Don’t let warmer weather get you into hot water with your finances
Two-thirds say that the warmer weather makes them feel happier and more willing to spend, and that they’ll figure out how to make up the money when it gets colder.
According to a 2011 Environics survey almost 40% of Canadians say they are more carefree with money in the summer, while 50% say they’re more lax with their bill payments.
With most educators typically off in the summer, the time to do more means the potential to spend more, even if they don’t necessarily have the cash to do it. However, during these uncertain times – and with fresh data from Statistics Canada stating that the ratio of debt to personal disposable income rose to 152 per cent last quarter (up from 150.6 at the end of 2011), it’s time for a lesson on debt and interest rates.
Educators Mortgage Agent Level 1 – Regional Director, Lending Services Nick Rao offers advice to those tempted to put their summer spending on ‘plastic’. “Beware of rates”, says Nick. “While bank and department store credit cards can seem like the easy way to fulfilling your summer plans, with average interest rates between 14% and 20%, they can also really rain on your parade when it comes time to paying them off.”
Your summer (or all-year) cash flow solution? Nick has a simple answer. “Instead of racking up your credit cards, consolidate your high-interest debts into one low-rate line of credit for example. You’ll be putting more money back into your pocket every month for summer goals and projects, while paying debt down faster. It’s a win-win situation.”
Homework:
See how much you could be saving by consolidating your high-interest debts into one low-rate line of credit through Educators by using our handy Debt Calculator. Click here to figure out your potential savings.
