How are you doing on your financial new year’s resolutions? By now, most people have given up on whatever goals they set out for the year. Whether your plan was to start contributing to your TFSA or RRSP, pay off your credit cards, or save by skipping your afternoon latte, it’s a good time to take a look at your progress. To keep you motivated, here are a few of the financial ups and downs that caught our eye in January:
New down payment rules kick in this month, but there’s an exception to the rule that’s sure to be a hit in the lower mainland. A condo development in Port Moody, B.C. is offering units with no down payment. Rather than a traditional down payment, buyers will be able to purchase condos for 8% below market value, and use that equity to get a CMHC-insured mortgage. In a time when Vancouver house prices are setting records regularly, and renters are faced with ultra-low vacancy rates, high rents and the constant threat of “renovictions,” this development is another example of the creative approach Vancouverites are taking to solve their housing problems. The offer is sponsored by BC Housing and available to buyers with household incomes under $92,430 for a two bedroom, and under $65,850 for a one bedroom.
You’ve probably heard our advice about credit cards before: Choose a rewards card that complements your spending habits, stick to your budget, and always pay off your balance in full every month. We already know carrying a balance is pretty much guaranteed to gobble up any amount you would have earned in rewards, but there’s a new reason you’ll want to keep it at zero. A survey has found 49% of Americans say they’re turned off by people who have credit card debt. The negatives work the other way too: 35% are embarrassed by their debt, and 43% say they feel judged for it. Here in Canada, our Digital Money Trends report revealed 43% of people carry some credit card debt, and more than one-third of people who have credit card debt won’t be able to pay it off within a year. We didn’t ask people about their relationship status, but if you want to tell your story about debt and dating, send us a note.
Here’s a neat number: Canadians are keeping $75 billion (with a B) in cash while they wait to see what happens with the stock market. That’s $6,030 in every household, and $2,133 for every man woman and child in the country. But it’s tricky to keep a few thousand dollars under your mattress. After accounting for inflation, you actually lose money when you hold your savings in cash. So where should you keep your money? If you’re not planning to use your money in the long-term, a GIC in a TFSA might be a good place to start. But if you think you’ll need quick access, try a high interest savings account – preferably one with a good interest rate that still allows you lots of flexibility with your money. You can try our savings account comparison tool to find the right one for you.
We all know pre-existing conditions can hurt your chances of being approved for life insurance, but what if you don’t have the condition yet? That’s the subject of a debate happening in Ottawa, where a Senate committee is expected to hold hearings on a bill that will prevent insurance companies from accessing the results of genetic tests such as those that can determine your likelihood of developing certain cancers. On one side of the debate is privacy – it’s no secret most people don’t want to share the results of DNA tests with corporations. The other side points out how relevant the test results are to actuaries, the people who determine the likelihood of a life insurance policy paying out. In theory, giving companies better information about their customers’ risk factors will help keep premiums lower for most people – but that doesn’t account for the changes people can make to lower their risk. It could take a while for the bill to become law though. It was first tabled in 2013, and needs to go through the House of Commons before it can be passed.
In case you missed it, our inaugural Digital Money Trends report came out earlier this month. It’s filled with information about how Canadians use technology to make decisions about mortgages, credit cards, saving and investing. You can read the full report here, or check out our summaries on the blog.
Our founder and CEO Alyssa Furtado appeared on BNN a few weeks ago to talk about Ratehub.ca and the trend toward variable rate mortgages on our site. Click here to watch the video.
And our friend Robin Taub made an appearance on Global’s The Morning Show to talk about credit cards that can help students manage debt. Click here to watch her advice.