Blog & News

December 28, 2012

What were the most outstanding events of 2012 for Canadians? Not an easy question.

Sadly, near the top of my list is the tragic story of Amanda Todd and her suicide resulting from bullying. More and more public attention has been focused on the problem of teenagers being bullied and the how this has been amplified by online harassment. We must do a better job.

I asked an 8 year old for her opinion on the most important events in 2012. Her answer is quite profound:

December 19, 2012

A Letter from "Mr. X"

Dear Margaret,

Can you believe it? It’s December 13th and I’m out of money already. I haven’t bought any Christmas presents yet!!!

You should know that I am not a spendthrift. I’m 64 years old and don’t have any consumer debt.

December 18, 2012

“Peace of Mind” or “Waste of Money”?

Are you aware whether you have balance protection on your credit card or not? Often when applying for a credit card, the applicant is not asked whether he or she wants the protection, it is added automatically and assumed as wanted unless the applicant asks to terminate it. You may think the protection is mandatory, or even part of the interest charge, but that’s not so.

Balance protection insurance is like other insurance in that it’s benefit coverage comes with eligibility requirements, exclusions and conditions. However, unlike other insurance, you are not applying for it to see if you qualify or approve its coverage, you are offered it automatically and then it is up to you to find out if you qualify or if you require the coverage. Therefore if you do not take any action, you will be paying for it even if you don’t qualify, and even if you don’t really need it or want it.

December 5, 2012

If Santa has been watching the news around the world, then he might be thinking more about falling off a fiscal cliff than splurging blindly on everyone this holiday season. And this has nothing to do with Scrooge. There is a big difference between sensible shopping and Grinch-like cheapness.

November 30, 2012

Now that Black Friday, Cyber Monday and Giving Tuesday has past, is there any money left for a budget?

Oh oh. I think it’s supposed to be the other way around. Aren’t we supposed to organize a budget first before we spend money?

To answer the very first question, it’s never too late for a budget. A budget always tells the truth – or at least it will get us thinking about what we are doing with our money. But this is often the rub. We are scared about the truth. We don’t really want to know how much everything costs. We close our eyes, plug our noses and whisper to the glistening Christmas stars, “Give me a break. It’s Christmas. It’s time to feel good. It’s time to give. Remember, it’s in the giving that brings us happiness. I’ll worry about the bills later.”

November 28, 2012

What do seniors need to know to be financially literate? This is an excellent question, not just for the financial literacy month of November, but one that the BC Centre for Elder Advocacy and Support and the Canadian Centre on Elder Law tried to answer in their detailed publication entitled Financial Literacy 101.

November 20, 2012

Good or Bad News?

Scotia bank reported recently that 40% of a particular client group were cashing in their RRSP’s early to take advantage of the Home Buyer Plan.

Good News. This really isn’t actually cashing in the RRSP because you can withdraw up to $25,000. in a calendar year and not pay tax on the funds if you buy a qualifying home. You then have 15 years to repay the money back into your RRSP (unusually 1/15th every year.) The Home Buyer’s Plan is an excellent way for people, especially young people, to buy a home.

Bad News? More and more experts are vocalizing their discontent with the new mortgage rules passed by the federal government in July 2012 which reduced the amortization period to 25 years for high ratio mortgages and reduced the home equity amounts from 85% of the property’s value to 80%.

October 26, 2012

The Globe and Mail today commented on a study conducted by the Canadian University Survey Consortium of more than 15,000 Canadian university students completing their undergraduate programs that found almost nine out of 10 students had one credit card - and that 26 per cent have two or more cards.

Very interesting. Regardless of the many questions that such studies bring like, how do you get access to the student’s personal banking information (do you ask them?), students have and use credit cards, presumably like everyone else. The study doesn’t tell us what students use the credit cards for or how high the balances are or the interest rates they pay.

Rob Carrick in the above article goes on to blame the invasion of credit cards onto university campuses on bank advertising and our consumption-driven economy. Hum.

October 25, 2012

How long has it been? 6 months maybe since we’ve heard about consumer credit. What we’ve heard about is household debt and mortgages. And more or less the same message from government and the credit industry. “How we must avoid what happened to the United States housing market in Canada.”

And, you know what? Yesterday was the first time I heard someone highly respected from the credit industry, Helmut Pastrick from the BC Central Credit Union, comment that what happened in the United States was much different than in Canada. He correctly said that we have much better lending standards and regulations in Canada. Some of the mortgages that caused difficulties in the United States for both borrowers and lenders were as the result of fraud.