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Financial Literacy Month-BMO's Tip of the Day: Space Out Payments to Avoid Cash-Flow Problems


TORONTO, ONTARIO--(Marketwire - Nov. 5, 2012) - To mark Financial Literacy Month, BMO Financial Group is releasing a series of financial tips throughout November. 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: Avoid cash-flow issues by creating a payment schedule that incorporates planned financial commitments.

"In order to get your regular payments under control, try spreading them out so that you don't end up having to pay a large lump-sum amount," said Serge Pépin, Vice President, Investment Strategy, BMO Asset Management Inc. "This will provide you with adequate breathing room and help you avoid having cash-flow problems for everyday expenses."

Consider this kind of planning for the following payments:

Property Taxes: The frequency of property tax installments varies by municipality, but most allow you to pay your annual tax assessment through equal quarterly or monthly payments.

Insurance Premiums: Consider making your insurance premium payments on a monthly basis. This way, you will not be scrambling for the funds when your 6-month or annual premium fee is due.

RRSPs: RRSP contributions can be made throughout the year. Consider opting for an automatic payment schedule that takes a small portion off every paycheque and puts it towards your RRSP.

Tax-Free Savings Accounts (TFSA): When contributing to your TFSA, small amounts invested on a regular basis are best. Over time, even small monthly contributions of $50 to $100 will add up.

Registered Education Savings Plan (RESP): Do not be shy to ask relatives and/or friends to incorporate contributions to an RESP as a part of your child's birthday and Christmas gifts. Not only will this allow their RESP to grow, but it will provide you with some relief when juggling other regularly scheduled payments.

"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).

BMO Financial Literacy Month Tips

November 1: Maximizing TFSA investments annually over 20 years can save nearly $30,000 in taxes.

November 2: Utilize rewards to squeeze the most value out of every dollar you spend this holiday season.

November 3: Choose an investment advisor who is right for you and will help you meet your financial goals.

November 4: Use your RRSP to help make the down payment on your first home.

For more on financial literacy, Canadians can visit the Government of Canada's Financial Literacy Month website, as well as BMO's Financial Literacy online resource.

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.

Media contacts:
Rachael McKay, Toronto
(416) 867-3996
rachael.mckay@bmo.com

Valerie Doucet, Montreal
(514) 877-8224
valerie.doucet@bmo.com

Laurie Grant, Vancouver
(604) 665-7596
laurie.grant@bmo.com

Internet: www.bmo.com
Twitter: @BMOmedia