Turn Your Mortgage into a Tax-Deductible Wealth Engine

The Smith Manoeuvre is a powerful yet underutilized strategy that allows Canadian homeowners to convert their mortgage into a tax-deductible investment loan. This approach helps pay off your mortgage faster, builds long-term wealth, and reduces your tax burden—without having to choose between investing or debt repayment when you get a bonus or tax refund.

How It Works

1. Secure a Re-advanceable Mortgage – This type of mortgage automatically increases your home equity credit as you make payments.
2. Invest the Borrowed Equity – Instead of letting that credit sit idle, invest it in income-generating assets like stocks, ETFs, or rental properties.
3. Tax Deductions & Reinvestment – Since interest on investment loans is tax-deductible, you can claim deductions annually, reducing taxable income. The tax refund can then be reinvested, compounding your gains over time.

Why It’s a Smart Strategy

✅ Pay Down Your Mortgage Faster – Implementing the Smith Manoeuvre can potentially allow homeowners to pay off their mortgage 5 to 10 years faster than with traditional methods
✅ Reduce Your Tax Bill – By making mortgage interest tax-deductible, homeowners can save thousands of dollars annually on income taxes
✅ Build Wealth Simultaneously – Instead of choosing between paying down your mortgage or investing when extra money comes in, you can do both.

This strategy requires discipline and financial planning. For homeowners looking to maximize their mortgage efficiency, the Smith Manoeuvre provides a clear path to wealth creation. Consulting a financial advisor is crucial to ensure the Smith Manoeuvre aligns with your specific financial goals, risk tolerance, and long-term wealth-building strategy.

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Debbie Balfour |Real Estate Investing Success Coach + Podcast Host Website: www.DebbieBalfour.com Email address: Debbie@DebbieBalfour.com Follow me on LinkedIn: Debbie Balfour