Have You Forgotten How to Save?

January 9, 2009   0 Comments   financial plan, information

I remember reading an article several months ago that outlined the major difference between Canadian and American consumers as Canadian consumers who buy on credit tend to pay off their debt immediately, whereas American consumers tend to take long periods of time to pay off their borrowed money.

I just found an article on the financialpost.com website from last year, which states this trend is changing.

Consumer credit represented 40% of personal disposable income at the end of the second quarter, according to CIBC World Markets. Mortgage credit, meanwhile, was 90.6% of personal disposal income. When those numbers add up to more than 100%, it means we have more debt than income.

The article is quick to mention that even with the downturn in the economy, this is not an end-game for Canadians. Rather, the advice is to re-evaluate your financial plan and make sure that it is aligned with your current financial situation.

This is an important point to remember. Throughout Following The Goods, I talk about financial plans, but it’s important to remember that these aren’t “set it and forget it” plans. A financial plan is something that you should constantly be reviewing and revising whenever you make a change in your lifestyle, whether it’s getting a new job, losing a job, graduating from school, or moving out of your parents house.

Remember, it’s up to you to own your financial plans and future – if you don’t keep track of what’s going on, no one else will.

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Tags: credit card debt, financial plan, money management