Tag: financial danger zone

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FINANCIAL SKILLS: FINANCIAL EDUCATION WILL NOW BE PART OF ONTARIO HIGH SCHOOLS

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Financial skills: Introduction

Schools typically provide a standard curriculum – mathematics, literature, languages, history, geography and the like; but conspicuously absent are any life skills such as a financial education. We have students graduating from high school that know when the Magna Carta was signed, but often with no concept of money. Finally Ontario is going to begin teaching financial skills to high school students.

Financial skills: Why do we need the schools to teach financial literacy?

“Canadians don’t understand the basics,” says Laurie Campbell, CEO of Credit Canada Debt Solutions. Many adults, she says, struggle with simple concepts like spending less than they earn.

As we recently pointed out, Canadians are among the most indebted in the world! A borrowing binge fueled by low-interest rates, is putting many Canadians in a financial danger zone and not setting an example for young people. They’re growing up seeing debt accumulation – not saving and budgeting.

Financial skills: The Investor Education Fund study

An Investor Education Fund study revealed:

  • Only 44% of parents believe their children are ready to manage money
  • Only 39% of high school students feel prepared to manage their finances after high school
  • 84% of parents and 70% of high school students want financial learning in the classroom

Financial skills: Students are looking for financial education

Tricia Barry, executive director of Money School Canada and a former banker, says that students know little more about money than they did five years ago. Ms Barry believes that:

  • By the time school students are in Grade 8 they should have an understanding of the concepts of income, expenses and interest; but they don’t
  • When they graduate from Grade 12, they should have a solid understanding of saving, smart spending, budgeting, borrowing and credit cards; but they don’t

According to Ms Barry, there is a direct correlation between the lack of money management training and the fact that more than 33% of those ranging in age from 18-29 are burdened with a debt of $10,000 or more.

Financial skills: Will all Ontario students be taught financial literacy?

At the moment financial skills courses will be rolled out as pilot projects at 28 high schools for 700 Grade 10 students. After the pilot projects are completed in June 2018, teachers and students will be asked to provide feedback. Based on the feedback provided, a financial skills mandatory careers course will be designed and implemented in the fall of 2018. In addition to financial skills the students will learn entrepreneurship and digital literacy in addition to career and life planning.

Schools need to lead the charge when it comes to financial literacy. As you can see by the alarming statistics of Canadian household debt, we can’t expect our young people to learn good money management skills at home. Knowledge is power and we need to do something to stem the tide of uncontrollable debt.

Financial skills: Do you need help with your debts?

Not only should financial skills be taught in high school but in elementary school as well; and the earlier the better. It’s time to break the cycle of debt while you still have options. Give the Ira Smith Team a call. We’ve got years of experience helping Canadians just like you, get back on track to debt free living. We can help.

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ENOUGH MONEY IN RETIREMENT: HOW CAN YOU BE WORTH OVER A MILLION DOLLARS &WORRY ABOUT BEING BROKE

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enough money in retirement

Enough money in retirement: Introduction

For most Canadians the thought of being worth over a million dollars is a totally unattainable dream. Yet, there are now almost 357,000 Canadians with at least $1 million in wealth, not including their primary home (Capgemini). And, as difficult as it is to believe, some of these millionaires worry about being broke. They worry about having enough money in retirement. The reality is that they may have reason for concern.

Enough money in retirement: What do the ultra rich worry about?

  • 20% of ultra-high-net-worth investors (defined as those with a net worth between $5 million and $25 million), are concerned about having enough cash to last throughout retirement. (a 2017 survey by the Illinois-based Spectrem Group, a financial research firm).
  • People feel angst about running out of money in retirement whether they have $1 million, $10 million or $50 million”, says Gordon Stockman, a fee-only financial planner and principal of Efficient Wealth Management Inc. in Mississauga.

Enough money in retirement: Why do the rich worry about running out of money?

The rich have very expensive lifestyles to maintain. They’re used to the finest things in life – mansions, vacation homes, household staff, exotic cars, first class travel, designer clothes – and they don’t want to give anything up. But, how will they be able to maintain these fabulous lifestyles for what could be a 25 – 30 year retirement? Something’s got to give.

Enough money in retirement: Is it possible to be worth over a million dollars and go broke?

Unfortunately, although difficult to believe, yes it is. There are examples in the news every day about actors, actresses and professional athletes who earn unimaginable amounts of money, and declare bankruptcy. It also happens to doctors, lawyers and other “regular rich folk” who lost track of their spending and blew through their money. It can happen to anyone. Very few people are rich enough to be immune from money problems.

Enough money in retirement: What about you?

No matter how much money you have, take a good hard look and your finances. And if you find yourself in a financial danger zone, contact Ira Smith Trustee & Receiver Inc. We’re a full service insolvency and financial restructuring practice serving companies and people throughout the Greater Toronto Area (GTA) facing financial crisis or bankruptcy that need a plan for Starting Over, Starting Now. Your financial problems can be solved with immediate action and the right plan. Give us a call today.

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CANADIAN HOUSEHOLD DEBT: WE SEEM TO LOVE IT!

household debt, Canadian household debt, how to pay off debt, debt, mortgage debt, interest rates, financial danger zone, credit card, credit card spending, Moneris Solutions, Equifax, auto loans, seniors, trustee, lifestyle, Canadian debt, Canadian economyCanadian household debt at a record high

The ratio of Canadian household debt to disposable income has hit a record high of 164.6%. This means for every $1 of after tax income Canadians earned, they owed nearly $1.65 in credit market debt – mortgages, credit cards and other kinds of consumer loans. The reality is that many Canadians are living in a financial danger zone. They’re walking a financial tightrope where anything like the loss of a job or an increase in interest rates can throw off this delicate balance and plunge them into financial disaster.

Increase is no surprise

TD Bank economist Jonathan Bendiner wrote about Canadian household debt, “The increase came as no surprise. Rising mortgage debt drove most of the growth as interest rate cuts by the Bank of Canada earlier in the year spurred borrowing, especially in the hot housing markets in British Columbia with all the homes for sale in Mission BC and Ontario”. The great concern now is what happens once interest rates rise to more typical levels. How many Canadian will no longer be able to pay their bills or carry their household debt?

5 reasons why for the increase in Canadian household debt

Why is Canadian household debt at an all time high? In addition to rising mortgage debt it may come down to one simple word – lifestyle:

  • Credit card spending rose by 8% this year (Moneris Solutions Corp.)
  • Spending on restaurants and fast food rose by more than 12% (Moneris Solutions Corp.)
  • Home improvement spending soared nearly 10% in the second quarter of the year compared with the same time last year, led by sales of glass, paint, wallpaper and flooring (Moneris Solutions Corp.)
  • Furniture sales are up more than 17% (Moneris Solutions Corp.)
  • Auto loans rose nearly 4% in the second quarter on the back of record vehicle sales (Equifax)

Has income kept pace with Canadian household debt? No!

Unfortunately incomes haven’t increased in the Canadian economy to compensate for the increase in spending and Canadian household debt. A Bank of Montreal report states that approximately 80% of Canadians are in debt and nearly 66% would have trouble affording their household debt if interest rates went up by just two percentage points. Canadians now spend an average 14% of after tax income on their debts. Sadly, the group that’s struggling the most is seniors. According to Equifax, for the first time in five years, 90-day delinquency rates rose among seniors in the second quarter.

What is a person to do?

Are you walking a financial tightrope? If interest rates rise will you be able to afford your household debt? Better yet, would you know how to pay off debt?

Don’t wait for disaster to strike! The time for professional help is NOW. Contact Ira Smith Trustee & Receiver Inc. We’re experts in debt and debt management. We approach every file with the attitude that corporate or personal financial problems can be solved given immediate action and the right plan. Starting Over, Starting Now we can give you financial peace of mind.

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WANT TO IMPROVE YOUR CREDIT SCORING? THEN CHOOSE YOUR FACEBOOK FRIENDS WISELY

credit score, credit scoring, Facebook, Facebook credit score patent, Facebook friends, loan, social media, credit ratings, social network, credit score, loan applications, financial danger zone, trustee, debt, social media, starting over starting nowWhat does credit scoring have to do with your Facebook Friends?

To improve your credit scoring, you are going to have to choose your Facebook Friends more wisely. Many people believe that when it comes to social media, it’s a numbers game and whoever has the most, wins. As a result they will “friend” anyone who asks. They don’t care who they are or why they want to be Facebook friends; the only thing that matters is that their number of friends keeps going up. That may now be a very dangerous game to play. Those Facebook friends that you’ve been amassing may be a liability if you apply for a loan.

It’s well known that Facebook mines data from its users for the purposes of pushing targeted advertising. However, Facebook now has a patent for authorizing and authenticating a user based on their social network on Facebook. Although this patent can be used for several benign functions like helping with search queries, it also states very clearly that it could be used to approve a loan based on a user’s social connections. In other words, the new Facebook algorithm can be used by lenders in determining your credit scoring when applying for a loan or mortgage.

The Facebook credit rating patent

“When an individual applies for a loan, the lender examines the credit ratings of members of the individual’s social network who are connected to the individual through authorized nodes,” the patent reads. “If the average credit rating of these members is at least a minimum credit score, the lender continues to process the loan application. Otherwise, the loan application is rejected.” So your Facebook Friends credit scoring, affects yours too!

Lenders are already using social media when considering your loan application

In case you find this shocking and futuristic, social media strategist and University of Sydney academic Laurel Papworth says that lenders in 36 countries are now using Facebook data as part of their tools for approving or rejecting loan applications. This puts a lot of power in the hands of your Facebook friends, especially when you consider that according to CNN there are 83 million fake profiles.

So do you really know your entire list of Facebook friends well and better yet, their financial situation and credit scoring? It’s time to take a serious look at your Facebook friends and start trimming the fat. Who you don’t actually know, and who you do know with poor credit scoring, can hurt you.

If you have been rejected for a loan – take action now!

If you have been rejected for a loan application because of a poor credit scoring, chances are that you are in a financial danger zone. The best thing you can do is contact a professional trustee as soon as possible. The Ira Smith team is here to help you conquer debt and live a financially healthy life Starting Over, Starting Now.

 

Call a Trustee Now!