Household debt ratio shrinks amid government aid

Statistics Canada’s latest reading showed Canadians’ debt burdens fell significantly in the second quarter. The national statistics agency said the seasonally-adjusted credit market debt-to-disposable-income ratio slid to 158.21 from 175.37 in the first quarter. However, the numbers come on the back of government aid and deferral programs, meaning the latest report may not be painting a true picture of the level of debt Canadians are facing.   

Re-commitment to rate freeze bad news for savers

While borrowers may have cheered the Bank of Canada’s re-commitment to a rate freeze earlier this week, it marks another nail on the coffin for savers, according to Dale Jackson. The personal finance columnist says sustained low rates present a dilemma for Canadians saving for retirement through vehicles such as tax-free savings accounts (TFSA) or registered retirement savings plans (RRSP). “A typical retirement plan calls for portfolio growth of between five per cent and eight per cent. Much of the heavy lifting is done through equity investments linked to the stock market, and that risk is offset by a significant portion of fixed income,” according to Jackson. He said lower fixed-income yields will continue to force investors to put a greater proportion of their retirement savings into riskier equity investments if they want to generate more income.

Young Canadians feel least financially secure amid COVID-19

Almost half of young Canadians between the ages of 18 and 34 said they feel less financially-confident since the beginning of the COVID-19 pandemic, according to a Sun Life survey published on Tuesday. The survey found nearly half of Canadians across all demographics reported feelings of financial instability. According to the survey, 55 per cent of young Canadians have altered their financial goals and plans, and nearly one-third have dipped into their savings during the pandemic.

Child care, flexibility needed to help women’s economic recovery

Affordable child care, flexible work schedules and new training are crucial to helping women regain their footing in the workforce, according to the Ontario Chamber of Commerce. In a report published Wednesday, the provincial business organization provided dozens of recommendations aimed at combating the “she-cession” of female unemployment amid the pandemic. COVID-19 has had a disproportionate impact on women, pushing female workforce participation down to its lowest level in three decades.  In July, The Royal Bank of Canada reported that 45 per cent of Canadian women had lost hours since the beginning of the pandemic, and nearly 1.5 million women became unemployed during the first two months of the pandemic. "This is not just a concern for women but for everyone and for the economy as a whole," said Claudia Dessanti, a senior policy analyst at the Ontario chamber.  “It's definitely time to go beyond the platitudes and...to develop a strategy."

TIP JAR

“You need to really be very clear on your philanthropic goals; who and where do you give – because you can’t respond to everyone that comes calling.” – CTV’s Chief Financial Commentator Pattie Lovett-Reid on how to handle a financial windfall

 

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