New tax cuts may reduce individual debt amongst Canadians but won't add funds to retirement, investment accounts



    Poll finds Canadians most likely to spend additional income on
    miscellaneous spending, paying down debt

    TORONTO, Nov. 20 /CNW/ - Canadians are as likely to spend their personal
tax cuts - which were recently introduced by the federal government - on
paying down debt (38 per cent) as on miscellaneous spending (37 per cent),
according to a new poll of 1,500 Canadians sponsored by Edward Jones.
    "What we are seeing is two critical elements of financial planning
competing for priority amongst Canadians," says Mary Chan, a partner at Edward
Jones. "We face unavoidable expenses every day and debt is an unfortunate
reality for many, so it's not a huge surprise that these two factors struck
home with Canadians."
    Canadians were asked to choose two options on which to spend their tax
cuts. Other options selected included retirement savings (13 per cent), saving
for a vacation/travel (13 per cent) and investing (11 per cent). Only 5 per
cent of Canadians plan to save for a home and only 3 per cent for their
children's education.
    "While paying off debt is an important first step, it's disheartening to
see that many Canadians do not plan to use their tax savings for retirement or
to invest," says Chan. "The first step should be managing debt, but Canadians
should then think about strategies to put this money to its best use. In the
end, every little bit counts towards a brighter, more financially secure,
future."

    
    Chan suggests these other tips to make the most out of the tax cuts:
    -   Once you've gained control of your debt, manage future expenses by
        developing wise borrowing and spending habits. For example, borrow
        only when necessary, shop around for competitive rates, and pay off
        credit card balances every month
    -   Use tax-deductible debt whenever possible. Interest on funds borrowed
        for investment purposes, such as investing in securities or rental
        real estate, may be tax-deductible
    -   Estimate the amount you will save and set up a preauthorized
        contribution plan which automatically withdrawals from an account at
        a bank or other financial institution and put the money into your
        RRSP or other investments
    -   If you don't already have an RRSP, now is a great time to get started
        - the younger you are when you open an RRSP, the more money you could
        have by the time you retire

    The survey was conducted by Leger Marketing.

    Other key findings:

    -   Four in 10 Canadians will spend their tax savings on miscellaneous
        spending
    -   Atlantic Canadians are most likely to take advantage of these new tax
        breaks to lower their personal debts (49 per cent) while Quebeckers
        are least likely (32 per cent)
    -   Quebeckers are most likely to utilize these tax saving options on
        miscellaneous spending (46 per cent)
    -   Ontarians are the group most likely to use the additional income for
        vacation (17 per cent vs. 13 per cent nationally), while more
        Albertans plan to utilize their tax savings to save for retirement
        (23 per cent vs. 13 per cent nationally)
    -   Albertans are the group most likely to invest the savings (22 per
        cent vs. 12 per cent nationally) while Atlantic Canadians are the
        group least likely to invest (6 per cent)
    -   British Columbians are the group least likely to save for a home
        (3 per cent vs. 5 per cent nationally)
    -   One in ten (13 per cent) young Canadians 18 to 34 plan to use the
        additional income to save for a home
    

    About Edward Jones
    ------------------

    Edward Jones is a full-service investment dealer with one of the largest
branch networks in Canada. It is a member of the Investment Dealers
Association of Canada and the Canadian Investor Protection Fund, and a
participating organization of the Toronto Stock Exchange. Including its
affiliates, Edward Jones serves more than 6 million individual investors in
Canada, the U.S. and the United Kingdom from more than 9,000 locations.
    Member CIPF.

    The Canadian survey results are based on an online survey of 1,513
nationally representative adults between October 30 and November 4 2007 by
Leger Marketing. A sample of this size will provide results that can be
considered accurate within plus or minus 2.5 per cent, 19 times out of 20.
Canadians were asked to pick two options so figures add up to more than 100
per cent.




For further information:

For further information: Jessica Davidson, (416) 969-2735 or Greg
Vallentin, (416) 969-2728

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