Weekend Reading: Rate Hike Drama Edition

As was widely predicted, the Bank of Canada raised its key interest rate by 0.25 percent last week, sparking interest rate drama across the nation about what this ‘means for you’, along with cries from mortgage professionals to ‘lock-in your rates’.

I suppose it’s newsworthy considering the BoC hadn’t raised rates in seven years, but everyone’s forgetting the two small rate cuts back in 2015 were to deal specifically with the plunge in world oil prices. No doubt we’ll see another 0.25 percent bump before the end of the year to get us back to where we were in September 2010 – at a whopping 1 percent. I’m not one for making economic predictions, but I’d guess that’s as far as this rate hike goes for some time.

It could be worse. Throwback to 1980 when the bank rate was 21 percent.

Knowlton Nash 21% interest in 1980

Indeed, fear of rising rates may have obscured the good news in all of this – Canada’s economy is improving.

Something to keep an eye on, though, as rates tick up: Canadians owed $211 billion on home equity lines of credit at the end of last year.

This Week’s Recap:

On Monday I explained that your financial plan is a compass or map to guide your financial journey.

On Wednesday Marie wrote about sudden money and how to manage a financial windfall.

And on Friday Marie compared personal banking options for seniors.

Over on Canadian Budget Binder I wrote about how my wife’s MS diagnosis nine years ago helped shape our financial future.

Weekend Reading:

43 key managers and executives at Sears Canada can collectively earn up to $7.6 million in bonuses even as thousands of laid-off workers aren’t being paid severance.

Jason Heath with the four reasons that retirement is costing Canadians more than ever.

What to do when he wants to retire one place, she another?

Get over your retirement fears. What this retiree did to stop ‘awfulizing’ retirement.

How to trick people into saving money: Inside Walmart’s curious, possibly ingenious effort to get customers to build up their savings accounts.

I plan on tapping into my RRSP before age 71 and this strategy makes sense for many other Canadians, too.

You can hardly go a week without someone claiming we are at “peak passive” or in the middle of an “ETF bubble.” Ben Carlson explains why these worries are overblown.

Ben Felix gives us more common sense investing with this video about downside protection and why it’s nothing more than a sales tool for the financial industry:

Along the same lines, once again here’s Ben Carlson on why simple beats complex.

Jason Zweig says it’s the little things that can colour an investor’s outlook.

I love this sketch from Sketch Guy Carl Richards about small incremental changes leading to massive improvement over time:

Massive Improvement

Should you use local ATMs or get money before you travel? Melissa Leong explains what you need to know about foreign currencies.

An interesting look at how the ‘McMansion Hell’ blogger fended off a lawsuit threat from real estate site Zillow.

Why your lack of knowledge about taxes is hurting your pocketbook.

Finally, a strange tale of how a $20 million collection of prints which includes some of the New York artist’s best-known works — John Lennon and Yoko Ono embracing just hours before he was killed; a nude and pregnant Demi Moore — remains hidden in a Halifax gallery’s storage.

Have a great weekend, everyone!

Print Friendly, PDF & Email

Leave a Comment

Join More Than 10,000 Subscribers!

Sign up now and get our free e-Book- Financial Management by the Decade - plus new financial tips and money stories delivered to your inbox every week.