Avoid excessive debt!
Take control of your financial situation: Live within your means
Where to begin? To live within your means, you need to know what you’re spending, have a plan and stick to it!
Step 1: Understand your spending habits
- Keep track of everything you spend money on every day.
- Use an expense recording system that works for you (e.g. notebook, mobile app or spreadsheet).
- After a couple of months, you’ll get a clear picture of how you’re spending your money and where to cut back.
Step 2: Look for savings
- Avoid impulse spending – always use a list when you shop and stick to it.
- Plan ahead to reduce your spending (e.g. pack a lunch, or take public transit).
- Lower your banking fees. – choose a bank account that meets your needs to avoid unnecessary fees.
Step 3: Make a budget and stick to it!
- Make a budget to map out your income, expenses and savings.
- Learn the difference between your wants and your needs, and put your needs first.
- You will face challenges from time to time, but keep at it and you will see the results in no time.
Canadians are saving less and spending more, which is leading to historically high rates of household debt.
- 42% of 35-44 year olds are struggling to or are not keeping up with bills and financial obligations.*
It’s easy to spend without realizing how the debts are piling up.
Six tips to avoid debt:
- Leave your credit cards at home.
- Decrease the credit limit on your credit cards – use the Financial Consumer Agency of Canada’s credit card selector tool to find out which credit card is right for you.
- Set up automatic bill payments with your financial institution.
- Avoid impulse buying. Sleep on it and see if you still want the item the next day.
- Avoid “buy now, pay later” offers.
- Keep track of your expenses and manage them with a household budget.
Managing Money and Debt Wisely: It Pays to Know!
Find helpful tools and resources at Canada.ca/Financial-Literacy-Month.
*2014 Canadian Financial Capability Survey.
- Four in ten millennials own their own home: HSBC study
- Financial Literacy: Have a savings plan
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- Financial Literacy: Live within your means
- Financial Literacy: Start with a budget
- November is Financial Literacy Month
- It’s that time of year: RRSPs versus TFSAs
- For information, assistance, and personal consultation, please contact the sponsor Karen Mason of Mason Financial.