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Tag: debt

  • Financial paralysis and how to get moving again

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    Canadians face financial pressure

      According to the data, Canadians remain under significant financial pressure, with a full 68% expressing concern about the cost of living. Almost a third (30%) of respondents are anxious about money, especially women and those making less than $50K per year, while Generation X worries about their retirement. 

      Compounding the issue, money insecurity is having a notable effect on how Canadians spend. Forty-two percent reported relying more this year on credit than cash, a 7% increase over last year’s numbers. Additionally, 48% carry debt, and 59% have more debt than last year. More than half (52%) pay off only a little bit more than a minimum amount due, resulting in higher balances—and less resilience for Canadians.

      Debt is being normalized

        A high cost of living and credit use aren’t new, but consider this: almost half of Canadians (45%) reported feeling “about the same” about their finances. Credit experts say that could be a problem. 

        “[I]t appears almost half of respondents characterize their feelings about their financial situation as being neutral when compared with last year—in other words, they are feeling numb to it,” states Peta Wales, President & CEO of the Credit Counselling Society in a press release. “Debt remains a source of stress and anxiety, and ongoing financial pressure can lead individuals to become desensitized to change, even as their balances continue to rise.”

        Invest your money or pay off debt?

        A comprehensive guide for Canadians

        Financial paralysis is a term used in the world of finance to describe the effect of money stress on some people. Signs include avoidance, inaction, and shutting down—or numbness. When in this state, simple financial tasks like using a budget, paying bills, or even checking accounts can feel beyond reach. Even worse, a person might overspend to compensate for negative feelings or out of a sense of helplessness. The primary solution—building a solid financial foundation—is a laughable suggestion to someone who’s gone numb.

        Snap out of it

          There’s no magic bullet for financial paralysis, but there are actionable strategies you can take to maneuver yourself in a strong position. That’s important, because research suggests that just like with compound interest, wins build on wins.

          Change your mind

          “Just as we learn language, customs, and social norms from the culture around us, we also absorb messages about money,” writes Nathan Astle in Psychology Today. Because of cultural money taboos, it’s difficult to talk about finances, and any perceived failure manifests as guilt and shame.

          If you want to find financial (and emotional) stability, it’s worth reaching out for help in this area. Therapists, peers, and support groups can help you untangle your feelings about money, while a financial advisor or credit counsellor can put your portfolio into perspective. 

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          Change your habits

          Although tedious, some money habits just work. Build (and stick to) a realistic budget. Prioritize paying down your debt. Build up an emergency fund.

          Change your timeline

          You just want a lifeline when you’re drowning in debt. You feel impatient because it’s uncomfortable—and because each passing month you owe even more.

          The truth is, paying down debt is a long-term project and you’ll be better off with a realistic sense of what it will take.

          Debt doesn’t just drain your bank account—it freezes your decisions. The stress and shame can make avoidance feel safer than action, but inaction only deepens the trap. Luckily, there are ways to get moving again. Face the numbers, make a plan, act consistently, and ask for the help you need.

          Get free MoneySense financial tips, news & advice in your inbox.

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          About Keph Senett


          About Keph Senett

          Keph Senett writes about personal finance through a community-building lens. She seeks to make clear and actionable knowledge available to everyone.

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    Keph Senett

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  • The ‘alternative scenario’ of an even bigger national debt disaster is in play after the Supreme Court ruled Trump’s tariffs illegal | Fortune

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    The Supreme Court ruled Friday that President Donald Trump’s extensive use of tariffs during his first year back in office were illegal. The court responded to escalating protests from small businesses saddled with higher costs and a large portion of Americans who are skeptical as to the benefits of Trump’s tariff regime. But by striking down part of Trump’s trade agenda, the judges might send America’s ever-widening deficit soaring even higher.

    The national fiscal outlook is already on an unsustainable trajectory. As the Congressional Budget Office projected earlier this month, federal debt is set to reach 120% of GDP by 2036, but that forecast assumes current policies will remain in place. A perfect storm of other factors could align to send debt climbing to even greater heights.

    One of those forces is the fate of Trump’s tariffs. The severity of America’s fiscal path has been somewhat “mitigated” in part by tariff-driven revenue, according to a report published Thursday by the nonpartisan Committee for a Responsible Federal Budget (CRFB). Removing this revenue stream would contribute to an “alternative scenario,” one with an even steeper debt burden than the one projected by the CBO. 

    Assuming Trump’s tariffs are not replaced, and certain government spending programs are either made permanent or revived, the deficit would reach nearly $4 trillion, debt could climb to 131% of GDP in 2036, and the additional interest burden would hit $820 billion, according to the report. 

    The mechanism by which vanishing tariff revenues fuel the deficit is straightforward but massive in scale. Currently, the CBO’s baseline fiscal projections are softened by the assumption that significant revenue from tariffs unilaterally imposed by the Trump administration will continue to flow into the Treasury. But the administration’s legal foundation for these collections crumbled before the court. Most of these tariffs were authorized under the International Emergency Economic Powers Act, a tool that has never before been used to implement tariffs and that the U.S. Court of International Trade already ruled illegal last year. 

    If the administration fails to replace the revenue with other taxes or offsets, the CRFB estimates that federal revenue would fall by $1.9 trillion through 2036. This loss represents roughly 0.5% of the nation’s total GDP over the next decade. While the administration could theoretically attempt to use alternative trade maneuvers to replicate the tariffs, there is no guarantee such a transition would be seamless or legally bulletproof.

    That lost revenue would presumably be evident immediately. The government is now on the hook to refund $175 billion of its tariff revenue, according to recent analysis by  the University of Pennsylvania’s Penn-Wharton Budget Model. But the costs would be even greater over the long run. Losing $1.9 trillion in expected income does more than just widen the immediate gap between spending and revenue; it triggers a compounding interest effect that worsens the overall debt. 

    When the government loses a primary revenue stream like tariffs, it must borrow more to cover its existing obligations. Under the report’s alternative scenario, this loss of revenue, combined with the permanent extension of temporary tax provisions from Trump’s One Big Beautiful Bill Act and a potential revival of enhanced Affordable Care Act subsidies, which expired earlier this year, would raise the deficit by $4.2 trillion over the next decade. This deficit, worsened by higher interest costs, could risk crowding out other forms of essential spending as the federal government becomes increasingly consumed by its own debt burden.

    “The alternative scenario does not account for dynamic effects on interest rates and the economy, which could worsen the fiscal outlook by pushing the economy further into a debt spiral,” CRFB researchers wrote in the report.

    The report outlines a more upbeat scenario, where debt rises more slowly than in the CBO’s forecast. In this version, lawmakers would either allow temporary tax policies to expire or fully offset their costs, while also ensuring that tariff revenues are either preserved by the courts or replaced by new legislative measures. Coupled with reforms to stabilize trust funds like Social Security, this path could see debt stabilize at a much lower 111% of GDP by 2036. 

    For now, however, the nation’s fiscal health remains on a deteriorating path. Removing Trump’s tariffs might be greeted favorably abroad and by most Americans, given that up to 90% of tariff costs are now paid for by American companies and consumers, according to a recent New York Fed report. But striking down the tariffs without replacements could come with hidden costs further down the road, as the alternative scenario of an even greater debt burden gets closer to becoming the new reality.

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    Tristan Bove

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  • Is buy now, pay later a road to more debt? 

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    How Expedia and Affirm will work together

    Launched in the mid-1990s, Expedia is a well-established travel portal where you can book flights, hotels, packages, cruises, rental cars, and more. Commonly, people pay for reservations using a credit card, but according to the company’s recent press release, there’s a demand for more payment options and transparency.

    Enter Affirm. As a partner, Affirm will offer Expedia customers the option to buy select bookings and pay for them over time on a monthly payment plan.

    The fine print

    Not all Expedia offerings are eligible for the BNPL payment option. In Canada, it will apply to select lodging and packages on Expedia, and on properties found on Hotels.com and VRBO.

    When you select an eligible booking, you’ll have the option to pay with Affirm on a customizable monthly payment plan. You’ll be able to choose:

    • Term of repayment (up to 24 months)
    • Frequency of repayment (bi-weekly or monthly)
    • Interest rate (from 0–32% APR, subject to provincial regulatory limitations)

    Affirm approves the plan instantly by doing a soft credit check, meaning it will not affect your credit score.

    Is it worth it?

    Accommodations are usually a top-line item in any travel budget, and many Canadians don’t have the cash up front. This is where credit cards may come in. When you spend on a credit card, you can pay off the balance over time. Plus, many cards—particularly travel credit cards—come with perks and extras like included travel insurance, points, or priority boarding. 

    Featured travel credit cards

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    Earn 20,000 bonus points (approximately $165 in cash back value) after you make $2,000 or more in eligible purchases within the first 90 days.

    However, regular credit cards charge an interest rate of between 19.99% and 24.99%, making every month of repayment delay even more costly.

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    With Affirm’s BNPL option, you choose the length, frequency, and rate of your plan and the payments are withdrawn automatically from your account. Some plans offer 0% interest, and you see everything up front before you approve. There are no hidden fees, late fees, or compounding interest. 

    Note: When you use Affirm, you won’t receive any applicable points or other benefits offered by your credit card.

    The dangers of BNPL

    According to the Financial Consumer Agency of Canada (FCAC), there are some risks to be aware of before you use buy now, pay later. Namely, that you might over-borrow and/or get into more debt than you can handle. Let’s look at why this might be.

    Buy now, pay later has a psychological appeal. It provides the thrill of a purchase while pushing the reality of repayment to the future. This may also account for why purchasers using BNPL often buy more than they intended to (between 10% and 40% more), which can lead to ballooning debt.

    There’s also a demographic dimension to BNPL services in that they may appeal most to people who are the least financially stable. This is because, unlike with credit cards, users can access a BNPL loan with only a soft credit check, which is a lower barrier to borrowing. 

    Booking travel with BNPL

    Buy now, pay later can make travel feel more accessible, flexible, and within reach—and that’s exactly where the risk lies. By allowing you to break large expenses into smaller installments, BNPL blurs the line between what a booking costs and what it feels like it costs. And when the upfront cost feels smaller, it’s easier to upgrade.

    Used intentionally, BNPL can be a helpful tool. Used impulsively, it can amplify overspending and regret. Before you click “Book Now,” make sure you’re planning not just for the trip, but for the payments that follow.

    Get free MoneySense financial tips, news & advice in your inbox.



    About Keph Senett


    About Keph Senett

    Keph Senett writes about personal finance through a community-building lens. She seeks to make clear and actionable knowledge available to everyone.

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    Keph Senett

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  • U.S. literally can’t afford to lose superpower status as debt looms—so we’re stuck in an ‘increasingly loveless’ marriage with Europe, analyst says | Fortune

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    Despite fears the trans-Atlantic alliance would break up over President Donald Trump’s desire to take over Greenland, the U.S. and Europe are too intertwined militarily and economically to split, according to Dan Alamariu, chief geopolitical strategist at Alpine Macro.

    Indeed, U.S. geopolitical dominance actually depends on European allies, he said in a note earlier this month, even as NATO members scramble to boost military spending to shore up capability gaps. Meanwhile, Europe can’t pivot to China or Russia.

    “The plausible and likely path is messy coexistence: periodic trade clashes, louder rhetoric, and gradual European autonomy at the margins, alongside continued alignment on Russia, nuclear deterrence, intelligence, and China policy,” Alamariu wrote.

    The strained ties were on display over the weekend during the Munich Security Conference. Secretary of State Marco Rubio vowed to remain involved in Europe and pointed to shared sacrifices on the battlefield, but reaffirmed the Trump administration’s goal to reshape the alliance.  

    Rubio also pulled out of a high-level meeting on Ukraine at the last minute, prompting one European official to call the move “insane” amid efforts to end Russia’s war there.

    But for now, Europe can’t break free of its dependence on the U.S. military, especially for high-end deterrence and warfighting enablers, Alamariu said. While the European Union is boosting defense spending, it’s not enough to achieve strategic autonomy anytime soon.

    “Even if politics sours, Euro-Atlantic defense runs through U.S.-centered institutions,” he added. “Bottom line: Without a common EU military and budget, the EU won’t become autonomous from the U.S., much less split off.”

    On the economic side, the two partners have extremely complex ties that cover supply chains, services, foreign direct investment and financial flows, representing the world’s deepest bilateral relationship, Alamariu explained.

    This dependence goes both ways and extends to military power. If NATO were to break up, the value of having the U.S. as an ally would be greatly diminished in Japan and South Korea, he said.

    “Without NATO and its major allies, the U.S. would struggle to maintain its globally dominant role,” Alamariu warned. “This would have dire implications for the USD’s global role and its weak fiscal outlook. The U.S. literally cannot afford not to be a superpower, lest its bills come due.”

    In fact, the U.S. fiscal picture has deteriorated sharply in recent years. And despite soaring deficits, Trump has vowed to increase defense spending by 50% to $1.5 trillion.

    Helping finance U.S. budget shortfalls is Europe, which remains a top buyer of Treasury debt. Alamariu said there’s no broad evidence of European liquidation of U.S. assets and predicted it’s unlikely. At the same time, the American economy continues to outperform, making it attractive to investors, while Europe lacks a viable alternative to Treasuries.

    EU foreign policy chief Kaja Kallas also highlighted U.S.-Europe codependence at the Munich Security Conference.

    “When, for example, Russia goes to war, they go alone because they don’t have allies,” she said. “When America goes to wars, a lot of us go with you, and we lose our people along the way. So that means that you also need us to be this superpower. Because if you look at the bigger picture in terms of economic might, China is a very, very powerful country.”

    To be sure, China is an economic threat to Europe, as a flood of cheap imports puts the continent’s industrial base at risk, Alamariu pointed out.

    China also is a critical enabler of Russia’s war on Ukraine, and has reportedly deepened its cooperation with Moscow, particularly for dual-use components and critical minerals used in Russian drone production.

    As long as Russia remains a threat, Europe has an incentivize to manage its tensions with the U.S. rather than seek a full-blown rupture, Alamariu said, adding that it will still accelerate “selective autonomy” in areas like defense investment and economic security.

    “Yet, collaboration with the U.S. will likely persist despite sky-high headline risks and mutual fear and loathing,” he said. “Our argument: the two are stuck with each other, in an increasingly loveless, if still convenient, marriage.”

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    Jason Ma

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  • Holiday debt hangover: How to get your finances back on track

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    Recent surveys show a growing number of Canadians carry holiday-related debt into the new year and feel more financial pressure because of it. In this article, we’ll explain what’s behind this holiday hangover, why this type of debt has become so common, and provide practical steps to pay it down so you can get your finances back on track.

    The state of holiday spending & debt in Canada

    According to Spergel’s latest Financial Hangover survey, about half of Canadians (51%) carried new holiday debt into 2026, and nearly three in 10 are starting the year with over $6,000 in holiday-related balances. At the same time, 75% report feeling more financially stressed than in past years, and nearly one in five expect to fall behind on credit card payments.

    “These figures show how easily seasonal spending can morph into a long-term debt trap when you’re dealing with 19.99% or 29.99% APR. That ‘hangover’ doesn’t just go away, it grows,” says Ronique Saunders, Credit Canada Credit Counsellor. According to Spergel’s survey, nearly one in three Canadians say it will take six months or longer to recover financially from holiday spending.

    These impacts go beyond numbers on a statement. Carrying high balances increases your credit utilization, which can hurt your credit score and make future borrowing more expensive. High balances also trigger significant interest charges and monthly interest expenses, which can quickly drain your cash flow and increase the total amount you owe. And seeing a large balance month after month adds emotional stress, making it harder to save or plan for the rest of the year.

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    Many Canadians carry holiday debt into the new year because of a few common money habits. One is present bias—focusing on enjoyment now and pushing costs into the future. Another is optimism bias—expecting finances to recover without a clear plan. These habits are normal, but they can cause debt to stick around longer than expected, especially as credit card interest adds up.

    Step-by-step financial recovery strategies

    Understanding how common this “holiday hangover” is—and taking steps to tackle your debt—can help you regain control of your money and reduce both financial and emotional stress as the year begins. Here’s how to get started.

    1. Assess your current situation

    The first step to getting back on track is to figure out where your money stands. Pull out your January credit card and bank statements and tally up any holiday debt. Seeing the numbers in detail provides a foundation for every decision that follows.

    A helpful way to start is by creating a “financial photograph.” This is a snapshot of your finances at a specific point in time, showing what you own versus what you owe. To create a financial photograph, use a piece of paper or a spreadsheet and list everything you own (savings, investments, maybe a home) and then subtract what you owe, such as credit card balances or loans. This will give you a clear picture of your net worth, separate from your everyday budget.

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    “Understanding your complete financial situation allows you to identify, organize, and create a realistic plan to pay off what you owe,” says Saunders.

    2. Create a realistic 2026 budget

    Consider your budget a spending roadmap for the year ahead, taking into account a plan to reduce your holiday hangover debt. When creating a budget, you can use a budgeting app, spreadsheet or a simple piece of paper to list your income and expenses—including debt payments. Determine how much money you have to spend each month and compare it with how much you pay for various bills and items during that same period. This will help you identify where you can cut back. Those savings can then be directed to your debt so you can pay it off sooner.

    The goal is to allocate as much as you reasonably can towards the debt while still covering your necessary expenses. “A realistic 2026 budget doesn’t need to feel restrictive—it should simply reflect your values, priorities, and financial goals for the year ahead,” says Saunders.

    3. Prioritize high-interest balances

    Once you have a budget in place, you can analyze your cash flow to determine the best debt repayment strategy. Keep in mind that not all debt costs the same. Credit cards usually carry the highest interest rates, so paying them down first saves the most money over time. 

    Two common repayment strategies are the snowball and avalanche methods. The snowball method focuses on paying off your smallest balances first, giving you quick wins that build momentum. The avalanche method focuses on the highest-interest balances first, which reduces the total interest you pay and can shorten the overall repayment period. 

    Counsellor Tip: If your interest rates are over 20%, the avalanche method is almost always the better choice to stop the “bleeding” of your monthly income. 

    4. Increase cash flow

    Boosting the money you have available can speed up your holiday recovery. Look for temporary ways to earn extra income, such as freelance work, part-time jobs, or selling items you no longer use. You can also free up cash by reviewing subscriptions or non-essential spending and redirecting that money towards debt repayment. 

    5. Pay more than the minimum

    Minimum payments may feel manageable, but they keep you in debt longer and increase the total interest you pay. Whenever possible, aim to pay a larger portion of your balance—as much as your budget allows. 

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    Himank Bhatia

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  • Elon Musk warns the U.S. is ‘1,000% going to go bankrupt’ unless AI and robotics save the economy from crushing debt | Fortune

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    Tesla CEO Elon Musk doubled down on his warnings about U.S. debt, predicting financial doom will be guaranteed without the transformative effects of AI and robotics on the economy.

    In a lengthy, wide-ranging interview with podcaster Dwarkesh Patel alongside Stripe cofounder and president John Collison on Thursday, the tech billionaire was asked why he pushed for aggressive spending cuts while leading the Department of Government Efficiency if technology will supercharge GDP growth and ease the debt burden.

    Musk replied that he was concerned about waste and fraud. That’s despite reports that many across-the-board staffing cuts included critical employees who had to be hired back.

    “In the absence of AI and robotics, we’re actually totally screwed because the national debt is piling up like crazy,” he added.

    Interest payments alone on the $38.5 trillion debt pile are about $1 trillion a year, exceeding the U.S. military budget, Musk pointed out.

    Debt-servicing costs also top spending on social programs like Medicare. But President Donald Trump has vowed to boost annual defense outlays to $1.5 trillion, so the defense budget could overtake interest payments again, at least temporarily.

    Reflecting on his work with DOGE, Musk said he had hoped to slow down the unsustainable financial trajectory the U.S. is on, buying more time for AI and robotics to boost growth.

    “It’s the only thing that could solve the national debt. We are 1,000% going to go bankrupt as a country, and fail as a country, without AI and robots,” he predicted. “Nothing else will solve the national debt. We just need enough time to build the AI and robots to not go bankrupt before then.”

    In late November, Musk made similar comments, saying on Nikhil Kamath’s podcast that the deployment of AI and robotics “at very large scale” is the only solution to the U.S. debt crisis.

    But he cautioned that the increased output in goods and services as a result of the technologies would likely lead to significant deflation.

    “That seems likely because you simply won’t be able to increase the money supply as fast as you increase the output of goods and services,” Musk added.

    Deflation would actually worsen the debt burden in real terms, while inflation would ease it initially, though a resulting spike in bond yields would eventually send debt-interest payments soaring.

    To be sure, the U.S. has some built-in advantages given that the dollar remains the world’s reserve currency, allowing the Treasury Department to borrow at lower interest rates than would be possible otherwise.

    The ability of the U.S. to issue debt in its own currency and the Federal Reserve’s bond-buying capacity also lessen the risk of an outright default.

    Still, the Committee for a Responsible Federal Budget warned last month that the U.S. is on a trajectory that could trigger six distinct types of fiscal crises.

    While it’s “impossible” to know when disaster will strike, “some form of crisis is almost inevitable” without a course correction, the CRFB said in a report.

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    Jason Ma

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  • How to improve your chances of being approved for a personal loan – MoneySense

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    In reality, lenders look at a much bigger picture. Credit history matters, but so do income stability, existing debt, and how you approach the application itself. While there’s no guaranteed formula for approval, there are steps you can take to improve your odds, without pretending your finances are flawless.

    Here’s what Canadian lenders typically look for, and what you can realistically do to strengthen your application.

    1. Strengthen your credit score

    There’s no way around it: your credit score plays a meaningful role in whether you’re approved for a personal loan. Most Canadian lenders rely on credit reports from Equifax and TransUnion to understand how you’ve managed borrowing in the past.

    Credit scores are often grouped into rough ranges:

    • Excellent: 760+
    • Very good: 725–759
    • Good: 660–724
    • Fair: 560–659
    • Below 560: Limited options, usually with higher interest rates

    That said, lenders don’t expect perfection. Many people apply for personal loans specifically because their credit utilization is high or they’re struggling with revolving debt. A lower score doesn’t automatically mean rejection; it simply affects which lenders are likely to approve you and at what cost.

    What helps most:

    • Pay everything on time. Payment history is one of the biggest drivers of your score and a major trust signal for lenders.
    • Be cautious with new applications. Applying for multiple loans or cards in a short period can lower your score slightly and can look worse to lenders.
    • Keep older accounts open if you can. Closing long-standing accounts can reduce the length of your credit history.

    A note on credit utilization: you’ll often see advice like “keep it below 30%.” That’s a helpful target, but it isn’t always realistic if you’re applying because you’re stretched. The key point is that high revolving balances can weigh on both your credit score and approval odds, and one purpose of a debt consolidation-style loan can be reducing that revolving pressure over time.

    2. Show stable income and employment

    When lenders review your application, they’re ultimately trying to answer one question: Can you reasonably repay this loan? Stable income and employment go a long way toward answering that.

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    Lenders generally feel more comfortable when borrowers have been with the same employer for several months, work full time or on a long-term contract, and can clearly document their income. That documentation might include recent pay stubs, notices of assessment, or bank statements showing regular deposits.

    If you’re self-employed or freelance, approval is still possible, but lenders will usually want more context. One or two years of tax returns, along with evidence of consistent income, helps show that your earnings are reliable rather than sporadic. In many cases, applications don’t fail because income is too low, but because it’s hard to verify. Making your income easy to understand can significantly improve your chances.

    3. Lower your debt-to-income ratio (DTI)

    Your debt-to-income ratio compares your monthly debt payments to your gross monthly income. Many Canadian lenders prefer to see this ratio under 40%, and some banks aim closer to 35%. These figures are often treated as rules, but they’re really guidelines.

    In reality, plenty of people apply for personal loans precisely because their debt-to-income ratio is already higher than recommended, often due to credit card balances with high interest rates. Lenders take this context into account. If a loan reduces multiple payments into one more manageable obligation, it may actually improve your overall financial picture.

    That said, DTI still matters because it affects affordability. If there are small ways to reduce it before applying, such as paying down a portion of a revolving balance, avoiding new debt, or temporarily increasing income, it can help. But the bigger goal is ensuring that the loan payment fits comfortably within your budget, not forcing your finances to meet an ideal ratio on paper.

    4. Ask for a realistic loan amount

    One reason personal loan applications can be declined is simply asking for too much. Lenders assess loan size in relation to your income, existing debt, and credit history, and an amount that feels out of sync can trigger a rejection.

    At the same time, applying for less than you actually need doesn’t guarantee approval. The better approach is realism: borrow enough to solve the problem you’re facing, without stretching your finances further. In many cases, lenders will counter with a different amount or term based on what they’re comfortable offering anyway.

    Applying for a reasonable loan size can improve approval odds and help ensure the loan actually solves a problem instead of creating a new one.

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    Natasha Macmillan

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  • City Council approves $447.4 million bond order to pay for construction of new high school

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    SALEM — The City Council voted unanimously Thursday night to borrow up to $447 million to pay for the construction of a new high school.

    The Massachusetts School Building Authority (MSBA) is expected to reimburse the city around 44% of the total project cost, but that percentage won’t be finalized until after the MSBA’s meeting in February. The MSBA requires communities to commit to paying up to the full amount of a new school project in order to move forward.

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    Michael McHugh can be contacted at mmchugh@northofboston.com or at 781-799-5202

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  • From flight to fight: How to strengthen your financial resilience – MoneySense

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    Financial stress is common. The nation’s Financial Consumer Agency reports that nearly half of Canadians have lost sleep because of it. In addition, it can be detrimental to physical and emotional well-being. 

    Luckily, there are simple steps you can take to strengthen your financial position. 

    Canadians are concerned

      According to the MNP data, the majority of Canadians (59%) expect a worsening of the economy in the coming year. Specific concerns include increasing unemployment (52%), spiking housing (59%) and healthcare (48%) costs, and higher taxes (53%). On a macro level, respondents expressed the belief that 2026 would bring rising poverty and inequality (62%) and a worsening government deficit (66%).

      Economic pressure is nothing new for Canadians, but bright spots have been few and far between since the COVID-19 pandemic. In the past six years, households have struggled with inflation, tariffs, and a shrinking job market. By now, it’s understandable if Canadians feel like they’re living in a never-ending financial crisis.

      The bad news is that it’s not all in our heads. MNP reports that only 47% of Canadians have an emergency fund to cover six months, and 41% say they’re $200 or less away from financial insolvency on a monthly basis.

      Best savings accounts in Canada

      Find the best and most up-to-date savings rates in Canada using our comparison tool

      Financial fight or flight

        Money pressures are common, but how you respond can be the difference between relative peace of mind and paralyzing fear. According to MNP, nearly three in five (59%) are adopting a “fight” mentality and taking proactive steps to protect themselves. Strategies include consolidating debt, adjusting their budgets, and seeking out help from a financial professional. 

        However, nearly a third (32%) are avoiding the problem—an anxiety response colloquially known as “flight”. If you avoid thinking about or discussing finances, or if you feel unable to act at all, you might be in a flight response. 

        “Sustained financial pressure is prompting both decisive action and withdrawal among Canadians,” says Grant Bazian, president of MNP LTD, adding that financial flexibility—or lack of it—may be the difference between someone who fights or flees. 

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        Take small steps toward financial flexibility

          There’s no quick fix to improving your financial flexibility, and it can be mentally and emotionally fraught to even think about. That said, small steps in the right direction will help you escape the cycle of fear around money. Here are some places to start:

          • Budget. If you already have a budget, now is a good time to revisit it. If you don’t have a budget, build one. Once you have accounted for all of your income and expenses, you can find ways to cut or redirect your spending.
          • Prioritize emergency savings. Experts suggest having between three and six months worth of savings in the bank to support you in case of job loss or other emergencies. Even a small but regular contribution will add up over time.
          • Pay down debt. Debt, especially on a credit card, can destroy your financial health. Regular interest rates can be as high as 25%, and increase what you owe quickly, because of compound interest. You can improve your position by not spending on credit, moving debt to a lower-interest credit card, and considering consolidating your debt.
          • Increase your income. Reducing your spending is only half the equation. If you can increase the amount of money you bring in, you’ll have more to work with. Consider a second job or a side gig. Sell off unused or unwanted items and put the proceeds towards your emergency fund or debt. 
          • Ask for help. Many people have shame or secrecy around money issues which stops them from getting the assistance they need. There are professionals and resources available to help you reach your financial goals. 

          Financial anxiety is widespread in Canada, but ignoring it only deepens the strain. And while broader economic pressures may feel out of reach, personal financial resilience is not. Take deliberate steps today to ease stress, build a more stable foundation, and gain a sense of control over your finances. 

          Get free MoneySense financial tips, news & advice in your inbox.



          About Keph Senett


          About Keph Senett

          Keph Senett writes about personal finance through a community-building lens. She seeks to make clear and actionable knowledge available to everyone.

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  • What New Year’s credit deals promise—and why you should be wary – MoneySense

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    Credit card debt in Canada

      If your last credit card statement dampened your seasonal joy, you’re not alone. According to TransUnion, consumer credit card debt rose 1.95% year over year in 2025, with even bigger jumps for mortgages, lines of credit, and auto loans. Wealthsimple reports that Canadians hold an average of $4787 in credit card debt, which can take time to pay off. And all the while credit card interest accumulates.

      Mark Kalinowski, a Financial Educator at the Credit Counselling Society, points to compound interest, or “the interest paid on the interest.” When you pay only the minimum amount due or less than the full balance, interest accumulates. You have to pay interest on that amount as well. “This can create a debt trap where cash flow is used to pay debt for long periods of time,” he warns. “Even small amounts borrowed can take decades to pay off.”

      “New Year’s” deals to watch out for

      Here are some common promotions that might cause more trouble than they’re worth. 

      Balance transfer

      A balance transfer is when you move debt from one credit account to another, usually with lower interest. There’s typically a balance transfer fee, usually 3–5%, so if you move $10,000 with a balance transfer fee of 3%, you’d pay $300. Promotional offers usually include a low interest rate for a limited time, and will sometimes forego the balance transfer fee.

      Canada’s best credit cards for balance transfers

      Read the fine print

      Moving debt from a high-interest card to one that charges less can be a great strategy when done right. Look for a 0% balance transfer fee, and ensure that the promo period is long enough to pay off your debt. Also, find out what happens if you miss a payment to avoid costly problems. 

      Imagine you transfer $15,000 in debt to a card with a 19% regular interest rate and a 0% interest promotional period for six months. To see how a balance transfer promotion could actually hurt your bottom line, Malinowski picks up the story: “They plan to pay $2,500 per month to pay it off in time but after making the first two payments, they miss one.” This can trigger a $50 late fee and cancel the promotional rate, he says. Now, you have a balance of $12,050 on a card charging 19%, which comes out to about $190 in interest per month. “It will take five more months to pay off the debt, and the total extra cost from interest and fees will be roughly $1,000,” he says.

      Sign-up bonus

      Sign-up bonuses promise a reward when you get a new credit card. Common rewards are boosted cash-back rates or credit card points, but sometimes there are other perks like a first-year annual fee waiver.

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      Read the fine print

      A sign-up bonus can be a valuable perk, but it’s a poor strategy for paying down debt. Bonuses are usually temporary (like a high cash back rate) or one-time (like an annual fee waiver or gift of rewards points). Not all cards let you apply points to your credit balance, and even if they do, the value won’t likely be enough to clear your debt. 

      You can always earn more by spending on the card, but that defeats your goal of debt reduction. Also be aware that every time you open a new credit account, it impacts your credit score. 

      What to do if a credit offer did not work out

      If you accepted a credit offer and it’s not helping you pay down your debt, there are a few things you can do.

      • Take action. Don’t be paralyzed by financial stress. Review your finances immediately (with a credit counsellor, if you wish) and make a plan.
      • Consider lower-interest credit cards. Credit card interest rates can be as high as 25%. Trim compound interest by moving your debt to a low-interest credit card.  
      • Consider consolidation. Combine your debt into one loan with a manageable payment, preferably at a lower interest rate. If you go this route, ensure that you also adjust your credit card usage going forward.

      How to tackle debt without using more credit

      “Getting new credit products without closing old ones can lead to increased debt loads over time,” Malinowski says, adding that you need to understand the source of your debt to work towards a solution. He recommends making a budget, cutting expenses, and putting any extra towards your debt. Increasing your income through a second job or side hustle can accelerate your progress. 

      As tempting as a quick fix may seem, taking on more credit isn’t the pathway to real financial relief. You can’t borrow your way out of last year’s mistakes. By slowing down, reading the fine print, and focusing on a clear repayment plan, you can turn January into a true reset—not just another cycle of debt.

      Get free MoneySense financial tips, news & advice in your inbox.



      About Keph Senett


      About Keph Senett

      Keph Senett writes about personal finance through a community-building lens. She seeks to make clear and actionable knowledge available to everyone.

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  • Luxury retailer Saks Global enters bankruptcy to restructure

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    NEW YORK CITY, New York: After years of expansion fueled by debt and rising pressure from cautious luxury shoppers, Saks Global has sought bankruptcy protection as it moves to overhaul its business and balance sheet.

    The New York-based private company, which owns Saks Fifth Avenue and Neiman Marcus, said on January 14 that it had filed for Chapter 11 bankruptcy in the Southern District of Texas. The filing comes as the retailer prepares to reposition itself in an increasingly competitive upscale market, backed by about US$1.75 billion in financing commitments.

    Leadership changes have accompanied the restructuring effort. Chief executive Marc Metrick stepped down earlier this month as the company grappled with debt linked to its $2.65 billion acquisition of Neiman Marcus in 2024. He was succeeded by executive chairman Richard Baker, who quit both roles earlier this week and was replaced as chief executive by Geoffroy van Raemdonck.

    The company is also facing intensifying competition while working to reduce its heavy debt load, even as some customers push back against steep price increases in the luxury sector.

    In a statement, the company said it was “evaluating its operational footprint to invest resources where it has the greatest long-term potential.”

    Saks said it does not expect operations to be disrupted during the bankruptcy process and will continue to honor customer programs while paying suppliers and employees.

    The retailer said it has secured financing commitments totaling $1.5 billion from some of its creditors, along with an additional $240 million in “incremental liquidity” from its lenders.

    Hudson’s Bay Co., the Canadian owner of Saks Fifth Avenue, split off the luxury retailer’s e-commerce business, Saks.com, in 2021. Three years later, after acquiring Neiman Marcus, Saks Fifth Avenue changed its name to Saks Global.

    The restructuring unfolds against a weakening global luxury backdrop. Worldwide sales of luxury goods are expected to contract for a second consecutive year in 2026 as consumers worry that the global economy will curb spending, according to a study released in November by Bain & Co.

    Hudson’s Bay, Canada’s oldest company, moved in March 2025 to begin liquidating all but six of its stores.

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  • Credit card interest rates: How high is too high? – MoneySense

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    Credit card rate caps spark debate

    The Canadian Bankers Association said in a statement Monday that Canada’s credit card market is highly competitive and well regulated.

    “Regulatory interventions aimed at artificially capping credit card interest rates can lead to unintended consequences that harm consumers, such as reducing credit availability for many Canadians and business owners,” said spokeswoman Nathalie Bergeron in an email. “Such a cap could drive customers towards more costly alternatives and reduce the value that all consumers receive from credit cards.”

    Conacher, who’s been pushing for lower credit card rates in Canada for decades, said that banks always say they’ll have to stop offering credit to some, but never provide proof. “Whenever the banks say we wouldn’t be able to afford, we wouldn’t have these margins, and then as a result, we’d have to cut off people, they should be required to prove that’s true,” he said. “No one should accept it at face value, given their profit levels.”

    He pointed out how credit card rates have stayed the same, generally hovering around 20%, despite wide fluctuations in interest rates over the last two decades, as evidence there is room to reduce.

    Best low interest credit cards in Canada

    Studies suggest rate caps could save billions

    Research in the U.S., after Trump first put out the plan as a campaign pledge, found that Americans would save about US$100 billion in interest a year if credit card rates were capped at 10%. The same researchers found that while the credit card industry would take a major hit, it would still be profitable, although credit card rewards and other perks might be scaled back.

    In remarks from late 2024 to a parliamentary committee, the banking association’s senior vice-president for banking policy, Darren Hannah, said that 71% of Canadians pay off their balance every month, while there are also some lower-interest card options. He said credit cards offer great value to consumers, that there are some options to switch credit card debt to instalment loans at potentially lower interest, and that the industry has worked with consumers during tough times like the COVID-19 pandemic when it provided deferrals on credit cards.

    What didn’t happen during the pandemic though, was much of any change in credit card interest rates. The lack of change, despite the historically low Bank of Canada policy rate, prompted the Canadian Labour Congress to call for a better response from banks in 2020. 

    Related reading: Credit card interest calculator

    Federal interest caps stop short of credit cards

    The question of what level of interest rate is acceptable is an age-old question, but one the federal government has worked to tackle recently. Ottawa officially lowered the maximum allowable interest rates on loans to 35% on an annual percentage rate from 48%, while separately setting out lower maximums for payday loan charges. The change wasn’t enough to affect credit cards, though.

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    And while interest rates are certainly key, it’s also important to look at hidden charges and other costs like interchange fees, said Claire Celerier, Canada Research Chair in household finance at the University of Toronto’s Rotman School of Management. “The risk is that if you cap the interest rate and if there is no cap on late payment fees, interchange fees, and so on, banks are going to recover by increasing all the other fees.” Such fees are generally more hidden than the interest rate, raising the potential of further distorting the market. 

    Lower-income cardholders tend to bear hidden costs

    Low-income people can sometimes shoulder a disproportionate share of fees, like the interchange fee charged to merchants, because while stores spread out the costs among all shoppers, high-earners get some costs back in credit card rewards. “I think what Trump is doing, the effect is that banks are going to increase their fees and it will be at the expense of the poor.” 

    The federal government in 2024 did secure an agreement on reduced interchange fees, though the rates still stand much higher than in Europe. 

    Derek Holt, vice president of Scotiabank Economics, said in a note Monday that a lowering of the cap on rates would also likely mean higher monthly minimum payments, card companies raising other fees and many losing access to free credit. “In short, education and efforts to raise financial literacy may be more effective than rate caps and so could efforts to address severe income disparities within the U.S. economy that are not the fault of the cards industry.” 

    Get free MoneySense financial tips, news & advice in your inbox.

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    About The Canadian Press


    About The Canadian Press

    The Canadian Press is Canada’s trusted news source and leader in providing real-time stories. We give Canadians an authentic, unbiased source, driven by truth, accuracy and timeliness.

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  • Neiman Marcus parent sells its Beverly Hills site

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    The land below the Beverly Hills flagship store of luxury retailer Neiman Marcus has been sold to a New York investor as the owners of the department store chain sell property to pay debts.

    Neiman Marcus, which has occupied the 9700 Wilshire Boulevard store since it opened in 1979, will continue to serve customers there as a tenant.

    “We made the strategic decision to sell the land beneath the Neiman Marcus Beverly Hills store and enter into a long-term lease with the new owner,” said a spokesperson for Saks Global. “This opportunistic real estate transaction does not impact our day-to-day operations. We remain committed to serving our loyal Beverly Hills customers.”

    Saks Global, the parent company of Saks Fifth Avenue, Neiman Marcus, Saks Off 5th and Bergdorf Goodman, sold the Beverly Hills Neiman Marcus site for an undisclosed price.

    The new owner of the property on the edge of the city’s prestigious Golden Triangle is Ashkenazy Acquisition Corp., a private real estate investment firm owned by Ben Ashkenazy.

    Ashkenazy also owns the former Barneys building on Wilshire Boulevard that is now occupied by Saks Fifth Avenue.

    “This strategic acquisition significantly expands Ashkenazy’s presence in Beverly Hills and reinforces the firm’s focus on irreplaceable, best-in-class retail assets located in globally recognized luxury corridors,” the company said in a statement.

    Executives at Saks Global have signaled plans to shore up cash by offloading stores, or raising emergency financing.

    It could also part with a stake in luxury retail chain Bergdorf Goodman to help pay off debts and reinvest in its core retail business, real estate data provider CoStar said.

    The company faces a $100-million debt payment deadline at the end of December and is considering Chapter 11 bankruptcy as a last resort, Bloomberg said. The scramble comes a year after Saks Global purchased Neiman Marcus in a $2.7-billion deal.

    The Beverly Hills retail property market is still one of the most robust in the country, said real estate broker Jay Luchs of Newmark. He was not involved in the Neiman Marcus property sale, but has brokered sales and leases of luxury stores in Southern California for more than two decades.

    “This is probably the best it’s ever been in Beverly Hills,” he said, with “essentially nothing available” on Rodeo Drive for merchants in search of store space and demand climbing on nearby streets such as Wilshire Boulevard.

    Some top-shelf brands are making their stores larger, and luxury brands, including LVMH, Chanel, Hermes and Richemont, are buying their stores instead of renting them, he said.

    “They don’t do that unless they’re making a tremendous amount of money, unless they want to be there forever,” Luchs said, “and they realize that Los Angeles and Beverly Hills is a very important market for them.”

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  • After U.S. debt soared to $38 trillion, the ‘easy times’ are now over as hedge funds jump into the bond market, former Treasury official warns | Fortune

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    The holders of U.S. debt have shifted drastically over the past decade, tilting more toward profit-driven private investors and away from foreign governments that are less sensitive to prices.

    That threatens to turn the U.S. financial system more fragile in times of market stress, according to Geng Ngarmboonanant, a managing director at JPMorgan and former deputy chief of staff to Treasury Secretary Janet Yellen.

    Foreign governments accounted for more than 40% of Treasury holdings in the early 2010s, up from just over 10% in the mid-1990s, he wrote in a New York Times op-ed on Friday. This reliable bloc of investors allowed the U.S. to borrow vast sums at artificially low rates.

    “Those easy times are over,” he warned. “Foreign governments now make up less than 15% of the overall Treasury market.”

    While they didn’t dump Treasuries and still hold roughly the same amount as 15 years ago, foreign governments didn’t ratchet up their buying in line with the recent surge in U.S. debt, which now tops $38 trillion.

    Private investors have stepped in to absorb the massive supply of Treasury bonds, but they are also more likely to demand higher returns, making rates more volatile, Ngarmboonanant pointed out.

    The influence of hedge funds, which doubled their presence in the Treasury market in the last four years, raises particular concern among U.S. officials, he added. In fact, the biggest share of U.S. debt that’s held outside the country is now in the Cayman Islands, where many hedge funds are officially based.

    Ngarmboonanant attributed “unusual turbulence” during recent shocks in the Treasury market, which has historically been a safe haven during crises, to hedge fund activity. That includes the sudden selloff in the immediate aftermath of President Donald Trump’s shocking “Liberation Day” tariffs.

    Relying on AI-fueled productivity gains, stablecoins, Fed rate cuts or inflation to sustain U.S. debt will eventually backfire, he said.

    “Financial engineering and false hopes won’t keep America’s lenders happy,” Ngarmboonanant predicted. “Only a credible plan to restrain deficits and control our debt will ultimately do that.”

    The ability of bond investors to force lawmakers to change course has earned them the “bond vigilantes” moniker, which was coined by Wall Street veteran Ed Yardeni in the 1980s.

    Indeed, upheaval in the bond market after Trump unveiled his global tariffs in April helped convince him to retreat from his most aggressive rates. That prompted economist Nouriel Roubini to say, “the most powerful people in the world are the bond vigilantes.”

    But analysts at Piper Sandler recently dismissed the power that bond vigilantes actually have over politicians. 

    In an August note, they pointed out that the bond market didn’t prevent federal deficits from exploding and haven’t steered Trump away from continuing to press his overall tariff agenda.

    Still, the U.S. debt outlook has become so dire that even longtime Republican Mitt Romney, a former senator and presidential candidate, has called for increasing taxes on the rich as the Social Security Trust Fund races toward insolvency in 2034.

    “Today, all of us, including our grandmas, truly are headed for a cliff,” he warned in a recent New York Times op-ed. “Typically, Democrats insist on higher taxes, and Republicans insist on lower spending. But given the magnitude of our national debt as well as the proximity of the cliff, both are necessary.”​

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  • Debt collection in Canada: What collectors can and can’t do – MoneySense

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    Debt collectors are obligated to follow specific rules about how they make contact and what information they can request; however, many Canadians aren’t sure where the line is between legal collection practices and harassment.

    Knowing these rules and what rights you have can turn a stressful situation into something you can handle with confidence. In this article, we’ll explain what debt collectors are allowed to do, red flags to watch out for, and steps you can take to protect yourself.

    Why debt collectors are calling you

    If a debt collector is contacting you, it usually means your account has passed the stage where the original lender can recover the money themselves. In Canada, creditors such as banks, credit card companies, and utilities typically begin with their own internal collections department when payments are missed. These internal teams are still considered debt collectors and must follow the same legal standards governing communication and conduct.

    Ideally, this is the stage where you should engage with the creditor, since resolving the issue early can prevent it from being transferred or sold to an outside collection agency. Typically, accounts are sent to external collections after about 90 to 180 days of non-payment. Once a debt reaches a third-party collection agency, that agency becomes your main point of contact—which explains why calls may start even if the original creditor has stopped reaching out.

    Understanding how this process works can help make the situation less overwhelming. “When you know who is contacting you, why they’re reaching out, and what your rights are, it’s easier to respond calmly and avoid being pressured into decisions that aren’t in your best interest,” says Craig Stewart, certified Credit Counsellor at Credit Canada.

    What debt collectors can do in Canada

    Debt collection rules vary by province; however, all collectors are required to follow Canadian consumer protection laws. Here is what they are permitted to do:

    • Contact you by phone, email, or mail: Collectors can reach out using standard communication methods, as long as they follow provincial limits on how often they can contact you.
    • Call only during permitted hours: Collectors can only call during certain hours, generally 7 a.m. to 9 p.m. Monday to Saturday, and 1 p.m. to 5 p.m. on Sundays (except for holidays). The rules vary by province.
    • Ask you to repay a legitimate debt: They are permitted to explain the amount you owe and discuss possible repayment options, as long as the information is accurate and the communication stays professional. They cannot mislead or pressure you to pay.
    • Contact your employer for limited reasons: Collectors can call your current employer to confirm your employment status, job title, or work address, but they cannot discuss your debt with your employer.

    Have a personal finance question? Submit it here.

    What debt collectors cannot do (this is harassment)

    Even though debt collectors are permitted to contact you, Canada has firm limits on how they can behave. If a collector crosses the following lines, it’s considered harassment and, in many cases, a violation of provincial law. “Understanding these rules helps you know your rights and navigate the situation without feeling intimidated,” says Stewart.

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    Here’s what collectors are not allowed to do:

    • Threaten, intimidate, or use abusive language: Collectors must speak respectfully and cannot yell, insult, or make illegal threats.
    • Contact your friends or family about the debt: They are not allowed to discuss your debt with anyone except you, your spouse, or a co-signer. 
    • Call excessively or outside permitted hours: Repeated calls meant to annoy or pressure you are not allowed, and collectors must follow provincial calling times.
    • Misrepresent who they are: A collector cannot pretend to be a lawyer, a government official, or law enforcement. They must clearly identify themselves and the agency they work for.
    • Add unauthorized fees: Collectors cannot tack on interest, penalties, or collection fees unless the original contract or provincial law allows it.
    • Pressure you to borrow money: They cannot encourage you to take out new, high-interest loans to pay off old debt.

    If a collector engages in any of these behaviours, it is considered harassment and you have the right to file a complaint or seek help from a non-profit credit counsellor.

    How to take back control when dealing with a debt collectors

    Dealing with debt collectors can be stressful, but there are steps you can take to stop the calls and regain control.

    Step 1: Confirm the debt is legitimate

    Always ask the collector to provide details in writing, including the original creditor, amount owed, and how it was calculated. Check your credit report to verify the debt, and do not make any payments until you’re sure it’s valid. “Always ask for the debt in writing before paying anything. Sometimes people are contacted about old debts that have already been paid, or even mistakes on their credit report,” says Stewart.

    Step 2: Keep a record of all interactions

    Write down the dates and times of calls, the names of callers, the agency they work for and what was discussed. Maintaining a detailed record can help if you need to challenge the debt or file a complaint.

    Step 3: Engage early to explore repayment options

    If the debt is still with the original lender’s internal collections department, engaging early often gives you more flexibility. You may be able to:

    • Set up a payment plan that fits your budget
    • Negotiate a lump-sum settlement

    Different creditors have different guidelines for what they will accept on an account in collection, but you may be surprised at how willing some creditors and collection agencies are to settle for a reduced amount. Your options will ultimately depend on the creditor, the age of the debt, and whether it has been transferred or sold to a collection agency.

    When negotiating, explain your current financial situation and offer a payment that works for your budget—the shorter the term and higher the payment the more likely they are to accept your offer. Remember to always get any final agreement in writing

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    Mike Bergeron

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  • Credit card interest calculator – MoneySense

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    Play around with our credit card interest calculator to calculate credit card interest and figure out how long it will take you to repay the debt. This tool can help you develop a plan to address your balance and avoid paying interest going forward.

    How to use the credit card interest calculator

    Our credit card interest calculator can help you figure out two key pieces of information: 

    • How much money you’ll pay in interest based on your current monthly payment
    • How many months it will take to pay off your credit card balance

    Start by inputting your credit card balance and your card’s annual percentage rate (APR). If you don’t know this number, log into your credit card account and pull up your card’s terms and conditions. 

    Next, decide if you want to see how much total interest you’ll pay based on your current monthly payment (and enter that amount) or specify your payoff goal in months to see how the total interest charges.

    How to calculate credit card interest

    Since interest is expressed as an annual percentage rate, card issuers take several steps to determine how much to charge each month. Here’s how you can figure out their method:

    1. Convert your APR to a daily rate. Most issuers charge interest daily, so divide the APR by 365 to find the daily periodic interest rate. Make sure you’re using the purchase interest rate (not the cash advance or balance transfer rate).
    2. Figure out your average daily balance. Check your credit card statement to see how many days are in the billing period. Then, add up each day’s daily balance, including the balance that carried over from the previous month. Once you have all the daily balances, divide the figure by the number of days in the billing period to find your average daily balance.
    3. Multiply the balance by the daily rate, then multiply the result by the number of days in the cycle. Now that you have all the details you need, multiply the average daily balance by your daily periodic interest rate. Then multiply that number by the number of days in the billing cycle. This shows you how much interest you’ll pay in a month.

    A quick example

    If you have a credit card with a $1,000 balance and 20% APR, your daily interest rate would be 0.0548%. Assuming you don’t add to the debt, you’ll be charged around $0.55 in interest every day. If there are 30 days in the billing cycle, you’ll pay $16.50 in interest for the month.

    How to avoid paying credit card interest

    When you get a credit card statement each month, you’ll see a minimum payment amount listed. This is often a flat rate or a small percentage of your balance (usually 3%), whichever is higher. 

    While it’s tempting to just pay the minimum payment your credit card issuer asks for, doing so guarantees you’ll be charged interest because you’ll be carrying a balance into the following month. 

    Instead, make a point of paying off your balance in full every month. Not only will you avoid paying credit card interest, but your card issuer will report these payments to the credit monitoring bureaus, which can boost your credit score. Plus, the cash back or rewards you earn with the card won’t be offset by the interest you’re charged, so you truly get more out of using your card.

    How to reduce credit card debt

    If you already have a credit card balance, don’t despair. There are strategic things you can do to get out from under credit card debt.

    1. Negotiate with your credit card provider

    As a first step, call your bank or credit card provider to request a lower interest rate. Your card issuer may be willing to work with you, so don’t hesitate to ask. They might agree to lower your rate, offer to switch you to a lower-interest card, or create a repayment plan that works for your situation—but you’ll never know if you don’t ask.

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    2. Make a budget and pay with cash or debit

    It’s important to honestly track your income and expenses so you can trim unnecessary costs. Stop charging purchases to your credit cards and switch to cash or debit, instead.

    While it might seem difficult, try to contribute to an emergency savings fund. If an unexpected expense comes up (like an appliance repair or vet bill), you can pull from your fund rather than charge it to your credit card.

    3. Open a balance transfer credit card

    If you have significant debt, find a balance transfer credit card with a great promotional rate. Then, move your existing balance to the card. You can quickly pay down the balance while you’re not being charged interest. The golden rule of balance transfer cards: never charge new purchases to the card.

    Canada’s best credit cards for balance transfers

    4. Try the avalanche or snowball repayment strategy

    There are two main approaches to paying off debt:

    • Avalanche method: Focus on paying off the debt with the highest interest rate first, while making only the minimum payments on your other accounts. Once the highest-interest debt is paid off, move on to the next-highest-interest debt.
    • Snowball method: Start by paying off the debt with the smallest balance first, while continuing to make minimum payments on your other debts. After clearing one debt, move to the next-smallest balance. This method may cost more in interest over time, but it can provide strong motivation and momentum to stay on track with debt repayment.

    5. Work with a credit counselling agency.

    It’s completely understandable to feel overwhelmed by your credit card debt, which is why a credit counsellor can be so helpful. Speak to representatives from your financial institution, a credit counselling agency, or a debt consolidation program to discuss your options. They can help you create a tailored plan to resolve the situation.

    5. Consider debt consolidation.

    If you’re juggling multiple loans and credit card balances and having trouble paying them off, it may make sense to consolidate your debt. This means combining two or more debts into one, with just one payment to make each month.

    Another option is a debt consolidation loan from a bank or other financial institution. Or you could work with a credit counselling agency to negotiate a debt consolidation program (DCP) or consumer proposal (repaying only part of your debt) with your lenders.

    Learn more about each of these options by reading “How to consolidate debt in Canada” and “Who should Canadians consult for debt advice?”

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    Jessica Gibson

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  • Japan Plans Extra Bond Issuance That May Fuel Fiscal Fears

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    TOKYO—Japan’s finance ministry plans to boost government bond issuance by $75 billion to fund an economic stimulus package, potentially stoking concerns about the nation’s fiscal health.

    Prime Minister Sanae Takaichi’s cabinet on Friday approved a draft supplementary budget for the fiscal year ending March 2026 that is worth 18.303 trillion yen, or about $117.10 billion. The government now plans to issue an additional 11.696 trillion yen of bonds, including increases in issuance of two- and five-year notes.

    Copyright ©2025 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

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    Megumi Fujikawa

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  • ‘Dr. Doom’ Nouriel Roubini breaks with the crowd on the AI bubble, saying the U.S. is headed for a ‘growth recession’ and not a market crash | Fortune

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    For nearly two decades, esteemed economist Nouriel Roubini has worn the nickname “Dr. Doom” with honor. He earned it in the mid-2000s for warning of a housing crash that Wall Street dismissed, until he was proven catastrophically right. 

    Since then, the NYU Stern School of Business professor emeritus has become one of the most recognizable bears in global finance, regularly sounding alarms about debt spirals, geopolitical shocks, pandemics, AI disruptions, and what he once called “the mother of all crises.”

    So it’s perhaps surprising, even disorienting, that in the midst of investors teetering on the edge of a bear market, Roubini is breaking with his cohort — including fellow 2008-financial-crisis-prophet Michael Burry — to dismiss their pessimism about the U.S. economy as misplaced.

    In a new essay for the Financial Times, the economist argues that the conventional view – that America’s “Liberation Day” tariffs would trigger stagflation, tank the stock market, kneecap the dollar, and end U.S. exceptionalism — is simply wrong. Instead, he sees something close to the opposite: a short period of cooling growth, followed by a powerful rebound led by technology and capital spending that keeps the U.S. firmly in the top spot.

    “The now common view that the U.S. stock market is in a massive bubble and bound to crash is incorrect over the medium term,” he wrote. On the other hand, what he predicted isn’t necessarily the rosiest. The near-term picture looks like a “growth recession,’ he said, meaning slower, below-potential GDP. It’s not the hard landing or 1970s-style stagflation many have predicted, and it isn’t a bubble popping, but it’s a lopsided economy, as many Wall Street analysts have also noticed.

    Tariffs won’t topple the recovery

    Roubini, who once warned of a “mega-threatened age” – the era where AI, aging populations and global instability threatened our prosperity — now argues the most extreme fears about tariffs and policy missteps haven’t materialized. That’s partly because, he says, this administration is responsive to market reactions. When asset prices slumped immediately after the tariff announcement, the administration “blinked,” softening policy and opening the door to more conventional trade negotiations.

    By next year, he says, growth will reaccelerate. The Fed is undergoing a period of monetary easing, fiscal stimulus is still flowing, and—critically—AI-related capital expenditure continues to surge.

    Roubini’s arguments align closely with two of Wall Street’s top analysts: Torsten Slok from Apollo Global Management and Mike Wilson from Morgan Stanley. Slok, known for his “Daily Spark,” combining insightful charts with brevity, argued on November 20 that the economy is “likely to reaccelerate in 2026.” Just days earlier, he had warned of inequality, saying “it is a K-shaped economy for U.S. consumers.” He has also flagged extreme concentration and valuations in the stock market, with the Magnificent 7 running far ahead of the rest of the market. 

    Wilson, chief equity strategist for Morgan Stanley, has been predicting a “rolling recession” for years, arguing that different sectors of the economy shrank at different times, resulting in something that felt like a recession, but unevenly distributed. This changed in April 2022, when a “rolling recovery” set in, he has argued since then, forecasting an economic boom ahead. Wilson has argued for the possibility of a correction in stocks but, like Roubini, does not see a crash as imminent. 

    Tech > tariffs

    The core of Roubini’s argument rests on a simple hierarchy: tariffs and policy noise are temporary, but technological leadership that results in innovation compounding over decades is not.

    “Tech trumps tariffs,” he writes.

    He estimates U.S. potential growth could double from 2% to 4% by the end of the decade, powered by innovation in AI and machine learning, robotics, quantum computing, commercial space, and defense technology. While this agrees with many Wall Street predictions (Goldman Sachs sees real potential growth reaching 2.3% in the early 2030s, for instance), the prediction of 4% blows most others out of the water. 

    However, those industries, Roubini argues, will continue to deliver the “exceptionalism” that has set the U.S. apart for the past 20 years, to the extent to which productivity will boost the economy out double-digits. 

    If potential growth rises, he says, equity returns should, too. When growth averaged only 2% over the last two decades, annual returns still hovered in the double digits. Faster growth means even faster earnings expansion, and valuations that look elevated today may be supported rather than speculative.

    Roubini has been striking a more positive tone for about a year now — in August 2024, while everyone feared a downturn was coming and frustrated that the Fed wouldn’t ease, he calmed market fears again. 

    Debt—and the dollar—look less dangerous than feared

    One of the most persistent fears around AI-driven spending is debt sustainability. But Roubini argues that this math would change if growth rises even modestly.

    The Congressional Budget Office projects debt-to-GDP soaring under 1.6% real growth assumptions. But if growth averages 2.3% or higher, the ratio stabilizes. At 3% or more, it falls, meaning that we could potentially grow ourselves out of debt; an argument President Donald Trump has also used.

    A tech-driven “supply shock”could also push inflation lower over time as production costs drop while productivity booms, meaning higher real rates may not translate into higher nominal yields.Even external liabilities look manageable, he argues, because rising tech investment tends to attract foreign equity inflows, similar to how “emerging-market” economies finance growth during a resource boom.

    Roubini also dismisses the widely discussed decline of the dollar, since he believes that the U.S. will accelerate while Europe stagnates, and thus the dollar will ultimately strengthen. 

    Notably, “Dr. Doom” admitted that the U.S.’s top adversary, China, is at least on par with the U.S. in innovating in the “most important industries of the future,” such as AI and robotics. However, he doesn’t seem too concerned with the AI arms race. 

    “The US economy and markets are best positioned among advanced economies,” Roubini wrote. “They will continue to benefit from the US being the most innovative advanced country.”

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    Eva Roytburg, Nick Lichtenberg

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  • Gambling apps fuel rising debt and addiction—here’s how to dig out – MoneySense

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    While those sums are above average, Kilner has watched both his tally of clients and the depth of their gambling debts balloon in recent years. “Ten years ago I didn’t see anyone, because you’d actually have to go into a casino,” he added. “It’s just the last two, three years.”

    Betting apps put young adults at risk

    The rise of online sports betting and casino apps has yielded big profits for gambling companies. But insolvency and psychology experts warn of dire consequences for a growing number of Canadians—young men, in particular—and recommend counselling, a payback plan, and self-examination for those needing to dig themselves out of debt.

    Compared to gamblers who exclusively played the lottery, Canadians who reported betting online over the past year were 45 times more likely to qualify as problem gamblers, according to a new report from Greo Evidence Insights, the Canadian Centre on Substance Use and Addiction, and Mental Health Research Canada.

    “Young adults are emerging as the group most at risk,” said Matthew Young, chief research officer at Greo, a not-for-profit research organization with expertise in gambling. Nearly one in three adults aged 18 to 29 place bets online, according to the poll, which was based on data from more than 8,000 respondents. “Those who do are far more likely to develop gambling problems and suffer related harms,” he said in a release.

    The sheer ubiquity of betting amounts to a constant risk for some, who carry a virtual casino in their pocket. “You can gamble walking down the street on your phone. You can gamble sitting in the comfort of your living room,” said Scott Terrio, manager of consumer insolvency at Hoyes, Michalos & Associates. “The former barriers to gambling—i.e., getting up off your ass and going to the casino or the track—aren’t there now.”

    Gambling losses and debt climb in Ontario

    Canada legalized single-event sports betting in August 2021, upending more than a century of prohibition on the practice in the hopes of winning back customers from offshore sites, U.S. casinos, and illegal bookmakers. Ontario threw open the door to private betting platforms, while other provinces including Quebec, British Columbia, and Alberta offer sportsbooks run by their lottery and gaming commissions.

    On top of being just a click away, daily fantasy sports companies such as DraftKings and FanDuel advertise relentlessly, as anyone who watched the recent Toronto Blue Jays playoff run can attest. “This is so prevalent and in your face,” Terrio said.

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    Typical debt totals for his clients range between $20,000 and $80,000, though he’s handled cases of up to $263,000. “I’ve seen statements where somebody was pulling cash advances out over the course of three or four days and it was in the tens of thousands from a few different banks,” he said.

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    In Ontario, the internet gambling industry saw monthly cash wagers rise 31% year-over-year to a record $8.6 billion in September, according to iGaming Ontario’s latest market performance report. Online casinos make up the bulk of that total, while non-casino betting—the category includes sports—saw by far the biggest increase at 39%.

    Official statistics on gambling debt are hard to come by, but Ontarians lost $329.4 million on the iGaming platform in September, 20% more than in the same month a year earlier.

    Managing debt after online gambling losses

    The path out of debt isn’t always pleasant. The first step is to acknowledge the problem, stop gambling—including by asking sites to ban you—and contact a non-profit credit counselling agency for financial advice.

    If the debt has spiralled, a second step is to work with a licensed insolvency trustee to consider a consumer proposal—an agreement with creditors to repay a portion of what’s owed, often within five years. “They like to see 30%, 40% depending on how bad the gambling was. But you get that at no interest,” said Kilner.

    Sometimes, creditors impose harsher terms on gambling debt because it tends to accumulate more rapidly, he said. “Normal debt generally builds up over time. And from the selfish perspective of the banks, they’ve probably made some money off you,” Kilner said. “They’ve been able to charge interest. Generally, with gambling, it’s quick.”

    Other experts said the percentage owed can range widely, and hinges on income, assets, and prior bankruptcies.

    Declaring bankruptcy is an alternative that typically results in a lower payback amount. But it wreaks havoc on credit scores and usually demands a much shorter timeline, often 18 months, said Terrio.

    Why online betting can become addictive

    The toughest part of the process may be confronting the deeper reasons behind addictive behaviour. “Ask yourself, am I doing it for entertainment?” said Kilner. If so, set a limit, as you might for a night out.

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    The Canadian Press

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  • America’s path out of $38 trillion national debt crisis likely involves pushing up inflation and ‘eroding Fed independence,’ says JPMorgan Private Bank | Fortune

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    While optimistic economists argue that America can grow its way out of a debt crisis, pessimists believe the real outcome will be somewhat less popular.

    Business leaders, policymakers, and investors are growing increasingly concerned by the United States’s borrowing burden, currently sitting at $38.15 trillion. The worry isn’t necessarily the size of this debt, but rather America’s debt-to-GDP ratio—and hence, its ability to convince investors that it can reliably pay back that debt. It currently stands at about 120%.

    To reduce that ratio requires either GDP to increase or scaling down the debt. On the latter end, this could include cutting public spending. This was already tried by the Trump administration, with the Department of Government Efficiency (DOGE) under Elon Musk claiming to have saved $214 billion.

    While those savings were drastically lower than promises made by the Tesla CEO when DOGE was first formed, and they’re a drop in the ocean of the bigger U.S. deficit picture, it does reveal the renewed focus Washington is giving to debt.

    This will be a prevailing theme for investors as well, according to JPMorgan Private Bank’s outlook for 2026. (The ban serves high net worth individuals.) The report, released today, says there are three issues investors need to bear in mind: Position for the AI revolution, get comfortable with fragmentation over globalization, and prepare for a structural shift in inflation.

    It is this final part, a shift in inflation, which is where the debt question comes in.

    JPMorgan writes: “Some market participants warn of a coming U.S. debt crisis. In the most extreme scenario, the Treasury holds an auction and buyers are nowhere to be found. We see a more subtle risk. In this scenario, instead of a sudden spike in yields, policymakers make a deliberate shift. They tolerate stronger growth and higher inflation, allowing real interest rates to fall and the debt burden to shrink over time.”

    A key snag in the plan is the toleration of higher inflation: After all, this is the remit of the Federal Reserve’s Open Market Committee (FOMC), which is tasked with keeping inflation as close to 2% as possible. While the FOMC could be swayed to take a broader view than its dual mandate of stable prices and maximum employment if a national debt crisis impacted these factors, it may need more than arguments from politicians.

    The method of allowing the debt burden to shrink thanks to lower rates is called financial repression, and could have knock-on effects on other parts of the economy over time. For example, Fortune reported over the weekend that America’s housing crisis happened, in part, due to a period of sustained low rates after the financial crisis.

    To orchestrate this repression could take some maneuvering, JPMorgan says: “We could see a less straightforward path to reduce the U.S. government’s debt load. Policymakers could erode Fed independence and effectively inflate the debt away by driving a stronger nominal growth environment characterized by higher inflation and, over the near term at least, lower real interest rates.”

    The less popular route

    Economists have previously described the looming debt crisis as a game of “chicken” to Fortune, as one administration passes the issue on to the next without plucking up the courage to address fundamental spending or revenue-raising changes.

    With an ageing American population, any government move to scale back social and healthcare spending would be likely be unpopular enough to prevent it from coming to fruition, the bank says. Likewise, increasing taxes are a sure-fire way to turn off voters.

    The report adds: “U.S. tax collections as a share of GDP are near the low end among OECD nations, suggesting ample capacity—if not the political will—to raise tax revenue to reduce debt. Similarly, mandatory spending on entitlement programs such as Social Security and Medicare could be curtailed to ‘bend the curve,’ as economists refer to efforts to slow the pace of future spending growth. But those options may prove politically unpalatable.”

    That said, the Trump administration has mustered some “peculiar” proposals for increasing revenue, without too much pushback from the public. One option is foreign cash, with the president claiming his “gold card” visa scheme could generate up to $50 trillion by selling cards to would-be American citizens at a price tag of $5 million apiece. However, America is already home to the majority of the world’s millionaires and the U.S. may struggle to find individuals who could afford such a card.

    Then, of course, there are tariffs, which raked in a record $31 billion in August. Debate is rife about whether U.S. consumers will end up ultimately paying for the policy, or whether the cost will be “eaten” by foreign firms. With a lack of data during the government shutdown, there’s no way to see whether that inflationary pressure is being passed through yet.

    The good news is, “at the moment, investors seem comfortable financing the U.S. government’s debt,” the outlook report added. At the time of writing, U.S. 30-year treasury yields sit at 4.7%, similar to where they began 2025, suggesting buyers of American borrowing are not yet demanding higher premiums to be enticed.

    JPMorgan adds: “U.S. Treasury bond buyers have been lining up, their demand on average 2.6x greater than supply. But the growing debt-to-GDP ratio of nearly 120% of GDP is troubling to most investors and economists. Solving the problem will be tricky.”

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    Eleanor Pringle

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