A survey released yesterday by Manulife Bank of Canada found homeowners, especially those in their 50s, are more comfortable with their debt than their parents. Manulife polled nearly 2,400 Canadian homeowners in all provinces and found 39 percent were “more comfortable with debt compared to their parents” while only 13 percent were “less comfortable.”
That didn’t mean they plan to live with rushing debt all their lives. The survey also found, “Eight in 10 homeowners indicate being or becoming debt-free among top financial priorities.” But the stigma of debt seems to have faded with the passing generations.
“Canadians are becoming increasingly comfortable with taking on debt and discussing that debt with those close to them,” says Jason Daly, a Manulife vice president. “This could be a result of our current low interest rate environment, which makes debt management seem less intimidating than it was in the ’80s and 90’s, when rates were much higher.”
Still, if you want to pay down debt, there are some easy ways to start…
1. Pay off the credit cards
You may be worrying less about your mortgage but you still probably have other debt, such as credit cards. Ninety-two per cent of those surveyed by Manulife said paying credit cards in full helped lower outstanding debt and create less things to worry about.
2. Pay extra!
People like making the minimum payments on their debts, means less money out of your pocket, right? Wrong. When you pay the minimum amount, you may have staved off the bill collectors for now but the interest on your debt will build up quickly. In the long run, you could wind up paying double what you owe because of that interest. According to 62 per cent of responders, making extra payments is beneficial to eliminating debt.
3. Create a budget
Fifty-one percent of home owners surveyed said keeping track of your money on paper will help know where you’ve spent money and on what. In addition, you can decide on how much you want to pay towards debt repayment which means you can determine how long it will take to pay off your debt.
If you want to learn more about saving a lot of money without spending a lot of time, check out Consolidated Credit’s free Personal Finance educational section. If you’re struggling with debt, call one of our trained counsellors today at 1-888-294-3130 for a free debt analysis.