Mortgage debt

By Stefania Di Verdi on November 19, 2012
Estimated reading time: 1 minute

One-third of Canadians are taking advantage of low interest rates to accelerate mortgage payments, plus info on RSP withdrawls and more.

A survey of 2,000 Canadian mortgage holders by the Canadian Association of Accredited Mortgage Professionals (CAAMP) found home owners are comfortable with their house debt and at least one-third are taking advantage of current low interest rates to accelerate payments. CAAMP also found a correlation with the tightened mortgage lending rules and a slowdown in Canadian housing resale activity as more first-time buyers are shut out of the market.
More Canadians (36%) took money from their RSPs this year to pay for things this year, according to Scotiabank. The average withdrawl was also up, to $24,531. The top reason cited for tapping registered accounts was buying a first home (40%). Fourteen per cent of Canadians took money out of their RSPs to cover day-to-day living expenses while 6% took money out to pay for a vacation. “Investing in a home and investing in retirement are both important parts of life and finding a way to balance both is key,” said Bev Moir, ScotiaMcLeod wealth adviser. “If Canadians are going to take money out of their RSP for a major purchase like a house, they need to have a plan in place to return that money as soon as they can so they don’t limit their options in the future. A financial adviser can work with you to map out the best strategy to achieve your goals, particularly if you’re dipping into your RSP for day-to-day expenses.”
Speaking of planning, Monday kicks off Financial Planning Week in Canada. Here’s a FPSC video featuring average Canadians talking about how planners helped them.