Monday, February 06, 2012

Sock it away

Time after time I see a tenant unable to pay their rent after just a few days of missing work. There is a snowball effect where they get behind in their rent and bills until the whole situation ends with them thousands in arrears. If your rent is over $1000 it's not hard to get into a lot of debt quickly.

I think it's that many don't know how to save and how to live within their means. Many times the same tenants have expensive cars and a lot of flashy stuff - think big screen TV etc. It's their right to have nice things but they also need to pay rent.

It seems things aren't getting better research shows our low interest rates are lulling Canadians into spending and not saving.

"In the 1980s, households saved up to 15 per cent of their income, but by the early 1990s this dropped below 10 per cent and finally bottomed out at 2.1 per cent in 2005. Since 2005, the savings rate has rebounded slightly - it was 4.8 per cent in 2010 - but it still appears Canadians are now spenders first and savers second." Read More Here

A good rule of thumb is to save 10% of your income every month. If you are really into trying something new save a dollar a day then increase until you can put $10 a day away. You'd be surprised at where you can cut spending to reach this goal. Take David Bach's Latte Factor test to see how much you can save everyday!

No comments: