Canadians should be careful how they spend when rates are low

The Bank of Canada held its key rate at 0.25 per cent on Wednesday, as widely expected. The low interest rate continues to exasperate a booming real estate market in Canada. As rates are expected to continue to stay around these record-low levels, CTV's Chief Financial Commentator Pattie Lovett-Reid warned Canadians that they should be careful how much debt they take on while money is cheap. She said rates may be low but the job market is unsteady and loan delinquencies are on the rise.

Why the 60/40 portfolio no longer works for retirement savings

Two of the world’s largest sovereign wealth funds announced that operating a portfolio strategy with 60 per cent invested in stocks and 40 per cent into bonds doesn't work in the current interest rate environment. Pension fund managers now have to decide between boosting their stake in equities or whether to remain cautious and expect lower yields for their fixed income investments. This choice is especially hard for people counting on their retirement savings, BNN Bloomberg Personal Finance Columnist Dale Jackson wrote.

Jobs recovery may be in the hands of Canadians with hoarded savings

Higher spending levels post-COVID may be key to recovering the thousands of jobs lost during the pandemic. Canadians have on average saved an extra US$5,800 as many businesses closed and leisure expenses were put on hold. Bank of Canada Deputy Governor Lawrence Schembri said the large amounts of savings could have a meaningful effect on the nation’s economic recovery and help to restore depressed employment levels.

3 ways the pandemic changed millennial finances

The pandemic brought on many changes, especially on how people interact with money physically and philosophically. More people were encouraged to save, spend more consciously and steer towards contactless payments. Kelsey Sheehy of Nerdwallet took a look into some trends that may last beyond the pandemic.

Canadians struggling to keep up with savings during pandemic

While some Canadians were able to save more money over the last year, some are finding it harder to stay on top of their finances. That's prompting economists to call the situation "a tale of two pandemics." More than one-third of Canadians said their household expenses have increased and made them unable to save, according to a report by FP Canada. The data also found two in five Canadians faced a job loss, reduced pay, or a cut in working hours over the past year. As certified financial planner Caval Olson-Lepage told The Winnipeg Free Press: "Money matters have and will likely continue to be the most lasting struggle out of this crisis."
 
TIP JAR

“You only need so many Peloton bikes.​”

- CIBC Senior Economist Royce Mendes said that consumer spending could unlock the Canadian recovery, as long as its deployed within each person’s means and goes to support local businesses.