It has definitely been a long winter thus far. As the calendar shifts to February, it would be easy to understand why Canadians might be stressed out. The Omicron variant has hit us pretty hard and has forced a ton of us away from our loved ones once again. We also had one of the largest snowstorms in our lifetime with over 30 cm of snow in Toronto in a day. Safe to say: the last month has not been easy, but we don’t want your financial situation to be a cause of concern for you.
1. Of course we are going to talk about inflation:
It’s tough to turn on a TV news network without hearing about current inflation levels. Inflation is essential to any healthy economy, but if it gets too high, it starts to make a noticeable impact on your cost of living. In order to avoid having your hard-earned savings lose value, make sure your money is working for you. Investing your money allows it to earn you a return. For almost 9 years, Cannect MIC has earned roughly 8% per year for its investors. Whether it is Cannect, a stock portfolio, an investment property, or a combination of investment vehicles, earning a return on your money is the best way to combat inflation. Even small amounts make a difference over time.
2. Interest rates are rising:
Is this worth being aware of? Yes. Is it worth panicking over? Absolutely not. The Bank of Canada does want everyone to be aware that interest rate increases are coming, but it is unlikely they will arrive as imminently as we think. With all the liquidity the Bank of Canada has pumped into the market, up is the only direction they really can go. These measures were put in specifically to prevent an economic collapse due to COVID-19 shutdowns, so increasing rates too quickly may end up undoing all the measures they put in place to protect the economy. Rates likely will increase over the next few years, but we think it will happen slowly enough to still be worth taking the offered variable rate. As we always say, the fixed vs variable debate is largely dependent on personal preference, but we think that variable rate discount is still too good to pass up. Take a look at the clip below to see my explanation on this.
3. Post-Holiday Financial Stress:
We are not too far removed from the holiday season. While it is a wonderful time of year for a lot of people, it can be a massive financial burden for many as well. If you now find yourself feeling concerned about your financial situation, the mortgage agents at Cannect are here to help you. Whether it be a home equity loan, line of credit, or a refinance, we can help you put together a plan for immediate financial relief and long-term savings.
This winter has been tough for a variety of reasons, but don’t let your financial situation be one of them. Follow Cannect on Instagram and subscribe to our YouTube channel to get more helpful mortgage advice.
Marcus Tzaferis and the Cannect Team
