As a part of our ongoing financial life skills and fraud awareness partnership with the Vancouver Canucks, we gave a saveSMART InvestRight presentation to 85 people in the Captain’s Room at Rogers Arena.  People had a lot of great questions and comments, so I decided to summarize them in a blog post and share them with our blog readers.

 

Before I start, I want to familiarize you with saveSMART InvestRight, a money management program that is for people of all ages. This program covers budgeting, saving, investing, and debt.  Our website has several saveSMART InvestRight worksheets that you can use to plan your finances or assess your financial situation. We also give seminars to groups throughout the year.

 

Now let’s get into the Q and A. Since it’s an ongoing topic in the media, I’m going to focus on questions about debt and spending. They are important, because they can affect your long-term financial goals.

 

Is it a good idea to consolidate debt? 

Debt consolidation can be a sensible approach to reigning in the unmanageable cost of a high-interest credit card or debt. Once you consolidate debt, it is important to be diligent about paying off the loan and not to fall back into the habits that brought about the situation in the first place. The Financial Consumer Agency of Canada (FCAC) has some good information about how to tackle your debt.

 

Should I save or pay off my credit cards? 

The commitment to “pay yourself first” is a great thing to do, but if you’re paying 28% interest on a credit card and receiving 1% on your savings, then the math doesn’t work in your favour. Here are three steps to get a handle on your finances:

  • First, make sure you have the money you need to cover your monthly and annual expenses
  • Have something tucked away for emergencies
  • Pay off your debt

If I’m 30 years from retirement, how much should I save to be sure I will be comfortable when I retire? 

Rule of thumb says that a person needs 50% to 70% of their pre-retirement income in retirement, depending on your retirement lifestyle and your health in retirement. Although income goes down, so can expenses if your children have finished their education and moved out of the house. Here are some calculators and other financial planning tools from FCAC that will help you get started.

 

If you have any questions or comments, please post them below.

 

Suggested Reading

Madoff on Madoff: Wealthy clients and affinity networks used to the feed scheme

Investor Alert: Beware of investment ploys touting foreign direct investments in India

Affinity Fraud: BBB’s Top Financial Scam for 2013

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