Weekend Reading – Household debt, giving back and more edition
Well, we all knew it I guess. Now we have some new stats to prove it.
Canadians have set a new record for household debt.
Our household debt burden has surpassed levels of both the United States and the United Kingdom.
Should Canadians be worried? Are you worried?
In the Globe and Mail article I read, the concern is that any sudden negative event – such as a jump in unemployment, falling house prices or rising interest rates – could put many thousands of families in financial stress. Falling house prices in particular, I don’t care about so much because personally, we’re not looking to sell and we have to live somewhere. Unemployment, that’s another story. I am worried about that and for that reason, my wife and I are working to reduce our debt should anything bad happen. On that note, the worrying, at least $200 per month, in addition to our regular mortgage payment, is going towards paying down our mortgage debt. That’s a good start for us. We hope to increase that by another $200 per month early in 2012, when our line of credit (LOC) is paid off.
Back to the article - ”the ratio of debt to personal disposable income hit a high of 152.98 per cent in the third quarter from 150.57 per cent in the prior three months, Statscan said Tuesday.” ”The report comes as Bank of Canada Governor Mark Carney is again sounding the alarm over swelling household debt. “Our greatest domestic risk relates to household finances,” the central banker said in a CBC radio interview.”
Note to Mark Carney – if you’re THAT worried about consumer debt, maybe you should increase rates, just a bit. Just a thought….
Until rates rise, the “easy money” will continue and you can’t blame folks for taking it.
In other news this week, I want to give kudos to Dan Bortolotti from Canadian Couch Potato who informed us about a perfect plan for the holidays. Literally. In the spirit of holiday giving, Justin Bender, portfolio manager with PWL Capital in Toronto, approached Dan with an offer for Canadian Couch Potato readers. As part of Justin’s charitable giving program, Justin is offering to help up to four DIY investors design and set up a passive ETF portfolio in exchange for a donation to the Centre for Addiction and Mental Health (CAMH). An outstanding initiative! Everyone wins, especially the CAMH.
In the spirit of the holidays, better to give than to recieve, no doubt Dan and Justin have this spirit mastered. Well done gentlemen!
If you’re like us, you’ve been busy getting things in order for the holidays over the last week. Finishing Christmas shopping, wrapping gifts and getting ready to entertain family and friends. It’s a special time of year, so hopefully there’s some fun that goes along with your stress!
If you have some time this weekend, I encourage you to check out the following articles from the blogosphere.
Next week, I hope to post an update and the final chapter in our 2011 personal finance and investing goals. I think we rocked. Stay tuned for that post and you can let me know your thoughts!
Until next week, stay safe, be happy and stay healthy!
Mich from Beating The Index wonders if there is a dividend cut coming for NAL energy.
Boomer & Echo offered some advice about servicing your vehicle.
Canadian Capitalist did another fine job of sounding the alarms to investors about high MERs in a post entitled Feeling the MER blues? Vote with your wallet.
Larry MacDonald gave us an update on what’s happening in the Euro Union.
Miss T from Praire EcoThrifter encouraged us to take our lunches to work to save money.
My University Money discussed pension envy.
Passive Income Earner wondered if you’re ready to buy in Canada’s lifeco. sector? I am, still, with my position in SLF DRIPping in my TFSA.
Youngandthrifty told us how to save some money on Christmas gifts this year. Her big tip? Make your own gifts, including homemade Baileys! Yum.
Susan Brunner gave an overview of all the real estate stocks she tracks. She was also nice enough to mention my post about what I thought were the top Canadian REITs. Thanks Susan!
Big Cajun Man was a tad annoyed TFSA limits for 2012 didn’t rise. Don’t worry BCM, you’re not alone – I want TFSA limits to rise as well!
DGI told us how to invest like a billionaire. A good article but wow, I’ll take being a millionaire first!
Michael James on Money discussed black swan events and the dangers of leverage. I have a mortgage, that’s enough leverage for me
The Loonie Bin told us that Fortis increased their dividend! I love it, another raise for the portfolio!
Preet Banerjee was on The National again this week. On Tuesday’s program, Preet told Canadians who he thought was the most impressive financial leader of 2011 (Mark Carney), the most disappointing financial leader of 2011 (Silvia Berlusconi), country he’d like to run (Luxembourg) (really?) and what he “got right” in 2011 – the need to save yourself and pay down debt. He also provided readers with an update on his site’s top bid, as part of the Bloggers for Charity initiative.
Andrew Hallam was gushing but also very modest about the crazy success of his book Millionaire Teacher. He was nice enough to mention my blog in his thank you list. You’re most welcome Andrew! Continued success!
TFB informed us how a guy potentially lost $10K while selling his website and how to put your blog up for sale.
Kevin from Invest It Wisely was kind enough to mention my blog in his recent post entitled the 3 Stages of Financial Freedom. I wish I was in stage 3 but I’m working on it!
Dividend Mantra is a buying machine. Check out what he bought here.
Million Dollar Journey’s net worth continues to climb and climb. Well done FrugalTrader! He’s going to be a millionaire within the next couple of years. He might have to rename his blog then
Jim Yih from Retire Happy Blog said investors need to pay attention to their investment fees. Absolutely!
Dividend Monk said while investing is important in life, investing in your health tops the list. Check out Matt’s thorough article where he suggests: eliminating highly processed foods, eating more fish, buying organic fruits and veggies, and much more.
Although Krystal Yee made some great points in her article When Renting is Better than Home Ownership, overall I had to disagree. Short-term, renting works for many Canadians for many reasons. Long-term, renting is not getting you into the ownership game and ownership is where wealth is built.
SPF dove deeper into donations for charities.
If you haven’t read his great article that appeared in Canadian MoneySaver, check out Dividend Ninja’s post that asked what happened to income trusts? – Part 2.
Just like every driver thinks they are better than average, I bet the same can be said for every investor and our friend the Dividend Guy told us so too!
Financial Uproar asked why women refuse to marry down?
BankNerd said BMO InvestorLine has announced the launch of its new Gold Deposit and Delivery Program. The new Gold Deposit and Delivery Program is a unique feature that offers a simple and cost effective way for BMO InvestorLine clients to buy and hold physical gold in their portfolios. Cool news, but not for me.
Mr. Cheap who had a post on Money Smarts Blog offered some last minute (cheap) Christmas gifts for folks.