With summer vacation season underway, many families are preparing for their next trip and making plans to maximize their time off.
Laura Egan, assistant branch manager at Envision Financial shared some insights on how people can make great summer memories without having to deal with financial headaches and bills in the fall.
Hang on to those receipts for your children’s art and rec programs
“While your kids are splashing about during swim lessons, you could be earning important tax credits,” explained Egan. “In the past few years, the Government of Canada has introduced and grown the types of programs eligible for credit come next tax filings. From recreation programs to the arts, hold on to your kids’ program receipts and share them with your tax advisor for consideration when filing.”
Go debit card, not credit card
“For many families, credit cards provide a quick and easy way to finance a summer vacation. But be very careful — unless you are able to pay off the full amount when your statement is due, the interest charged could cripple you financially,” warned Egan.
“Ideally, you’ll save up for your vacation beforehand, but if you need to borrow funds to help pay for your vacation, there are alternatives like a personal line of credit that allow people to borrow at a lower interest rate than credit cards, which can soar as high as 20 to 25 per cent.”
Got your travel insurance?
“Nothing will break the bank faster than having an unexpected medical emergency outside the country — and even outside the province,” sharef Egan. “We’ve all heard the horror stories of travelers owing thousands of dollars in medical bills when travelling to places like the U.S. or Mexico, but what many people don’t know is that there are limitations on what is covered even when travelling within Canada. I always advise people to play it safe and look into additional travel insurance because it’s better to be over prepared than not.”
Help your children start a small business
“It’s never too early to teach your children the value of a dollar,” said Egan. “A great thing that parents can do over the summer is open a savings account for their kids and then help them get a summer business going like walking dogs around the neighbourhood, mowing lawns or washing cars. Not only will the kids earn some pocket money, but they’ll also learn some important life lessons about saving.”
There’s no time like the present to start saving for next year
“One of the best ways to not break the bank is to ensure you’ve saved up for your vacation in advance,” said Egan. “One of the easiest ways to do this is to set up a savings account specifically for a vacation fund. People can set it up so that a certain amount from each pay cheque is automatically transferred into this account. When it comes time to take your vacation next year, you’ll have a solid lump sum saved up already.”