Life Underwriter (CLU) or Registered Financial Planner (RFP), to prove they meet the necessary qualifications. Always check for relevant issuing bodies to ensure the advisor you’re considering is up to date and compliant with how to advise you on future money moves.

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2. Pay off credit card debt with a personal loan

Taking charge of your debt can result in greater financial optimism for the future, as you can finally stop wasting money on compounding interest and put those dollars back into your future by saving or investing them wisely.

Here are three more Canadian websites to seek help with debt relief: Credit Counselling Society: Offers credit counselling, debt repayment solutions and financial education resources Consolidated Credit Counseling Services of Canada: Provides credit counselling, debt management programs, and financial literacy initiatives Financial Consumer Agency of Canada: Offers resources and tools to help Canadians make informed decisions about their finances, including information on credit and debt management

Money.ca also offers financial calculators to help you manage your money better in a number of key areas, including:

• Savings
• Investments
• Debt-to-income ratio
• Credit card minimum payment
• Credit card pay off
• Mortgages
• Car loans

3. Stop wasting money on overpriced car insurance

Depending on your provider, car insurance can eat a significant chunk of your monthly budget. With insurance being so competitive, there’s a good chance you can shop around to find some sizeable savings. Just because you’ve been loyal to one insurance company for years doesn’t mean you can’t explore what’s available to you today, for less.

The best way to save big on auto insurance is research. You can consult an insurance broker to shop around for you or you can use comparison sites that let you compare quotes from a trusted brands like as insurancehotline.com, ratehub.ca or lowestrates.ca.

You can quickly and easily switch to a more affordable auto insurance option by providing some information about yourself and your vehicle and then choose from tailor-made packages that best suit you.

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4. Invest in real estate and other private assets

Wealthy millennials have discovered investment opportunities that were once the exclusive domain of hedge funds. According to a Royal LePage survey, a growing number of young Canadians between the ages 18 to 35 are choosing to invest in income properties before purchasing their own homes. The report highlights that this age group is more likely to own multiple properties compared to older investors. A significant 15% of investors in Canada own an income property without owning their primary residence, with this number increasing to 33% among those under 35.

Investing in real estate is a proven method for building wealth in Canada due to the potential for long-term property value appreciation, passive income from rentals and tax advantages.

For Canadians looking to dip their toes into real estate investment, options include buying a rental property, exploring real estate investment trusts (REITs) or participating in real estate crowdfunding. These smart money moves allow individuals to start their journey toward financial growth through real estate investment.

If you’re saving up to purchase your first home, consider opening up a tax-free first home savings account to take advantage of income rates as high as 6%.

5. Automatically invest your spare change

The Moka financial app rounds up your everyday purchases to the nearest dollar and invests the spare change to help you reach your financial goals. It also offers personalized advice and insights to help you make smarter financial decisions.

For example, let’s say you purchase a doughnut for $2.30. Before you’re done licking the powdered sugar off your fingers, Moka will round the amount to $3.00 and invest the 70-cent difference for you. That’s all there is to it. The psychology behind this savings hack lies in leveraging the concept of micro-saving, where consistently saving small amounts like spare change can accumulate over time, showing the power of incremental progress toward achieving financial goals.

Your spare change may not seem like much, but check out this math: $2.50 worth of daily round-ups add up to $900 per year — and that’s before your savings earn money in a high-interest savings account or a Tax-Free Savings Account (TFSA).

Bottom line:

Don't let the halfway point of 2024 mark a financial setback! These smart money moves can help get you back on track, from paying down debt and lowering car insurance costs to exploring real estate and automated savings hacks. Take control of your finances today and build a secure future.

Sources

1. Royal LePage: More than 1 in 4 Canadians plan to purchase an investment property in the next five years: Royal LePage Report (May 25, 2023)