News Releases

TORONTO, ONTARIO--(Marketwire - Nov. 28, 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: Small business owners should take advantage of applicable year-end tax strategies to minimize 2012 tax costs.

With 2013 just around the corner, small business owners should start implementing tax strategies that will help them minimize year-end costs and save money. Small business specialists, accountants and/or investment advisors can give owners a clear understanding of the financial health of their business, and provide them with straightforward methods that can pay dividends come tax time.

"It's a good idea to do a financial check-up well ahead of year-end to get a good idea of the tax strategies that are available to you," said Joe Collura, Small Business Banking Area Manager, BMO Bank of Montreal. "Consult with a small business specialist and your accountant to review some straightforward methods that can help minimize the amount of 2012 income tax payable."

BMO offers the following year-end tax considerations for small business owners:

• Defer income: Small business owners may be able to reduce their current-year taxes by deferring, to January, some of the income they expect to receive in December.
• Gather business receipts: Maximize income tax deductions by itemizing all allowable receipts for business-related expenses (e.g. gas, customer lunches, coffee for the office).
• Inventory write-offs: A drop in the value of inventory could represent an opportunity for an additional income tax deduction for the current year. Speak to a banking advisor and your accountant about the tax rules that apply to your particular situation.
• Review RRSP situation: For independent small business owners, income earned by the business becomes personal income when filing taxes using the T1 form. Registered Retirement Savings Plan (RRSP) contributions are deducted from annual income, thereby lowering income tax payable at the individual's marginal tax rate. Set up a new RRSP or make a contribution to an existing plan for 2012 to benefit from the tax-deferred growth.

"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.

November 5: Space out payments to avoid cash-flow problems.

November 6: Take advantage of the benefits of preferred shares.

November 7: Consider investing in a Registered Retirement Savings Plan (RRSP) and taking advantage of tax incentives when saving for retirement.

November 8: Take advantage of Canada's numerous online personal finance resources.

November 9: Before you head off on your winter vacation, be sure you and your family are properly covered in the event of a medical emergency.

November 10: Understand what you can hold in your RRSP.

November 11: Stick to the one-third rule when planning the purchase of a home.

November 12: Secure your retirement by opening a Registered Retirement Savings Plan (RRSP) as early as possible and contribute to it on a regular basis.

November 13: As couples prepare for their wedding day, they should have "The Financial Talk" to help the transition from "my money" to "our money."

November 14: Using a combination of a credit card, debit card and cash will give you convenience, security and flexibility when you travel or shop in the United States.

November 15: Give the gift of securities and benefit from tax savings.

November 16: To stay on track to reach your financial goals, keep a well-diversified investment portfolio.

November 17: Take advantage of spousal RRSPs.

November 18: Take advantage of credit cards that offer affordable emergency medical travel insurance.

November 19: Parents-to-be should consider their financial situation before the Big Day.

November 20: Use the tax refund generated by your Registered Retirement Savings Plan (RRSP) contribution to pay down your mortgage.

November 21: Save for your child's education by investing monthly Universal Child Care Benefit (UCCB) cheques in a Registered Education Savings Plan (RESP).

November 22: Save for your child's education by encouraging friends and family to contribute to a Registered Education Savings Plan (RESP) this holiday season.

November 23: Bringing your lunch to work can help you save for retirement.

November 24: Creating a financial plan, which includes an emergency fund, can help you plan for tomorrow's unforeseen expenses and avoid incurring high interest debt.

November 25: Say "I do" to keeping the costs of your wedding under control.

November 26: Savvy students know to pay off their credit card balance in full each month and take advantage of rewards and discounts to save money.

November 27: Consider consolidating high-interest debt into a line of credit to save on interest costs and become debt-free sooner.

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.