The Globe and Mail published an article yesterday about the yearly cost of impulse spending using data from a BMO poll. Take a guess at what the average Canadian is spending on items they didn’t really need to pick up but did anyway. A thousand dollars a year?
Ok, fine, two thousand?
Almost four thousand dollars. A year. $310 a month, to be exact.
At first I thought there’s no way I could spend that much per year on things I buy on a whim, and then I started doing math in my head and realized it’s entirely possible, and I probably spend even more than that a year on impulse buys. Do I feel bad about it? Yup. Do I regret it? Yup. Do I often take things back when I can’t handle the guilt anymore? You bet I do. But I’ve never gone into debt for it.
Which brings me to the next article that caught my eye, also from the Globe and Mail. Not only are we impulse spending to the tune of $310 a month, but as a whole, we’re going into debt more and more and us Canadians don’t really care about it. We’re not even sorry, and that’s our national stereotype (trust me, this is one case where I would not be upset if we apologized).
We’re overspending, we’re taking on more and more debt, and we don’t. care. In trouble? Just borrow more, it’ll be fine. Want renovations on your kitchen but can’t afford them? Take out a HELOC and go to town! Who cares if you won’t be able to afford to put food in those cupboards, the granite counter tops will look AMAZING.
Remember when I posted that few Canadians have emergency savings? That was bad enough, but a whopping 7% of those who would consider relying on debt couldn’t raise the $2,000 emergency regardless of the timeline in which they were given to do it. And that’s even more alarming.
Canadians are carrying record levels of debt and yet, surprisingly, 62 per cent of those surveyed are comfortable with their financial situation… That is quite a disjoint. It’s concerning to see that access to credit and taking on more debt has become an accepted part of financial planning. – Ted Michalos, Bankruptcy Trustee with Hoyes, Michalos & Associates
My question is why is this happening? How did the normalization of debt get to a point where it’s ok to use it for day-to-day spending? And how can we change this so that savings is the normal, and debt is the minority?
What the hell, Canada?! It doesn’t have to be this way!