Gross Salary

Salary before deductions

NET salary

Amount of money after deductions

Taxable Income

Any money you earns after being decucted

Tax rate

Percentage of your taxable income being taxed by your goverment

Tax brackets

ranges of income taxed at diffrent rates.

RRSP

Registered Retirement Savings Plan, a tax-advantaged investment account in Canada.

Advantage of RRSP

Allows tax-deferred growth on investments until withdrawal, and contributions may reduce taxable income. Once you withdraw you most likely cant put those funds back into the RRSP.

TFSA

Tax-Free Savings Account, an investment account in Canada that allows tax-free growth and withdrawals.

What is the advantage of TFSA

The advantage of a TFSA is that it allows for tax-free growth on investments and tax-free withdrawals, providing flexibility in saving and investing. You can only add a certain amount to your TFSA.

RESP

Registered Education Savings Plan, a Canadian savings account designed to help save for a child's post-secondary education, with government grants and tax-deferred growth. If you do not go to post secondary edication you can withdraw however penalties will uccur

What is the advantage of an RESP

The advantage of an RESP is that it provides tax-deferred growth on contributions, allowing savings to grow until the beneficiary is ready to use the funds for qualified education expenses, along with access to government grants.

50-30-20 rule

A budgeting guideline that suggests allocating 50% of income to needs, 30% to wants, and 20% to savings and debt repayment.

4 steps of budgeting

1. Figure out your income

2. Dive total income in percentages

3. Prioritize your spendings

4. Set some goals

Interest

Money that you make on your own money

What is simple interest

A method of calculating the interest charge on a loan based on the principal amount and the interest rate over a specified period.

What is compound interest

A method of calculating interest where the interest earned is added to the principal, so that each period's interest is calculated on the new total.