A recent study by the Certified General Accountants of Canada says that Canadian household debt is at record levels. Most of that debt the report goes on to say is for consumption and not for assets like housing, investments. 58% of respondents indicated that their debt is caused by daily living expenses. By the same token 65% said that their debt was a barrier to their financial security. 78% of the respondents to the survey indicate that they would not change their saving patterns in response to a deteriorating economic climate. As an individual you can change your own financial picture and not be part of the statistics.

Pay most expensive debt

Pay off the most expensive debt first like credit cards. Typically the interest for credit cards is around 20 to 30% annually. Paying the minimum payment on a credit card will not save you money as the interest accumulates daily. Instead strive to pay off as much as you can as fast as you can. If it means selling items you no longer use then do it. A lot of consumers get hooked on credit cards because of the initial low interest rates. After a short period of time the credit card company increases the interest rate.

After you pay down your most expensive debt put some money aside every month for a 'rainy day'. This would be a separate bank account that would be strictly for unforeseen expenses like car repairs, etc. After you have done this for a few months you will start saving money like you have never done before. Better still if you stick to paying cash for everything then the credit card debt will come down even faster. You will feel the pain a lot more with cash then with credit cards.

Daily Budget

Stick to a daily budget as this will help you in deciding whether you need that Tim Horton's coffee or not. When you forgo the little expenses like the Tim Horton's coffee, it will be easier to save money. Little expenses add up to big expenses if your not careful.

Two clients of mine Mark Anthony and Cleopatra have been on a cash budget for over 2 years now. Together they saved enough money to buy a house with a substantially smaller mortgage than their neighbours. How's that for bragging rights. They have even taught their kids the value of saving money so much so that their eldest son, Napoleon, paid his own way through college with no help from mom or dad! They told me that they couldn't have done it without getting their spending under control.

Don't be part of the statistics, get your financial house in order today and you will have a better life financially.

About Author / Additional Info:
Mathew is President of MRJ Financial Solutions and is dedicated to improving your bottom line. Questions/comments: mjazenko@yahoo.ca or visit us at http://mrjfinancialsolutions.ca