Bank’s overnight rate drops to generational low!
The Bank of Canada just lowered it’s key lending rate by three quarters of a percentage point or .75 basis points. Assuming the banks follow the BoC lead ( they have not always the past few months) that will make the prime lending rate now 3.25%. This latest act of desperation by the BoC is to prevent us from dropping into a deeper and more prolonged recession, because of a world wide economic crisis and a troubled U.S economy.
This is all in an attempt to increase the flow of funds and to increase consumer confidence. In layman’s terms it is supposed to give you (and businesses) incentive to go out and spend some of your hard earned cash. This will not result in an immediate reversal of fortune, that will take some time. The immediate result they are looking for is to generate some heat on the frozen credit market. In other words, they want to make it easier for businesses and consumers to access money to borrow.
What does this mean to the average Joe or Jane? Well if you have a variable rate mortgage (one that is tied to prime rate) or a line of credit, then your payments will go down. That is if your bank follows the BoC’s lead, and there is now evidence that they are not. Other than that, there is not really enough incentive to run to the mall with a wad of cash. People are still losing their jobs at a record pace, because their companies are suffering and trying to remain solvent.
So what can you do? Try to improve your personal financial situation by eliminating your debts as quickly as possible. Call my office today for a no obligation debt analysis so you can see where you are at and to get an opportunity to get a plan to eliminate all your debts in a very short period of time.
Cheers,
Pat
p.s- You can find me on Twitter,Linkedin, Facebookand friendfeed.
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Give yourself the best Christmas present ever!
it’s not an ipod, iphone, or even a new coalition government for those who want it. Curious? Be patient! Drum roll please……. here it is, a plan to get you out of debt and quickly. You may be thinking, well that is not very exciting. However when you think about it, actually it is! Picture this, no mortgage, no line of credit, no credit card debt what so ever, you are totally debt free.
Now instead of living paycheck to paycheck you are now able to build true wealth. You have the resources at your disposal to allow you to travel, to invest in your children’s education or the ability to make your retirement truly golden.
There is no time better than now to start. It could be the difference between truly living or just going through the motions. Even though we have not met yet, I believe that you deserve better. So take this opportunity and contact my office right away, so we can put you on the fast track to a brighter future.
Just so we don’t leave anyone out, this gift can also apply for those who celebrate Kwanzaa or Hanukkah.
Cheers,
Pat
p.s- You can find me on Twitter,Linkedin, Facebookand friendfeed.
Would you fail a liquidity test too?
The inspiration for this article comes from two sources. One the article about BCE takeover falling apart and the other today being Black Friday in the US. At first glance you may have a hard time figuring out how these two events are connected, however upon closer inspection they are essentially about the same thing.
The Ontario Teachers Pension Plan take over of BCE (Bell Canada Enterprise) quickly evaporated this week thanks to a 5 line clause in their agreement. The basis of that clause was a solvency test which they failed, in layman’s terms, their debts outweighed their assets. Black Friday, the day where retailers hope to finely get into the black (profitability).
Take a look at your own life, if you were faced with a life emergency and were forced to liquidate everything, would your debts outweigh your assets? Answering the following questions will give you a better idea.
Do you own your own home or do you rent?
Did you use 100% financing to purchase your home?
Are you leasing your car, truck or van?
Do you have money put away for a rainy day? The rule of thumb is 3 months salary.
Are you saving for your retirement? If not you should start and soon. See my friend Steve and think about direct deposit so you would not miss it. Retirement may come sooner than you think and the government may not have any money left ( thanks to all these bailouts) to subsidize your retirement with OAS or CPP.
The point that I am trying to make is this, do you own your stuff or does someone else? If you rent you are helping someone else build equity. If you bought your home with zero down (100% financing) you run the risk of not being able to get what you paid for it if you were forced to sell it if your local market is now depreciating. Also if you leased your vehicle you also run the risk now more than ever of having to pay more than it is worth at the end of your lease to keep it.
There is no better time than now to take a look at your own personal financial situation. Call my office today for a no obligation debt analysis so you can see where you are at and to get an opportunity to get a plan to eliminate all your debts in a very short period of time.
Cheers,
Pat
p.s- You can find me on Twitter,Linkedin, Facebookand friendfeed.
Citigroup gets rescued!
Today the news came out that Citigroup (Citifinancial’s parent) received a government bailout. They received a 20 Billion dollar cash injection, this is after they have already received 25 billion earlier this year. Now don’t get me wrong, I am all for stabilizing the economy. Many pundits said that if Citi failed it would de-stabilize the whole banking system. While I do not exactly disagree with making sure that the big banks are liquid, in this case couldn’t a suitor been a good solution? Wells with the help of Berkshire Hathaway could have made this happen, as they are one of their largest shareholders. What do you think?
The auto industry is sill looking for 25 Billion and have been thus far been left out in the cold. However the CEO’s and the executives of the big three really shot themselves in the foot by showing up in Washington last week by private jets. They would really convey the need for funds if they limited the excessive expenses and focused on their bottom line. They are saying if they go bankrupt the results could be catastrophic, by that we mean over a million jobs lost.
The fact is that our economy’s are in rough shape. Our government leaders really have their work cut out for them. We can still do our part, and by that I mean making sure that we are all in the best possible financial shape to ride through these tough times. To do this, feel free to contact my office today for a no risk debt analysis, so we can show you how to maximize your income and use it to become debt free sooner.
Cheers,
Pat
p.s- You can find me on Twitter,Linkedin, Facebookand friendfeed.
Signs that you may be in need of a bailout and what you can do about it!
Unless you have been living on a deserted island some where you are probably aware that we in the midst of some interesting and challenging economic times. Big business are lining up for bailouts, the markets are just one roller coaster ride after another, yet we ( the consumer and tax payer) are the engine that runs the economy and where can we turn if we need help?
Here are some signs that you may be in need of a bailout and what you can do about it:
1) More than 40% of your income is going to service your debt.
2) Your balance is higher than 90% of your credit limit.
3) You are using one credit card to pay another.
4) You have been late more than once in paying your creditors ( not utilities).
5) You have or are receiving calls about money you owe.
6) You are living paycheck to paycheck.
7) You think the light at the end of the tunnel is an oncoming train.
You are stressed about the money you owe.
9) Your debts are keeping you up at night.
10) You feel like you are working only to pay your bills!
There is a better way! If you are a home owner, the lowest cost of borrowing is against your home. That is because it is a secured loan. Contact me today and we can look at combining all your debts into one simple payment, also providing you with a plan to pay it off quickly and efficiently if you qualify. Start focusing on designing your life instead of just paying your bills and you will be surprised how different your life can be. I would recommend that you sit down with a financial advisor like my friend Stephen Cox to help you design out your long term financial plan.
Cheers,
Pat
Thinking of throwing in the towel?
With all that has been happening in the financial markets these past few weeks, I would not blame you if that is what you have been thinking. However don’t do it, and here is why.
1) Boom always follows the bust. As corny as it sounds, hard times never last, but good people do. My favorite investor Warren Buffet has a saying that rings true ” Be greedy when others are fearful and fearful when other are greedy”. There is no better time than now to prepare for your best financial future.
2) Have a plan. Your life may not be perfect right now, but you should know where you are going. You would not get in your car to go on a vacation with out a destination in mind. However many people go through life with out any clear objective. Begin with your end in mind, so get off your rear end and develop a plan and see your objective.
3) Clean your house. By that I mean your financial house. If you are to get out of this financial crisis smelling like roses, then you need to get your finances in order. Trim the fat and cut out any unnecessary expenses. Systematically eliminate all of your debt and start building true wealth.
I would be honored to help you develop your plan to eliminate your debts. Please feel free to contact me at my office so we can get you on the road to true financial freedom.
Cheers,
Pat
Are you in a rut or digging your grave?
How we feel about our own finances has an effect on the market as a whole. Well now you may be saying that you feel less optimistic because the markets have been going in the toilet lately. It’s sort of like the chicken and egg scenario. Didn’t this all start with the demise of the sub prime mortgage market. If you remember that all started when people were unable to keep up with their mortgage payments and started to lose their homes. It sort of has a snow ball effect don’t you think.
The real difference between a rut and a grave is the depth! So stop digging and put down your shovel. There are solutions and there is a better way.
1) Stop looking at your feet and start looking at where you want to go. Begin with the end in mind, and with that I mean that you should have a clear vision of where you want to go.
2)Take action now. Don’t get caught up in analysis of paralysis. Just do something, and learn from what you do until you find out what works.
3) Expect to succeed. Hoping and praying will kill you. Expect to achieve your end result. If your boat overturns in the middle of the lake, you don’t hope to make it to the shore, you find the closest point and swim your butt off and get there. Be persistent and find a way.
If your current financial crisis finds you buried up to your eyeballs in bills, there is a better way. Contact my office today so we can show you how to systematically eliminate all your debts so you can build true wealth.
Cheers,
Pat
What is money anyway?
As all the world’s financial markets are losing trillion’s of dollars almost daily, I am having to think “What is money anyway?”
It is more than pieces of paper with pictures of deceased notables on it as Anthony Robbins says. Some say that it is financial currency for the value placed on the exchange of service from one party to another. But it is more than that as well. Below is the definition that I like the best.
“It is the physical representation of value that rises and falls in ourselves, within us. Not within ‘things’ outside of us, but within us. For without us, what can the value of a thing, such as a car, be to us? Nothing, at least not to us. In other words, it is we, the observers, that place value in things, but this value is really value in us – we give value to the material things. The material things have no ‘money’ value in themselves – we give that to them. So, money is the external physical representation of a particular section of our internal value, within us, within you.That is why a house or a block of shares valued at $1 million today can fall to a valuation of half a million dollars tomorrow when fear is introduced into the hearts of those involved. The fear kills a portion of the internal values of the participants and that is reflected by the paper money, the ‘body’ of value.”*
To minimize the effects of this financial meltdown personally, then you must make sure that you are in the best financial shape possible. That means paying off your debt as quickly as possible and having cash available in your portfolio to invest in the market as the buying opportunities present themselves. Contact my office now and leave a message, if you are interested in checking out a new way to pay off your debt quickly so you can then have more cash available to take advantage of the buying opportunities.
Cheers,
Pat
* Taken from David Cameron Gikandi’s “Happy pocket full of Money“.
How to recession proof your life!
If you have been watching the news lately you have probably heard that times are tough and it may possibly get tougher. Well that does not have to apply to you personally. Below are a few suggestions to help you ride through the turbulent times with a smile on your face.
1) Trim the fat. As obvious as this seems, some people do not see it. There is no better time than now to pay off your debt and cut the ties to your creditors. Doing it may be easier than you think and you can do it with the money that you are currently making. Contact my office today and we can show you how to put you on the fast track to eliminating all your debts.
2) Make cash king. Now that you are well on your way to paying off all your debts you do not want to run them up again. Put the credit cards on ice, (literally and figuratively). Everywhere you had used your credit cards before also take cash, debit or certified cheques and if you have to use your credit card pay it off as soon as you use it as interest is charged from the date you use it rather than when you get your bill. You should also know that by paying off your credit cards and not using them greatly improves your credit.
3) Plan your purchases. I am not saying that you should not take a vacation, buy the new iphone or a new flat screen television, save up and then pay cash for them. Don’t get sold on no money down, interest free or no payments, promotions at the big box stores, as they are linked to taking their in store credit cards.
4) Start your own business. The idea here is to develop another income stream, and multiple if possible. Don’t quit your day job if you have one. Many times you can do this while still working a full time gig. Click here or here for some idea’s for home based businesses. I also recommend Ed Dale’s “Thirty Day Challenge” to show you how to start an internet business. There are tax advantages to doing this as well, consult your account for full details.
5) Focus on income producing activities. As exciting as having your own business is, it is still required that you work in it if you want it to produce an income. Concentrate on activities that will generate revenue for you and your business.
6) Share the wealth. Last but certainly not least, as you are riding out this possible recession remember others may not be as fortunate. Sow the seeds of your success, and share with others what is working for you and also what lessons that you have learned along the way. Also do not forgot about local charities that also need your financial help, as their services will be needed more now than ever before.
Cheers,
Pat
“If you can’t convince them, confuse them.”- Harry S. Truman
How to get a risk free double digit return on your money!
You’re about to learn some closely guarded information you’ll never hear from bankers, brokers, insurance agents, or credit card companies. Many love to keep you in the dark about debt, credit, and investing so they can keep getting richer at your expense.
If you don’t do something about it, more than half your lifetime earnings will eventually end up in the bulging pockets of others. Think I’m kidding? Read on.
Banks and lenders are robbing you blind, as the real interest rate of your home mortgage may be as high as 200%! Let’s use this example. Average home costs 225K, assuming you have good credit and you get an interest rate of 5.7%. Now this is where it gets interesting, you have options to spread out your loan to 25, 30 or 35 years.
At 25 years, you will be paying 194,906.41 in interest alone before it is paid off. At the end of the 25 years you have paid 419,906.41 for that 225K house. At 30 years, you will be paying 241,714.81 in interest alone before it is paid off. At the end of the 30 years you have paid 466,714.84 for that 225K house, now almost double. At 35 years, you pay 290,772.51 in interest or that 225K house has cost you now 515,772.51! In case you have not got it so far, the bank always pays them selves first! In fact it will take you almost 15 years of payments ( on a 25 year mortgage) to break even on a principal and interest payment balance. There is also no guarantee that your real estate will appreciate at the same interest rate the bank is charging you!
Credit card companies lure you with the “prestige” of their credit cards. Meanwhile, you’ll end up paying them two, three, even five times what you actually spend on products and services! Would you pay $17,500 for something worth $3,500? Well, that’s exactly what you’re doing when you charge $3,500 on a credit card!
There are over 50 Million credit cards in circulation in Canada, or over 2 per adult. Over 22 million of those cards carry a monthly balance. Canadians owe over 50 BILLION in credit card debt! Our national mortgage debt tops 500 Billion. Here is a scary fact, for every dollar of disposable income that we have, we owe $1.25 to debt. We are not making any real progress.
Who’s winning this game, give you one guess and it ain’t us!
Most people believe that the stock market is a better investment than paying off their debt. However the truth is, when you pay off your debt you can get a Guaranteed Return of up to 20% a year. Try getting that in the stock market! Especially with the recent volitity that we have seen in the past week or so, investing in stocks can be a risky proposition.
Let Craigburn Capital show you how to steer clear of the traps and put you on the path to financial freedom. You’ll learn how to get rid of all your debts in as little as 5-7 years and possibly retire a debt-free millionaire. It’s easier than you think. Contact us today so we can show you how.
Cheers,
Pat
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