Creative Ways to Save Money and Pay down Debt

December 29, 2016

Creative Ways To Save Money and Pay Down DebtCanadians’ top financial priority is to pay down debt in 2017. But, how do you get the ball rolling?

For the seventh year running, a CIBC poll says the top financial goal of Canadians is to pay down debt. Coming in at nearly 30 per cent, prioritizing debt repayment is at its highest level since 2010.

“With debt loads continuing to climb, it’s encouraging that repaying debt remains a top priority for Canadians,” says Scott Wambolt, Senior Vice President, Retail and Business Banking, CIBC. “However, with some Canadians saying they are taking on debt just to cover day-to-day expenses and too few actually seeking advice on how to build a repayment plan, it’s clear there is a gap when it comes to taking action on debt reduction.”

How to start making headway and get out of debt

For the 28 per cent of Canadians who want to pay down debt this year, CIBC offers the following tips to get started on tackling your debt:

  1. Create a spending plan and recognize that your finances are all connected – progress on one financial goal can open up opportunities to improve others.
  2. Focus on longer term – controlling spending and eliminating high-interest debt is vital and will help you build your retirement savings. Even small contributions today can make it easier to grow your wealth or investments.
  3. Stick to the plan – If you fall off track, get back to your plan as soon as possible and keep making progress towards your goal.
  4. Talk to an advisor – put realistic steps in place to reduce interest costs and accelerate debt repayment. Pay off your most expensive debts first and/or consolidate your consumer debts into one loan with one payment at a lower interest rate.

Making headway on your debt usually goes hand-in-hand with spending less to save money. Trim what you spend on home and auto insurance with the following tips:

Pay your premiums all at once

Whether it’s for your car insurance, home, or life insurance, pay your policy in full instead of in monthly installments. This means you won’t have to pay those pesky fees that many insurance companies charge to cover the cost of administering monthly payments.

Increase your deductibles

Save about five to 10 per cent on your auto or home insurance simply by increasing your deductibles from $500 to $1,000. Make sure you’re comfortable with this number as it is the amount you would have to pay in the event of a claim.

Bundle policies

Many insurers offer discounts to customers who combine their home insurance and auto insurance policies, usually in the five to 15 per cent range.

Moving neighbourhoods in 2017? Might be time to move insurers too

Part of your home insurance and auto insurance rates are based on where you live. Don’t assume your current insurer will give you the best rate at your new address; compare both home insurance and auto insurance rates to see who offers you the best deal in your new neighbourhood.

Shop around and compare rates

It goes without saying that we’re all about comparison shopping, it’s in our name after all: ComparaSave. Comparing rates for the home and auto insurance coverage you need is the easiest way to save money. The company who provided you the best rate five years ago, two years ago or even last year, may no longer offer you the best deal today. See if you can get a better price and compare auto insurance and home insurance rates today.