Get ready for the worst case of the Mondays you can probably imagine.
The third Monday of January is dubbed ‘Blue Monday’ — the most depressing day of the year. We’re deep in the grips of winter and up to our eyeballs in bills from the holidays. There’s probably no money left over for a vacation, so we’re forced to face our financial demons.
The period between ‘Blue Monday’ and Valentine’s day is considered the saddest month. The Financial Blues Survey from Credit Canada and the Financial Planning Standards Council found last year that more than half (53 per cent) of Canadians feel financially blue by mid-January. Younger adults, ages 18 to 44, are especially blue about finances this time of year (68 per cent versus 53 per cent for the general population). Meanwhile, more than one-in-five Canadians (20 per cent) have a credit card bill that’s larger than their savings account.
Credit Canada and the Financial Planning Standards Council launched their annual campaign to help people shovel themselves out of their piles of debt.
Yahoo Finance Canada spoke with Credit Canada CEO Laurie Campbell for some ways to cope.
How do we face down January?
Campbell: January is a difficult month and ‘Blue Monday’ is fast approaching. With the short winter days and the fun of the holidays behind us, many Canadians are feeling financially blue. One of the best ways to escape this feeling and get your finances on track is to start slow and set realistic goals. Involve family members and talk to others about how you’re getting on. Remember you’re not alone and that Credit Canada’s free and confidential credit counselling service is just a phone call away.
What are the financial fault lines facing Canadians?
Campbell: While the Bank of Canada announced it is maintaining interest rates at 1.75 per cent, consumer and household debt is still high in Canada. Housing prices are only increasing in cities such as Toronto and Vancouver and the cost of living is becoming unmanageable. As a result, we’re seeing people borrowing more and repaying less, thinking they can weather the storm. Canadians need to get help before it’s too late.
What are some tips for curing the financial hangover many are facing?
Campbell: Start by taking a deep breath and opening your credit card statements – it’s crucial not to ignore them. Determine where you stand financially after the holidays and pay off the cards with the greatest interest first. It’s also important to get a spending plan in place and stick to it. Try keeping a journal and writing down what you’re spending each week, or sticking your budget on your fridge where you’ll see it regularly.
How can we recession-proof our life?
Campbell: Get an emergency fund in place. Whether your car breaks down or your pet needs to go to the vet, unexpected events can take a huge toll on our financial well-being. Start by saving small and over time it will all add up. There’s also no harm in seeking professional advice from a certified financial planner. They can help Canadians develop valuable budgeting and saving skills and give that sometimes much-needed element of reassurance and support.