Is it Payday Yet?
A new survey of nearly 5,000 Canadians found that almost half (47 percent) of workers would have a hard time meeting their financial obligations if their paycheque were to be delayed by
even as little as one week.
The survey, by the Canadian Payroll Association (CPA), came out at the same time as news that personal debt levels were at an all-time high. Our credit market debt (consumer credit, mortgages, and loans) stands now at 168 percent of our disposable income. With all this debt, some Canadians are starting to feel the pinch.
- 35% of those surveyed felt overwhelmed by their debt level.
- 32% said their personal mortgage was the most difficult debt to pay.
- 23% said their credit card debt was the most difficult to pay.
Why are we in so much debt? Higher overall spending.
- 32% cite higher living expenses.
- 25% cite unexpected expenses.
“It is very difficult for people to change or reduce their spending patterns,” says Janice MacLellan, CPA’s vice-president of operations.
Besides having difficulty paying debts, higher spending also has a negative effect on people’s retirement savings.
MacLellan’s advice? Pay yourself first.
“By paying yourself first through automatic payroll deductions, you are diverting money into a retirement or savings account before you have the opportunity to think about spending it.”
Sources: Canadian Business, Globe and Mail