It’s Not Too Late, Grab These CRA Benefits Before December 31!

I know the year is almost up, but there is still time to get in on the CRA benefits you won’t want to forget about! Then, consider this stock for an investment.

| More on:
Elderly man giving a Christmas present to his wife

Image source: Getty Images

The Canada Revenue Agency (CRA) picked maybe the worst time for so many of its benefits, grants, and savings accounts to reach their deadline for contributions. Sure, the end of the year does make sense. However, who is really this organized amidst all the holiday craziness to make a decent contribution?

That’s why today I’m going to highlight some benefits that Canadians can still grab before the December 31 deadline. What’s more, here’s how to never miss it again, and see further growth in the future.

CRA cash

Let’s go over some of the best CRA options out there to make sure you’re on top of them. If you’re a parent, then the top choice you should be getting organized for is the Registered Education Savings Plan (RESP). By making sure that you contribute before December 31, you can claim up to $500 per year through the Canada Education Savings Grant (CESG).

There isn’t a limit to how much you can put into the RESP, but there is a limit to what you can get from the grant. For every dollar you contribute, you’ll receive back 20% up to $500 each year. However, if you missed the year before (but only the year before), that jumps up to $1,000 from the CESG. So don’t miss out on a single year!

Now most people already know about how contributing to the Registered Retirement Savings Plan (RRSP) can continue until the end of February. However, that’s different if you’re turning 71. The very last day you can contribute to your RRSP is on December 31 of the year you turn 71. So please make sure you’re contributing all you can towards your future!

Don’t let it happen again!

This is now a pretty mad rush to get yourself contributing to these incredibly important programs before the end of the year. So let me tell you about a way to make sure this never happens again. That comes down to creating automated contributions towards these investments each and every paycheque.

First, make yourself a budget. Then see what you can reasonably put aside each and every paycheque towards these goals. If that’s $500, then put some towards your RESP and some towards your RRSP so that you reach the limits without going over them.

By the end of the year, you could do a top up, sure. But in the end you won’t have to worry that you missed out on contributing that year! Now let’s get into an option you may want to consider these days.

Think long term

The goal of the RESP and RRSP is to get investors thinking long term about their growth strategies. The RESP is a bit sooner, so perhaps consider exchange-traded funds (ETF) or even guaranteed income certificates. Especially at these rates lately.

But if you’re thinking long term when it comes to your RRSP, I would certainly consider some Dividend Aristocrats in there as well. This will provide you with income that can be reinvested again and again – and a great option today is BCE (TSX:BCE).

While BCE stock is down thanks to market performance and recent acquisitions of competitors, it’s still strong. The company continues to expand its fibre-to-the-home network, offering the fastest internet as well. It now offers a huge dividend yield at 7.55% as well to consider. Here is what $3,000 could get you by putting that into your RRSP, for example.

COMPANYRECENT PRICENUMBER OF SHARESDIVIDENDTOTAL PAYOUTFREQUENCYPORTFOLIO TOTAL
BCE – now$5159$3.87$228.33quarterly$3,000
BCE – highs$6659$3.87$228.33quarterly$3,894

Now you have extra passive income of $894 from returns and $228.33 from dividends. That’s a total of $1,122.33 in just a year! And imagine what that can do for you before retirement.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

More on Dividend Stocks

Young woman sat at laptop by a window
Dividend Stocks

5% Dividend Yield: Why I Will Be Buying and Holding This TSX Stock for Decades!

Stability and a healthy return potential are among the hallmarks of the so-called “forever stocks.” But while many stocks promise…

Read more »

grow money, wealth build
Dividend Stocks

Here’s the Average RESP Balance and How to Boost it Big Time

The RESP can be an excellent tool for saving for a child's future. But is the average enough? And where…

Read more »

Two colleagues working on new global financial strategy plan using tablet and laptop.
Dividend Stocks

Best Stock to Buy Right Now: Manulife vs. CIBC?

These stock have enjoyed massive rallies in the past year. Are more gains on the way?

Read more »

investment research
Dividend Stocks

How to Use Your TFSA to Earn $12,000 Per Year in Tax-Free Income

The TFSA can act like a part-time job when invested properly, using your funds to turn your investments into the…

Read more »

edit Sale sign, value, discount
Dividend Stocks

1 Magnificent TSX Dividend Stock Down 60% to Buy and Hold Forever

Northwest Healthcare Properties is an overlooked TSX stock that's yielding more than 6% with solid fundamentals.

Read more »

Increasing yield
Dividend Stocks

High-Yield Alert! 3 Dividend Stocks to Buy Now for Perfect Passive Income

High yield dividends aren't always filled with risk. And these high yielders could certainly be well worth it.

Read more »

Utility, wind power
Dividend Stocks

Is Brookfield Asset Management Stock a Buy for its 3.2% Dividend Yield?

While the stock appears to be fully valued, Brookfield Asset Management is a solid dividend stock for long-term wealth creation.

Read more »

IMAGE OF A NOTEBOOK WITH TFSA WRITTEN ON IT
Dividend Stocks

2 TFSA Stocks to Buy Immediately With Your $7,000 Room

These two stocks provide stability and reliable dividends to grow your Tax-Free Savings Account (TFSA).

Read more »