Investment ideas: 5 ways to invest $1,000

18 December 2024 by National Bank
Investir: 4 idées payantes

Are you looking for ways to grow your portfolio? Good news: you don’t need to be a stock expert! Here are 5 ways to invest wisely and grow $1,000.

In this article:

RRSP: save on tax

The Registered Retirement Savings Plan (RRSP) is a popular investment for retirement. Contributions are tax-free, which puts more money in your pocket to reinvest or to pay for other projects.

The amount you save will depend on how much you’ve invested, your tax bracket, and your province.

Can an RRSP be used for other projects? Yes! There are programs you can use to withdraw money tax-free.

TFSA: invest tax-free

Unlike an RRSP, a Tax-Free Savings Account (TFSA) does not reduce your taxable income, but it does provide tax-free investment income. And that means significant savings!

This tool is particularly beneficial if your goal is to save for short-term projects like a vacation or home renovations. It’s also great to have as an emergency fund.

If your net income is low, you could consider using a TFSA to save for retirement. Because it generates no taxable income, you’ll keep your Guaranteed Income Supplement (GIS).

RRSPs and TFSAs each have their advantages and disadvantages. An advisor can help you make the right choice for your situation.

FHSA: save for your first home

Are you looking to buy your first home, or you haven’t been a homeowner in the past four years? If so, you can start investing your savings in the First Home Savings Account (FHSA). 

This registered plan is a great tax-free option to start saving towards a down payment. The FHSA combines the advantages of the RRSP and TFSA. Just like an RRSP, your contributions are tax-deductible, and same as the TFSA, your withdrawals are non-taxable.

More about the FHSA:

  • You can contribute up to $8,000 per year, up to a lifetime maximum of $40,000.
  • You can hold the account for a maximum of 15 years.
  • It’s possible to combine the FHSA with the HBP to increase your down payment.
  • Unlike the HBP, you don’t need to reimburse any amount withdrawn for your down payment.
Picto of a home with three stacks of coins in front of it

Saving potential
 Let's say you contribute the maximum amount of $8,000 per year for 5 years. You then invest that $40,000 in a balanced portfolio with an average annual rate of return of 2.8%. After 15 years, your FHSA could be worth more than $57,000, for a potential gain of $17,000.

RESP: invest in your kids’ futures

Are you planning to pay for your child’s post-secondary education? The Registered Educations Savings Plan (RESP) is the perfect tool to help you achieve your goal. You’ll get access to generous government grants that will help your money will grow even faster.

The following financial benefits are available within an RESP:

  • Canada Education Savings Grant (CESG): equal to 20% of your RESP contributions, up to a maximum of $500 per year. You may also qualify for extra help if your family income is below a certain threshold. With this grant, you could benefit from a maximum amount of $7,200 for life.
  • Quebec Education Savings Incentive(QESI): equal to 10% of your contributions, up to a maximum of $250 per year. The lifetime maximum is $3,600. Bonuses are available for low-income families.

In other words, if you invest $1,000, you’ll receive at least $300 in the form of grants!

The grants and investment income will become taxable to your child when you retire. However, since your child will most likely start out with a low income, he or she will have very little to pay.

Direct brokerage: take control

If you want more control over your finances, why not use a direct brokerage platform and personally manage your investments? You’ll learn everything there is to know about investments and how to best invest your savings.

This easy-to-use tool offers cost-effective pricing that can save you money. Your profile makes it easy to track your portfolio’s progress, while the speed of transactions means you can benefit from the best deals on the market. Make the right choices, and you'll make some money.

Even when investing on your own, you’re never alone. The platform provides powerful tools to help you make the right financial decisions. Plus, it’s always possible to speak with an agent to learn more.

Whatever your projects or your budget, it’s time to make smart investments and grow your money. Explore your options and decide what’s best for you.

Would you like to discuss this with us? Contact your National Bank advisor or your wealth advisor at National Bank Financial. Don't have an advisor?
 

Make an appointment

Tags :
Savings and investment, Investments
Back
Terms of use
National Bank’s virtual assistant

When using our Virtual Assistant Service (the "Chatbot"), you accept these Terms of Use, which are subject to change without notice. Furthermore, you agree to consult these Terms of Use from time to time and acknowledge that your continuing use of the Chatbot means that you have accepted any changes that may have been made. Your continued use of the Chatbot means that you’ve read, understand and agree to these Terms of Use, the Terms of Use for our website, our Online transaction services, and to our privacy policy. You also understand any other agreements that you have with us will continue to apply when you use the Chatbot.

1. Our Services and your responsibilities

The Chatbot is an automated service which is integrated into our online banking platform.

The Chatbot is preprogrammed to answer general questions concerning the use of our online banking platform solely for informational purposes. The Chatbot is not able to answer questions on personal monetary transactions or products you hold with us.

By using the Chatbot, you understand and agree that:

  • The Chatbot does not provide financial advice or financial planning services.
  • The Chatbot does not conduct any banking transactions.
  • The Chatbot may not be able to answer all your questions. Therefore, it may not be able to provide you with the information you require. You must judge whether the answer provided responds to your question accurately. In the case of uncertainty, a customer service representative would be happy to help you. You can call us toll free at 1-888-483-5628 or 514-394-5555.
  • The Chatbot is not a complaint service. You cannot use the Chatbot to file complaints. If you have any complaints, you can contact us at the number indicated above.
  • We monitor, record and store the discussion that you have with the Chatbot to improve our interactions with our clients.
  • You will not provide the Chatbot with any confidential, personal, or private information. For example, you will not provide the Chatbot with your login information, PIN or other personal banking information.

2. Limitation of Liability

You acknowledge that we won’t be liable for any losses or damages that you may suffer as a result of your use of the Chatbot, including if the Chatbot is unavailable for any reason.

We cannot guarantee that the results obtained via the Chatbot will be accurate and reliable and that the answers provided will meet your expectations.

We will not be held liable for damages you incur as a result of:

  • Any delay, error, interruption or omission on our part or any other event beyond our control.
  • Any deficiency or technical error or any unavailability of our systems and wireless networks.
  • Your failure to meet any of your obligations.
  • Any amendment to or suspension, refusal or blockage of the Chatbot.
  • Any decision or measure you take in response to information and data obtained via the Chatbot.
  • Any other damages you may incur that are not caused by negligence on our part.

3. Language

You have requested that these Terms of Use, and related documents be drawn up in English.

4. Governing Law

These Terms of Use are governed and must be interpreted in accordance with the laws in force in the province or territory where you reside. If you reside outside Canada, the laws in force and the courts of competent jurisdiction are those of the province of Quebec.

Virtual assistant