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Author: Oskar Malone

  • What to expect from the Bank of Canada during the January 29 rate announcement: Experts weigh in with “optimistic” 0.25% rate cut

    What to expect from the Bank of Canada during the January 29 rate announcement: Experts weigh in with “optimistic” 0.25% rate cut

    The Bank of Canada (BoC) is set to announce its latest target interest rate decision on January 29, 2025. This policy update is critical for Canada’s economic recovery amid global economic uncertainty. For businesses, households, and financial markets, the decision could signal the next steps in monetary policy after a year of easing inflation, resilient employment, and global trade challenges.

    Key factors influencing this announcement include Canada’s cooling inflation, robust labour market performance, and external risks like US trade tariffs. Analysts are debating whether the BoC will continue its cautious rate cuts or maintain the status quo as it navigates this delicate balancing act.

    The Economic context: Canada’s current landscape

    After battling inflationary pressures in recent years, Canada’s inflation rate has steadily eased. In December 2024, inflation dropped to 1.8%, within the BoC’s target range.

    This decline marks a significant improvement, as Chief Economist at BMO, Douglas Porter, noted: “Given that we’ve seen a substantial decline in inflation in the past year and interest rates are coming down, the broad economic picture suggests a rebound for the Canadian economy after two years of sluggish performance.”

    The labour market has also shown remarkable resilience, with strong employment growth and rising consumer spending. However, there’s an intricate interplay between falling inflation and economic activity.

    Head of Canadian Fixed-Income Strategy at BlackRock, Rachel Siu, emphasized the BoC’s “data-dependent framework,” suggesting that future rate decisions will hinge on continued economic indicators.

    The housing market remains a central concern, particularly as mortgage renewals approach under relatively high borrowing costs. Yet, signs of relief are emerging.

    Tiago Figueiredo, macro strategist at Desjardins, said, “That amount of easing should be enough to weather the storm from upcoming mortgage renewals and should see economic activity increase.”

    Bank of Canada’s policy stance

    Throughout 2024, the BoC implemented a series of rate cuts to support economic recovery. While these measures have begun to stimulate activity, the question remains whether the central bank will opt for additional cuts in 2025.

    James Orlando, an economist at TD, highlighted the cautious approach: “Given where interest rates are in Canada right now, we think the BoC can go a little bit slower with its cuts.” This perspective suggests that past easing efforts may have already laid the groundwork for recovery, providing the BoC with an opportunity to pause and assess their impact.

    Internationally, central banks are adopting varied strategies, with some accelerating rate hikes while others hold steady or cut rates. The BoC’s decision will underscore its unique approach to balancing domestic needs and global trends.

    Jennifer Lee, senior economist at BMO, pointed out, “That alone could be an occasion for more policy caution, particularly when past easing efforts are already showing some signs of gaining traction (evidenced by home and vehicle sales).”

    External risks: The tariff factor

    Global trade remains a critical external risk for Canada’s economy. Recently imposed US tariffs have strained trade relations and could have ripple effects on Canadian industries.

    Global Chief Economist at Manulife Investment Management, Frances Donald, remarked: “The two economic stories are becoming very different in a way that we haven’t seen for literally many decades. And in 2025, I think we’ll spend a lot of time talking about how Canada’s economy has fundamentally and maybe permanently shifted away from the US model.”

    The BoC must weigh these external challenges to assess whether further rate cuts could help insulate Canada’s economy or exacerbate trade imbalances. Potential retaliatory measures against US tariffs add another layer of complexity to the economic outlook.

    Market expectations and analyst predictions

    Economist forecasts from a recent Reuters poll indicate that 80% of respondents expect the BoC to implement a 25-basis-point (0.25%) cut in January. This expectation aligns with a cautiously optimistic outlook for Canada’s economy. However, Lee warned that the BoC may hold off on deeper cuts due to signs that previous measures are beginning to take effect.

    While inflation has moderated and economic activity is showing signs of improvement, experts remain divided on the projected rate trajectory for 2025.

    Claire Fan, RBC economist, described the outlook as one of “cautious optimism,” citing the positive impact of a recent tax holiday and a declining inflation rate.

    Implications for Canadians

    For Canadian households, the BoC’s rate decision will directly affect borrowing costs, mortgage rates, and overall consumer spending. With many mortgage renewals on the horizon, a lower interest rate could ease financial strain for families. Businesses, meanwhile, may benefit from improved access to credit, fostering growth and investment opportunities.

    On a broader scale, the decision will shape Canada’s long-term economic resilience and global competitiveness. As Figueiredo noted, easing efforts could sustain economic activity through these uncertain times. However, challenges like global trade disruptions and economic divergence with the US underscore the need for a careful and measured approach.

    Bottom line

    As the Bank of Canada prepares for its January 29 rate announcement, it faces a complex economic landscape. With inflation under control, a strong labour market, and external risks like US tariffs, the BoC must balance competing priorities.

    This decision marks a pivotal moment for Canada’s economy in 2025, with potential implications for households, businesses, and markets. Staying informed and prepared for these shifts will be critical as the country navigates its path toward economic recovery and resilience. For now, cautious optimism remains the prevailing sentiment among analysts and policymakers alike.

    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • From $183K to $833K: How Canadians in their 50s bridge the retirement savings gap

    From $183K to $833K: How Canadians in their 50s bridge the retirement savings gap

    Welcome to your 50s! This is your last decade of formal employment — and a time to finalize and fine-tune what retirement will look like. While this process can be exciting, it can also be daunting. That’s because it’s in your 50s when most Canadians start to play “catch-up” on retirement savings.

    Take, for instance, the average savings for Canadians nearing retirement. According to a data report released by Money.ca, the average retirement savings for Canadians aged 55 to 64 is $833,696 — a significant increase compared to the $183,067 saved by those in the 45 to 54 age range. This sharp rise suggests that many Canadians focus heavily on increasing their retirement contributions in their 50s in an effort to close the gap before they retire.

    As a result, the savings accumulated in your 50s are critical for your retirement goals. Now, if you’ve fallen behind on your retirement savings, don’t panic — there’s still time to make meaningful progress towards this goal.

    Understanding the importance of catch-up contributions

    Your 50s are prime earning years for most Canadians, which means you can boost your savings significantly. In fact, the Canada Revenue Agency (CRA) allows individuals over 50 to make higher contributions to tax-advantaged accounts such as Registered Retirement Savings Plans (RRSPs) and Tax-Free Savings Accounts (TFSAs). These “catch-up” contributions can help accelerate the growth of your retirement fund.

    For example:

    • RRSP Contribution Limits: You can contribute up to 18% of your previous year’s income, up to the maximum limit for the current year. If you have unused RRSP contribution room from previous years, this is the time to use it.
    • TFSA Limits: With an annual limit of $7,000 (2024), you can also utilize unused contribution room from previous years to save more.

    Automate your savings

    Consistency is key. Automate contributions to your RRSP, TFSA, or other savings accounts to ensure that you’re putting aside money regularly. Payroll deductions or pre-authorized transfers make it easier to stay disciplined.

    Maximizing investment returns

    Investments play a crucial role in catching up on retirement savings. Meet with a financial advisor to:

    • Ensure your portfolio is appropriately balanced between high- and low-risk assets.
    • Take advantage of investment opportunities within your RRSP or TFSA to grow your savings tax-efficiently.
    • Consider dividend-paying stocks, mutual funds, or bonds that align with your risk tolerance and retirement timeline.

    Reevaluating your financial plan

    By your 50s, you likely have a clearer picture of your retirement timeline and financial needs. This is the perfect time to:

    • Assess Retirement Goals: Determine your target retirement age and desired lifestyle. Will you travel? Downsize your home? Understanding your goals will help you estimate how much you need to save.
    • Review Retirement Income Sources: Look at your projected income from sources such as Old Age Security (OAS), the Canada Pension Plan (CPP), workplace pensions and personal savings. This will help you identify potential shortfalls.

    Cutting expenses and reducing debt

    Reducing your financial obligations now can significantly impact your retirement readiness. Focus on:

    • Paying Off High-Interest Debt: Credit card balances and personal loans should be prioritized to free up more income for savings.
    • Downsizing or Simplifying Living Arrangements: Consider moving to a smaller home or reducing discretionary spending to redirect funds toward your retirement.

    Exploring additional income streams

    If your current savings are insufficient, look into ways to boost your income:

    • Take on Freelance Work or a Side Hustle: Earning additional income can be a fast track to saving more.
    • Sell Unneeded Assets: Downsizing and selling unused property or assets can provide a financial boost.
    • Consider Working Longer: Delaying retirement by even a few years can significantly increase your savings and reduce the number of years you need to draw on them.

    Delay benefits for bigger payouts

    For Canadians nearing retirement, delaying government benefits such as CPP or OAS can lead to increased monthly payouts. For example:

    • Delaying CPP past age 65 can increase payments by 8.4% per year (up to age 70).
    • Waiting to take OAS benefits can result in a 0.6% increase per month (or 7.2% per year).

    Bottom line

    Catching up on retirement savings in your 50s is not just possible — it’s achievable with a well-thought-out plan. By taking advantage of tax-advantaged accounts, reducing debt, optimizing investments and boosting income where possible, you can bridge the gap and retire comfortably. Remember, the best time to start was yesterday, but the next best time is today.

    This article From $183K to $833K: How Canadians in their 50s bridge the retirement savings gap originally appeared on Money.ca

    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • Are you expecting a raise this year? A more cautious salary increase budget is anticipated for 2025 in Canada

    Are you expecting a raise this year? A more cautious salary increase budget is anticipated for 2025 in Canada

    Like many Canadians, you’re hoping to see a salary bump on your paycheque this year. A recent survey saw a projected 2025 salary increase budget of around 3.3%, according to Normandin Beaudry, an actuarial and total rewards consulting service. The survey, conducted in November 2024, comes from nearly 400 Canadian organizations to determine their salary increase budget.

    "Organizations are trying to find the right balance between retaining top talent, while also managing their compensation spend to remain agile and competitive amid an evolving and uncertain geopolitical landscape,” Darcy Clark, Normandin Beaudry’s senior principal, compensation, said in a statement.

    “While less aggressive than last year’s 3.6%, it’s important to note that the forecast for 2025 remains above historical norms and [is] outpacing current rates of inflation."

    However, the survey also revealed 68% of participating organizations made no change to their initial 2024 summer budget forecast for 2025.

    2025 salary increases

    Of those changing their initial projections, 65% are reducing their initial budgets with cost reduction efforts as the main motivator. As well, on a year-over-year basis, the survey reveals continued gradual decline in average salary increase budgets following a series of sharp increases realized from 2021 to 2023.

    As for what else the money can be used for, 42% of organizations that participated in the survey also plan to set aside an average additional budget of 0.9% in 2025.

    "By reserving these resources, organizations are positioning themselves to better address potential challenges during the next compensation cycle," explained Clark.

    "This strategy provides them with an opportunity to tackle internal inequalities more thoroughly with ad hoc salary adjustments. Additionally, setting aside a portion of their budget can help support salary increase differentiation for high performers and address retention efforts for highly strategic or business-critical roles."

    Breakdown by industry

    According to Normandin Beaudry’s survey, industries with the most substantial decreases are in the electronic gaming and visual effects, transportation and warehousing and telecommunications and data processing/warehousing industries. The company attributes the more conservative increase budget forecast from the survey to substantial increases to compensation programs implemented over the last several cycles, cost reduction efforts and decreased pressure for talent in the market.

    To contrast, the initial salary increase budgets are increasing in finance and insurance, public services and pharmaceutical and biotechnology industries. Increases are likely linked to the competitive nature of the market.

    Average total salary increase budget forecasts by ownership structure include:

    • Not-for-profit organizations: 4.1%
    • Privately held organizations (not listed on a stock market): 3.9%
    • Publicly traded organizations (listed on a stock market): 3.4%
    • Government organizations/Crown corporations: 3.6%

    This article Are you expecting a raise this year? A more cautious salary increase budget is anticipated for 2025 in Canada

    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • Death of the chequing account: How startups are enticing users to switch

    Death of the chequing account: How startups are enticing users to switch

    A cheque? Uh, sure. Hold on.

    I leave the canvasser at the door and walk back to my kitchen’s everything drawer. It’s filled with batteries, tape, paperclips and… somewhere buried between packs of Mabel’s labels and paperwork long overdue for a review, I find it. My chequebook.

    “So, who do I make the cheque out to? I don’t know if I remember how to fill these things out anymore.”

    The Canadian chequing account is dying, or it’s already dead, yet hard-working Canadians continue to pay $16 to $30 each month — that’s $200 to $360 per year — for the privilege of a chequebook.

    “You can stay with us,” the big banks say, “as long as you pay the fees.”

    Or, you can avoid those account fees by maintaining high minimum account balances — typically $4,000 to $6,000. But, is having thousands of your dollars held hostage in your account for the privilege to use it in your best interest?

    It’s certainly in the banks’ best interest. Our big six banks are among the most profitable companies in the world with regular appearances on Fortune 500 top companies by earnings.

    Death of the chequing account

    Stop wasting money on outdated chequing accounts. Switch to a modern alternative that rewards you for your everyday banking. It’s time to ditch the fees and start earning perks.

    A standard chequing account is best if you:

    • Collect paper payroll cheques
    • Prefer speaking with a teller inside a brick-and-mortar bank
    • Pay utility accounts, credit cards, and mortgage payments with cheques
    • Need to cash a cheque
    • Accept paying fees or holding high minimums in your account

    A chequing account alternative is best if you:

    • Have automatic, digital deposits from your employer
    • Pay bills (utilities, mortgages, credit cards, etc.) through automatic bill payments
    • Use e-transfers to split bills, such as a night out with friends for dinner or a shared vacation
    • Use a mobile app or web browser to manage your accounts on the go
    • Prefer the security of digitally encrypted transactions
    • Enjoy no-fee rewards banking

    As Canadians, we love the stability our big banks bring, but we’re not seeing higher earnings and better customer service that you’d think loyalty would afford us.

    A brief history of the chequing account through the decades
    Money.ca

    There is a better way but are Canadians ready for it?

    According to a 2024 report from Statistics Canada:

    • 82% of internet users used online banking in 2022
    • 76% of people aged 65 to 74 banked online
    • Over 88% of people aged 25 to 54 manage a chequing or savings account online

    This large cohort of digitally-savvy, working Canadians are ready for rewards banking.

    Rise of rewards banking

    Big banks are smart and are adapting to changing customer demands and the rapid pace of technology and innovation. Financial technology (fintech) startups are deploying innovative technology at a rapid rate to improve and simplify financial services, offering faster, cheaper, and more user-friendly alternatives to traditional banks.

    In the last year alone, Wealthsimple advertised its Cash Account as “Canada’s highest interest chequing account” — serving notice to Canadians a chequing account can earn interest. EQ Bank rebranded their “hybrid account” to something more colloquial as the “Personal account,” dropping the hybrid moniker as more Canadians’ blur the line between a chequing and savings account. Even KOHO, once known as a prepaid credit card with a high interest rate on balances, has entered the banking space by taking steps to obtain a full banking license in Canada, aiming to become a full-fledged bank.

    Why does this matter? Because EQ Bank Personal, Wealthsimple Cash and KOHO Essential are all chequing account alternatives. None of these accounts use the term chequing, but all of them operate exactly like a chequing account offered by traditional, big banks — and more. Turns out these chequing account alternatives also offer clients more rewards and incentives, such as:

    • Earn at least 2% interest on your paycheque
    • Earn cash back when you spend money
    • Pay bills and send e-transfers without limits
    • Manage multiple accounts (emergency funds, sinking funds, bill funds, etc.)
    • Get the exact Canadian Deposit Insurance Corporation (CDIC) insurance as the Big Six Banks
    • Can open an account from your couch in minutes

    *Interest rates vary by provider. EQ Bank offers 3.50% interest only with direct deposit; base rates may differ. Check individual account terms for details.

    All those features are without the fees or minimum account balances required by traditional, big banks.

    Afraid to switch? It costs nothing to open an account and test it out. It’s not complicated and the idea of using a fintech for your day-to-day banking needs is not a radical idea, even our American cousins opting for this approach more and more over the last decade.

    Simple math: Traditional banks vs. rewards banking

    Traditional bank vs. rewards banking infographic comparing the cost of chequing account to the money you can make with a rewards bank account
    Money.ca

    If everything remains the same, after 30 years, you’ll have either paid over $6,000 for your chequing account or missed out on over $9,000 of interest from having $4,000 sitting in a 0% interest account to avoid the fees.

    The opportunity cost alone should make you pull the proverbial plug on that outdated and costly chequing account.

    Time to make your money work for you

    Most Canadians, even newcomers, go to the bank their friends or relatives recommend.

    Taking your banking online offers convenience, rewards, and an opportunity to look beyond a neighbourhood branch. When you bank on yourself, you open up your world to compare financial products that best suit your needs, not necessarily from one financial institution.

    Perhaps Canada’s oldest banks will compete for our loyalty and win us back with better service and higher interest rates in our everyday accounts.

    Sources

    1. Fortune: Fortune Global 500 2024 edition

    2. Statistics Canada: Trends in online banking and shopping (Mar. 21, 2024)

    3. The Globe and Mail Online bank Koho Financial moves to next stage of approval toward gaining a banking licence, by Clare O’Hara (Jan. 26, 2024)

    This article Death of the chequing account: How startups are enticing users to switch originally appeared on Money.ca

    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • When Walmart’s ‘low prices’ aren’t so low: How Trump’s tariffs could cost Canadians more — and how to fight back

    When Walmart’s ‘low prices’ aren’t so low: How Trump’s tariffs could cost Canadians more — and how to fight back

    Walmart CFO John David Rainey issued a stark warning: President Donald Trump’s proposed tariffs could force the retail giant to raise prices on some items, despite its commitment to affordability.

    Speaking to CNBC, Rainey expressed concern over the unavoidable impact of the potential tariffs.

    “We never want to raise prices. Our model is everyday low prices. But there probably will be cases where prices will go up for consumers,” he cautioned.

    For many households, these potential price hikes add to an already challenging economic environment, amplifying worries about affordability and inflation.

    Rising costs leave Canadians feeling the pinch

    In recent years, Canadian consumers faced escalating costs for essential goods.

    As of December 2024, Canada’s annual inflation rate stood at 1.8% — a slight drop from 2.0% in October due to the temporary sales tax break announced by the federal government.

    Now, after a year of high inflation and rising costs, the threat of a 25% tariff on Canadian goods exported to the US — a threat President Donald Trump hasn’t completely removed from the negotiation table despite the looming February 1, 2025 deadline — means Canadian consumers could be facing another year of rising living costs.

    Why tariffs are driving price concerns at retailers, like Walmart

    Walmart, the world’s largest retailer, sources two-thirds of its merchandise from North American manufacturers and suppliers, but the remaining one-third comes from countries like China.

    It’s these international products that will see price increases — facing a tariff increase as high as 60% to 100%.

    Walmart CEO, Rainey, acknowledged that these tariffs could make it impossible for the “Low Price” retailer to maintain the company’s promise of low prices on every product.

    Rainey explained that, while raising prices isn’t something the company wants to do, “there probably will be cases where prices will go up for consumers.”

    Other retailers, such as Lowe’s and AutoZone, are similarly bracing for higher costs due to their reliance on imported goods. Lowe’s CEO Marvin Ellison revealed that 40% of the company’s merchandise is sourced from outside the US, leaving a significant portion of its inventory vulnerable to the effects of tariffs.

    These rising costs aren’t just an inconvenience — they represent a potential economic domino effect. US-based National Retail Federation (NRF) warned that tariffs act as a hidden tax on consumers, driving inflation, eroding household purchasing power and impacting everyday goods like clothing, shoes and home essentials.

    How tariffs translate to higher prices

    The financial impact of tariffs can be staggering. Proposed tariff rates range from 10% to 20% for general imports, with Chinese goods facing levies of up to 100%.

    The NRF estimates that these tariffs could increase household costs by an average of USD$7,600 per year, a cost burden that could spill over to Canadian consumers shopping at US-based retailers like Walmart.

    If Canadian consumers take the full brunt of increased costs, this would translate into an average living expense increase of almost $16,700 per year.

    Biggest impact is on everyday items

    The increase in prices would be especially noticeable in common household items. For instance, a $100 winter coat would now cost $121, while $90 sneakers could cost as much as $116.

    These seemingly small increases add up over time and strain household budgets.

    Ripple effects for Canadian shoppers

    While Trump’s tariffs are primarily aimed at Chinese imports into the US, their impact will likely extend to Canadian consumers. Walmart Canada sources some products from the US, so price hikes south of the border could make their way into Canadian stores. Additionally, as retailers navigate higher costs for imported goods, they may pass these increases on to customers.

    This is especially concerning in a time when many Canadians are already feeling the pinch of rising inflation. According to Statistics Canada, inflation for groceries alone increased by 6.7% year-over-year in 2024. With tariffs adding another layer of financial strain, finding ways to mitigate these costs becomes more critical than ever.

    Tips to avoid paying more

    Although rising prices may feel inevitable, there are steps that Canadian consumers can take to protect their wallets. Here are some practical strategies to minimize the impact of tariff-induced price increases:

    Diversify your shopping options Focus on buying locally produced goods to avoid products impacted by tariffs. Supporting local businesses not only helps reduce reliance on imports, but it also bolsters the domestic economy.

    Buy in bulk or during sales Stocking up on non-perishable essentials before price hikes go into effect is a smart way to save money. Look out for sales, especially on items that might see the sharpest increases, such as apparel or household goods.

    Leverage loyalty Programs Retailers like Walmart offer memberships, such as Walmart+, that provide exclusive discounts and free delivery. These savings can help offset the rising costs of goods.

    Focus on private-label Products Private-label goods, such as Walmart’s Great Value brand, are often more affordable than name-brand items. Retailers tend to use private labels to maintain competitive pricing, even when costs rise elsewhere.

    Consider online shopping alternatives Compare prices across multiple online platforms to find the best deals. Many e-commerce retailers offer discounts or free shipping promotions that can help reduce overall spending.

    The bigger picture

    The effects of Trump’s tariffs go beyond Walmart shelves. They highlight a growing trend in global trade policies that prioritize domestic production at the expense of international trade relationships. While these policies may aim to strengthen the US economy, they risk creating economic challenges for consumers worldwide, including in Canada.

    NRF CEO, Matthew Shay, described the tariffs as “a tax on American families,” and the same could hold true for Canadian households indirectly affected by these measures. Higher prices, inflation and reduced purchasing power are just some of the potential consequences.

    Looking ahead

    Walmart and other retailers are already working to adapt. Diversifying supply chains to reduce dependency on high-tariff countries like China is one strategy, though it will take time to implement fully. For now, consumers must remain vigilant, alter their shopping habits and make informed purchasing decisions to navigate this uncertain landscape.

    As Rainey pointed out, price increases may be unavoidable in some cases, but taking proactive steps can help soften the blow. By focusing on local goods, shopping strategically and leveraging retailer programs, Canadians can weather the storm of rising prices and keep their budgets intact.

    This article When Walmart’s ‘low prices’ aren’t so low: How Trump’s tariffs could cost Canadians more — and how to fight back originally appeared on Money.ca

    Sources

    1. CNBC: Walmart may have to raise some prices if Trump tariffs take effect, CFO says, by Melissa Repko (Nov 19, 2024)

    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • Personal finance guru Ramit Sethi says there’s no right time to have ‘the talk’ about money with your partner — but the first date is probably too soon

    Personal finance guru Ramit Sethi says there’s no right time to have ‘the talk’ about money with your partner — but the first date is probably too soon

    As you prepare for your first date, it’s easy to find yourself rehearsing the perfect small talk: The questions you’ll ask, the answers you’ll give and how to steer clear of awkward silences.

    But beyond the usual first-date classics, like “What do you do for work?” or “Where did you grow up?” there’s one topic of conversation that might just send your date reaching for the check sooner than later: The money conversation.

    While discussing money is important in any relationship, finance expert Ramit Sethi advises the first date might be a little too soon.

    “Some people in the financial community encourage talking about money on the first date. I find that a little nerdy. Like who wants to be on a first date talking about your asset allocation? You know, it’s like, get a life,” Sethi told Moneywise in a recent interview ahead of the release of his new book, Money for Couples.

    There are subtle ways to gauge your date’s relationship to their finances without diving into the topic directly.

    Here’s how Sethi suggests approaching the conversation.

    Talking dollars on a first date: Transparency or TMI

    First dates are already filled with enough potential awkwardness — from nervously avoiding eye contact to forgetting basic table manners. Adding topics like salary, debt or finances into the mix might just guarantee there won’t be a second date.

    A recent Ipsos poll conducted on behalf of BMO found that while there is an overwhelming belief that finances should be discussed somewhat early in a relationship (83%), two in five (41%) believe it should be happen when the relationship becomes official, while 31% think that these talks can wait until a couple is ready to move in together. This timing often coincides with the shift from the honeymoon phase to deciding whether the relationship has long-term potential.

    “Sometimes I wonder if any of these folks have been on a first date,” Sethi said, emphasizing that money conversations don’t need to happen right away.

    First dates are about sharing interests and exploring emotional compatibility, not creating a financial evaluation. Discussing money too soon can feel invasive or overly transactional, turning a potentially great connection into an uncomfortable encounter.

    It’s a sensitive subject — one best saved for when trust and mutual understanding have had time to grow.

    The subtle art of learning about money habits

    However, Sethi doesn’t suggest avoiding money-related topics entirely when getting to know someone. Instead, he shares that there are simple, natural ways to learn about someone’s attitudes toward money without directly asking.

    “When you’re getting to know somebody, obviously you’re curious. You ask them questions like where did you grow up? What did you guys do for fun as a family? Where did you go to school?,” Sethi said.

    Understanding someone’s attitude toward money is crucial for many. A 2024 poll from Simplii Financial found that 94% of Canadians admit that it’s important to them that they and their spouse/partner are on the same page when it comes to their household’s finances.

    When starting any conversation about an intimate topic like money, curiosity is the best guide. Listening closely for clues about how they describe their lifestyle — whether, say, they enjoy simple pleasures or lean towards indulgences — are windows into their financial mindset.

    Ultimately, discussing finances is deeply personal and varies for each couple. Finding an approach that works for you and your partner is one of the best ways of aligning your financial goals and building a strong foundation together.

    Sources

    1. I Will Teach You to be Rich: Books

    2. Ipsos: Relationship Wars: Spending a source of conflict for as many as one in three (32%) couples (Feb 9, 2024)

    3. Ipsos: As Valentine’s Day approaches, four in ten (38%) say money is a major cause of stress in their relationship (Feb 12, 2024)

    This article Personal finance guru Ramit Sethi says there’s no right time to have ‘the talk’ about money with your partner — but the first date is probably too soon

    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • Junk fees are taking a toll on Canadians’ financial and emotional wellbeing

    Junk fees are taking a toll on Canadians’ financial and emotional wellbeing

    For Canadians already feeling the pinch of rising costs, junk fees — unexpected or hidden charges tacked onto financial transactions — add a new layer of stress and frustration. According to new research from global technology company Wise, over half (57%) of Canadians say their emotional well-being has been negatively affected by these fees, with many reporting increased anxiety and financial strain.

    “Junk fees are more than just an annoyance; they’re an invisible tax on everyday Canadians,” said Brigit Carroll, senior policy and campaign manager for the Americas at Wise.

    “They undermine financial stability, create unnecessary stress and erode trust in financial institutions. These findings should serve as a wake-up call for policymakers to expand junk fee legislation to include hidden charges in financial services, particularly in international transactions.”

    Hidden cost of hidden fees

    One of the most egregious examples of junk fees is the inflated exchange rate markups buried within international money transfers. Wise’s survey revealed that 81% of Canadians have been negatively impacted by these hidden fees, which often catch consumers off guard and disrupt their financial plans.

    Despite this, federal junk fee legislation has failed to address hidden fees in financial services. This omission is glaring, considering that over half (51%) of Canadians have sent money internationally in the past year — and 79% of survey respondents believe these fees should be a legislative priority.

    These hidden charges are more than just an inconvenience; they’re an obstacle to financial stability. Over half of Canadians (54%) said junk fees have made it harder to budget, while 48% reported that these charges are preventing them from traveling and 51% said they’re struggling to save for major life purchases like a home.

    Eroding consumer trust

    The pervasive nature of junk fees isn’t just affecting Canadians’ wallets; it’s also eroding trust in the institutions that impose them. According to the survey, 75% of respondents reported reduced trust in their financial institutions due to these fees. Moreover, 86% said junk fees have influenced their decisions about which companies they choose to do business with, and 74% have either stopped or plan to stop using services that rely on hidden charges.

    For Canadians, the message is clear: Transparency shouldn’t be optional. An overwhelming 96% of respondents expect all fees to be disclosed upfront before using a financial service. Anything less is seen as a breach of trust.

    A call to action

    “The results of this study highlight an urgent need for action,” Carroll emphasized. “Hidden fees in international payments, and financial services as a whole, must be part of the conversation around junk fees. Ignoring this issue risks further damaging consumer trust and increasing financial hardship for Canadians.”

    The survey underscores the growing call for transparency and fairness in financial transactions. With over 2,500 Canadians between the ages of 18 and 60 participating, the findings make it clear that junk fees are not just an annoyance — they’re a serious issue with tangible impacts on Canadians’ financial and emotional well-being.

    For Canadians, the stakes are high. Without action to address junk fees comprehensively, the financial and emotional toll is likely to grow, leaving more individuals struggling to stay afloat in an already challenging economic climate.

    Survey methodology

    The survey was conducted by Dynata on behalf of Wise from October 4 to 8, with a total of 2,562 Canadian respondents between the ages of 18 to 60 years.

    This article Junk fees are taking a toll on Canadians’ financial and emotional wellbeing

    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • Make sure you sell these 7 things before you retire — it can make (and save) you thousands of dollars

    Make sure you sell these 7 things before you retire — it can make (and save) you thousands of dollars

    As you approach retirement, financial planning takes centre stage. While many focus on savings and investments, there’s another often-overlooked strategy to bolster your nest egg: Getting rid of stuff you no longer need.

    It’s not exactly the KonMari Method, but downsizing your home, clearing out your garage and selling key assets before retirement can generate cash, reduce expenses and simplify your life. Clearing out clutter always feels good, and making money at the same time will probably sound better to soon-to-be retirees who worry that they might outlive their nest egg.

    Here are seven things to sell before you retire that could add thousands of dollars to your retirement fund.

    Home downsizing is a game-changer

    For many retirees, the family home is a centrepiece asset and a big expense. Selling your current home and downsizing to a smaller property, condo or even a rental can free up significant cash while slashing property taxes, maintenance costs and utility bills.

    In fact, a recent poll by Wahi showed that 37% of Canadians who planned on selling their homes in the near future are planning to downsize, 69% of which are aged 55 and up.

    Multiple cars

    If you’re no longer commuting daily or if you or your partner don’t need separate cars, selling extra vehicles can save thousands. According to the CarGurus Index, the average used car price in right now is $31,166 — suggesting that shedding unused vehicles could add a significant amount to your retirement fund.

    But the benefits don’t stop there. By selling an extra vehicle, you’ll also save on insurance, registration, maintenance and fuel, potentially cutting annual expenses by thousands.

    Unused RVs or boats

    Dreams of RV road trips or boating adventures often fizzle as retirees realize the costs and maintenance can rival — or even outweigh — the benefits. Selling these big-ticket items before retirement can recoup tens of thousands of dollars.

    What a seller can get for their used RV varies greatly and depends on the RV’s size, type and condition. But like selling an unused car, the real savings arguably come from avoiding ongoing storage fees, insurance premiums and costly repairs that can drain your retirement budget.

    High-end furniture and antiques

    Do you have a house full of furniture that won’t fit into your downsized living space? Or antique pieces gathering dust? Selling these items can bring in a surprising amount of cash.

    Websites like Chairish or 1stDibs specialize in high-end furniture and antiques, helping sellers connect with buyers willing to pay top dollar. Downsizing your belongings not only declutters your space but also saves on moving costs. In some cases, selling large furniture pieces before you move could save hundreds — or even thousands — on relocation expenses.

    Designer clothes, jewellry and accessories

    If your closet is filled with designer handbags, expensive suits or fine jewellry that you rarely wear, now is the time to sell. Websites like Poshmark, The RealReal, or eBay can help you fetch fair market value for these items.

    For retirees looking to simplify their wardrobe, selling luxury goods can provide a quick financial boost. Shedding expensive tastes also means fewer temptations to buy similar items in the future — another long-term savings win.

    Unused exercise equipment

    That treadmill, elliptical or weight set collecting dust in the basement could be a goldmine. High-quality exercise equipment retains significant resale value, especially as demand for home gyms continues to grow, with 73% of Canadians saying they prefer to exercise on their own rather than in a gym or group setting — per recent findings by Made in CA.

    Selling unused equipment can net you anywhere from a few hundred to several thousand dollars, depending on the condition and brand. Plus, clearing out these bulky items creates extra space in your home — a win if you’re downsizing.

    Collectibles and memorabilia

    Are those old baseball cards, vintage comic books or rare coins gathering dust? These items may hold significant monetary value, but they often sit untouched for years. Before retiring, consider having your collections appraised and selling them to serious buyers.

    The market for collectibles can be volatile, so timing your sale carefully is key. For example, a rare Superman comic book sold in 2024 for about USD$6 million, while sports memorabilia continues to fetch astounding prices. Even if your collection isn’t worth millions, selling it can produce an unexpected windfall.

    This article Make sure you sell these 7 things before you retire — it can make (and save) you thousands of dollars originally appeared on Money.ca

    Sources

    1. Wahi: Few Canadians are being forced to sell their homes: Wahi survey, by Josh Sherman (Jun 13, 2024)

    2. CarGurus Index: Explore used car pricing trends

    3. Made in CA: Fitness industry statistics in Canada, by Nicole Blair (Dec 31, 2024)

    4. Savvy Dime: Rare comic books that are extremely valuable today, by Kate Row (Nov 26, 2024)

    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • Expert warns of a severe market collapse — offers 3 options to shelter investments

    Expert warns of a severe market collapse — offers 3 options to shelter investments

    Canadian markets have shown resilience in 2024, with the S&P/TSX Composite Index and key sectors such as energy and financials posting solid gains. However, renowned investor Jim Rogers warns that a financial storm is looming. In a recent interview with ET Now, Rogers cautioned that the North American equities markets are long overdue for a major financial correction. “When the next market collapse comes, it’s going to be the worst in my lifetime.”

    With this ominous prediction, Canadian investors may be reevaluating their portfolios. Rogers recommends focusing on cash and defensive assets like precious metals and agriculture as part of a protective strategy.

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    Hoarding cash: A temporary safety net

    Rogers, who co-founded the Quantum Fund, has navigated through turbulent markets before, notably during the economic turmoil of the 1970s and again during the dot com bubble and burst. As a result, the esteemed investor has learned a thing or two about weathering a market storm.

    Based on his experience, Rogers suggests holding a significant amount of cash in preparation for the next collapse.

    “I am not spending my cash yet. I would like to have more cash because, when the next market collapse comes, it’s going to be the worst in my lifetime,” Rogers said.

    He continues with a few other solid suggestions: “If I were buying today — and I’m not — I would probably buy silver or agriculture.”

    In Canada, investors may want to consider a similar approach. Keeping cash in a high-interest savings account or short-term Canadian government bonds, such as T-bills, can offer some security while preserving liquidity for future opportunities.

    Keeping cash in a high-interest savings account

    Keeping cash in a high-interest savings account can be a smart hedge during a stock market correction as it keeps your earnings safe from market volatility.

    Keep in mind that, during a stock market correction, many investments lose value rapidly, and liquidity becomes crucial. By keeping your investment cash in a high-interest savings account, your cash balance is secure and unaffected by market swings. This ensures you have readily accessible funds to cover expenses or invest when better opportunities arise.

    Read More: Pick the best high-interest savings account

    Holding cash during a market correction puts you in a strong position to exploit investment opportunities. When stock prices fall during a correction, many high-quality assets can become undervalued. Cash on hand allows you to buy stocks, bonds or ETFs at lower prices, capitalizing on the potential for future growth once the market recovers.

    While cash may not deliver the high returns of other investments in the long run, holding cash in a high-interest savings account during a stock market correction provides liquidity, safety and the opportunity to buy assets at discounted prices, making it a valuable hedge against market volatility.

    Precious metals as a hedge against uncertainty

    Precious metals like gold and silver are often seen as hedges against inflation and economic uncertainty, primarily because they cannot be printed by central banks like traditional currency. In 2024, gold has drawn significant attention from investors, reaching new record highs as concerns over inflation rise.

    Read More: How to invest in gold

    Silver, while also rallying this year, remains well below its historical peak. Rogers noted this discrepancy as a reason for his interest in the metal. “Silver is down 40% or 50% from its all-time high… Gold has been making all-time highs,” he explained. “Silver is down — it’s hard to find things that are down.”

    Read More: How to invest in silver

    For Canadian investors, exposure to precious metals could be achieved through gold mining stocks like Barrick Gold (NYSE:GOLD) or Franco-Nevada (NYSE:FNV), which have performed well amid rising commodity prices.

    This article Expert warns of a severe market collapse — offers 3 options to shelter investments originally appeared on Money.ca

    What to read next

    • Wondering if you should save or invest to meet your money goals? Click here to determine the best path for you
    • If your looming retirement is stressing you out, check out what wealthy baby boomers are doing to stay savvy
    • Unsure of how to navigate your monthly budget? Zero-based budgeting could be the answer

    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • This critical formula can transform your personal finances for the better — and it’s simple to calculate. Here’s how to use it for riches in 2025

    This critical formula can transform your personal finances for the better — and it’s simple to calculate. Here’s how to use it for riches in 2025

    Imagine a future where financial freedom isn’t just a dream but a clear, achievable reality. What if the key to unlocking that future was as simple as a basic formula?

    The good news is there is a game-changing strategy — the Cash Flow Formula — that has the potential to reshape your relationship with money and help you build lasting wealth.

    Not convinced? Considering the average Canadian credit card balance reached $4,499 last year and nearly half of all cardholders ended up carrying this expensive debt for many months — the option to use a game-changing money formula may be the right strategy.

    Whether you’re struggling with debt, looking to grow your savings, or ready to invest, the Cash Flow Formula offers a practical solution and actionable steps that help optimize your cash flow.

    Learn how to manage expenses, eliminate bad debt, and even leverage good debt to build assets. By the end, you’ll be equipped with the tools to take control of your finances and turn 2025 into a year of abundance and financial security.

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    The cash flow formula explained

    If you’re unfamiliar with the cash flow formula, take heart. It’s more commonly applied to businesses, but you can also apply it to your personal finances. Melissa Houston, a CPA who covers women in business issues for Forbes, explains it this way: “Cash flow is the lifeblood of a business. It’s the stream of money coming in and going out that keeps operations running, pays bills and helps a company to grow.”

    It’s pretty straightforward: You can create wealth by treating your finances like you’re running a company. Now, let’s break down the main components of the cash flow formula:

    • Income. Your income is the money you bring in through work, investments, pensions, side hustles, etc. The ability to grow your income is important, but it’s not the only thing you should focus on.

    • Expenses. Expenses eat away at your income, and while some — like rent, clothing and transportation — are unavoidable, excessive spending on things like fancy toys or dining out are not.

    • Debt. As it pertains to the cash flow formula, debt can become a problem if you are spending too much money covering the interest on credit cards or making large car loan payments. But not all debt is created equal. There is such a thing as good and bad debt (a mortgage on your home versus high-interest credit cards).

    • Cash flow. Your cash flow is the money left over after you’ve covered all your expenses, including your debt payments. You have more money to save and invest if your cash flow is high. While you can invest in stocks, bonds and exchange-traded funds (ETFs), you can also make capital improvements to your property, such as a home renovation that drives up its value.

    Accumulating more money: The formula applied in 2025

    Here are three cash-flow strategies businesses use that you can easily adopt to your own finances in 2025.

    Prioritize adding income over cutting expenses

    This does not mean you should ignore expenses, especially the wasteful ones. And thankfully, nearly a third of Canadians are already planning to cut back on spending in 2025, according to a BMO survey.

    That being said, there’s a limit to how much you can cut. There are fewer limits on your ability to earn income.

    Eliminate bad and expensive debt

    Here, credit card debt remains the chief culprit when it comes to bad debt.The average credit card balance for Canadians was $4,499 in the second quarter of 2024, according to TransUnion.

    And, the Bank of Canada also says close to half of Canadians with a credit card carry a balance for at least two consecutive months.

    Converting to a lower interest personal loan can free up cash through a monthly payment that ensures you are paying down your debt.

    Use good debt to your advantage

    While this can be risky for a novice investor, especially if you lack discipline, increased cash flow leaves room to take on good debt by purchasing real estate. For example, if you purchase a rental property, you can use the rent you collect to pay the mortgage while owning an appreciating asset.

    Chatting with a financial advisor or real estate professional before attempting this is best. But increased cash flow sets the stage for effectively managing your debt — and maybe the occasional indulgence.

    Sources

    1. LinkedIn: Melissa Houston, CPA

    2. Forbes: The Crucial Role Cash Flow Plays In Business Success (Feb 2024)

    3. BMO: BMO Survey: One-Third of Canadians Expect to Curtail their Spending in 2025 (Dec 17, 2024)

    4. TransUnion: Q2 2024 Credit Industry Insights

    5. Bank of Canada: The reliance of Canadians on credit card debt as a predictor of financial stress (July 2024)

    This article This critical formula can transform your personal finances for the better — and it’s simple to calculate. Here’s how to use it for riches in 2025

    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.