Impulse buying is costing Canadians
A majority of Canadians surveyed say they shop to cheer themselves up. According to this survey, impulse buying is costing Canadians close to $4,000 annually.
In recent months, Canadians have been bombarded with warnings that they are too indebted, with debt-to-income ratios sitting at an average of 152%. Government officials are quick to blame mortgage debt, as a mortgage is likely the largest debt most Canadians will carry, yet it is also the only debt that gains value as it is paid down. Non-mortgage debt, like credit cards and car loans not only carry a higher rate of interest, but the goods purchased depreciate in value as soon as the owner takes posession. This recent article from the Financial Post shows that on average, the amount that impulse spending is costing Canadians each year is $3,720, building high-interest debt, and preventing many from accumulating emergency savings, or paying off other debts.
A recent survey suggests that over the last 10 years, Canadians are spending more than they are saving, with 60% of respondents stating they will shop to eliminate a bad mood. On average, $310 per month is believed to be going towards impulse spending, and the majority of those surveyed said they would be likely to save a larger amount if they truly made an effort to limit their impulse purchases. Experts suggest using several available online tools to make a detailed budget, in the hopes of curbing the impulse spending habit.