Canadians used to save 20 per cent of their disposable income, but not anymore. Many working Canadians are barely making ends meet, according to a recent survey by the Canadian Payroll Association. It showed that 48 per cent of those surveyed are living paycheque to paycheque.
Saving for your retirement is important. So is planning for unexpected expenses that may happen in the shorter term, such as car repairs or vet bills. Everyone should have a rainy day fund because life brings many surprises. For some, that may mean job loss and illness unfortunately.
Putting money aside can make the difference between feeling stressed and being in control of your money. Here are three easy savings tips you can practice even during this busy and expensive time of year.
1. Start now. Some banks offer low-cost or no-cost accounts to young people, seniors, and low income Canadians.
2. Automate it. Transfer money to a savings account automatically every paycheque and watch your savings grow.
3. Make a budget and update it regularly. “Think about your short-term, medium-term, and long-term savings goals. A good way to start is to use the Financial Consumer Agency’s budget tool,” advises Jane Rooney, Canada’s financial literacy leader. Do you need to buy a new washing machine within six months? Should you start saving for a child’s education? What if you want to take a vacation next year?
Find more tips, tools, and useful resources online at itpaystoknow.gc.ca.