Reducing Your Carbon Footprint
April 24, 2020
By: Daphne Dawson
The Government of Canada has launched a spree of support Canadians and businesses, helping the most vulnerable in
society to ensure Canadians can continue to live after the pandemic comes to an end. This will cost taxpayers over $817
billion dollars plus interest on borrowed capital.
The primary program includes (Source: CBC News)
- $200 Billion in Credit and Liquidity Support via Bank of Canada
- $85 Billion in Income and Sales Tax Deferrals
- $285 Billion in liquidity support for businesses
- $73 Billion Wage Subsidy
- $35 Billion CERB Payments
- $15.3 Billion in Canada Emergency Business Account Payments
- $5.5 Billion in GST Credits
- $9 Billion in Financial Aid to Students
- $1.7 Billion in Oil Well Clean Ups
- $145.6 Billion in other forms of direct support
10% of mortgages with the big 6 banks have been deferredLow returns on safe investments, cheap mortgages, and heightened ability to qualify for credit cards has left Canadians on a spending spree since the 2009 recession. The majority of Canadians (52%) report having less than $10,000 in liquid savings with 40% of Canadians saying they have less than $5000 (Source: BMO). Paired with an average mortgage payment of just under $1500 a month and over half of Canadians less than $200 away each month from bankruptcy, the math doesn’t add up. This is compared to Canadians continually spending more each year on non-essentials like travel and clothing.
leaving an estimated $663 Million per month unpaid
The inability for Canadians to save has left millions across this country desperate for cash with many looking for someone to point to blame for their negligence with their finances. The fact of the matter is, the only person to blame is themselves.
A few weeks ago, big banks were in the hot seat after people brought up that banks were charging interest on principal during the 6-month mortgage deferral program, claiming it as ‘greedy’ and an ‘abuse of the situation.’ We need to acknowledge that this program was created as a good-will program from the banks. Many don’t understand the consequences if this program wasn’t in place. We’re talking 500,000+ mortgages being foreclosed, collapsing the economy, mortgage backed securities, blue-chip stocks, mutual funds, and RRSP savings plan leading to Economic ruin. Without this program we’d experience a depression never seen before; Pandemic recession plus a consumer and mortgage debt crisis.
This all should teach Canadians that no matter how low interest rates may be on fixed income investments, GIC products, and plain vanilla savings accounts there’s no excuse for not saving. The inability for 37 million Canadian to not save could have led to an economic depression that would ravage us for decades.