A Huge Wake Up Call!!
Wow… when I googled “Canada’s Current inflation rate” this week, what I found out was a little staggering, to say the least. Almost scary to tell the truth.
Reality is…. Our inflation rate has climbed from 1% on Jan 1, 2021, to 3.4% as of the first of May! That’s a 240% increase in inflation in just 4 months.
So for a little review, let’s define what inflation really is… according to google, Inflation is the general % increase in prices of goods and services and fall in the purchasing value of money over one year time.
In simple terms for me, what $1.00 could buy in January, now costs me $1.034 to buy in May. Might not sound like a lot when it comes to one dollar, but let’s put this in perspective when buying a new car.
A $35,000 car in January will now cost you $36,190 in May… that’s an additional $1,190 of the hard-earned after-tax money that you need to purchase the same car, only four months later.
If that doesn’t seem a little unsettling for you, I would suggest it should, or at best make you ask a few questions about your personal finance picture.
Here are a few thoughts or questions that come to my mind?
1. What is causing this inflation rate to increase so dramatically? … in my opinion, this is a direct effect of the Government printing so much money due to Covid and the state of our economy since Covid began. The Government has printed billions of dollars to support jobs and businesses… now we are paying the price for that with the costs of goods and services increasing with inflation. The buying power of $1 gets reduced as the government prints money so it now takes more dollars to buy the same thing. This is a really serious problem for all of us that need’s a formulated plan for us to counter this effect of inflation.
2. Will inflation continue? My bet is absolutely yes… the more important question is how much will it increase? The answer is who knows? The more the government bails people out and subsidizes businesses the more we can expect increased inflation… and that is bad news for all of us.
3. With inflation being almost inevitable… what personal financial plan do you have in place to combat inflation on the rise (from 1% to 3.4% in just 4 months?) The bottom line is if your money coming in (income sources from your job, investments, side hustles, etc.) is increasing at a rate higher than 3.4% equal to inflation you are breaking even… if it’s not, your in serious trouble. The increase in your expenses due to inflation will be eating into your leftover income causing that to get smaller and smaller and that folks is a real problem.
4. What can I control that will increase my income to combat inflation and keep my disposable income increasing? Your job? If you are self-employed.. maybe… if someone else is signing your paycheque (government included) probably not! Side hustles you have control. Investments… well that depends on how much time you spend managing these funds.
5. How are my investments performing? This is something that needs to have a high priority for everyone regardless of how much money you have put away. If your investments are not yielding a minimum of 3.4% … you’re losing. If you have cash sitting in savings/chequing accounts… you’re losing. If you have GIC’s locked in at low interest rates below 3.4% … your losing! If you have cash stashed under your pillow… you’re losing! Well, you might say… “Well where can I find low risk, highly controlled investments with returns higher than 3.4% to beat inflation? “My answer to that is “Have you spent the time to look, analyze how your investments are performing or ask people who have those solutions for you? “Reality is… those investments are out there… you just need to spend the time researching those and finding the people you can trust to give you sound financial advice. That takes some effort, no doubt about it but the urgency and the need to do this is very important especially as inflation is on the rise.
6. Financial Education is crucial. We need to prioritize time to spend gaining the knowledge we need to always be improving our personal financial statement or financial status. Knowledge is Power folks! Take control of your financial status… no one else is going to do it for you.
We are here to help and serve you in any way we can! Our Glenroe Lending business is growing exponentially beyond my belief to over $12 million invested in just over one year utilizing investors’ money. We offer safe low-risk, highly controlled investments utilizing 1st place mortgages in real estate properties. Essentially we have become a bank offering a “savings account on steroids” to our investors yielding a 9% annual interest rate, with monthly interest payments and full liquidity when requested. This is an amazing choice for our investors and we want to share this with as many people as we can to provide a solution for people to increase their disposable income, create passive income and stay ahead of that “roaring lion” known as expenses!
Please feel free to reach out to us (yes, my three girls are now actively involved in this business as we have seen massive growth) and see if we can help you navigate this financial journey. We truly are not interested in selling you anything but are VERY interested in providing answers to solutions and opportunities you might not find elsewhere.
Thanks for reading this… enjoy the warm weather coming this weekend!
PS … I have attached our Glenroe Lending Factsheet in a file below if that is of interest to you.
Kind Regards,
John Heeney
Glenroe Lending
“We build LEGACY to create TRANQUILITY”
john@glenroelending.ca
519 808 7370
