How to best utilize $18,000
I have approximately $18,000 that I am trying to determine how to best utilize. Here is my info:
- age 29
- annual income: $102,500
Assets
- I own my vehicle - approx value $10,000
- I own a house in name, but its a recent purchase and the bank owns most of it (interest 2.94%)
- TFSA savings account at Tangerine: $6,600 (I think it's 2.15% interest)
- Chequing account: $24,000 (includes the $18K)
- RRSP invested in a few individual stocks - approx. $5,000
Debt
- OSAP approx. $15,000 (5.5% floating interest rate, tax deductible)
- mortgage - a lot - 2.94%
I am trying to determine how to allocate the $18,000. I do not want to pay down the mortgage as it is split ownership with my girlfriend and she cannot afford to match my payment against the mortgage. I could wipe out the OSAP and eliminate that debt, although the interest on it is tax deductible. I have $28,620 in room in my RRSP for 2014 contribution.
I am leaning towards either paying off the OSAP in full and putting the rest in my savings account/spend on a trip, or making an RRSP contribution, or a combination of both. I like the idea of getting rid of the debt, but I also hate taxes and I've already paid over $31,000 in income tax this year. I work as a lawyer in the private sector, so I do not have a pension, but my income will continue to rise.
Any suggestions are welcome.
- age 29
- annual income: $102,500
Assets
- I own my vehicle - approx value $10,000
- I own a house in name, but its a recent purchase and the bank owns most of it (interest 2.94%)
- TFSA savings account at Tangerine: $6,600 (I think it's 2.15% interest)
- Chequing account: $24,000 (includes the $18K)
- RRSP invested in a few individual stocks - approx. $5,000
Debt
- OSAP approx. $15,000 (5.5% floating interest rate, tax deductible)
- mortgage - a lot - 2.94%
I am trying to determine how to allocate the $18,000. I do not want to pay down the mortgage as it is split ownership with my girlfriend and she cannot afford to match my payment against the mortgage. I could wipe out the OSAP and eliminate that debt, although the interest on it is tax deductible. I have $28,620 in room in my RRSP for 2014 contribution.
I am leaning towards either paying off the OSAP in full and putting the rest in my savings account/spend on a trip, or making an RRSP contribution, or a combination of both. I like the idea of getting rid of the debt, but I also hate taxes and I've already paid over $31,000 in income tax this year. I work as a lawyer in the private sector, so I do not have a pension, but my income will continue to rise.
Any suggestions are welcome.